1. Patterns of Business Model Generator Prepared by Hani Tarabichi From Business Model Generator Book

2. Patterns of BMG Similarities in business models exists and can be made into patterns A single business model can incorporate several patterns at the same time 3. Patterns of BMG - Unbundling A business usually is a bundle of: Customer relationship business area Product innovation business area Infrastructure business area These business areas have different economic systems, competitiveness, and cultural imperatives 4. Patterns of BMG - Unbundling Customer relation: Finding, acquiring, and keeping customers and building relationships with them. Product innovation: Develop new attractive products. Infrastructure business: Build and manage platform for high volume repetitive tasks. 5. Patterns of BMG - Unbundling Companies are to focus on: Operational excellence Product leadership Customer intimacy 6. Patterns of BMG - Unbundling 7. - Unbundling 8. Patterns of BMG Long Tail Long Tail business model aims at Selling Less of More. Offering large number of niche products which sells relatively infrequently Requires: Low inventory cost Strong platform 9. Patterns of BMG Long Tail From selling small hit items in large volumes To selling very large number of niche products in small quantities It works best with user generated content. Lulu.com Lego 10. Patterns of BMG Multi Sided Platform MSP facilitates interaction between different groups If it grows rapidly it could form network effect Creates value as intermediary connecting different interdependent groups together. Chicken & egg dilemma 11. Patterns of BMG Free as a business model 12. Patterns of BMG Free as a business model At least one substantial customer segment is able to continuously benefit from a free of charge offer. None paying customers are financed by another part of the business model or by other customer segment 13. Patterns of BMG Free as a business model Sometimes the MSP subsidize a customer segment in order to attract users. How to price? Who to subsidize? How can we attract sufficient number of customers for each side? Which side is more price sensitive? Will the other side generate enough revenues to cover the expenses and costs of the subsidized side? 14. Patterns of BMG Free as a business model Examples: Free offer based on MSP: Metro NP Freemium model: Flicker/red hat/ LinkedIn Bat & Hook model: Free inexpensive initial offer turns customers into repeat purchases Loss leader: Skype Razor & Blade: Gillette, HP, Mobile operators 15. Patterns of BMG Free as a business model 16. Patterns of BMG Free as a business model 17. Patterns of BMG Free as a business model 18. Patterns of BMG Open Business Model Creates and captures value by systematically collaborating with outside partners Outside-in: Exploiting external ideas within the firm Inside-out: Providing external partners with ideas or assets lying idle within the firm 19. Patterns of BMG Open Business Model 20. Patterns of BMG Open Business Model