MOE - Business Model Canvas

Summary

This lecture introduces the Business Model Canvas (BMC), a tool for entrepreneurs and business owners to outline their business concept comprehensively. The BMC is a single-page document divided into nine blocks, covering aspects like customer segments, value propositions, channels, key activities, resources, partners, cost structure, and revenue streams. The lecture guides viewers through understanding each block's purpose and how to fill them out effectively, emphasizing the importance of specificity and coherence in the business model.

Takeaways

• 📈 The Business Model Canvas (BMC) is a strategic tool used to outline a business concept comprehensively.
• 🎯 The BMC has three main objectives: to identify the BMC, describe it in each item, and understand how to write one for your business.
• 📝 The BMC is designed to fit on a single sheet of paper, making it a concise and clear overview of a business.
• 🤝 It helps in understanding a business's competitive advantage, value creation, delivery, and capture mechanisms.
• 🚀 The BMC is beneficial for highlighting a business roadmap, reflecting strategic thinking, and connecting ideas with processes.
• 👥 'Customer Segments' is the starting block of the BMC, focusing on identifying and detailing potential customer groups.
• 💡 'Value Propositions' is the central block, emphasizing the value a product or service offers to customers.
• 🔗 'Customer Relationships' deals with how a business interacts and maintains relationships with its customers.
• 📍 'Channels' describes where and how customers find and engage with a business.
• 🔑 'Key Activities', 'Key Resources', and 'Key Partners' are operational blocks that define the actions, assets, and collaborations necessary for business operations.
• 💸 'Cost Structure' and 'Revenue Streams' are the financial blocks, detailing the expenses and income sources of the business.

Q & A

What is the main topic discussed in week six of the course on managing, organization and entrepreneurship?

The main topic discussed is the business model canvas.

What are the three main objectives of the business model canvas chapter?

The objectives are to identify the business model canvas, describe it in each item, and understand how to write one for your own business.

What does BMC stand for in the context of the lecture?

BMC stands for Business Model Canvas, which is a tool to provide a clear overview of a business on a single sheet of paper.

Why is the business model canvas important for businesses?

It helps entrepreneurs or business owners outline a comprehensive picture of the business concept, understand the business's competitive advantage, and identify areas for improvement.

How does the business model canvas help in strategic thinking?

It highlights the business roadmap, accurately reflects strategic thinking, and connects ideas with the process to turn them into a business.

What are the nine blocks of the business model canvas?

The nine blocks are customer segments, customer relationships, channels, value propositions, key activities, key resources, key partners, cost structure, and revenue streams.

Why should you start with customer segments when writing a business model canvas?

Starting with customer segments helps to understand who needs the product and allows for a more detailed and specific approach to serving the needs of different customer groups.

What is the purpose of the value propositions block in the business model canvas?

The value propositions block outlines the products and services offered to customers and how they solve their problems or fulfill their needs.

How can you identify the value of your product in the value propositions block?

You can identify the value by listing product features, benefits, and advantages, and focusing on how these aspects meet the needs of your customer segments.

What does the customer relationships block focus on?

It focuses on how a business interacts with its customers to maintain relationships, including ways to attract new customers and encourage repeat purchases.

Why are channels important in the business model canvas?

Channels detail where and how customers find and engage with the business, which is crucial for effective communication and distribution of value propositions.

What are key activities, and how do they relate to the business model canvas?

Key activities are the actions a business must perform to run operations and produce value propositions. They are essential for understanding the daily operations and identifying new activities or solutions to serve customers.

What are key resources, and how do they fit into the business model canvas?

Key resources are the necessary tangible assets, such as materials, people, knowledge, or intellectual property, required to perform key activities and create value propositions.

Who are key partners in the context of the business model canvas?

Key partners are external companies or parties that support and strengthen business operations, helping to increase efficiency and productivity.

What does the cost structure block represent in the business model canvas?

The cost structure block represents the monetary costs of operating a business, including expenses like raw materials, labor, maintenance, rent, insurance, taxes, and marketing.

How is the revenue streams block different from other blocks in the business model canvas?

The revenue streams block is focused on the income generated by the business, including various sources such as service fees, product sales, rents, and license fees.

