Business Model Canvas Part 2: Example
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The document discusses the transformation of the Swiss watch industry, focusing on the business model of SMH in 1982 during a decline in market share and manufacturing challenges. It details a new value proposition aimed at repositioning watches as jewelry, targeting both heritage and low-end markets, while reducing production costs and emphasizing marketing. Ultimately, the new business model led to sustained revenue in a previously failing industry.
Business Model Canvas Part 2: Example
- 1. Business Model Canvas: BMC Part II An Example Cloverhill Consulting The future is developing… Shaun B. Brailsford T:: +44 (0)779 206 2662 E:: shaun@cloverhillconsulting.com Skype:: Shaun.Brailsford
- 2. Business Model Canvas: BMC SMH (Swiss Corporation for Microelectronics and Watchmaking Industries Ltd.)
- 3. 1982 - The Situation Business Model Canvas: BMC
- 4. 1982 - The Situation Business Model Canvas: BMC Quartz technology Swiss watch market share falls to 15% Banks shutting down money supply Manufacturers think – We can’t produce that quality at a that price Fear of cannibalising profits Asuag & SSIH Bankrupt James Bond looses his Omega
- 5. Business Model Canvas: BMC Nicholas G. Hayek
- 6. A New Value Proposition Watches are jewellery Business Model Canvas: BMC
- 7. The Strategy Upmarket watches positioned as heritage pieces Create a new watch for low end market Manufacturing cost to be less than 15% of retail price Reduce components parts from 91 to 50 Insisted on owning 51% of the new company Business Model Canvas: BMC
- 8. Business model canvas: BMC SMH (Swiss Corporation for Microelectronics and Watchmaking Industries Ltd.)
- 9. The Marketing Fashionable, low cost & lifestyle Pricing $40 - $50 30% of retail price to go into marketing Limited edition runs Commissioned Artists & industrial designers to create “The Look” Stand alone Swatch stores Business model canvas: BMC
- 10. KP KA VP CR CS KR CH C£ R£ 10 SMH PRODUCTION & QUALITY CONTROL R&D HR, FINANCE ETC MANUFACTURING PLANTS BRAND PORTFOLIO HIGH END & LUXURY SEGMENT MID SEGMENT MASS MARKET BLANCPAIN, OMEGA, LONGINES, RADO TISSOT, CERTINA, HAMILTON, MIDO SWATCH, FLIK FLAK
- 11. KP KA VP CR CS KR CH C£ R£ 11 SWATCH PRODUCT DESIGN MARKETING & COMMUNICATION SWATCH DESIGN SWATCH BRAND MASS MARKET TRENDY LOW-COST LIFESTYLE (SECOND) WATCHES LIFESTYLE MOVEMENT MSWATCH SHOPS RETAIL LIFESTYLE EVENTS GUERRILLA MARKETING MANUFACTURING PAYMENTS TO SMH MARKETING WATCH SALES SMH AS PRODUCTION PARTNERS
- 12. KP KA VP CR CS KR CH C£ R£ 12 SWATCH Fashion item
- 13. The Lessons Identified the Value Proposition Defined clear Customer Segment Clearly structured Channels to Market Manufactures as Key Partners Product design as a Key Activity Business Model Canvas: BMC
- 14. The Conclusion With a new business model a failing industry can now delivers sustained revenue Business Model Canvas: BMC
- 15. Business Model Canvas: BMC Cloverhill Consulting The future is developing… Shaun B. Brailsford T:: +44 (0)779 206 2662 E:: shaun@cloverhillconsulting.com Skype:: Shaun.Brailsford
Editor's Notes
- #11: SMH is vertically integrated and controlled with respect to production, R&D, sourcing and HR.