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Could you list all of the key building blocks you need to develop, manage, maintain,
market, and sell a product on a single sheet of paper? With the business model
canvas you can! Using the business model canvas approach is a great way to force
yourself to focus on the most strategically important elements of your product. As
the name suggests, the typical use case for this tool is to outline the fundamental
building blocks of a business, but it also can work really well for a product.
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5/19/2020 Business Model Canvas: Definition, Benefits, and Examples
Today we’ll show you how the business model canvas works and how you can use it
to come up with a high-level product strategy.
The categories or buckets contained in a canvas can be customized. But most will
look similar to the one here—covering such key areas as:
TheWant
product’s value
to build × it does and promises)
propositions (what
better
roadmaps?
Customer segments (who it’s for)
Download
Key activities our book
(the steps the team must complete to make it successful)
Key resources (what personnel, tools, and budget the team will have
access to)
Customer relationships (how the team will support and work with its
customer base)
Cost structure (what it costs to build the product as well as how to sell
and support it)
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5/19/2020 Business Model Canvas: Definition, Benefits, and Examples
If you think about it, that’s a fairly comprehensive set of building blocks you’ll need
to think through for your product before you begin developing it. There will certainly
be additional factors that’ll affect your strategy, but if you can fill in these high-level
details—which, as you can see, should fit comfortably on a single page—you’ll have a
useful strategic guide for developing your product roadmap.
(https://www.productplan.com/building-your-first-product-roadmap/)
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5/19/2020 Business Model Canvas: Definition, Benefits, and Examples
There are plenty of reasons. But simply put, you can think of a business model canvas
as a mission statement for your product roadmap. It’s a handy reference you can
refer to to make sure your roadmap always reflects all the strategic elements needed
for your product’s success.
Our co-founder Jim Semick has a couple of great short videos explaining the
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business modelWant toconcept,
canvas build better
which you can check out in the player below.
roadmaps?
10:37
As Jim explains, here are a few of the benefits of using a business model canvas to
think through product strategies:
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5/19/2020 Business Model Canvas: Definition, Benefits, and Examples
This way, rather than trying to write out every detail about your product plan
beforehand, you can just document the highlights—and then you can get rolling
translating the canvas into your product roadmap.
These meaty plans included detailed cost estimates, revenue projections going years
into the future, and long-term plans for growing the staff. How could any of that
remain accurate for long?
In product terms, you can think of the business plan as resembling an MRD (Market
Requirements Document). It’s long, detailed, and probably mostly untrue by the
time it’s done.
But because you can put a canvas together so quickly, it will much more accurately
reflect your strategic thinking and your company’s current reality. And if things
change, it’ll be easier than a long and detailed plan to adjust. Which brings us to
Jim’s third benefit…
With a one-page business model canvas acting as the strategic undergirding for your
roadmap, you’ll always be able to quickly spot any items or plans that need updating
whenever priorities change or new realities demand that you adjust your approach.
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5/19/2020 Business Model Canvas: Definition, Benefits, and Examples
Imagine that as they were talking through what belonged in the “Revenue Streams”
bucket of the business model canvas, Amazon’s Echo team came up with three
sources of revenue to start with:
2) Using the device to sell other stuff as customers ask it to connect to the Amazon
marketplace. (“Alexa, please add laundry detergent pods to my shopping cart.”)
Now, if the Echo product team put these on their business model canvas, they’d
know that they need to make room for budget, time, and resources on their product
roadmap for all of these revenue streams.
It’s easy to write. But how are you going to translate that “word-of-mouth” strategy
into an actual plan?
Maybe you’ll need to budget time and resources for developing things right into your
product that make it easier for users to share their experiences with friends, such as
a handy tool to help them tweet about it. Maybe you’ll even want to include an
“Invite a friend” feature that lets users easier send a trial license to friends, or a
couponing feature that offers some reward to a user who brings in two more users.
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5/19/2020 Business Model Canvas: Definition, Benefits, and Examples
The point is, your business model canvas can serve as a great strategic reminder of
the things you’ve determined are important enough to make it onto your product
roadmap.
So you can always look back and see immediately—it’s just one page, after all—if
you’re still working on all of the essential elements of your product, or if you’ve
inadvertently strayed from them and gotten lost in the wrong details.
That’s why we’re big proponents of the business model canvas approach to guiding
your product roadmap (https://go.productplan.com/trial).
Do you have an opinion about using the business model canvas approach for
developing and documenting your product’s strategy? Feel free to share them
in the comments section.
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