Business Model Canvas,
our central communication tool

4 Value Proposition

This refers to the unique value that your business offers to its customers. It's the reason why customers turn to your company over others. It could be based on product performance, innovation, customization, design, brand/status, price, cost reduction, risk reduction, accessibility, or convenience

8 Cost Structure

This describes all costs involved in operating a business model. It defines how to create value, deliver value, and maintain customer relationships.

7 Customer Segments

This element involves identifying and understanding the target market or market segments for your business. It's crucial to recognize the potential customer base and focus on expanding your business within these segments.

9 Revenue Streams

This represents the cash a company generates from each customer segment. Revenue streams can be generated through different means such as asset sales, usage fees, subscription fees, lending/renting/leasing, licensing, brokerage fees, or advertising

5 Customer Relationship

This element describes the type of relationship a company establishes with specific customer segments. Customer relationships may be driven by customer acquisition, customer retention, and boosting sales

6 Channel

Channels are the means through which a company delivers its value proposition to its customer segments. This could include the company's marketing and distribution strategy

1 Key Partnerships

These are the relationships and strategic alliances with other businesses and suppliers that help your company with resource acquisition, reduction of risk, and optimization of economies

2 Key Activities

These are the most crucial actions a company must take to operate successfully. Key activities could be related to production, problem-solving, or platform/network

3 Key resources

These are the most important assets required to make a business model work. They could be physical, intellectual, human, or financial

Examples key activities

  1. Research and Development:
    This involves creating new products or improving existing ones. It's a key activity for product-oriented companies.

  2. Production:
    This covers all actions related to product development, manufacturing, and delivery. It's a predominant activity in business models focused on manufacturing.

  3. Marketing:
    This involves promoting the company's products or services to increase their visibility and attract potential customers

  4. Sales and Customer Service:
    This includes activities related to selling the company's products or services and providing support to customers.

  5. Problem Solving: This is the core activity of organizations seeking unique solutions to specific problems. Examples include hospitals, consultancies, and most service providers.

  6. Platform/Network Building:
    This involves creating and managing platforms or networks that enable the delivery of the company's value proposition. It's a key activity for tech companies and those operating in the digital space.

  7. Infrastructure Management:
    For infrastructure-oriented businesses, key activities might include cloud computing, financing, social network management, lobbying, and regulatory management.

  8. Data Capture and Processing:
    For digital business models, key activities might include sourcing, transport, processing, and delivering of goods, as well as data capture, processing, managing, and presenting.

  9. Sales and Marketing:
    This involves activities related to promoting and selling the company's products or services.

    The specific key activities of a company depend on its business model and the industry in which it operates

Examples key partners

  1. Suppliers: These are entities that provide the necessary inputs or resources for your business. For instance, a restaurant might have a key partnership with a local farm that supplies fresh products.

  2. Distribution Partners: These are entities that help in the distribution of a company's products or services. For example, a software company might partner with various online platforms to distribute its software.

  3. Strategic Alliances: These are partnerships formed with other businesses that have complementary strengths and expertise. For instance, a tech startup might form a strategic alliance with a larger tech company to leverage its established market presence and resources.

  4. Joint Ventures: These are partnerships where two or more businesses come together to undertake a specific project or business activity. For example, Airbnb had a joint venture with Tesla Motors to bring charging stations to select hosts' homes.

  5. Coopetition: This is a scenario where companies that are competitors collaborate on specific projects or initiatives. For example, two competing tech companies might collaborate on developing a new industry standard.

  6. Buyer-Supplier Relationships: These are partnerships where one company relies on another for supplies. For example, a corner store that sells fresh bread but doesn't bake it might have a key partnership with a nearby bakery that supplies the bread.

  7. Advisors: These are individuals or entities that provide expert advice or consultation to a business. For instance, a startup might have a key partnership with a legal firm for legal advice.

  8. Investors: These are individuals or entities that provide financial support to a business. For instance, a tech startup might have key partnerships with venture capitalists or angel investors.

  9. Integration Partners: In the case of Software-as-a-Service (SaaS) companies like Salesforce or Adobe, integration partners who can connect their software to other systems can be considered key partners.

    These partnerships are crucial as they provide vital support, help optimize costs, reduce risk, access key resources, and deliver value to customers

Examples key resources

  1. Physical Resources: These include tangible assets such as buildings, vehicles, machinery, and equipment. For instance, a manufacturing company's key physical resources would be its factories and the machinery within them.

  2. Intellectual Resources: Intellectual property like patents, trademarks, copyrights, and proprietary data or algorithms are considered intellectual resources. A technology company, for example, might rely heavily on its patented technology or software code as a key resource.

  3. Human Resources: The skills, knowledge, and expertise of employees are critical resources, especially in knowledge-intensive and creative industries. A consulting firm's key resource would be its team of expert consultants.

  4. Financial Resources: This includes cash, lines of credit, and financial guarantees that a company can use to support its operations and growth. A startup might consider its venture capital funding as a key financial resource.

