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My students apply concepts from my (Jeff Funk) course on business models to "Catchbox," which is a portable wireless microphone. Since it can be easily thrown and caught, it can be used in large conference or class rooms to facilitate participation from the audience.
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Project presentation MT4002 Technology Management Strategy
Liisa Hakala Tuomas Hervonen Jarno Hilvenius Essi Puustinen Ekku Rytkönen
Agenda
1. Introduction to Catchbox
2. Value proposition
3. Customer selection
4. Value capture
5. Scope of activities
6. Strategic control
6th Nov 2012 2
INTRODUCTION
6th Nov 2012 3 INTRODUCTION
VALUE PROPOSITION
CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
(CatchBox web page, 2012)
The Company • Participated in the Finnish
“Summer of startups” program
• 10 weeks internship program of Aalto Entrepreneurship Society
• End result was their product: Catchbox
• Business plan is still in progress – Our goal was to design a
business plan for the company
– Everything from this slide onwards is created by our group
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
VALUE PROPOSITION
6th Nov 2012 5 INTRODUCTION
VALUE PROPOSITION
CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
(CatchBox web page, 2012)
Catchbox
• Throwable wireless microphone
– no-one has to run around with a traditional microphone
• Engages the audience
– Breaks the ice
– Sparks discussion
– Helps sharing ideas
– Increases interaction
• Fun to throw, easy to catch
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
“Best new device for crowd Q&A I’ve ever seen.”
Doug Richard, (Dragons den UK &) School for Startups, London
Value of Catchbox
• For lectures:
– Its hard to maintain the attention of the audience
– Catchbox keeps students on their toes and awake
• Enhanced discussion
• Better Q&A sessions
• Improved learning experience
– How would the curve look like when using Catchbox?
6th Nov 2012 7
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
(Mills, 1953)
class paying full attention %
time, min
Disadvantages
• Takes attention and focus to the wrong place
• Creates too big fuss when used for the first time
• Microphone flies to difficult place or a corner
• Someone does not know how to catch
– Could be embarrassing?
• What if Catchbox knocks off coffee or something else?
– Who is responsible?
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Technical Details
• Product includes – Wireless transmitter – Motion sensor – Microphone – Design-cube shaped cover
• Not easy to break • Easy to plug-in to a system • Microphone switched off when
Catchbox is in the air • Switched on when catching/landing
INTRODUCTION
VALUE PROPOSITION
CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Technical Assumptions
• A lot of strategic questions were left unanswered
• Resulting technical assumptions
– Cover can be changed
– Open from side when needed to switch on/off
– Can be sold with or without the transmitter
– Charging by changing battery
INTRODUCTION
VALUE PROPOSITION
CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
CUSTOMER SELECTION
6th Nov 2012 11 INTRODUCTION
VALUE PROPOSITION
CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
What is the customer like?
• Curious
• Innovative
• Interactive-freak
• Adventurous
• Not too serious
• Desires to improve
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Who would be the user?
• Universities
• Executive education organizations
• Comedians
• Magicians
• Firm events
• TV shows
• All kinds of speakers
• (Sponsor firms)
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
“This is the first time that a group has proposed a technology that might help me in my job! Good topic.”
Jeff Funk, MT4002, NUS
(NU
S w
eb p
age,
20
12
)
Segmentation
• Service Providers
– Companies that provide organizations with audio-visual systems in their facilities
– Turnkey style service includes all equipment, installation and later on maintenance
• Direct Buyers
– Companies or individuals that deliver speaches in a variety of situations
– Key issue is mobility
– For example guest lecturers, consultants, etc.
Two big segments:
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Segmentation
• Service Providers
+ Not price sensitive
+ Need to convince only the provider
+ Bulk buys
− Market penetration is hard
− Long delivery chain
• Direct Buyers
+ Greater volumes initially
+ Easier market penetration
+ Might start hype reaction
− Need of substantial marketing efforts
Pros and cons:
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Differences in needs
• Service Providers
– Professional quality
– Assembly is not a problem
– Stationary usage
• Direct Buyers
– Need easy connectivity
– Ready to use
– Mobile usage
Two big segments:
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
VALUE CAPTURE
6th Nov 2012 17 INTRODUCTION
VALUE PROPOSITION
CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Value capture methods
• Two main sources of revenue – Online sales (Direct buyers)
– Service Providers
• Online sales – The sales occurs through our websites
– Customer can pay with • Credit/debit
• PayPal Express Checkout
• Service Providers – Pay directly to us
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Cash flow in the value network
DIRECT BUYERS
PURCHASING THE PRODUCT FOR THEIR
OWN USE
SERVICE PROVIDERS
INDIRECT CUSTOMERS
PURCHASING A SYSTEM THAT THE PRODUCT IS A
PART OF
CATCHBOX
TECHNOLOGY ASSEMBLY COMPANY
COMPONENTS
SUPPLIER 1
SUPPLIER 2
SUPPLIER 3
TEXTILES & COMPONENT S
