Do's, Dont's & TrendsOnline Business Models

Alexander Talmon & Tobias Günther @talmon, @elaspix

3 x 3

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Topics

● 3 Best practices (Do's)● 3 Show stoppers (Dont's)● 3 Trends

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Best practices 1

● Start with lowest costs and welcome the “Valley of Death”● Use bootstrapping if you can afford it● Valley of Death is the time span where you have no

income but 100% expensive product development● Implement features only that your customers desire● Shape and polish your product in near “stealth mode”

● Link: Entrepreneurs Overestimate Their Revenues By Almost 400% (by Kimberly Weisul, May 2011)

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Best practices 2

● Focus on a product business but start as a service business● Products mean scalability which means your business

model is worth the time you spent with creating it● Start as service means you need to know what your

customers want (Hands on)● Concentrate on the needs of your customers

● Link: What Should You Do with Your Crappy Little Services Business? (by Mark Suster, April 2011)

http://www.harting-mitronics.ch/imperia/md/images/lg/hartingmitronics/anwendungen/sensorik/industrial_robots_700_500x374.jpg

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Best practises 3

● Offer the core of your product for free use● The cheapest way of advertising if the world finds it

helpful● Generates traffic which helps you with improvements

● Link:● Simfy.de● Spotify.de

http://www.gruenderszene.de/wp-content/uploads/2011/05/Simfy-mit-10-Millionen-Finanzierung.jpg

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Show stopper 1

● Focus on the one market need, the one product● Development takes a lot of time● Build not more as the “minimum viable product” and go

testing● Link: The remarkable power of FOCUS (by Radu Ticiu on

May, 2010)

http://christmasstockimages.com/free/backgrounds/slides/random_trees.jpg

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Show stopper 2

● Don't set on advertising as your only source of income● The CTR is declining steadily (from 78% to 0.15%)

● Link: Average CTR for Banner Ads (by tomcat66_g500, Sept, 2008)

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Show stopper 3

● Pitch customers, Vcs, business angels or partners using market needs and customer desires but not with technical features

● This is especially true for tech founders● Link: Sell benefits, not features (by Yaro On March 2006)

http://farm4.static.flickr.com/3015/2765083201_55a958db14.jpg

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Trends 1

● Mass customization and individualization● Individual products, but industrialized

production● Links

● www.yourvideocard.de● www.spreadshirt.de

http://www.yourvideocard.de/produkte

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Trends 2

● Gamification & Joy of use● Comfortable Consumption,Video usage increases

strongly● Use new interfaces provided by Native Apps, find out

new ways of using technology (mobile) but be careful as the diversity of devices & plattforms is growing

● No barriers (could mean no flash player?)● Link Video-Shopping auf dem iPad (by Stephan Meixner,

April 2011) über die Videoaggregation-App ShowYou

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Trends 3

● Virtual Goods● Sell products whose shipping costs are zero● Be careful with duplication (limited number of copies)● Track their movements so that they get an individual

history and “personality”● Link: Spending Money on Nothing (by Holger Mohr

January, 2009)

http://venturebeat.com/wp-content/uploads/2008/10/headline_-virtual-goods-company-vixim-google-docs-1.jpg