  5. Digital Resources: For businesses operating in the digital space, key resources might include online platforms, digital infrastructure, and customer databases.

  6. Expert Knowledge: Specialized knowledge or expertise that gives a company a competitive edge can also be a key resource. This could be industry-specific knowledge or a deep understanding of a particular market.

  7. Political Connections: Relationships and connections that can influence regulatory decisions or provide access to favorable terms can be considered key resources for some businesses.

  8. Contracts with Key Partners: Agreements with suppliers, distributors, or other partners that provide favorable terms or exclusive access to products or services can be key resources. For example, a fashion outlet might rely on its contracts with fashion producers.

    These resources are the building blocks that enable a business to function effectively and should be managed carefully to ensure the company's long-term sustainability and competitive advantage

Examples value propositions

  1. Slack: Slack's value proposition is its simple, easy-to-use platform and instant messaging capability that facilitates collaboration for teams, regardless of the complexity of a project or everyday barriers.

  2. Airbnb: Airbnb's value proposition is its platform that connects people who want to rent out their homes with people who are looking for accommodations in that locale. It provides a unique travel experience at any price point.

  3. WordPress: WordPress offers a value proposition of enabling users to create a website in minutes. It provides an easy-to-use platform for website creation and management, making it accessible to users with varying levels of technical expertise.

  4. Domino's Pizza: Domino's Pizza's value proposition is its guarantee of delivering hot, fresh pizza within 30 minutes, or else it's free. This promise of short delivery time appeals to customers who value quick service.

  5. HubSpot: HubSpot's value proposition is its easy-to-use Customer Relationship Management (CRM) platform that integrates all the tools needed for marketing, sales, and customer service.

  6. Fjällräven: Fjällräven, a Swedish outdoor clothing and equipment company, offers durable, timeless, and functional products as its value proposition. This appeals to customers who value sustainability and outdoor adventure.

  7. Bloom & Wild: Bloom & Wild, a flower delivery company, offers a value proposition of delivering fresh, carefully packaged flowers through the letterbox with next-day delivery. This appeals to customers who value convenience and thoughtful gifting.

  8. Juniper Print Shop: Juniper Print Shop's value proposition is its affordable, downloadable art prints that customers can print in various sizes to suit their needs. This appeals to customers who value affordability and flexibility in home decor.

  9. Found My Animal: Found My Animal, a pet accessory brand, offers a value proposition of promoting animal adoption through a distinctive line of handmade accessories. This appeals to customers who are pet owners and animal welfare advocates.

These examples illustrate how a value proposition can be based on various factors such as product performance, newness, customization, design, brand/status, price, cost reduction, risk reduction, accessibility, or convenience

Examples customer segments

Customer segments in the Business Model Canvas are the different groups of people or organizations an enterprise aims to reach and serve. These segments are defined by shared characteristics, needs, or behaviors, and they significantly influence the organization’s strategy and value proposition. Here are some examples of customer segments:

  1. Mass Market: This segment does not distinguish between different customer groups and focuses on one large group of customers with broadly similar needs and problems.

  2. Niche Market: This segment targets a specific, specialized customer group. For example, a company that provides high-end audio equipment for professional musicians.

  3. Segmented: Different segments within a market are targeted, with slightly different needs or problems. For example, a car manufacturer offers different car models based on varying customer needs such as economy, luxury, or utility.

  4. Diversified: This segment targets two unrelated customer segments with very different needs and problems. For example, a company like Amazon that serves both consumers and businesses.

  5. Multi-Sided Platforms (or Markets): This segment serves two or more interdependent customer segments. A credit card company, for example, needs a large base of cardholders and a network of merchants who accept the card.

  6. Geographic: Customers are segmented based on their location, from country level down to suburb or zip code, depending on the purpose and available data accuracy.

  7. Demographic: Segmentation based on age, gender, family situation, income, occupation, and other demographic factors.

  8. Behavioral: Segmentation based on customer behaviors, such as spending habits, brand interactions, and product usage.

  9. Psychographic: Segmentation based on lifestyle, interests, attitudes, and values.

  10. Needs-based: Segmentation based on specific needs or jobs to be done that customers are trying to address.

Examples customer relationships

  1. Transactional: This means there is no real relationship between the company and the customer. The company interacts with the customer on a transactional basis. For example, a kiosk at an airport usually doesn’t establish a relationship with its customers.

  2. Long-term: This means a long-term and maybe even deep relationship is established between the company and the customer. The company interacts with the customer repeatedly, fostering loyalty and trust. Subscription-based services with regular interactions often have this type of relationship.

  3. Personal Assistance: This relationship is based on human interaction. The customer can communicate with the company's employees for assistance during the sales process or after the purchase. This can be done in person, by phone, or through email.

  4. Dedicated Personal Assistance: In this type of relationship, a dedicated customer representative is specifically assigned to handle all the needs and questions of a particular customer. This is common in the B2B sector, where clients require extensive support.

