What Is a Business Model
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On the surface, a business model might seem nothing more than a working specification containing the details on the core operations of a venture. In reality, a business model is the key ingredient to your success, it is something that your venture can use to outwit the competition and continuously expand your revenue. A business model is what’s needed to extract value out of offered products or services. As a future or established business owner, it makes absolute sense to understand what the core constituents of a business model are and eventually formulate a business model that takes into account these ever-crucial components.
Once you have developed the right product or have designed the appropriate service to be offered, the next thing in line is to create your business model. While doing so, the following components need to be focussed on:
1. Superior customer outreach:
Reaching out to your target market remains the most important component in designing a business model. Depending upon the nature of products or services offered and the potential consumer base, you would make use of the internet, email, broadcast media, telemarketing, word-of-mouth promotion, flyers, brochures, billboards or other ways to reach out to your customers. Double check that you are certain about the most effective channels to reach your target market.
2. Appropriate product/service pricing:
Another crucial decision that has to be made on behalf of the company is how much the customer will be charged for the offered product or services. Working out an appropriate pricing strategy might as well be the key difference between skyrocketing returns and financial hiccups. Realistically quantifying the value customers gain from your product or services is the first step in developing a pricing strategy. Estimating the involved operational costs as well as scrutinizing the offered competition will help you decide whether to stick with low-cost volumetric sale approach, opt for high-cost targeted sale strategy or a blend of both. As a rule of thumb, your company will survive the competitive apocalypse if and only if its pricing has been tailored in view of the consumer.
3. Extensive Customer support:
Apart from educating customers on how to make the most out of your product or service, a great deal of time and effort needs to be invested in providing unsurpassed support. The offered support can from answering email queries to setting up a one-on-one session to integrating and commissioning the products and solutions. Contemporary customer support alternatives include 24/7 web support, 24/7 call center or periodic on-premise troubleshooting.
4. Effective selling strategy:
It is equally important to have a persuasively compelling selling strategy as a part of your business model. In addition to having specialised sales staff on-board your team, the business owner also has to know how to sell the products and services effectively. You need to be studded with skills that would land and seal a business deal completely. The company’s sales process has to be seamless and the best way to ensure that is to dry test the selling stratagem.
5. Consumer loyalty and satisfaction:
Eventually, the success (or failure) of a venture is dependent on how satisfied the customers are with the quality they receive and the experience they undergo. Customer satisfaction consequently translates to brand loyalty and advocacy. A pleased consumer base will directly contribute to accelerate the sales conversion cycle and agitated customers would lead to quite the opposite of that.
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