Basic Elements of a Business Model

Select features embedded in product or service

Determine benefit to the customer from using the

product or service

Identify market segments to be targeted

Confirm available revenue streams

Design mechanisms to capture value

In the simplest terms, a Business Model is how a business makes money.

This introductory presentation is intended to introduce a framework for further thought and discussion through which AIRN will define its Business Model.

EMBEDDED SERVICES -- MEMBER BENEFITS

AIRN services must have features which its members perceive as valuable (i.e., as beneficial to them).

It is important to remember that members pay dues or fees because they want to solve a problem or meet a need. Members, whether openly or not, will always be asking the question, “What’s in it for me?”

Features are what the service provides. Benefits are the reasons members pay for the service.

Successfully and sustainably developing AIRN requires that its services meet member needs.In most cases, the only thing your customer

is thinking is, "What's in it for me?" The thing your customer cares about is, "Will this work for me?“

Just because you are partial to a particular service does not mean the market will share your feelings.

To be sustainable, AIRN must provide services that meet its members real or perceived needs.

Identify Member Benefits

Segmentation Marketing

Key Market SegmentsMarket segmentation is the subdividing the AIRN membership into a group or groups of people who have similar needs.

It is important to divide members into groups and then decide which services best fit each group.   AIRN also may determine after defining the member segments that the ideal member is one who can belong to two or more of the of the groups shown in the chart and discussed in the next slides.   

The “Golden Egg”Revenue Streams

The 80/20 rule: 20% of AIRN service will consume 80% of its time; 20% of its services will generate 80% of its income. Analysis can help you see where AIRN can best utilize time and money. 1. For every service AIRN offers calculate the total revenue minus total costs = “profit.”2. In addition to the actual costs, add in the average amount of time spent to deliver each service because time is another form of money.3. Combine the information from steps one and two and identify which services have the highest “profitability.” It will help determine whether or not to provide or continue a member service.

POLITICAL, ECONOMIC, SOCIAL & TECHNOLOGICAL (PEST) ANALYSIS (Example of factors influencing businesses)

SWOT ANALYSIS