April 16, 2012
IDEO.org Fellow Emily Friedberg considers various business model prototypes that the team will test on the ground in Nairobi over the coming weeks.
As we prepare to head to Nairobi, we’ve been thinking about a whole range of business model possibilities and trying to figure out which models (or pieces of models) will help us design the most successful prototypes for the water, hygiene and nutrition business we’re working to create. The goal of creating prototypes, big and small, is to start to understand how people think about the hypothesized value proposition, how they prefer to have different kinds of products delivered, what bucket of products and services they value most, and what they’re willing to pay.
To begin the prototyping process, we brainstormed all sorts of potential business models for selling water, hygiene, and nutrition products as part of one business -- from a bricks and mortar store front, to roving trucks, to door-to-door sellers. We also thought through various payment, distribution, and product bundling options. We eventually decided on several key models that will be provocative and interesting to prototype with consumers in Nairobi over the next few weeks.
Before departing for Kenya, we also spent time breaking down our potential business models into their component parts so that we can test what works and what doesn’t work. Some of the questions we’ll be asking once we get arrive in Kenya include:
- Product mix: what product or combination of products or services are we selling?
- Delivery mechanism: how will we deliver the product or service to our customer?
- Payment mechanism: how and how much will customers pay for the product or service?
- Revenue model: what is our overall revenue model including distribution, alternative revenue streams, and financing?
- Value proposition: what is the message we are selling to our customers with our model and branding?
- Customer capture: how do we inform and reach our customers?
- Sales force: what does our sales force look like and what incentives are in place to encourage sales and social impact?
- Competition: what is the competitive landscape and how will we compete?
- Suppliers: Who are our suppliers? What does distribution and logistics look like?
By breaking down the pieces of the business model in this way, we were able to come up with several prototypes that will hopefully help us answer each of our questions above. For example, we’re seeking to understand whether a subscription service is something people might be interested in for individual products and then for various bundles of products and services. We’ll be on the ground in Nairobi for the next two weeks finding answers to these questions and many others. Stay tuned for updates!