Concept Development & Business Model Design - Manu Vollens

The Future of News
VRT NewsLab
September 6, 2014 (Brussels)

What’s innovative about this product?
Introducing
consumables
Taking away
consumables

@manuvollens
corporate disruptor
&
strategy designer
+32484960793
manu@boardofinnovation.com

Let’s warm up with an exercises

A short QUIZ on creativity & innovation

“Creativity is
actually the same
as innovation”

creativity
production of ideas that are
novel & useful
!
innovation
not only about generating, but also
realizing them

“Implicitly, people
don’t really like
creative ideas”

!
Highly creative ideas carry often a lot
of uncertainty to them
When people feel uncertain, they
prefer ideas that are practical instead
of creative, to reduce uncertainty.

“Chaotic people are
more creative”

It is rather openness to new
experiences that determines creativity.
Other personality characteristics are
weak predictors of creativity

“When you believe you
are creative, you will
indeed come up with
more creative ideas”

Creative self-efficacy is the belief that
one has the ability to produce creative
outcomes. Believing in your own
abilities makes you perform better.

Example: paperlater.com
Paper Later
People reading news online
- No time during the week for reading full articles
- During the weekend still like to relax with “real” paper
A custom printed newspaper with your online
bookmarkerd articles of that same week,
delivered to your door!
- fixed price/printed item
- sell add-ons (coffee, breakfast, …)
x

Example: paperlater.com
Paper Later
People reading news online
- No time during the week for reading full articles
- During the weekend still like to relax with “real” paper
A custom printed newspaper with your online
bookmarkerd articles of that same week,
delivered to your door!
- fixed price/printed item
- sell add-ons (coffee, breakfast, …)
x x

Formula for a good “baseline”
Hot fresh pizza delivered to your door in 30 minutes or it’s free!
(Dominos Pizza)

Formula for a good UVP
Instant Clarity Headline
=
End result customer wants
(the promise)
What makes you different?
(meaningful specific)
The buy-in
(guarantee)
Hot fresh pizza delivered to your door in 30 minutes or it’s free!
(Dominos Pizza)

subtitle
Accept the fact that you’ll have
explore to new territory.

Result?
“in china when you're one in a million, there are 1300 people just like you” - Bill Gates

Result?
“in china when you're one in a million, there are 1300 people just like you” - Bill Gates
The more data services collect on us:
The more it becomes clear that you are not
that special or unique after all…

How innovative are you?
Hier zie je de
artikelen
waarvan wij
100% zekerheid
hebben dat ze je
zullen
interesseren

In order to be more creative…
you’ll need to hack your habits.

“We are what we repeatedly do.
Excellence, then, is not an act, but a habit.
Artistotle

“What goes unbeknownst to some tennis fans and viewers
are the habits and strange routines that even the most
famous of players do during a match. These mainly odd
routines are highly mental components to athletes'
performance in a match.

What are your personal habits?
40% of all your daily actions

Habits: the mouse experiment (Duhigg)

How to design & hack your habits

Concept Development & Business Model Design - Manu Vollens

Innovation Battlefield
What makes you different?

Why this tool?
Goal: to challenge the “awesomeness” of our concept

Identify those features
that create the wow.
such data
much virtual
so no limit
very experience
wow
many viral
no boring

Structured process: The Innovation Battlefied
Pleasure level
“unexpected awesomeness” “harder,better, faster, stronger.”
“Expected essentials”
How hard will a feature be missed if left out?
H
How much pleasure does
this feature bring?
“I don’t care...”
“It hurts, take it away.”
L
L H
Indispensability Level
1 brainstorm template per team

We will list all the different
STEP 1
features/characteristics of your concept
f. x
f. y
f. z
f. a
f. b
f. c

STEP 1
Rank the features from the perspective
of your key customer.
STEP 2
f. x
f. y
f. z
f. a
f. b
f. c

Structured process: The Innovation Battlefied
Pleasure level
f. a
f. b
f. x f. y
f. c
H
this feature bring?
L
L H
f. z

How to rank the features of your concept?
!
How much happiness
does this feature
bring to our customer?
f. x
Would this feature be missed
by our customer if left out?