Outlines

00:00

📈 Introduction to Business Model Canvas

The lecture introduces the concept of the Business Model Canvas (BMC), a tool designed to help entrepreneurs and business owners outline a comprehensive view of their business concept. The BMC is a single-page document divided into nine blocks, each representing a key aspect of the business. The lecture aims to teach students to identify the BMC, describe each item, and understand how to write a BMC for their own business. The speaker emphasizes the importance of the BMC in understanding a business's operations, competitive advantages, and areas for improvement.

05:02

👥 Focusing on Customer Segments

This section delves into the first block of the BMC, 'Customer Segments,' which identifies potential customer groups. The speaker advises specificity in defining customer segments, suggesting that businesses should not aim at 'everyone' but rather focus on specific, similar groups based on demographics, interests, and behaviors. The lecture provides an example of segmenting a student body by gender and sexual orientation to tailor the business's offerings to the needs of these groups. The speaker also recommends focusing on one main customer segment to ensure the business can effectively deliver value.

10:03

💡 Crafting Value Propositions

The lecture continues with the 'Value Propositions' block, emphasizing the importance of understanding how a business's product or service can solve customer problems. The speaker suggests listing product features, benefits, and advantages to articulate the value offered. Features describe the product's characteristics, benefits explain the positive experiences customers gain from using the product, and advantages highlight how the product outperforms competitors. The speaker uses a deodorant product as an example to illustrate how to identify and communicate the value proposition effectively.

15:03

🤝 Establishing Customer Relationships

The 'Customer Relationships' block is explored, focusing on how businesses interact with customers to maintain relationships. The speaker advises considering promotional strategies and customer engagement methods to attract and retain customers. The section emphasizes understanding customer interactions from their perspective and establishing relationship types that cater to specific customer segments. The goal is to create a strategy that encourages repeat purchases and fosters a community around the business.

20:05

📡 Identifying Channels to Reach Customers

The lecture moves on to the 'Channels' block, which details where and how customers find and interact with the business. The speaker highlights the importance of choosing the right communication and distribution channels based on customer characteristics and business nature. The section encourages businesses to consider the customer journey, from initial awareness to purchase and product delivery, to determine the most effective channels for reaching their target audience.

🔧 Key Activities, Resources, and Partners in Business Operations

This section discusses the operational aspects of the business, starting with 'Key Activities,' which are the actions a business must perform to run and produce value propositions. The speaker suggests listing daily operations and tasks that contribute to the business's core functions. 'Key Resources' are then explored, which include physical, intellectual, and human resources necessary for business operations. Lastly, 'Key Partners' are defined as external companies or parties essential for business success, emphasizing the importance of collaboration in business operations.

💰 Understanding Cost Structure and Revenue Streams

The lecture concludes with the financial aspects of the BMC: 'Cost Structure' and 'Revenue Streams.' 'Cost Structure' refers to the monetary costs of operating a business, including expenses like raw materials, labor, and marketing. The speaker advises businesses to identify all costs to understand the financial implications of operations. 'Revenue Streams' are the sources of income for the business, which can come from various products or services. The speaker encourages businesses to consider different revenue models and payment methods that are convenient for customers.

Keywords

💡Business Model Canvas

The Business Model Canvas is a strategic management tool used to outline, analyze, and design business models. It is a visual chart with elements describing a firm's or product's value proposition, infrastructure, customers, and finances. In the video, it is introduced as a single sheet of paper divided into nine blocks, each representing a key aspect of a business model, and is used to provide a comprehensive overview of a business concept.

💡Customer Segments

Customer Segments refer to the specific groups of people or organizations the business targets as customers. The video emphasizes the importance of identifying and understanding these segments to tailor the value proposition effectively. It suggests dividing the customer base into groups with similar characteristics, such as age, gender, income, interests, and pain points.

💡Value Propositions

Value Propositions are the products, services, or features that a business offers to its customers. They address the needs, wants, or problems of the customer segments. The video explains that these should be clearly defined to communicate how a business or product can satisfy its customers, using examples like a deodorant's features, benefits, and advantages.

💡Channels

Channels refer to the means through which a business communicates with its customers and delivers its value propositions. The video discusses how understanding the customer's journey can help identify the most effective channels, whether online or offline, to reach and engage with the target audience.

💡Key Activities

Key Activities are the most important actions a business must undertake to offer and sell its value proposition. The video explains that these activities are the operational building blocks of the business model and can include production, problem-solving, and service delivery, which are essential for creating and maintaining value propositions.

