Sunday, July 14, 2024
Business

Business Model Canvas: Unlocking Business Success

If you are thinking about starting a new business, you should be familiar with the Business Model Canvas. If you are unfamiliar with it, allow me to explain. Business Model Canvas is a technique that highlights the value that business models provide to clients while visualising and analysing them. Customer segmentation, value proposition, channel, customer relationship, revenue stream, key activities, key resources, key partner, and key structure are its nine components.

Allow me to further explain the Business Model Canvas

Customer segmentation

Customer segmentation in Business Model Canvas is to know who your customer or consumer will be. There are these four points that will help you find your customer.

  • Geographic segmentation: You have to define your customer by geography, including nation, city, region, and even the distinction between urban and rural locations.
  • Demographic segmentation: In demographic segmentation, you need to group your customers by age, ethnicity, religion, gender, educational level, and income, among others.
  • Behavioural segmentation: Divides up the consumer base according to criteria such as past purchases, brand loyalty, product use, and advantages desired.
  • Psychographic segmentation: You need to be specific about the kind of consumer you are targeting in terms of personality, lifestyle, social standing, interests, and opinions.

Value proposition

The value proposition is why the customer should come to you and not go to another business. What is so special about your product or service that you are providing? 

Channel

Channel in the Business Model Canvas is how you will reach your customers to let them know about your products. In a simple way, How will you make your customers aware of your product or service. 

Customer relationship 

Knowing how to keep up a relationship with your consumer is something you should be aware of. A company must be clear about the type of connection it aims to establish with every consumer group. 

Revenue stream

Revenue stream in the business model Canvas represents the money that a business makes from every customer segment (profits are the result of removing expenses from sales).

Key activities

The key activities are essential tasks that you will be doing to promote your business. In addition, certain key activities are required for each company to grow and promote its business.

Key resources

The key resources are the resources that you will need to run your business, such as Apps for your business or it can be stores or both. Additionally, they include the labour you might need, the capital you will be investing in, and similar things.

Key partner

Partners are the people who will help you with your business, for example, the supplier that you might need or distribution partners in the supply chain. But remember one thing: your shareholders will not be key partners here.

Cost structure

The cost structure is all the expenses you will need to start a business and properly run it.

Business Model Canvas
Source: edrawsoft.com

In Conclusion

The Company Model Canvas is an effective tool for creating and visualising company plans. by concentrating on nine major points. It helps businesses better understand their processes, make the most use of their resources, and produce value. Long-term success depends on this framework’s promotion of sustainable growth and strategic clarity.

Luzon Technologies

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