The Business Model Canvas Tutorial 1: Oct 12nd, 2017 The Business Model Canvas WANG Huimin hmwang@se.cuhk.edu.hk

The Business Model Canvas is a common language for describing business models and adapting business models

Example

Infrastructure Customers Offer Financial viability

Customers infrastructure Offer financial viability Customer Segment CLIENT SEGMENTS Customer Segment infrastructure Customers Offer the users. financial viability

Customers What to offer? infrastructure Offer financial viability CLIENT SEGMENTS Value Propositions CLIENT SEGMENTS Customer Segment infrastructure Customers What to offer? Offer financial viability

Customers What to offer? infrastructure Offer financial viability CLIENT SEGMENTS Value Propositions CLIENT SEGMENTS Customer Segment infrastructure Customers What to offer? Offer CLIENT SEGMENTS Channels financial viability

Customer Relationship CLIENT SEGMENTS Customer Relationship CLIENT SEGMENTS Value Propositions CLIENT SEGMENTS Customer Segment infrastructure Customers What to offer? Offer CLIENT SEGMENTS Channels financial viability

Customer Relationship CLIENT SEGMENTS Customer Relationship CLIENT SEGMENTS Value Propositions CLIENT SEGMENTS Customer Segment infrastructure For whom? What to offer? CLIENT SEGMENTS Channels CLIENT SEGMENTS Revenue Stream

Customer Relationship CLIENT SEGMENTS Customer Relationship CLIENT SEGMENTS Value Propositions CLIENT SEGMENTS Customer Segment infrastructure For whom? What to offer? CLIENT SEGMENTS Key Resource CLIENT SEGMENTS Channels CLIENT SEGMENTS Revenue Stream

Customer Relationship CLIENT SEGMENTS Key Activities CLIENT SEGMENTS Customer Relationship CLIENT SEGMENTS Value Propositions CLIENT SEGMENTS Customer Segment infrastructure For whom? What to offer? CLIENT SEGMENTS Key Resource CLIENT SEGMENTS Channels While Key activities describes the most important things a company must do to make its business model work CLIENT SEGMENTS Revenue Stream

Customer Relationship CLIENT SEGMENTS Key Activities CLIENT SEGMENTS Customer Relationship CLIENT SEGMENTS Key Partnerships CLIENT SEGMENTS Value Propositions CLIENT SEGMENTS Customer Segment How to offer? For whom? What to offer? CLIENT SEGMENTS Key Resource CLIENT SEGMENTS Channels Key partnership describes the network of suppliers and partners that make the business model work CLIENT SEGMENTS Revenue Stream

Customer Relationship CLIENT SEGMENTS Key Activities CLIENT SEGMENTS Customer Relationship Key Partnerships CLIENT SEGMENTS Value Propositions CLIENT SEGMENTS Customer Segment How to offer? For whom? What to offer? CLIENT SEGMENTS Key Resource CLIENT SEGMENTS Channels CLIENT SEGMENTS Cost Structure CLIENT SEGMENTS Revenue Stream

Customer Segment Describe different groups of people or organizations an enterprise aims to serve. Heterogeneity of customer demands Limited resources and effective market competition For whom are we creating value? Who are our most important customers? Why:

Customer Segment Ways of Segmentation: Extrinsic attributes -geographical distribution -organization … Intrinsic attributes - gender, age, habit, income, personality… Consumer behavior - Recent consumption - Consumption frequency - Total consumption …

Value Proposition Describes the bundle of products and services that create value for a specific Customer Segment --Why users think your product valuable? --What kind of value in detail? --Compound value?

Channels Describe how a company communicates with its Consumer Segments to deliver a Value Proposition Awareness—Evaluation—Purchase—Delivery— After Sale

Key Resource Describe the most important assets required to make a business model work –can be physical, financial, intellectual, or human –can be owned or leased by the company or acquired from key partners.

Key Partnerships Describes the network of suppliers and partners that make the business model work. --Who are our key partners? --Who are our key suppliers? --What does your partner obtain from you? --What do you obtain from your partner?

