Summary Digital Business Models MIDTERM (UvA) - GRADE 8.5
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Course
Digital Business Models (6013B0504Y)
Institution
Universiteit Van Amsterdam (UvA)
This summary contains all readings + videos for the midterm of DBM 2023 taught by Balazs Szatsmari. Focus on the findings of the articles (you do not necessarily need to know all hypothesis by heart). The summary is 1.5 spaced for reading comfort. You can always text me if you have any comments or ...
Summary: Digital Business Models University of Amsterdam: 6013B0504Y
This summary contains all readings + videos for the midterm of DBM 2023 taught by Balazs Szatsmari. Focus on
the findings of the articles (you do not necessarily need to know all hypothesis by heart). The summary is 1.5
spaced for reading comfort. You can always text me if you have any comments or questions! Good luck ☺ !!!
WEEK 1: STRATEGY 2
V1 + 2: The Business Model Canvas ............................................................................................................. 2
V3: Profiting from Experiences .................................................................................................................... 4
A1: Consumer Power: Evolution in the Digital Age ....................................................................................... 6
A2: Antecedents and Consequences of E-Business Adoption for European Retailers ...................................... 8
A3: The Wheel of Business Model Reinvention .......................................................................................... 10
A4: Strategy and the Internet .................................................................................................................... 12
A5: Value creation in E-business................................................................................................................ 15
WEEK 2: THE DEMAND SIDE OF THE CANVAS MODEL 17
A6: Brand Experience, What is It? How is it measured? Does it Affect Loyalty? ........................................... 17
A7: Elements of Strategic Social Media Marketing: A Holistic Framework ................................................... 19
A8: Social Media? Get Serious! Understanding the Functional Building Blocks of SM ................................... 21
A9: Consumer trust B2C e-Commerce and the importance of social presence: experiments in e-Products and
e-Services ................................................................................................................................................. 24
A10: Marketing Strategies, Perceived Risks, and Consumer Trust in Online Buying Behavior........................ 25
WEEK 3: WOM AND SOCIAL MEDIA 28
A11: Word of Mouth and Interpersonal Communication ............................................................................ 28
A12: What Makes Online Content Viral? .................................................................................................... 30
A13: The Big Five, Self-esteem and Narcissism as Predictors of the Topics People Write about in Facebook
Status Updates ......................................................................................................................................... 32
A14: Influencers on Instagram: Antecedents and Consequences of Opinion Leadership ............................... 34
Article 15: Does Twitter Matter? The Influence of Microblogging Word of Mouth on Consumers’ Adoption of
New Movies ............................................................................................................................................. 36
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, Week 1: Strategy
V1 + 2: The Business Model Canvas
Osterwalder, A. (2012). https://www.youtube.com/watch?v=8GIbCg8NpBw
Blah blah blah Phenomenon = smart people using a lot of words, but not understanding each
other. → When it comes to business models: Words are not enough.
- We need a shared, visual language that allows us to sketch out business models.
An organization’s business model can be described with 9 basic building blocks → mapped
out in one pre-structured canvas to see how they all fit together → Business model Canvas:
tool that helps you map, discuss, design, and invent new business models.
On the left-hand side: On the right-hand side:
back stage that enables front stage related to
the front stage. the customer.
https://www.youtube.com/watch?v=2FumwkBMhLo&t=9s
DEMAND SIDE
1. Customer Segments – all the people / organizations for which you are creating value.
2. Value Proposition – the bundles of products and services which create value for your
customers.
3. Channels – through which touchpoints you’re interacting with customers and delivering value.
4. Customer Relationships – outline the type of relationships you’re establishing with your
customers.
5. Revenue Streams – make clear how and through which pricing mechanisms your business
model is capturing value.
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,SUPPLY SIDE
6. Key Resources – the infrastructure to create, deliver, and capture value.
o Show which assets are indispensable in our business model.
7. Key Activities – show which things you really need to be able to perform well.
8. Key Partnerships – show who can help you leverage your business model.
o You will not own all key resources/perform all key activities yourself.
9. Cost Structure – describes the costs that business occurs through its operations.
Business Model Canvas – The Basics
- You never write on a canvas.
- For every building block: use a Post-It Note.
o Mobility: “you can put it up, you can discuss, you can put it down”
o E.g., taking away one post-It: what is the impact on the rest of the model?
Example: Nespresso gets consumers to pay 600 to 800% more for home coffee.
- In a commodities business. How?
o Nespresso almost failed in 1987 due to nonperforming business model.
▪ Same product/technology: but BM did not work.
o Nespresso changed the business model for espresso.
▪ First to invent single portion coffee – machines + aluminum pods.
▪ Recurring revenues: You can buy the machines everywhere, but you can only
buy the pods from them (patents are important key resource).
• Want to switch? Need to buy a new machine: high switching cost.
▪ Very high-end brand (expensive): cannot establish this only through the
internet. → Physical stores important as well.
o Results: one of the fastest growing businesses in the Nestlé group.
https://www.youtube.com/watch?v=o1RBSPEKqYU → Watch this if you would like to see
how Osterwalder fills in the BM Canvas for Nespresso.
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, V3: Profiting from Experiences
Joseph Pine. (2014). https://www.youtube.com/watch?v=MV19mK-tOKs
The Gumball Wizard: A coin is inserted, and the crank is turned → “the gum-balling
experience” starts: The gumball spirals down before the child is able to take it.
- No functional purpose: You do not get a better manufactured good/ better service from
the gumball spiraling down, and yet it has more value because of the experience.
Commoditization
Commoditization: the process by which goods that have economic value and are
distinguishable in terms of attributes end up becoming simple commodities in the eyes of the
market or consumers.
- Commoditized products are only differentiated based on their price.
Internet: the greatest force of commoditization: fructuous marketplace, customers can compare
prices, which tends to push the prices down) + Services are being commoditized as well.
→ Goods and services are everywhere becoming mere commodities, they are no longer enough
to create economic value today.
→ Companies must move to a new level of value: stage experiences for their customers.
o Experiences are distinct economic offering.
→ Shifting in an experience economy.
The Progression of Economic value (see figure):
1) commodities (extract) → 2) goods (make) →
3) services (deliver) → experiences (stage).
Example for coffee:
1) Coffee as a commodity. One cup of coffee is only
worth around €0.05.
→ 2) Roast and grind the beans and put them on a shelf
in the grocery store: Make goods. Worth of a cup of coffee increases to €0.10.
→ 3) Performing the service of brewing the coffee in a kiosk: Deliver the service. Worth
increases to €1.50.
→ 4) Surround the brewing of that coffee with the ambience and theater of a Starbucks: Provide
experiences. In the end it is worth maybe €4,- per cup (with only €0.05 worth of beans in it).
If you create a great experience, your customers will be willing to pay for that experience.
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