💡Key Resources

Key Resources are the assets required to offer and deliver the previously mentioned elements of the business model. The video describes these as the physical, intellectual, human, or financial resources necessary for the business to operate effectively, such as raw materials, employees, and capital.

💡Key Partners

Key Partners are the network of individuals or organizations that the business collaborates with to ensure the successful operation of its business model. The video suggests that these partners can provide essential support, such as suppliers, distributors, or joint venture partners, and are crucial for enhancing business operations.

💡Cost Structure

Cost Structure refers to the monetary layout of operating a business and includes all the expenses incurred in running the business. The video explains that understanding the cost structure is vital for financial planning and includes costs like raw materials, labor, and marketing expenses.

💡Revenue Streams

Revenue Streams are the income generated from the business model. The video discusses how businesses can have multiple revenue streams, such as sales, subscriptions, or licensing fees. It emphasizes the importance of identifying how and from whom the business will earn money.

💡Customer Relationships

Customer Relationships describe how a business interacts with its customers to build and maintain a relationship. The video highlights strategies like promotions, after-sales care, and loyalty programs that can be used to attract, retain, and engage customers.

Highlights

Introduction to Business Model Canvas (BMC) as a tool for business overview.

Three main objectives of the chapter on BMC.

BMC helps outline a comprehensive business concept.

BMC details business operations, competitive advantage, and value creation.

BMC is a one-page document collecting key business information.

Benefits of using BMC: strategic clarity and business roadmap.

BMC's nine blocks detailed: customer segments to revenue streams.

Starting with customer segments for an effective BMC.

Defining customer segments for targeted business value.

Writing detailed customer segments to understand customer needs.

Value propositions as the core of BMC.

Tips for writing value propositions: features, benefits, and advantages.

Differentiating product features from benefits and advantages.

Customer relationships block focuses on maintaining customer interactions.

Channels block details where customers find and engage with the business.

Key activities block lists essential business operations.

Key resources block identifies necessary physical and intellectual assets.

Key partners block outlines external support for business operations.

Cost structure block focuses on the monetary cost of operating the business.

Revenue streams block identifies how the business generates income.

Drafting the nine BMC blocks provides a comprehensive business view.

Example of a hotel business model canvas.

Transcripts

[Music]

