editor’s note: this article from overseas famous blog strategyzer, Chinese version is compiled from the heavens and the earth will point zhuhai rudder (WeChat public number: techgogogo). In this paper, the author of business model of some common and easy to ignore question has carried on the profound thinking, incisive original understand fairly. Hope that domestic entrepreneurs can reference one, will you take out the business model of burn, take out torture to see if it is really a real gold does not fear the oven fire…
the following for the full text:
a startup fails, the cause of death tend to be diverse. Such as: error of choose and employ persons, the pace is tearing the egg (scale too fast), or ignore the demands of the customers, and so on. In addition, a big reason is that your business model itself is a problem that, and you turned a blind eye, even does not see, you are really NO ZUO NO DIE. I recently with Alex Osterwalder some profound thinking about the question, summarizes some key problems of our business model may be, for everybody reference.
1. Create a customer like I don’t make money products
yes, you take great pains to get out of this product is really looks amazing, with ease, to use the target customer praise, but mum when they asked him to pay, because the price is too high. Why the price is too high? Because the cost is high, and you are calling is not luxury market. So customers can really turn out to be “amazing” — onlookers praise once, and then just stop there. This error looks very conspicuous, but it’s one of the most easy to let us deep in the product in the process of carelessly trample to ensnare the empty one. (editor’s note: this I have had the bitter experience, before creating a private cloud is not convenient to disclose name of products, materials, storage level two 1 t made a raid 1 SSD, the board selected high-end, the material of shell with close to Apple TV. Cost to get rid of several thousand, and ultimately to the customer, all love at hand, asking price, shook his head wave. Because this product positioning is a home storage products, general home users, although there is a corresponding pain points, but who are willing to pay thousands of ocean. Later, baidu cloud, kingsoft cloud group, millet routing, etc., basically is sentenced the death penalty for the product)
2. The user switching costs low market spending too much money to get the user
actually you in order to get the user and a lot of money in it there is nothing wrong, but if the markets you are geared to the needs of the user Switching costs (Switching Cost) is too low, too much spending money in there may be a big risk. Because you may spend large sum of money to get back the user, because another competitor offers a little cheaper price or better experience, maybe they will switch to the other side of the above products. At the same time also want to remind everyone here, we do afterwards remember lego products our technical barriers and user viscosity, so as to raise the user switching costs. Such as our domestic WeChat Wechat do well in this respect, your friends are using WeChat, you have to switch to the Kakao Talk in South Korea or Japan Line, then you should consider your own switching costs: you need to convince your friends with the Line, need to take the pressure of the others say you are traitors, and on and on…
3. For a long purchase (decision) cycle of customer care too much
please beware of we put too much energy on buying the long cycle of audit clients, of course, if they can purchase a large number of products every time, and you have enough money to fight another matter. For example if your main products is the government, they have a big budget, but asked them to finalize the deal between with you often is a protracted war, so you have to consider whether you have enough cash flow, can let you insist to that time, don’t teacher not jie body first dead.
4. Excessive disorderly throw money on the new markets share
when you enter a new market, we can’t really talk about how to capture market share, because our first to the market to make up, this, but a very take the lion’s share of the money. So you don’t like walk into an existing market can easily walk into an emerging market, unless you are very good at fight, can there a way to keep cash flow to people began to learn the value of your product is unique and began buying up so far. As master of innovation, but also the father of the lean startup Steve Blank, if you are in a new market, will have to wait until the target customer began to really realize that they indeed have a demand for your products, wait until the Tipping Point (Tipping Point) is present, your business must be able to withstand several years without any gains a severe test, finally Ming may have a storm comes a month.
5. Targeting those barriers guarded market
although the value proposition of your product unique, but there is a “keeper” thousands of miles away from you in many pay users. The goalkeeper may be individuals, may be a company, or any other one in hand you walk into the key of the market as a single entity organization, and they will do all we can to you. This is why the current old music media services company with music content copyright large shield has been pushed the streaming media service provider to catch the reason. And that is why now locked in a Titanic amazon and publishing industry’s reason.
6. Operating in a fast moving slowly on the market of
why when it comes to speed is entering a rapid run a key factor of the markets, I think the technology industry is one of the most obvious example. Whether you are early to enter the market (like the previous mentioned 4 points), or too slow to enter the market, unfortunately, you will be faced with a group of it’s hard to meet the users, they or do not know your product was (premature) into the market, or already have no interest in your product, because there are better alternative to appear (too late to enter the market). Such as Iridium satellite ( Iridium ), it is a satellite telephone company, it is because in the mobile communications this slow on the operation of the market quickly and could cripple the living example. Because when the satellite phones it, based on base station of mobile phone has already covered most of the iridium satellite tried to occupy the user. Although the satellite phone claims as long as you can stand in the sun and the moon place wouldn’t exist communication blind zone, at best, and our company can only claim 97% of the coverage area.
7. Breaking the law system of wire
once you violate copyright laws, you used to the rapid growth of enterprise, may be caused by trapped in dealing with all kinds of officer and stagnate even rapid retreat from now on. If your new product was so groundbreaking, even around the laws are now simply has not yet been established, so, when you are ready to associated with a group of old traditional enterprises, trade unions, even in trying to figure out what it is to your product under the condition of the government institutions, in order to develop a huge battle. But in the end, your business is likely to face is the end of the fall. Aereo co creative use of miniature antenna collected broadcast TV signal will spread through the network to paying customers, the final in 2014 and the traditional TV operators and losing of the officer of, because it violates the already very mature and complex TV copyright laws. (editor’s note: of course, this is not to say that we want to stay at a respectful distance from sb, pioneering innovation, on the other hand, we still should encourage us to pursue this groundbreaking innovations. But, as Peter Thiel in his “from 0 to 1” “enterprise monopoly, success of enterprise competition” described in the section, now everybody is disruptive innovations, in fact, we should focus on more is not innovation brought about by the destruction. But from 0 to 1 of qualitative change at the same time, to consider how to coexist with other enterprises. The process as much as possible to avoid competition, especially when you want to expand to adjacent areas. The lite version of the journal from 0 to 1, please come to my website or micro letter public review.)
of course, there are exceptions: Uber and reality so can this guy now, is because they are actually can jump over cautious or bypass the wire of the law.
it is 7 PM, we summarize, of course, it goes far enough. Here hope everybody accepts our subjective initiative, will you experience, think of possible problems need attention to business model, and selfless dedication to our colleagues for reference, lead us together on entrepreneurship soar!