SUPPLIER 1
SUPPLIER 2
SUPPLIER 3
COVER MANUFACTURING
COMPANY
Payment service provider
Banks
PayPal
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Catchbox´s net profit margin is ~50%
0 %
10 %
20 %
30 %
40 %
50 %
60 %
70 %
80 %
90 %
100 %
Catchbox cost structure
Net profit
Costs
Inclusive of textiles, hardware system, logistics, inventory, payment service provider, labor
Sales price 300 €
(Houston chronicle web page, 2012)
SCOPE OF ACTIVITIES
6th Nov 2012 21 INTRODUCTION
VALUE PROPOSITION
CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Setting up operations
• Catchbox is a startup
– Small company
– No/Fuzzy infrastructure at the moment
– Limited resources
• One product Narrow horizontal integration
• Outsource rather than do Low degree of vertical integration
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Activities to carry out
• Catchbox acts as the designer – Cover design and technical aspects of the product – Some logistics administration and inventory of
technology units and covers
• Manufacturing is outsourced – Cheap components and technology assembly (China?) – Finnish cover manufacturer Finnish quality
recognition and the brand value
• In the case of our business growing – Logistics company to manage logistics and inventory Catchbox holds only design functions
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Order information flow
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
SERVICE PROVIDERS
INDIRECT CUSTOMERS
PURCHASING A SYSTEM THAT THE PRODUCT IS A
PART OF
DIRECT BUYERS
CATCHBOX
TECHNOLOGY ASSEMBLY COMPANY
COMPONENTS
SUPPLIER 1
SUPPLIER 2
SUPPLIER 3
TEXTILES & COMPONENT S
SUPPLIER 1
SUPPLIER 2
SUPPLIER 3
FINNISH COVER MANUFACTURING
COMPANY
PURCHASING THE PRODUCT FOR THEIR
OWN USE
Material flow
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
SERVICE PROVIDERS
INDIRECT CUSTOMERS
PURCHASING A SYSTEM THAT THE PRODUCT IS A
PART OF
DIRECT BUYERS
CATCHBOX
TECHNOLOGY ASSEMBLY COMPANY
COMPONENTS
SUPPLIER 1
SUPPLIER 2
SUPPLIER 3
TEXTILES & COMPONENT S
SUPPLIER 1
SUPPLIER 2
SUPPLIER 3
FINNISH COVER MANUFACTURING
COMPANY
PURCHASING THE PRODUCT FOR THEIR
OWN USE
Activities to carry out
• Marketing and promotion – In the absense of resources marketing has to be
modern and clever – Marketing through social media such as Facebook and
Twitter – Participating in public events with media coverage – Promotion through the customers
• Direct buyers promote Catchbox by using it and getting the word out
• Service providers can promote the new product to their customers Added value to their offering by having a product their competition lacks
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Examples
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
• Promotion in events:
– Finnish Municipal Elections debate 2012 (YLE)
Examples
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
• Promotion by speakers:
– Linus Torvalds in Aalto University (EIT ICT Labs)
STRATEGIC CONTROL
6th Nov 2012 29 INTRODUCTION
VALUE PROPOSITION
CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Strategic Control
• Competitive advantages
– Nothing similar available
– Finnish design
– Professional buyers
• Trust quality products
– Niche product (Avainlippu web page, 2012)
Complementary Assets
• Needed technology already available
– design concept product
• Production can be easily outsourced
• Need to broaden supplier base
• Licensing contracts with cover providers and designers
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Protecting the product
• Patenting design
• Trademark
• Retaining high quality
– Demanded by professional buyers and users
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
Future possibilities
• Larger version for catching the atmosphere in larger events
– e.g. crowd surfing Catchbox in concerts
• Advertisements on the cover
• Company-tailored covers
• Catchbox with camera
INTRODUCTION VALUE
PROPOSITION CUSTOMER SELECTION
VALUE CAPTURE
SCOPE OF ACTIVITIES
STRATEGIC CONTROL
THANK YOU!
Next: 5 minutes for questions
Go!
(Rapgenius web page, 2012)
References • Cover slide background picture
– http://www.talouselama.fi/Kasvuyritykset/pehmea+mikrofonikuutio+lensi+yleison+sydamiin++startup+loi+valmiin+tuotteen+2+kuukaudessa/a2139106 , last used 17.10.2012
• Catchbox related pictures and Cite from Doug Dichard – www.thecatchbox.com, last used 17.10.2012 (First blue one original, other own mock-ups)
• Attention graph on slide 7 – Mills, H. R., Techniques of technical training, Cleaver-Hume Press, London, 1953.
• Photo of Jeff Funk on slide 13 – NUS Faculty of Engineering Staff profiles, http://www.eng.nus.edu.sg/etm/staff/Funk_JL.htm, last
used 17.10.2012.
• Estimated margins for Catchbox on slide 20 – http://smallbusiness.chron.com/average-profit-margin-small-business-23368.html, last cited
10.10.2012.
• Finnish Municipal Elections debate 2012 on slide 27 – screen capture: YLE broadcast, 21.10.2012
• Linus Torvalds public speech on slide 28 – screen capture: EIT ICT Labs live webcast, 23.10.2012
• “Design from Finland” figure on slide 30 – http://www.avainlippu.fi/liiton_merkit/design-finland, last used 15.10.2012
• Borat picture on slide 34 – http://s3.amazonaws.com/rapgenius/1291131680_two-thumbs-up.jpg, last used 17.10.2012.
Back up slide: Level of margins
• There are four types of wireless microphones: • headset microphone
• lavalier/lapel microphone
• handheld microphone
• The price ranges for each product type falls roughly into the following categories (source: myshopping.com.au):
• 7-80 €
• 80-240 €
• 240-480 € (Catchbox)
• 480-1600 €