A fantastic idea and your willingness to develop your startup may not be enough to succeed. Why?
Your plan is great, but it changes in your mind over time, and you may forget about the underlying assumptions in your project and change them without in-depth, customer value analysis.
As a result, you have a big mess in your head, which may lead you to go off the business rails and make it impossible to make your dreams a reality. Now, you may ask, how do I avoid this? My answer is Business Model Canvas.
Business Model Canvas is a simple business model. It helps you to answer the most significant questions and make a recipe for going viral. Your canvas lets you have everything about your business on only one piece of paper wherever you are.
The Business Model Canvas contains nine (only the most important) elements:
1. Customer Segments
Find the answer as to who is your customer and what he/she is thinking, seeing, doing and feeling. This is where you should step into your customer’s mind. Research everything about them, their life and family. That is the first step for your product to meet your customers’ needs. Find the solution and personalise your product.
2. Value Propositions
Discover your product’s value. The reason why your potential client should buy, use or subscribe to it. Example? Lower price or more convenient use than your competitors’ products.
This is how you provide the information to your clients. In short, it is a sales and marketing journey – the method determining how you will promote, sell, deliver and communicate about your product. Places where customers can find or share information about the product.
4. Customer Relationships
This area is about how you interact with the customer through their product (customer care) journey. Is it personal or not? Phonecall, email or maybe Social Media?
Do they need support or not? If yes, then what does the support involve? Places where users have contact with the product.
5. Revenue Streams
The primary goal of your business is to earn money. It has to be profitable. Now is the time to estimate the amount of money you can make for your product values and how much people can pay for it. Should your product be free or not?
6. Key Activities
Define the activities (things to do) required to deliver fundamental product values. For example: learning about your product’s users.
7. Key Resources
Create a list of resources for performing activities and delivering key product values. What unique assets must the business have to compete?
8. Key Partnerships
Think about what your business needs, what you have to do in-house (more cost-effective for you), and what business relationships you need.
9. Cost Structure
Estimate the main factors of cost. How high are your costs? Compare your costs with your revenue.
Analyse your idea, and figure out your business. Start by answering these questions:
Does it make sense?
Could it be better?
You should also look at the competitive environment and think about your long-term advantage.
When everything is leading you to success, Canvas could be the best tool to keep your business on the right track. So do not hesitate, download an interactive Business Model Canvas here, and make the first step in starting your own company.