10
Business Models that rocked 2010 Feedback? Comments? Twitter: @nickdemey BoardofInnovation.com
Some people stumbled upon great ways to make money. During 2010 many promising concepts reached a tipping point. Let’s take a closer look at their business models
10 different ideas to make money 27/04/10
10
PatientsLikeMe.com Example case: “The feedback of other patients with similar conditions made 10% switch from doctor. Welcome in the information age. ”
+70,000 patients share medical records*
27/04/10
*xconomy.com/boston/2010/02/10/patientslikeme-growing-as-pharma-customers-boost-focus-on-patients/?single_page=true
27/04/10
The Business Model behind PatientsLikeMe.com a community platform for patients Forget privacy, people are sharing more info than ever, even medical records. By offering a free service PatientsLikeMe can attract thousands of patients.
by BoardofInnovation.com
27/04/10
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The Business Model behind PatientsLikeMe.com a community platform for patients With permission, PatientsLikeMe gathers data that can be resold for huge sums to third parties likes pharmaceutical companies. Simple. Marvelous.
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27/04/10
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9
Flattr.com Example case: “When Paypal, Mastercard and others blocked Wikileaks, the Swedish Flattr donation system kept Wikileaks’ income stream afloat”
1 Wikileaks article led to +3500 donations*
27/04/10
*flattr.com/thing/42799/Afghanistan-War-Diary-2004-2009
27/04/10
The Business Model behind Flattr.com a service to structure donations for content Online readers consume tons of content monthly. Strong content can be ‘flattred’ via a button. (similar to ‘like’ on Facebook)
articles (content) Online content creator
HQ Inc
Reader
Flattr.com
Online content creator articles (content)
Content you've read this month
by BoardofInnovation.com
27/04/10
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The Business Model behind Flattr.com a service to structure donations for content You decide wich fee you give monthly to Flattr.com. Every month, Flattr splits your fee evenly over all creators and takes a 10% commission.
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27/04/10
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8
Groupon.com Example case: “Exclusive deals limited in time made Groupon the fastest growing company ever, leading to hundreds of copy-cats world wide.”
GAP made $11,000,000 within 1 day
27/04/10
*revenews.com/barrysilverstein/will-success-for-the-gap-secure-groupons-first-mover-advantage/
27/04/10
The Business Model behind Groupon.com a broker platform with exclusive discounts Groupon uses a no cure no pay strategy. They guarantee that a minimum number of clients will take the discount that is communicated.
HQ Inc
Inc
Groupon.com
Company Guaranteed number of clients
Buyer Massive discounts 1 deal, 1 city, 1 day
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Buyer
Crowd of buyers
27/04/10
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The Business Model behind Groupon.com a broker platform with exclusive discounts Next, when enough people take the massive discount, the deals goes on. Groupon takes 50% of the revenue resulting from this promotion.
!
HQ Inc
Inc
50% of revenue
Groupon.com
Company Guaranteed number of clients
!
Product
Buyer Massive discounts 1 deal, 1 city, 1 day
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Significantly Less Mone
Buyer
Crowd of buyers
27/04/10
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7
Spotify.com Example case: “In August SONY BMG Sweden confirmed they already made more money out of Spotify music service than iTunes.”
750K paid subscribers are already hooked*
27/04/10
*techdigest.tv/2010/12/spotify_pass_75.html
27/04/10
The Business Model behind Spotify.com an adbased freemium model The basic music streaming service is offered for free to music fans. Advertisers pay to cover the costs.
!
Money
Inc
Advertiser Exposure to music fans HQ Inc
Spotify
Music fan Free music service
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27/04/10
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The Business Model behind Spotify.com an adbased freemium model A small percentage does already pay for a premium service. The 2011 US launch must be the most anticipated music service launch ever.
!
Inc
Money
Advertiser Exposure to music fans HQ Inc
Spotify
Music fan Free music service
!
Monthly subscription €9,99
Music fan Ad-free Premium music service
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27/04/10
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6
PayWithaTweet.com Example case: “Paying with the value of your social network was never more easy. Expect more concepts like this in 2011. (e.g. SocialWhispers.com,...)”
+300,000 people paid already with a tweet*
27/04/10
*vator.tv/news/2010-10-11-pay-with-a-tweet-a-new-kind-of-marketing
27/04/10
The Business Model behind PayWithaTweet pay with the value of your social network More a marketing tool than a business model but remarkable enough to mention. Instead of paying with cash, users buy products with exposure.
