Business Model

Canvas
Subagyo
Teknik Industri UGM
Iegmubetter

Business Model Canvas

A

shared language for describing,

visualizing, assessing, and changing
business models

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The 9 Building Blocks

1.

2.

3.
4.

5.

Customer
segments (CS)
Value propositions
(VP)
Channels (CH)
Customer
relationships (CR)
Revenue streams
(R$)

6.

7.
8.

9.

Key resources
(KR)
Key activities (KA)
Key partnerships
(KP)
Cost structure
(C$)

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Customer Segments
- For whom are we creating value?
- Who are our most important customers?
The

customer segments building block

defines the different groups of people
or organization an enterprise aims to
reach and serve.

Common needs
Common behaviors
Other attributes
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Customer Segments
- For whom are we creating value?
- Who are our most important customers?

Mass Market
Niche Market
Segmented

Diversified

Pembagian customer di Bank

[Link] jualan buku dan cloud computing

Multi-sided Platforms (or Multi-sided

Markets)

Credit card company: Pemegang Kartu dan

Merchants
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Value Propositions
What value do we deliver to customer?
Which one of our customers problems are we helping to
solve?
Which customer needs are we satisfying?
What bundles of products and services are we offering to each
customer segment?

The

reason why customers turn to one

company over another.
It solves a customer problem or
satisfies a customers need.

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Value Propositions

Quantitative

e.g. Price, speed of service

Qualitative

e.g. design, customer experience

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Value Propositions

Newness

Performance

Tailoring products and services to the specific needs of

individual customers or customer segments

Getting the job done

Improved product or service performance

Customization

New set of needs that customers previously didnt

perceive

Helping a customer get certain jobs done

Design

Especially in Fashion and consumer electronics

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Value Propositions

Brand/Status

Price

Customers may find value in the simple act of using and

displaying a specific brand.
e.g. wearing a Rolex watch
Offering similar value at a lower price is a common way
to satisfy the needs of price-sensitive customer
segments.

Cost reduction

Helping customers reduce costs is an important way to

create value
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Value Propositions

Risk reduction

Accessibility

e.g. one-year service guarantee reduces the risk of postpurchase breakdowns and repairs.
Making products and services available to customers
who previously lacked access to them.
e.g. fractional private jet ownership by NetJets.

Convenience/Usability

Making things more convenient or easier to use

e.g. iPod and iTunes

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Channels
Raising

awareness among customers

about a companys products and
services
Helping customers evaluate a
companys value proposition
Allowing customers to purchase specific
products and services
Delivering a value proposition to
customers
Providing post-purchase customer
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Channels
Through

which channels do our

customer segments want to be
reached?
How are we reaching them now?
How are our channels integrated?
Which ones work best?
Which ones are most cost-efficient?
How are we integrating them with
customer routines?
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Channel Types
Direct

Own

Sales force
Web sales

Indirect

Partner

Own stores
Partner stores
Wholesaler
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Channel Phases
How do we raise awareness about our companys
Awarenes
products and services?
s
Evaluatio
n

How do we help customers evaluate our organizations

value proposition?

How do we allow customers to purchase specific

Purchase
products and services?

Delivery

After
sales

How do we deliver a value proposition to customers?

How do we provide post-purchase customer support?
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Customer Relationships
Motivations

Customer acquisition
Customer retention
Boosting sales (upselling)

What type of relationship does each of our

customer segments expect us to establish
and maintain with them?
Which ones have we established?
How costly are they?
How are they integrated with the rest of our
business model?

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Customer Relationships

Personal assistance
Bantuan kepada customer baik saat pembelian
maupun pasca beli
Contoh: call centers, email, atau at point of
sale
Dedicated personal assistance
A customer representative specifically to an
individual client.
Misal: in private banking
Self-service
Company maintains no direct relationship with
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customers
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Customer Relationships

Automated services
e.g. personal online profiles give customers
access to customized services.
Communities
Many companies maintain online communities
that allow users to exchange knowledge and
solve each others problems.
Co-creation
[Link] invites customers to write reviews
and thus create value for other book lovers.
You [Link], solicit customers to create content
for public consumption.
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Revenue Streams
For

what value are our customers really

willing to pay?
For what do they currently pay?
How are they currently paying?
How would they prefer to pay?
How much does each revenue stream
contribute to overall revenues?
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Revenue Streams

Asset sale

Usage fee

Fiat sells automobiles, which buyers are free to drive,

resell, or even destroy.
Hotel charges customers for the number of nights rooms
are used

Subscription fees
Lending/Renting/Leasing
Licensing
Brokerage fees (intermediation services)
Advertising
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Revenue Streams

Pricing Mechanisms
Fixed Pricing

Dynamic Pricing

List Price
Product feature
dependent
Customer segment
dependent
Volume dependent

Negotiation
(bargaining)
Yield management
Real-time-market
(based on supply and
demand)
Auctions (competitive
bidding)

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Key Resources
What

key resources do our value

propositions require?
Our distribution channels?
Customer relationships?
Revenue streams?

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Key Resources
Physical

e.g. Manufacturing facilities, buildings,

distribution networks

Intellectual

Brands, proprietary knowledge, patents

Human
Financial

Financial resources, financial guarantees

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Key Activities

What key activities do our value propositions require?

Our distribution channels?
Customer relationships?
Revenue streams?

