Value acceleration is not the only goal of your business model. The second key goal of your business model is to screw the competition. No, that’s nasty and unethical. Let me rephrase that, the goal of your business model is to make your competitors business models increasingly inefficient and ineffective.
Amazon Prime is an example of deliberately weaponizing a business model. The Apple app store did the same, as is Google’s suite of peripheral products feeding data into it’s search algorithms.
Would the product work just as well without these? Pretty much. Users wouldn’t see much difference, but the impact that they have on businesses trying to compete with them is chilling.
So, when we are designing a business model part of our time has to go on creating and maximising value. The other part has to go on how do we disrupt other business models so that our business has the space to flourish.
Oak trees poison the ground around them to kill off competition. In most markets there are so many competitors that if you don’t take this approach then one or more will copy every aspect of your product, quality and price and you are then back where you started.
When you design your business model ask whether you are going to be seen as item 32 in your competitors board meeting, or as an existential threat. If you are an existential threat, which you should be, how do you stymie the main thrusts of their counter attacks.
Tesla’s direct to consumer sales does this to traditional car manufacturers. They have the choice of abandoning a 100 year old distribution model and having to compete on the same footing as Tesla in a new channel, or ceding it to Elon Musk. Unpalatable either way.
How are you going to force your competitors to be in the similarly awkward position of having to rip their business apart to stay in the game?
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Denis Oakley & Co designs disruptive business models for companies of all sizes
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Above all keep questioning, keep challenging assumptions!
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