CT Blog Business Models and Value Proposition
In this blog I will try to give my readers an insight in how a business model works and what a value proposition is.
When trying to understand how a business model works take a look at the business model canvas. The business model canvas consists of 9 elements:
1. Customer Segments:
This element shows who is your customer and what do they want.
2. Value proposition:
Here we take a look at why customers buy and what is compelling about the proposition.
3. Channels:
In what way are propositions promoted, sold and delivered. And does this work ?
4. Customer Relationship:
How is the interaction with the customer through their ‘ journey’?
5. Revenue Streams:
How does the business earn revenu from the value propositions ?
6. Key Activities:
What unique strategic things does the business do to deliver its proposition?
7. Key Resources:
What unique strategic assets should the business have in order to compete?
8. Key partnerships:
What can the company not do so it can focus on its Key activities?
9. Cost Structure:
What are the major cost drivers of the business and how are these linked to revenue?
Here you can see an example of a filled in business model canvas, the example is taken from Uber:
The Value proposition:
The value (proposition) map describes the features of a specific value proposition in your business model in a more structured and detailed way. It breaks your value proposition down into products and services, pain relievers and gain creators.
Next to this we have the customer profile, this describes a specific customer segment in your business model in a more structured and detailed way. It breaks your customer down into its jobs, pains and gains.
In the next picture both are shown to give you an better insight :
On the left side you can see the Value proposition and on the right the customer profile.
In order to keep you up to date I will share the current top 5 of innovative companies with you, these are:
1. Buzzfeed
2. Facebook
3. CVS Health
4. Uber
5. Netflix
I hope I gave you an better insight into business models and how this is build up. Furthermore I explained the value propositions and the customer profile by telling you where to focus on when making one. By using using visual images I hope to make it clearer and easier to understand.
Till next time!
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