Cost Structure Describes all costs incurred to operate a business model – such as creating and delivering value, maintaining Customer Relationships, and generating revenue --What are the most important costs inherent in our business model? --Which Key Resources are most expensive? --Which Key Activities are most expensive?

Case Study—Skype’s Business Model

Case Study—Skype’s Business Model What Skype offers? 1, Instant Messaging 2, Global phone calls 3, Value-added service: SkypeIn, SkypeOut, Skype connect, voice massage. 4, Instant Translation

Case Study—Skype’s Business Model Who is the customer? Global users --Individual Users --Companies

Case Study—Skype’s Business Model How to offer service? --Skype software in all kinds of versions --Cooperated with communications network operators

Case Study—Skype’s Business Model Cost? --Build signal communication channels --Software development Revenue? --Free  Non-free

Case Study—Skype’s Business Model Global users, Skype out users, Company that want to make cheap international calls without travelling around

Case Study—Skype’s Business Model Voice calls, Video calls, Video conference Group calls, Sending massage and files for free, Cheap voice and video calls Global users, Skype out users, Company that want to make cheap international calls without travelling around

Case Study—Skype’s Business Model Provide software download, Organize self service. Pay the credit Voice calls, Video calls, Video conference Group calls, Sending massage and files for free, Cheap voice and video calls Global users, Skype out users, Company that want to make cheap international calls without travelling around

Case Study—Skype’s Business Model Provide software download, Organize self service. Pay the credit Voice calls, Video calls, Video conference Group calls, Sending massage and files for free, Cheap voice and video calls Global users, Skype out users, Company that want to make cheap international calls without travelling around Skype.com skype apps, skype managers, skype hardware

Case Study—Skype’s Business Model Provide software download, Organize self service. Pay the credit Software development and maintain, Complaint management Voice calls, Video calls, Video conference Group calls, Sending massage and files for free, Cheap voice and video calls Global users, Skype out users, Company that want to make cheap international calls without travelling around Skype.com skype apps, skype managers, skype hardware

Case Study—Skype’s Business Model Provide software download, Organize self service. Pay the credit Software development and maintain, Complaint management Voice calls, Video calls, Video conference Group calls, Sending massage and files for free, Cheap voice and video calls Global users, Skype out users, Company that want to make cheap international calls without travelling around Software developer, Skype brand Skype.com skype apps, skype managers, skype hardware

Case Study—Skype’s Business Model Provide software download, Organize self service. Pay the credit Software development and maintain, Complaint management Microsoft, Telecom companies, Hardware manufacturer, Payment providers, Distribution partners Voice calls, Video calls, Video conference Group calls, Sending massage and files for free, Cheap voice and video calls Global users, Skype out users, Company that want to make cheap international calls without travelling around Software developer, Skype brand Skype.com skype apps, skype managers, skype hardware 网络运营商：

Case Study—Skype’s Business Model Provide software download, Organize self service. Pay the credit Software development and maintain, Complaint management Microsoft, Telecom companies, Hardware manufacturer, Payment providers, Distribution partners Voice calls, Video calls, Video conference Group calls, Sending massage and files for free, Cheap voice and video calls Global users, Skype out users, Company that want to make cheap international calls without travelling around Software developer Skype brand Skype.com skype apps, skype managers, skype hardware Advertisement Premium service Skype hardware

Case Study—Skype’s Business Model Provide software download, Organize self service. Pay the credit Software development and maintain, Complaint management Microsoft, Telecom companies, Hardware manufacturer, Payment providers, Distribution partners Voice calls, Video calls, Video conference Group calls, Sending massage and files for free, Cheap voice and video calls Global users, Skype out users, Company that want to make cheap international calls without travelling around Software developer Skype brand Skype.com skype apps, skype managers, skype hardware Software development and maintain, Marketing and complaint management Advertisement Premium service Skype hardware

Example

Reference Osterwalder A, Pigneur Y. Business model generation: a handbook for visionaries, game changers, and challengers[M]. John Wiley & Sons, 2010. 》

Thank You! WANG Huimin hmwang@se.cuhk.edu.hk