create and develop business model
DESCRIPTION
Presented in Lean circle - Bangalore meetup http://bangalore.leanstartupcircle.com/events/84149722/ by Rammohan and Pallav Barah. There are 5-6 examples of Indian companies and their plausible Business Model canvasTRANSCRIPT
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RammohanPallav Barah
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Burn your Business Plan
No Business Plan Survives First Contact With A Customer
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Business Model
Describes the rational of how an organization creates, delivers and captures value
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Value PropositionWhat Are You Building and For Who?
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Value Proposition It’s about solving a need or a problem Distinct mix of elements catering to the segments need Type of Value Prop (non-exhaustive list)
Newness – Cell phones Performance – Mostly Technology “Getting the job done” – Airlines pays Rolls-Royce fee for
every hour engine runs Design – Mostly Fashion & consumer electronics Brand – Rolex watch Price – Southwest , Deccan, Nano Cost reduction – SalesForce – CRM app Risk reduction – Used cars buyers receives 1-year guarantee Accessibility – Mutual funds , NetJets(rental private jets,
fractional ownership) Convenience/Usability – iPod, iTunes
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Customer SegmentsWho Are They?Why Would They Buy?
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Customer SegmentsWho are they
Demography Age etc.,
Types of Segment Mass Market – Consumer electronics Niche market – Supplier/Buyer relationship Segmented – Retail Arm of Credit Suisse for
assets <100k USD, and >500K USD Diversified – Amazon retail diversification
w/cloud Multi-Sided – Media companies, Credit Card
companies
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ChannelsHow does your deliver your product to your Customers?
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ChannelsWebMobilePhysical
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Customer RelationshipsHow do you Get, Keep and Grow Customers?
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Customer Relationships
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Customer relationshipPersonal assistance - POS, call
centerDedicated – Relationship managerSelf-Service – ATMAutomated Services – Online profileCommunities – Sears social Co-creation – Amazon encourages
reviews
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Revenue StreamsHow do you Make Money?
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Revenue StreamsHow do you make money from
each customer segmentSome Revenue Streams (non-
exhaustive) Subscription fee – World of Warcraft Leasing / renting – Zipcar (rent cars by
hour) Licensing – Netflix Brokerage fee – Credit card providers Usage fee – Telecom operators
Fixed Menu Pricing vs Dynamic Pricing
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Key ResourcesWhat are your most important Assets required to make the business model work?
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Key ResourcesPhysicalIntellectualHumanFinancial
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Key PartnersWho are your Partners and Suppliers?
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Key PartnersWhat key resources are we
acquiring from partnersWhat key activities do they
performStrategic alliance
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Key ActivitiesWhat’s Most Important for the Business?
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Key ActivitiesProductionProblem solvingPlatform/Networks
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Cost StructureWhat are the Costs and Expenses
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CostsFixed costsVariable costsWhat are the most important
costs
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Example BMCsDisclaimer : We had no inside information in creation of these BMCs. The BMCs have been created with publicly available information available on websites, reports, personal experience etc.,
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Competitive BMCs - FlipKart
VALUE
PROPOSITION
CHANNELS
CUSTOMER
RELATIONSHIPS
CUSTOMERSEGMENTS
REVENUE STREAMS COST STRUCTURE
KEY
PARTNERS
KEY
RESOURCES
KEY
ACTIVITIES
• Convenience• Wide selection• Cheaper• Trust (CoD)
• Urban Indian book lovers
• Internet-connected people with no credit cards
• First-time online shoppers
Book sales
Publishers
• Delivery staff• Technology
capability
Through email, online chat and database marketing
Web
• Supply chain optimisation
• Delivery optimisation
• SEO• Auto
recommendations
Technology, warehouses, deep discounts
Vision : Online Value-Shopping
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Competitive BMCs - CrosswordVision : Leisure book browsing
VALUE
PROPOSITION
CHANNELS
CUSTOMER
RELATIONSHIPS
CUSTOMERSEGMENTS
REVENUE STREAMS COST STRUCTURE
KEY
PARTNERS
KEY
RESOURCES
KEY
ACTIVITIES• Urban
Indian book lovers
• Companies
• Stationery buyers
• Casual mall visitors
• Book sales
• Advertising
• Publishers• Franchisees• Shopper’s
Stop (parent co)
• Real estate
In store, Crossword club
• Store• Phone• Web• Institutional
• Sourcing• Visual
merchandising• Book reading
sessions• Crossword Literary
Award
Real estate, cost of inventory • Coffee• Trinkets
• Browsing experience
• Instant gratification
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Multi Sided BMCs – “Mid-Day”Vision : Evening Gossip
VALUE
PROPOSITION
CHANNELS
CUSTOMER
RELATIONSHIPS
CUSTOMERSEGMENTS
REVENUE STREAMS COST STRUCTURE
KEY
PARTNERS
KEY
RESOURCES
KEY
ACTIVITIES• Mumbai
English-speaking mass market
• Office-goers• Commuters
• Corporates for advertising
Advertisers + Agencies:• Mass
market• Mumbai• Classified• Discount
• Retail offtake (5%)
• Advertising (95%)
• PTI, AP etc.