this is week six of managing

organization and entrepreneurship

the topic that we will discuss today is

about business model canvas

in this page you will see that there are

three main objectives of this chapter

after you finish the lecture today first

you will be able to identify the

business model can was and it's

important for business

second you will be able to describe

business model can watch in each item

and third you will understand how to

write a business model can watch for

your business

when we start the lecture you can hear

that i mentioned business model can

watch many times and for now you might

have a question what is business model

can wise let's get to know it together

in this chapter business model canvas is

a tool to get a clear overview of your

business in a single sheet of paper we

call business model can watch shortly as

bmc which come from the first letter of

each word business model can wash is

designed to help entrepreneurs or

business owners outline a big picture of

the business concept in all-round

aspects it is a tool that provides the

details of a business which helps us

understand what business is doing what

is a business competitive advantage

how an organization creates deliver and

captures value and in what way the

business needs to improve

in conclusion business model canvas is

one page document that collects

important information about the business

why should we use a business model can

was what is the benefit of building a

business model can wash business model

can wash is a handy and quick way to

highlight your business roadmap not only

will it accurately reflect your

strategic thinking and your company's

current reality

but it also connects the idea with the

process to make it into a business

in addition it allows everyone to get a

clear idea of what the business will

likely be

if you move on to the next page you will

see what canvas looks like in the sheet

of paper you can see that it divided

into nine blocks each block is about the

ally of business which are one customer

segments

two customer relationships

three

channels

four

value propositions

five key activities

six

key resources

seven

key partners

eight cost structure

and the last one nine revenue streams

i will start explaining each block to

you first

after that i will provide an example on

how to write it

in order to write an effective business

model can wash i recommend that you

start with customer segments

which is the block on the right side of

canvas

customer segments refer to a group of

people who can be your customer what you

need to write in this block is who needs

your product

do not write everyone in the customer

segments because

not everyone can be your customer just

like the word segment you should specify

details of your customer as clearly as

possible and group them you should

divide a customer base into groups of

individuals that are similar in specific

ways such as their age range their

gender their income range their

interests their pain points or their

behavior

with clear specific customer segments we

will be able to understand the needs of

customers then we can provide the value

of the product to serve them

for example based on the students in

this course i might divide all of you by

gender segment

with this segment base i can divide all

students in this course into a group of

male students a group of female students

and a group of lgbtq plus students as i

mentioned above in order to write

effective customer segments in business

model can watch it would be easier to

focus on one main customer as your

business target

let's say that with all these three

segments

i might say that my business will focus

on a group of female students then i can

focus on how to provide a product's

value to certify my core customer which

is a group of female students

when you write the information in

customer segments the more details you

write the better you can understand your

customers

therefore i recommend that when you fill

in the information in this block you

should identify the customer's general

demographic what do your customers like

or dislike their lifestyle their

personality their geographic area and

their behaviors moreover you should look

into the segments that provide most

revenue to your business

after you settle with customer segments

i recommend you to focus on value

propositions which is in the center of

business model can watch value

propositions are the sum of its worries

product and service that you offer to

the customers it is about how your

business or product can certify your

customer therefore we could state that

to fill in the value propositions you

need to check out your customer segment

and figure out how your product can

solve that problem in summary when you

write the details in this block think

about the value of your product that you

can offer to your customers

what drives customers to shoot our

products and service

for example

how your product can solve their

problems

i will provide tips for you

a good way to write value proposition is

listing product features

product benefits and product advantages

product feature refer to a

characteristic attribute that a product

or service has it is simple facts of a

product design statement function

or the explanation on what the product

is made of for example

the deodorant product is made of plastic

its open lid is at the bottom

products benefits describe why a

customer would use a product in the end

these could be point out by details of

the inside ingredients or elements of

the product with the explanation on

positive experience the customer may get

after using your product so you need to

check the material or ingredients in use

to produce the product and then identify

what is so good about these practical

ingredients

for example

these deodorants has orange sty dress

and orange leaf extract which is known

for antioxidants properties and high

vitamin c which will make your skin

moisture eliminate unpleasant smell and

brighten your skin

next products advantages

these refers to how the product helps

the customer or the good point of the

product that is better than competitors

you can connect the idea with the

products feature and identify good

points the customer will gain from it

for example the deodorants products

provide 48 hours of antibacterial

why are the brands might be able to

provide only 12 hours or 24 hours this

makes the product in an advantageous

position when compared with others

when you prepare value propositions

please think about a product features

products benefits and products

advantages

it will help you simply specify your

product value that you offer to your

customer

most importantly please always remember

that these values should certify the

need of your customer

also

in preparing variable positions

it would be based if you provide points

of different and points of parity which

are the aspects of your product that

differentiate you from your competitors

and the aspects of your product that

should have in common with your

competitors respectively

as the example above the deodorant

product provides 48 hours of

antibacterial

this is a point of difference which

makes your product different from your

competitors on the other hand

eliminating unpleasant smells is a point

of parity which is basic must-have if

you don't have this value the customer

might not buy your product because it

cannot certify basic needs for them next

let's move on to customer relationships

customer relationships blog is how a

business interacts with its customer

in order to maintain the relationship

with them it focuses on how we get our

customers it is about the way to attract

