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Semester Exam Business Summary
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A summary of all business-related lectures during the 3rd semester of AMFI.
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Sem. 3 Business Exam – SummaryBusiness Model Canvas
Class 1
Business Model – “a business model describes the rationale of how an organisation creates,
delivers and captures value”
Creates – everything about creating a company, creating ideas, being creative. This doesn’t
mean the product needs to be new, can also be the way you are giving/delivering it to the
customer group (new to them).
The Business Model Canvas
- Resembles a painter’s canvas, which allows you to paint new or existing models.
- Creation = key word. Use it, paint on it, make 10 paintings, last one will be the right
one. Give yourself freedom to experiment.
How to approach every building block?
First 4 – front office, external, everything around customer
I Customer Segments – defines the different groups of people or organisations an
enterprise aims to reach and serve
Different Types
1. Mass market – basic stuff everybody needs, e.g. A4 paper
2. Niche market – a very specific target group, you know their needs and focus on them
3. Segmented – think of jewellery store: you’ve got a group that has the same need
(they want to buy jewellery) but they are in different price ranges.
4. Diversified – different customers with different needs, offer different stuff for
different people. E.g. Colette: you can buy a magazine, sunglasses, watches, but also
really expensive designer clothing.
5. Multi-sided platforms (or markets) – think about marktplaats, etsy, bol, amazon
(second hand part) you’ve got the demand and the supply. Anybody can buy
something; anybody can sell something.
Customer groups represent separate segments if: needs require distinct offer, reached
through different channels, require different relationships, have different profitabilities,
willingness to pay
Questions
- For whom are we creating value?
- Who are our most important customers?
,II Value propositions – describes the bundle of products and services that create value
for a specific customer segment you know the customer’s pain and have the opportunity to
offer them a solution
Possible values you can offer – see difference between own core values and customer’s!
1. Newness – e.g. rubber laces, apple, brings something new/innovative
2. Performance – e.g. Nike: new things, sustainability
3. Customisation – e.g. also Nike, mymuesli
4. Design – close to brand/status
5. Brand/status – ‘if you buy this you will be really cool/relaxed/sustainable/outgoing’:
all in brand identity
6. Price – e.g. Primark
7. Cost reduction – e.g. TK Maxx, dress for less (sell previous collections) you’re offering
discount for a more expensive product
8. Risk reduction – e.g. army boots, think about guarantees
9. Accessibility – e.g. Albert Heijn to go, online and apps (buying through phone), you
have to go above what’s normal
10. Convenience/usability – e.g. easy to wash, not necessary to iron
Questions
- What value do we deliver to the customer?
- Which one of our customer’s problems are we helping to solve?
- Which customer needs are we satisfying?
- Which bundles of products and service are we offering to each customer segment?
III Channels – describes how a company communicates with and reaches its customer
segments to deliver a value proposition don’t go the obvious way! Find out if your customer
is actually there and prove it.
Channel types
1. Partner: already a revenue stream. as they will buy part of your collection
2. Own: you have all the control (e.g. over brand identity), but you will also have a lot of
costs (sell to be able to cover all the costs)
3. Indirect/direct: sell directly to the customer or different channels in between?
Channel phases – per phase, think about which channel you are going to use.
1. Awareness – e.g. through Instagram
2. Evaluation – bad publicity costs a lot more than building up a good reputation
3. Purchase – where or how to buy
4. Delivery – e.g. click and collect, integrating different channels
5. After sales – you want them to buy more or something more expensive: aftercare.
Through which channel (e.g. email) and is the channel effective? Does the customer
prefer a certain channel for these kinds of things?
With Omni channel, the message you’re getting on your phone or computer should be the
same as in store SAME STORY!
, Questions
- Through which channels do our customer segments want to be reached?
- How are we reaching them now? – Benchmark, use another company to see what
they’re doing
- How are our channels integrated?
- Which ones work best?
- Which ones are most cost-efficient?
- How are we integrating them with customer routines?
IV Customer Relationships – describes the types of relationships a company establishes
with specific customer segments What kind of relationship do you want with the customer?
Close/24/7 or freedom? What kind of relationship do they want with you?
Categories
1. Personal Assistance – if your customer really values this, getting help e.g. in store
2. Dedicated personal assistance – e.g. how personal do you want the service to be
3. Self-service – think about the supermarket
4. Automated services – scanning and paying yourself, time efficient (if customer
doesn’t have time perhaps)
5. Communities – e.g. lululemon is a yogabrand, they sell a product but also a lifestyle.
Formed a community, chat with other customers, sharing info, in-store yoga events
6. Co-creation
Questions (always customer on top!)
- What types of relationship does each of our customer segments expect us to
establish and maintain with them?
- Which ones have we established?
- How costly are they?
- How are they integrated with the rest of our business model?
V Revenue Streams – represents the cash a company generates from each customer
segment (cost must be subtracted from revenues to create earnings). Channels you have
result in locations/products the revenue is coming from.
Different ways to generate Revenue Streams:
1. Asset sale – simply selling products
2. Usage fee – you don’t own it, you use it and return later. e.g. Filippa K where you can
lease a pair of trousers. E.g. the library.
3. Subscription fee – constant flow of revenue, not common in fashion yet.
4. Lending/renting/leasing
5. Licensing – business to business, e.g. Gucci accessories: somebody buys license to be
able to sell Gucci products
6. Advertising – think about Facebook, their core business is to get people to network
but one of their revenue streams is from advertisements (think about having space
left on your webshop)
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