Business Model

A business model is a strategic plan that outlines how a company creates, delivers, and captures value. It encompasses the company’s value proposition, target customers, Revenue streams, cost structure, and Competitive Advantage.

Examples:

• Subscription Model: Companies like Netflix charge a recurring fee for access to their streaming service.
• Freemium Model: LinkedIn offers basic services for free while charging for premium features.
• Marketplace Model: Amazon connects buyers and sellers, taking a commission on each sale.

Cases:

• Airbnb: Uses a platform model to facilitate short-term rentals between hosts and guests, generating Revenue through service fees.
• Warby Parker: Operates on a direct-to-consumer model, selling eyewear online and in stores, while also offering a home try-on program.
• Spotify: Combines advertising with premium subscriptions to monetize its music streaming service.