Marketing Management

Professor Ashis Mishra

Business Model Templates

Let me talk about business model and its template in little details. A business model template typically
has nine different blocks or constituents. They are the customer segment that is who is the customer,
the value proposition that is what is value to the customer, the various channels that is how to reach
the customer both physically, as well as emotionally, or cognitively.

And the fourth component is customer relations, how to develop and maintain relationships with the
customer. Fifth, revenue stream. What will be the revenue cost and hence the net earnings? Sixth, key
resources. What assets are required to deliver this value? That is physical resources, financial
resources, manpower resources, intellectual resources whatever kind of resources.

Seven, key activities. What activities need to be carried out to provide value to the customers? That is
manufacturing, or retailing, or consulting, or supply chain, what kind of activities? Then the eighth
component is key partnerships. What activities you do in-house and what you outsource? And if you
outsource, to whom do you outsource?

And the ninth component is the cost structure. What are the different costs incurred to operate the
business? That is the fixed cost, the variable cost, and eventually the economy of scale etc.

So this can be represented pictorially, which I will show it to you, and also, I'll explain to you how this
is relevant to a marketing organization.

So here if you look up to it, each of these nine key blocks has been put into the template. So if you
look at -- start from the left, key partnerships, it explains what do you do in-house and what do you
do outsourcing? So, typically, for a business which is based on marketing, it will involve the suppliers,
the manufacturers, the third-party logistics.

If you look up to the key activities then for a marketing organization, the key activities will be
manufacturing, retailing, logistics, supply chain.

If you are looking at key resources, what will be the key resources for a marketing organization? It
would be brands. It would be customer databases. It will be manpower who run the business, the
distribution network which is very important for marketing, the financial power to run the business,
launch new products, launch new brands, reach out to new customers.

If you look up to the value proposition, very significant, what is value to the customer? What will
satisfy the customer? So, typically, if you look up to a marketing organization or different products
and brands, why do people buy the products and brands? So that typically would be price conscious
consumers, or value conscious consumers, or experience seeking consumers, or luxury seeking
consumers. Essentially what I'm talking about here is we are talking about different type of consumers
and different key parameters or different key propositions of the marketing organization that attracts
the customers.

So that will lead to the obvious things, who are the customers? Geographic, demographic,
psychographic, behavioral, different type of consumer segments, how to establish relationship with
the customers and of course the channels that is distribution network, store formats, online formats,
the different promotion that is the emotional connect.

So these are the different attributes of a business model. Apart from that, of course, we will be talking
about the cost and the revenue streams. So this is quite relevant for a marketing organization.

© All Rights Reserved. This document has been authored by Professor Ashis Mishra and is permitted for use only within the cours e "Marketing
Management" delivered in the online course format by IIM Bangalore. No part of this document, including any logo, data, illus trations, pictures,
scripts, may be reproduced, or stored in a retrieval system or transmitted in any form or by any means – electronic, mechanical, photocopying,
recording or otherwise – without the prior permission of the author.
 Marketing Management
Professor Ashis Mishra
Business Model Templates

So what happens is this business model that I have spoken about is a

generic business model. It is applicable to any kind of organization. So if you apply this to a
marketing-based organization, you are aware of and you get to realize how this business works.
What you get to realize is this organization survives, is it because of the customers, is it because of
the value proposition, is it because of technology, is it because of distribution network that it is being
able to reach the customer more in comparison to the competitors? So you also get to appreciate
the position or the significance of marketing in the business.

© All Rights Reserved. This document has been authored by Professor Ashis Mishra and is permitted for use only within the cours e "Marketing
Management" delivered in the online course format by IIM Bangalore. No part of this document, including any logo, data, illus trations, pictures,
scripts, may be reproduced, or stored in a retrieval system or transmitted in any form or by any means – electronic, mechanical, photocopying,
recording or otherwise – without the prior permission of the author.