So now that you understand all these nine different building blocks in a business model canvas, let's
start filling in the details.
We will start with customer segment.
So you have to mention which customer segment are you targeting in this specific business model.
So you can divide your customer based on the geography, their age group or the different interests
they have.
If I'll give you a couple of examples, like Coca Cola.
Now Coca Cola is a mass market product.
That means no matter whether you are five year old or 50 years old, anyone can drink Coca Cola.
But when we look at other products like beauty product or let's say pet food, these are targeting some
specific niche.
For beauty product.
We are targeting females from age group of 18 years to, let's say 40 years who are comfortable with
trying new beauty products online so you can have multiple customer segment and their profile.
The next one is the value proposition and you have to explicitly mention what differentiate your product
when compared with other competitors in the market.
So your product can have a newness or performance improvement.
You can allow these people to customize the product.
You can have a design or a branding power, or you can have a price, power or convenience.
So let's say if you end up building a new hardware or a software, that's the newness.
Let's say if your product is two X faster, that's the performance improvement.
Let's say if you allow these people to customize a gift or a product, then that's the customization.
And let's say if you have some design, some unique design or let's say some branding power, well,
all of these can be a value proposition.
You have to mention the value proposition for your business.
The third one is channel.
You have to mention all the channels that you are using to market your product to communicate with your
target audience.
Let's say if you are selling some product, well, you can sell all of your products using a website
or a ecommerce store or a mobile app.
But on the other side, you can also use some offline channels like a retail store.
You can also have some partnership with these retail giant like Target or Wal Mart.
So you have to mention all those channels that you are using to communicate with your customer or maybe,
let's say, distributing your product.
Then you have to mention how are you acquiring your customer and building relationship with them?
Let me give you a couple of example.
So if you go to an airport and if you wanted to print your boarding pass, well, that's a transactional
relationship.
The second example would be, let's say if you are going to a hospital, well, they always try to make
a long term relationship with you.
Third one is your software, and they always try to have a self serving relationship.
So you have to mention what kind of relationship are you building with your customer.
Then we have our revenue stream.
So you have to mention things like how exactly are you generating revenue?
Are you generating revenue through subscription business model?
Are you generating revenue through brokerage fees, through usage fees or asset sale?
You have to mention all the different revenue stream you have in your business.
If I'll give you a simple example of companies like Amazon, Amazon have ads as their revenue stream
cloud computing platform as the revenue stream, then they have ecommerce margin as their revenue stream,
and they also have few other revenue stream from hardware devices like Kindle or from Amazon Prime.
And maybe they have hundreds of other revenue streams as well.
Then you have to mention all the key resources that you need in order to operate your business.
And these key resources can be physical store like Walmart, have their physical store as their key
resource is this can be intellectual resource like human capital.
So companies like Qualcomm use intellectual human capital as their key resource.
This can be humans.
Again, Tesla have the exactly same intellectual capital, which is human capital as their key resource.
This can be financial key resource like Netflix.
Then you have to mention key partners, which all people or companies you need in order to make sure
that.
Your business is operating successfully.
So you can mention all of the companies where you have strategic alliances, joint ventures, acquisition,
and finally you have to mention key activities.
So what is the most important thing your company must do in order to make sure that your business model
work?
In case of Tesla manufacturing, the car is the key activities they have to do, So production can be
your key activities for a consulting firm.
Problem solving is the key activities that they have to do for some platforms for companies like Uber
and Amazon, maintaining the platform or network effect is the key activity they have to focus on.
The last one is obviously your cost structure.
So you have to mention these different types of cost structure.
If you look at companies like we work, they follow a fixed cost structure.
That means they are leasing these property for ten, 20 years and that's your fixed cost.
That means if you buy more number of properties, your fixed cost will rise.
Then you have your cost driven.
So if you are creating an affordable airline or an affordable product, you have to have a cost driven
cost structure.
Then you have your value driven.
So if you are focusing more on value, less on cost, then that's a value driven cost structure.
If you look at a couple of luxury hotel or these luxury brand or cars, these have the value driven
cost structure and then you have your variable cost.
So if your cost will increase with the number of employees which is there in case of service companies,
that's a variable cost structure.