• Journalists
• Salespeople with media-planning knowhow
• Transactional• Deep multi-year
high-touch relationships
• Railway platforms
• Kirana shops
• Direct
• Brand building• Distribution• Newsgathering• Improving ABC
numbers in key demographics
Newsroom, newsprint
• Light entertainment after/during a busy day
• “2nd newspaper”
• Mumbai-wide reach of readers in a relaxed context in a unique time window
2 or more distinct but interdependent customers – usually subsidized on one end to attract “other” side
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Evolving BMC – Makemytrip in 2000
Vision : Online travel for NRI VALUE
PROPOSITION
CHANNELS
CUSTOMER
RELATIONSHIPS
CUSTOMERSEGMENTS
REVENUE STREAMS COST STRUCTURE
KEY
PARTNERS
KEY
RESOURCES
KEY
ACTIVITIES• NRIs
Advertisers + Agencies:• Mass
market• Mumbai• Classified• Discount
• Travel Ad network• Customer Retention rate 30%
• OTA• Internationa
l Airlines• Travel
editors
• Technology• People
• Online chat• Email
marketing
• Online
• Brand building• OTA/Airline
Partnership• Indian community
advertising• Travel content
• Technology• Deep Discounts/Offers
Cheap tickets to India online
3 months into Oct 2000 (launch of MMT) realized there is no market for online-travel, so focus NRI
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Evolving BMC – Makemytrip in 2005
Vision : “One”-stop travel stop VALUE
PROPOSITION
CHANNELS
CUSTOMER
RELATIONSHIPS
CUSTOMERSEGMENTS
REVENUE STREAMS COST STRUCTURE
KEY
PARTNERS
KEY
RESOURCES
KEY
ACTIVITIES• Indian
business travelers
• Indian tirth yatra travelers
• Indian holidayers
Advertisers + Agencies:• Mass
market• Mumbai• Classified• Discount• MMT developed product in travel+hotel
(no Ads)• Marketing done for airlines• Hotels finders fee
• LCC• Hotels• Travel
agents and tour operators
• Proprietary Tech to link all supplier sites to check inventory
• Domain-experts
• Call center• Retail shops• 24*7 support
• Online
• Supplier relations• Develop domain-
specific skills to offer best product
• Advertising - Media
• Technology• Ticket and hotel consolidators
• Instant booking with real-time purchase
• Search provided Lowest Price
• Customized products for social/religious trips, weekend package
• One-stop for air/rail/bus/hotel
• Money-back guarantee
India Market ready (external factors – IRTC online so Indians get comfortable with online CC, Deccan needed to sell tickets online
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Google Business Model
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Other types of Business Models ?(Un)bundled business – Bharti
Airtel, Long Tail – Lego Custom Factory,
Lulu Freemium – Flickr, RedHat
(supports every release for 7 years over open source using subscription), Skype
Bait & Hook – Cell phones for free in US
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What after BMC ?Create MVP Validate BMC with MVP (customer
dev)
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Reference