Ent ch 5
A ______ describes the rationale of how a new venture creates, delivers, and captures value.
A business model is the rationale of how a new venture creates, delivers, and captures value.
The first part of the business model is ______, which identifies the product or service, the value generated by it, and how you will reach the customers.
CVP
What are the channels for the delivery of the value proposition?
Communication, distribution, and sales channels
What did IKEA understand about the goal of customers purchasing furnishings?
Customers want nice furnishings rather than worn, secondhand pieces. IKEA developed do-it-yourself furniture kits for lower cost than major furniture stores.
What is a way in which entrepreneurs solve the customer's problem of lack of money?
Deliver previously unaffordable products or services for less. Lack of money is a problem experienced by customers of many new startups.
T/F FedEx solved delivery transportation before focusing on customer needs.
False
t/f; Segmenting markets is not a good way to generate more business.
False, Breaking customers into groups according to different needs and problems generates more business.
Why is the BMC important?
It fills in the details of the business model. The BMC gives a more thorough overview of the business model logic.
The component that describes managing such stock and design is ______.
Key activities-- all about getting the job done
What was Tata's CVP for its product to replace scooters in India?
Provide an affordable, safer mode of transportation.
What is the type of CVP that describes why people really like your products and focuses on the customers and what they really need and want?
Resonating-focus CVP shows an understanding of customers' problems and needs while describing how to meet those demands.
What did Justin Gold, from Justin's nut butters brand, discover about the infrastructure needed for his company?
The original food processor from his kitchen made a better product. When he tried to scale using a mill, the product was not as good.
T/F An entrepreneur needs to figure out which customers to focus on and which to ignore.
True, A major part of the business proposition is to figure out which customers to focus on.
When considering customers, entrepreneurs must ask themselves ______.
Who will pay for what I am offering? How will you maintain customer relations once they're established? How will you reach your target audience?
Entrepreneurs use ______ to try to encourage existing customers to switch to their product.
advertising
What are the three main types of approaches to creating value propositions?
all benefits resonating focus points of difference
The four parts of the business model
coexist
The ______ is a statement that describes exactly what products or services your business offers and sells to customers.
customer value proposition
How can entrepreneurs make products and services attractive to more than one customer segment?
different CVPs for each customer segment Adjusting CVPs for each segment is important.
The Quip toothbrush is an example of the ______ business model.
differentiation; Even though there were already electric toothbrushes, Quip was able to create a simple, convenient, and affordable toothbrush.
The advent of Massive Open Online Courses (MOOCs) is an example of the business model ______.
disruption; MOOCs are free, whereas traditional higher-education courses require fees..
T/F: infrastructure includes financial forecasts
false, financial forecasts are part of the financial viability
The business intends to create, deliver, and capture value for customers is known as the business ______.
model canvas The model canvas subdivides the business model to provide a more thorough overview of the logic of the business model.
What is the message of CVP?
promising value to the customer
The business model presented in the textbook is a journey to gather evidence and prove the startup can be ______.
sustainable; The business model is designed to help the entrepreneur collect evidence to see if what they are creating works and is sustainable over the long term.
Which components of the BMC are part of infrastructure?
Resources and activities Infrastructure includes key activities, key resources, and key partners.
What is the business model that offers a product without differentiation?
imitation
A ______ market comprises a large group of customers with similar needs and problems.
mass
In order to create the business model canvas, the business ______ is broken into nine components.
model
Efficient changes to the business model can be made during the startup stage because ______.
the business is small in the beginning
According to author Doug Hall, what is the one big benefit for the customer?
the overt benefit The overt benefit answers the question "What's in it for me?"
T/F The CVP helps delineate the value of the entrepreneur's idea.
true, The CVP helps prove that customers want to buy the product or service.
An example of a lack-of-access problem is solar energy.
true; Small-scale solar has most been suitable for commercial buildings.
Financial ______ defines the revenue and cost structures a business needs to meet its operating expenses and financial obligations.
viability Financial viability helps manage more than how you intend to make money.