Let’s look at “service” we all know:

What are the features or characteristics of this concept?
f. x
Handle with care
Able to track
Within 3 days
…

Pleasure level
f. a
f. b
f. x f. y
f. c
H
this feature bring?
L
L H
f. z

Pleasure level
Handle with care
H
this feature bring?
L
L H
!
How much happiness
does this feature
Able to track
Within 3 days

f. x
SMS alert
Free recall
Real-time tracking
…

Pleasure level
SMS alert
Free recall
Real-time tracking
Handle with care
H
this feature bring?
L
L H
!
How much happiness
does this feature
Able to track
Within 3 days

f. x
Cardboard box
FedEx logo
Vans
…

Pleasure level
SMS alert
Free recall
Real-time tracking
Handle with care
H
this feature bring?
L
L H
!
How much happiness
does this feature
Able to track
Within 3 days
Cardboard
Vans
FedEx Logo

f. x
€15/parcel
Be at home
Sign-off
…

Pleasure level
SMS alert
Free recall
Real-time tracking
Handle with care
H
this feature bring?
L
L H
!
How much happiness
does this feature
Able to track
Within 3 days
Cardboard
Vans
FedEx Logo
Be home
€15/p
Sign-off

Identify those features
that create the wow.

Pleasure level
SMS alert
Free recall
Real-time tracking
Handle with care
H
this feature bring?
L
L H
!
How much happiness
does this feature
Able to track
Within 3 days
Cardboard
Vans
FedEx Logo
Be home
€15/p
Sign-off
<15 min

Pleasure level
SMS alert
Free recall
Real-time tracking
Handle with care
H
this feature bring?
L
L H
!
How much happiness
does this feature
Able to track
Within 3 days
Cardboard
Vans
FedEx Logo
Be home
€15/p
Sign-off
Drone

A concept we created 2 years ago:

Pleasure level
SMS alert
Free recall
Real-time tracking
Handle with care
H
this feature bring?
L
L H
!
How much happiness
does this feature
Able to track
Within 3 days
Cardboard
Vans
FedEx Logo
Be home
€15/p
Sign-off
In car
Frictionless

STEP 1
f. x
f. y
f. z
f. a
f. b
f. c
now it’s up to you!

STEP 1
Rank the features from the perspective
of your key customer.
STEP 2
f. x
f. y
f. z
f. a
f. b
f. c
now it’s up to you!

Make Teams of 2 & sit back to back!

How well did you communicate your dog?
what were your assumptions?

What was the hypothesis for the iPod?

Making Hypothesis, testing Assumptions

What kind of assumptions has your concept?

15 years ago - 1 dominant business model

Spotify, subscription on music

In a nutshell
An organization’s logic of creating,
delivering and capturing value.

10 types of innovation
Configuration Offering Experience
Business
model Network Company
Structure Process Product
performance
Product
system Service Channel Brand Customer
Engagement
Volume of innovation efforts
last 10 years
source: Doblin Group, Inno 15

10 types of innovation
Configuration Offering Experience
Business
model Network Company
Structure Process Product
performance
Product
system Service Channel Brand Customer
Engagement
Cumulative Value Creation
last 10 years
less than 2% of projects,
produce more than 90% of value

Top Innovators

Many components.
Every Business Model =
Many different ingredients.

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
micro-payments

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
Newspaper printed with ink that repels mosquitoes

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
Echobox

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
Runkeeper

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
ZombiesRun: Running as a game

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
latest news stories printed on…

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
Right to use content, pictures, …

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
Franchising Models

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
Reshare - Foreign press translated into 11 languages

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
Klout: Online influence as reputation

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
justreachout.io

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
Bitcoins

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
Moskow: Pay with Exercises

5
Money
5
Less Money
Product
Service
Experience
Right
Data
1
Reputation
Credits
Exposure
Pay with a Tweet

You are in the center!
Your own startup

Business Model transactions
Focus to make this flow as smooth as possible. #frictionless

Can be more complex.
Many different players, a lot of monetary transactions.

80%
of ideas come from
analogy thinking
G. Jucevi

Learn from others!
startups, big organisations, …

Some of the industries I’ll highlight:
News/ Publishing
Dating
Gaming

What to pick?
Free!
for the user.
1.
Paid!
the user = client.
2.

Free
(Hidden) other agenda:
- Aim for an early exit.
- Acqui-hire
- Prestige
- …
Rule of thumb:
There is no free lunch.

What to pick?
Free!
for the user.
1.
- Pay-what-you-want -

Free?
Pay-what-you-want. (including free)
Customer can pick
his own price.