  5. Self-Service: In this type of relationship, the company maintains no direct relationship with customers. Instead, it provides all the necessary means for customers to serve themselves, such as user-friendly interfaces and automated processes.

  6. Automated Services: This involves the use of automated processes to recognize individual customers and their characteristics, and to provide a tailored service. For example, Amazon recommends books based on previous purchases.

  7. Communities: Some companies encourage customer loyalty and engagement by creating online communities that offer a platform for customers to interact and share experiences.

  8. Co-Creation: This involves customers in the process of value creation. For example, some companies allow customers to customize their products online, or suggest new product features..

These relationships are designed around three major goals: customer acquisition, customer retention, and upselling. The type of customer relationships a company establishes can deeply influence the overall customer experience

Examples cost structures

The Cost Structure in the Business Model Canvas refers to the major costs and expenses associated with operating a business. It's an essential component that helps businesses understand their financial needs and plan for profitability. Here are some examples of cost structures:

  1. Fixed Costs: These are costs that do not change with the level of output or sales, such as rent, salaries, and insurance.

  2. Variable Costs: These are costs that change directly with the level of output or sales, such as cost of goods sold, direct labor costs, and sales commissions.

  3. Economies of Scale: These are cost advantages that a business enjoys as its output expands. Larger companies often benefit from economies of scale through bulk purchasing discounts or more efficient manufacturing processes.

  4. Economies of Scope: These are cost advantages that a business enjoys by producing a wide variety of products rather than specializing in just one product.

  5. Cost of Revenue: This includes the direct costs tied to the production and distribution of a company's products or services.

  6. Research & Development / Product / Technology: This includes costs associated with maintaining and improving a company's products or technology.

  7. Sales & Marketing: This includes personnel costs for sales and marketing activities, as well as costs for advertising and promotional campaigns.

  8. Operational Costs: These encompass expenditure related to employees, infrastructure, activities, and partnerships.

These cost structures are influenced by the company's key activities, key resources, and key partnerships. Understanding and optimizing the cost structure is essential for achieving profitability and long-term sustainability

Examples channels

  1. Advertising: Utilizing newspapers, magazines, TV, Google Ads, and Facebook Ads to actively gain awareness for your product.

  2. Sales Network: A network of sales professionals or affiliates who sell the company's products or services.

  3. Wholesalers: Companies that buy products in bulk and sell them to retailers or other businesses.

  4. Online Retailers: E-commerce platforms or websites where products are sold directly to consumers.

  5. Own Internet Sales: The company's website or online store where customers can purchase products or services directly.

  6. Signage: Physical signs or billboards that advertise the company's products or services to passersby.

  7. Customer Acquisition Channels: These often include sales and/or marketing channels that are designed to attract new customers.

  8. Sales Channels: Including support and after-sales service, these channels focus on the actual selling of products and services.

  9. Value Delivery Channels: These may include interaction, transaction, and intermediation channels, for example between the demand and supply side of platform business models.

  10. Customer Retention Channels: Channels that are used to keep existing customers engaged and loyal to the brand.

  11. Google Ads: Digital advertisements placed through Google's advertising network.

  12. Direct Communication: Channels for direct communication with customers, such as email, phone calls, or in-person meetings.

These channels are chosen based on the company's Value Proposition, Customer Segments, and the overall strategy for reaching and serving customers. They are integrated into the customer's routines and are assessed for their effectiveness and cost-efficiency

Examples revenue streams

Revenue streams in the Business Model Canvas represent the various ways in which a business generates income from its customer segments. Here are some examples of revenue streams:

  1. Asset Sale: This is the most direct way of generating revenue by selling ownership rights to a physical product. For example, a car manufacturer like Fiat sells automobiles.

  2. Usage Fee: Revenue is generated by the use of a particular service. The more the service is used, the more the customer pays. This is common in utilities like water or electricity, or in phone companies that charge by the minute.

  3. Subscription Fees: This involves charging a recurring fee for continuous access to a product or service. Examples include media streaming services like Spotify or Netflix, where customers pay a monthly fee.

  4. Renting or Leasing: Companies earn revenue by providing customers temporary access to an asset. An example is an equipment rental service where customers pay to use machinery for a limited time.

  5. Licensing: Revenue is generated by allowing customers to use protected intellectual property in exchange for a fee. This is common in the software industry, where companies like Microsoft license their software to users.

  6. Brokerage Fees: This revenue stream comes from intermediation services between two parties. Real estate agents and stock brokers typically earn money through brokerage fees.

  7. Advertising: Companies can generate revenue by offering advertising space on their platforms. For example, Google and Facebook earn a significant portion of their revenue through advertising.

  8. Freemium: This model offers a basic service for free while charging for premium features. Many software companies, like LinkedIn, use this model to attract a large user base and then upsell advanced features.

  9. Data Selling: Companies that collect data may generate revenue by selling this information to other businesses interested in the insights.

These revenue streams can be transaction-based, resulting from one-time customer payments, or recurring, based on ongoing payments for continuous service or product access