HQ Inc
Pay with a Tweet/post
Digital product
Paywithatweet
Online shopper
Twitter users
Facebook friend
Social network
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27/04/10
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The Business Model behind PayWithaTweet pay with the value of your social network Hopefully boosting the viral effect what would result in a better reputation for the initiator. The latter could use this to sell more products later on.
HQ Inc
Pay with a Tweet/post
Digital product
Paywithatweet
Online shopper
1
Twitter users
reputation Pay with a Tweet/post
Digital product
Facebook friend
Social network
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27/04/10
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5
HumbleBundle.com Example case: “Buying indie games and supporting charity is an attractive formula. Being open and transparant helped this pay-what-you-want concept.”
$1,824,408 was raised within 1 week
27/04/10
27/04/10
The Business Model behind HumbleBundle a succesful pay-whay-you-want formula You decide how much you pay. Information of previous buyers (How much do other Mac users pay?) set anchor prices to encourage payments.
!
HQ Inc
Set your own price
Humble Bundle
Gamer Digital games
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27/04/10
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The Business Model behind HumbleBundle a succesful pay-whay-you-want formula To boost sales Humble Bundle gives buyers control on how the money is divided over themselves, charity and other organizations.
!
HQ Inc
!
Set your own price
Humble Bundle
Gamer Digital games
Set % commission
!
Set % donation
! Inc
Set % donation
Charity
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EFF
27/04/10
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4
Free with in-app sales Example case: “The sales of virtual goods has flourished in 2010 and even outperformed mobile ads. 6/10 top grossing iPhone apps can be bought for free.”
80% of revenue comes from in-app sales*
27/04/10
*readwriteweb.com/mobile/2010/10/in-app-purchases-generate-more-revenue-than-ads.php
27/04/10
The Business Model behind In-App sales cross-selling strategy By offering the game (or application) for free they try to get you in. If the experience is addictive, users are willing to pay for extras.
Free mobile game
Addictive Experience HQ Inc
Mobile Game
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Mobile Gamer
27/04/10
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The Business Model behind In-App sales cross-selling strategy Often an intermediate credit system is used to loose the real-world value perception of the virtual goods that can be bought with it.
Free mobile game
Addictive Experience HQ Inc
Credits
!
Mobile Game
Mobile Gamer Money
Digital upgrades & virtual goods
Some credits
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27/04/10
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3
Quirky.com Example case: “Quirky raised the bar for co-creation platforms by paying out influencers. Every week 2 new products are being launched.”
+500 people co-designed 1 new iPad stand*
27/04/10
*quirky.com/products/30-Cloak-iPad-Case
27/04/10
The Business Model behind Quirky.com a co-creation platform + e-shop Inventors pay $99 to submit their idea to this co-creation platform. After selection a community of designers will co-design and improve this product.
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27/04/10
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The Business Model behind Quirky.com a co-creation platform + e-shop Suppliers will set a minimum amount on the pre-sales. If enough people buy this product, it will be go into production.
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27/04/10
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The Business Model behind Quirky.com a co-creation platform + e-shop Revenues from the e-shop are shared with the community. 30% of profit goes to the initiator. 30% will be proportionally divided amongst the influencers.
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27/04/10
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2
Airbnb.com Example case: “In times when more people discover the joy of sharing Airbnb.com, swap.com and others found ways to make some cash on this movement.”
+700,000 nights are already booked*
27/04/10
*airbnb.com/home/press
2
Clickworker.com Example case: “Just like Amazon Mechanical Turk, people world wide are performing micro-tasks gaining micro-payments. ”
+300.000 people paid already with a tweet*
27/04/10
The Business Model behind AirBnb.com a one-sided matchmaking platform With this bottom-up P2P model AirBnb connects normal people so they can rent out spare rooms to eachother. A professional service democratised.
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27/04/10
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The Business Model behind AirBnb.com a one-sided matchmaking platform Depending on the rental price AirBnb takes a commission up to 12%. Other platforms use posting fees when people just swap goods or services.
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27/04/10
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1
Kickstarter.com Example case: “Looking for $15,000 funding? Scott Wilson convinced 13,512 people to pledge money to develop an iPod Nano Watch.”
$941,718 was funded within 30 days
27/04/10
27/04/10
The Business Model behind Kickstarter.com a marketplace for fund seekers First step, give Fund Seekers some exposure so they can connect with a crowd of ‘backers’ who are willing to pledge some money for their ideas.
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27/04/10
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The Business Model behind Kickstarter.com a marketplace for fund seekers Next, people who gave funding to a project idea are being rewarded (small or large) depending on the amount they pledged.
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27/04/10
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The Business Model behind Kickstarter.com a marketplace for fund seekers Kickstarter takes 5% of the funding as a commission.
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27/04/10
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