Situation: A company is in the process of shifting their business model to better address customer needs. They have three different models under consideration. Management is split between these models, but must arrive at a consensus. How do you optimize your business model?
Advice from the CEOs:
Right now, you are considering three different potential models:
Tools – your old model
Data – produced by your old model
Service – your new model
These are different models with different prospects.
The money makers in marketing focus on data, not tools. Data is information, and this is what is valuable to clients. If you want to focus on the data component of your offering.
Currently, you are scraping data from social media and matching this to your client’s database on a real-time basis. There’s a model and value here because you are enhancing your client’s current database by making it more useful and actionable to them.
You have tools to enable and add value to existing client databases by allowing them to better segment their database. Again, there is value here.
Your core IP is the ability to correlate diverse data sources. Have you protected this IP? If not, this needs to be a top priority.
How much information that you scrape from social media sources can you share without violating privacy? This is something to think about because people are becoming increasingly sensitive about companies collecting their private information.
Situation: A company works primarily with early stage/rapidly growing companies. To extend their service offering, they have alliances with corporations which are interested in these companies as sources of innovation. The alliances have helped them to gain new customers, but the CEO is curious whether he can gain additional revenue from these alliances. How can you monetize marketing alliances?
Advice from the CEOs:
Match making is a valuable resource – regardless of where your company is located or the customers that you serve. Companies are less likely to pay for something that they perceive as having received free in the past, but are more than willing to pay for options that will enhance both their top and bottom lines.
Look at ways that you can make your services more valuable to your current corporate alliance partners. How can you help them make more revenue, or enhance their bottom lines through a win-win revenue-sharing relationship?
Become a match maker and get a fee. Offer your alliance partners opportunities that are more intimate than speed dating. Make sure that you are playing both a key introductory and ongoing role.
Use speed dating to match companies and funding sources. Invite investment bankers or private equity firms. Charge a 1-2% match fee if they do a deal.
Simplify your model. Who is your real audience – who is the constituency that you can best serve?
The most valuable deals and matches are those that offer ongoing revenue opportunities to your alliance partners. This is where you can offer them the most important value – a value for which they will pay.