Other industries
#win #fail
Emotional connection
Social/group pressure
…
selling to businesses
social/group pressure
…

What to pick?
Free!
for the user.
1.
- Tip jar/ donation -

Free?
Tip jar - Donation.
Main difference:
People often get the product for free, but
are free to do an extra transaction.

What to pick?
Free!
for the user.
1.
- + Premium -

Free, for some.
Different segments of
users.

What to pick?
Free!
for the user.
1.
- + Premium -
- bait&hook (add-ons) -

Pay for recurring upgrades or consumables
Offer part of your service
for free (or nearly free)

Open Source model with paid consulting support

What to pick?
Free!
for the user.
1.
Paid!
the user = client.
2.
Reason why people upgrade!

Free, but pay for extra features

What to pick?
Paid!
the user = client.
2.
- Vanity - reputation -

Some people only want “the best”
Ultimate luxury. 12K€ Smartphone (Vertu)

Vanity, reputation…
Vanity is so powerful!

Looks & Reputuation in games.
To fit in Exclusivity Show Commitment ...

Important learning: You need other people to show off!

Pay to get noticed. (above the crowd…)
Would you pay to get seen by your friends on Facebook?
Facebook 2012

What to pick?
Paid!
the user = client.
2.
- Loss-aversion -

Another tactic: Lure people in with free + lock-in.
Just give it a try!

Pay-as-you-go model.
Switching cost?

Similar, pay-per-use.
Blendle - itunes for journalism

What to pick?
Paid!
the user = client.
2.
- Loss-aversion -
- Privacy/ Anonymity -

Privacy features are very powerfull!
Hide your profile.
Incognity mode.

What to pick?
Paid!
the user = client.
2.
- Loss-aversion -
- Mystery/ Surprises -

Mystery crates (& surprise upgrades)
similar to Lottery system = very lucrative!

Real life mystery crate (on subscription)
Trust & credibility created by 1 person (not a company)

Blind dates, anyone?
Crazy Blind Date by OKcupid. (up to $3/date)

What to pick?
Paid!
the user = client.
2.
- Loss-aversion -
- Mystery/ Surprises -
- Helping peers/ gifts -

This one is on me…
Yes, Awesome.
I’m a PLUS member.

Virtual gifts.
Line messaging app is one to keep an eye on!

Learn from gaming.
Question:
Do you allow people to spend (all their) money?

Why does this person get a +120M€ contract?

What to pick?
Free!
for the user.
1.
Paid!
the user = client.
2.
Third party
pays the bills.
3.

What to pick?
Third party
pays the bills.
3.
- Advertising -

Every ad-based model.
The user becomes
the product.

Ad-business is straight forward. but hard.
Offer content.
Control eyeballs
Steer attention to ads
Profit.

What to pick?
Third party
pays the bills.
3.
- Advertising -
- Affiliate/ Referral -

Drive sales for another.
Affiliate & Referral models.

Integrated referral links?
Pinterest is the perfect match!

What to pick?
Third party
pays the bills.
3.
- Advertising -
- Affiliate/ Referral -
- Data Reseller -

Resell data.
One company is more transparant than the other.

What’s the value of your own personal data?
Resell your own data via a platform:
example Citizenme.

What to pick?
Free!
for the user.
1.
Paid!
the user = client.
2.
Third party
pays the bills.
3.
Broker/
Matchmaking
4.
Can be a mix of all three.

Broker/
Matchmaking
4.
- One-side pays -

Many dating platforms are based on this model.

Get paid to date?
Very controversial
of course.

Get paid to date.
Other platforms experiment with other rewards than money.

Broker/
Matchmaking
4.
- One-side pays -
- Both sides pay -

Matchmaking between 2 normal users.
only 1 of the 2 parties pays.

AirBnb & other broker platforms

Broker/
Matchmaking
4.
- One-side pays -
- Both sides pay -
- Crowdfunding -

Crowdfunding (many variations)
For pre-sales?
Investment?
Donation?

Crowdfunding
The product itself is often not the primary driver:
“Be part of something bigger, a revolution in …”

Get a return of an investment in someone else.

Questions? Just Ask!
Manu Vollens - @manuvollens
+32 484 960 793
manu@boardofinnovation.com

Concept Development & Business Model Design - Manu Vollens

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