new customers and keep a relationship

with them to make them come back and

repurchase a helpful step to fill in

this block is to form the details on how

customers interact with your business

to fill in this block you might need to

think about promotion or any idea to

make the customer first come to use your

product

repeat purchase your product again and

again

and word of mouth to make the customer

engage with the business more

such as discount for the first time

purchase

coupon

after sales care cost center or special

discounts however

please note that when you decide

customer relationships you have to look

at the customer's point of view primary

so you should establish types of

relationships

with specific customer segments in mind

channel's block is detailed about where

the customer finds our business it is

about where will your customer find us

in this section you might need to ask

yourself how do you communicate with

your customer and how do you deliver the

value propositions

channels could be online channels or

offline channels depending on who your

customers are

so it is very important for you to look

into the character of your business and

xmi your customer

in order to explore which communication

channel and distribution channels are

the most convenient the most effective

and suitable for the customer

for example if your customer segment is

young people age around 18 to 25 who

lived in the city with inside research

we found that online social media

platforms are the media platform that

they use the most

so

we might focus on using facebook twitter

and instagram as channels to connect and

reach them for both communication and

distribution if you are struggling with

the way to fill in this section

you might think about the journey that

customer might take along the way to

find your business

such as

the channel that customers take in order

to get to know about the business

the channel does customer take in order

to find more information about the

business

the channel that customers take in order

to make a purchase

or

the channel that customer receive the

product

and this is what you should write in

channels block of business model cambras

on the left side of canwas

there are three blocks which are key

activities key resources and key

partners

this section focuses on the operation of

your business

let's start with key activities key

activities block is the list of

activities that your business has to do

by themselves in order to run the

business this section focuses on what

actions do your business do every day to

run the business

and to produce value propositions

therefore we could say that it is about

what do we need to do

for example if you are running a coffee

shop will you prepare the coffee bean

and grow coffee plants will you highways

the coffee bean will you do the

production will you deliver a product to

the customer will you do research to

develop a new product

will you design product packaging

will you manage your business facebook

page

if yes

then you need to fill those activities

in this blog

by preparing the details in this blog it

will help you look through your business

activity which will help you in idea

creating for new activity or new

solutions to serve the customer

next

key resources

what is key resources

basically key resources are practical

resources

it is about what do we need to have

when we talk about key resources it

could refer to physical resources

such as material

ingredients

medicines

intellectual property people

knowledge

or any resources that we are supposed to

have in order to achieve the key

activities

for example if you are running a coffee

shop your business key resources might

be store space people ask stuff

internet connection

car oven electric city baking

ingredients

coffee making ingredients

coffee making machines roast coffee

machines

pots

tables and chairs

key resources block will be easy to fill

in if you have clear details in key

activities and value propositions

to complete this section

you should look back into key activities

and value propositions

then

list resources that are need for

creating the value of your business

operation

when we write this section we will know

what resources that we already have and

what resources we need to find more

key partners blog is about who do we

need to work with key partners can be

defined as the partners of your business

that you cannot run the work without

them it is a list of other external

companies or parties who will support

and strengthen your business operation

that you need to work with

so

we could say that it is the section

about external companies or parties that

business needs to depend on

in summary key partners are the partners

who will help the business increase

efficiency in business process to fill

in this block you should list external

parties who help you run the business

operation

for example think about choppy alibaba

or ebay which is an e-commerce platform

that key partners are the delivery

companies these delivery companies will

help shopee alibaba or ebay in the

productivity operation for local

deliveries of purchased goods

keep moving on forward to the bottom

block in the canvas

which are cost structure and revenue

streams these two blocks are related to

finance i will explain what it is one by

one

let's start from the block on the left

side

cost structure

cost structure is the monetary cost of

operating as a business this block

focuses on what kind of expense that

cost you

and how much is it it is about all costs

incurred to operate a business

examples of business costs are the cause

of water

the cost of electricity

because of raw materials because of

labor

because of machine maintenance

rain costs

insurance costs

taxes

or marketing costs

to fill in this section

you might need to ask yourself

are there any cost or expense to run a

business

if yes

what is it

then fill those expense in the cost

structure block

the last block in the business model

canvas that we will talk about is

revenue streams

revenue streams refer to the money that

you generate it is about what will we

get paid

also the revenue of your business that

you get paid could be more than one type

of product or more than one activity

there are many type of revenue that your

business can generate such as

one revenue from service fee

to

revenue from selling products

three

revenue from the rent

and four revenue from license fee

for example

if you run the coffee shop you might get

paid from the product selling coffee

cake bakery

milk roast bean coffee and you might

also get pay from service fee if you

charge them more money in case they

would like to use the individual meeting

room at the coffee shop so in this blog

you have to figure out how we can make

money at least what you get paid also it

would be good if you are able to specify

deeply to the extent which form of

payment method is convenient for the

customer such as credit card payment

cash or bank transfer drafting these

nine business model can watch blocks

will help us think all router and get

the picture of business

we could identify the point to improve

and identify the focus point for

business easier and suitable for the

changes

so far i believe that now you understand

what business model can watch is and

understand how to write

i will provide an example in the next

page

remember that the idea in the business

can was should be coherent with each

other

this is an example of the hotel business

that i decide as an idea to show you as

an example on what it looks like if you

finish drafting the canvas

[Music]

do

[Music]

you can find more examples at the link i

provide for you here

you