Production

Designing, making, and delivering a product in

substantial quantities and/or superior quality.

Problem solving
Platform/network

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Key Partnerships

Who are our key partners?

Who are our key suppliers?
Which key activities do partners perform?

Motivations for creating partnerships:

Optimization and economy of scale
Reduction of risk and uncertainty
Acquisition of particular resources
and activities
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Cost Structure

What are the most important costs inherent in our business

model?
Which key resources are most expensive?
Which key activities are most expensive?

Business Model Cost Structures:

Cost-driven
Value-driven

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Cost Structure
Characteristics
Fixed

costs
Variable costs
Overhead Costs
Economies of scale
Economies of scope

Cost advantages that a business enjoys due

to a larger scope of operations.

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Business Model Patterns

Business Models with
Similar
characteristics
Similar
arrangements of
business model
building blocks, or
Similar behaviors
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Pattern No. 1

(Un-Bundling Business

Models)
The

concept of the unbundled

corporation holds that there are three
fundamentally different types of
businesses

Customer relationship businesses

Product innovation businesses, and
Infrastructure businesses

The

three types may co-exist within a

single corporation, but ideally they are
unbundled to avoid undesirable trade29
offs or conflicts
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Three Core Business Types

Economics

Product Innovation

Customer Relationship Management

Early market entry enables charging premium prices and

acquiring large share
Speed is key
High cost of customer acquisition makes it imperative to
gain large wallet share
Economies of scope are key

Infrastructure Management

High fixed costs make large volumes essential to achieve

low unit costs
Economies of scale are key
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Three Core Business Types

Culture

Product Innovation

Customer Relationship Management

Battle for talent; low barriers to entry; many

small players thrive
Battle for scope; rapid consolidation; a few big
players dominate

Infrastructure Management

Battle for scale; rapid consolidation; a few big

players dominate

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Three Core Business Types

Competition

Product Innovation

Customer Relationship Management

Employee centered; coddling the creative stars

Highly service oriented; customer-comes-first
mentality

Infrastructure Management

Cost focused; stresses standardization,

predictability, and efficiency

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Unbundling The Mobile Telco

Mobile telecommunication firms have started
unbundling their business. Traditionally they competed
on network quality, but now they are striking network
sharing deals with competitors or outsourcing network
operations altogether to equipment manufacturers.
Why?
Because they realize that their key asset is no longer
the networkit is their brand and their customer
relationships.
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Infrastructure Management

Product Innovation
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Unbundling The Mobile Telco

Equipment Manufacturers

Telcos such as France Telecom, KPN, and

Vodafone have outsourced operation and
maintenance of some of their networks to
equipment manufacturers such as Nokia Siemens
Networks, Alcatel-Lucent, and Ericsson.
Equipment manufacturers can the networks at
lower cost because they service several telcos at a
time and thus benefit from economies of scale.
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Unbundling The Mobile Telco

Unbundled Telco

After unbundling its infrastructure business, a telco

can sharpen its focus on branding and segmenting
customers and services.
Customer relationships comprise its key asset and
its core business. By concentrating on customers
and increasing share of wallet with current
subscribers, it can leverage investments made
over the years acquiring and retaining customers.
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Unbundling The Mobile Telco

Content Providers

For product and service innovation, the unbundled

telco can turn to smaller, creative firms.
Innovation requires creative talent, which smaller
and more dynamic organizations typically do a
better job of attracting. Telcos work with multiple
third-parties that assure a constant supply of new
technologies, services, and media content.

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Pertanyaan:
Bagaimana

jika no telepon tidak

dikuasai operator

Menjadi milik pelanggan, atau

Milik pemerintah?

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Pattern #2: Long Tail Business

Models
They

focus on offering a large number

of niche products, each of which sells
relatively infrequently
Aggregate sales of niche items can be
as lucrative as traditional model
whereby a small number of bestsellers
account for most revenue.

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Contoh Kasus: Book Publishing

Industry
Old

Model

Penerbit secara hati-hati memutuskan

menerbitkan buku yang most likely akan
menjadi best sellers (ada titik minimum).

New Model
Enabling anyone to publish.
Helping niche and amateur authors bring
their work to market.

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Pattern #3: Multi-Sided

Platforms
Bring

together two or more distinct but

independent groups of customers
Such platforms are value to one group
of customers only if the other groups of
customers are also present.

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Contoh Kasus
Visa
Google
eBay
Apple,

iTunes-Appstore

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Pattern #4: Free as a Business

Model
At

least one substantial customer

segment is able to continuously benefit
from a free-of-charge offer.
Non-paying customers are financed by
another part of the business model or
by another customer segment

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Contoh
Metro

(free paper)
Open Source
Skype
Google
Free mobile phone

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(How) can you set it free?

Advertising:

a multi-sided platform

model
Freemium: Get the basics for free, pay
for more.
Bait & Hook: an attractive, inexpensive,
or free initial offer that encourages
continuing purchases of related
products or services (a.k.a Razor &
Blades model)
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Pattern #5: Open Business

Model

Used by companies to create and capture value

by systematically collaborating with outside
partners.
Combination of Internal/external technology base
and our/other firms market to create our new
current market.
Acquiring R&D from external sources can be less
expensive, resulting in faster time-to-market.
Unexploited innovations have the potential to
bring in more revenue when sold outside.
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Terimakasi
h

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