Lecture 1: Digital Business Models COPY

Question 1

Magic Triangle of Business Models

Answer 1

Key elements that form the foundation of a successful business model:

• Value Proposition,
  Successful innovation not only benefits the company but also creates value for customers. (Business Model Innovation)
• Revenue Model
  Answers how the business model generates value for shareholders and stakeholders. (Profit Formula / Mechanism)
• Operating Model
  Key Resources and Processes

Question 2

Crowdfunding & Crowdsourcing (4)

Answer 2

Crowdfunding

• Campaign contributors typically receive the raised money only if a specific critical mass is achieved.
• Investors in crowdfunding projects usually receive better rewards with higher contribution amounts

Crowdsourcing
solution of a task or problem is adopted by an anonymous crowd

• Crowdsourcing can foster a positive company-customer relationship through interaction and inclusion.
• Contributors in crowdsourcing may receive rewards, but sometimes none are offered, relying solely on the participant’s personal interest in the topic.

Question 3

Long Tail (2)

Answer 3

The main bulk of revenues is generated through a ‘long tail’ of niche products.

• When a company sells physical products using the “Long Tail” pattern, storage of products can become a problem.
• Successfully applying the “Long Tail” business model pattern requires the ability to handle the complexity of product diversity.

Question 4

Leverage Customer Data & Hidden Revenue

Answer 4

Describes how companies, like Google, ..

use customer-generated data to gain a competitive advantage.

Question 5

E-Commerce Business Model Pattern (2)

• Definition
• Advantages

Answer 5

Traditional products or services are delivered through online channels only,

Advantages:

• Increased reach with minimal additional costs.
• Enables a larger product offering as customers can efficiently search and filter products.

Question 6

Freemium business model pattern? (2)

• Definition
• Difference to the physical world

Answer 6

Freemium models: Limited use plus usage-based charges (pay per use)

Zero additional Production and Distribution Cost

Question 7

In Platform as a Service (PaaS) solutions, certain customer activities are managed by the PaaS solution, while some activities are still managed by the customers.

Please indicate which processes are “self-managed” by the customer and which are managed by the “PaaS”. (4)

Answer 7

PaaS Managed

• Storage
• Runtime

Self-Managed

• Data
• Applications

Question 8

The Value Proposition Map can be considered an “add-on” to the Business Model Canvas.

It maps the section “Value Proposition” to which section of the Business Model Canvas:

Answer 8

Customer Segments