The Business Model Canvas

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What is the Business Model Canvas?

The Business Model Canvas (BMC) is a strategic management tool to quickly and easily define and communicate a business idea or concept.

  • The right side of the BMC focuses on the customer (external), while, the left side of the canvas focuses on the business (internal). 
  • Both external and internal factors meet around the value proposition, which is the exchange of value between your business and your customer/clients.

Value Proposition

It is the fundamental concept of the exchange of value between your business and your customer/clients.
  • Value Proposition is the value exchanged from a customer for money when a problem is solved or pain is relieved for them by your business.
  • It is important to have context around the goals the company is trying to achieve for its Customer Segments and where your business/product/service fits in the value chain.
Good questions to ask when defining your business/product:
  • What is the problem I am solving?
  • Why would someone want to have this problem solved?
  • What is the underlying motivator for this problem?

Customer Segments

Customer Segmenting is the practice of dividing a customer base into groups of individuals that are similar in specific ways, such as age, gender, interests, and spending habits.

Things to consider when determining your Customer Segments:
  • Who are we solving the problem for?
  • Who are the people that will value my value proposition?
  • Are they another business?
  • If so, what are the characteristics of those businesses?
  • Or, are they other people?
  • Does my value proposition appeal to men/women or both?
  • Does it appeal to young adults aged 20 to 30 or teenagers?
  • What are the characteristics of the people who are looking for my value proposition?
To continue...

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