TRANSFORMING BUSINESS MODELS (short)

Transforming Business Models
Kimberli J. Lewis
What happens to business when:
•Technology changes
•New Markets open up
•Technology Changes
•Customer needs & Preferences changes
•Availability of Resources change
•Economies change
2
Either they transform & flourish or they die
3
Look at Business Segments
that must or have transformed
•PUBLISHING
• PUBLISHING
• MOVIES
• MUSIC
•MOVIES
•MUSIC
•PHOTOGRAPHY
4
Look at Businesses that have shifted
SHOPPING
TAX CONSULTING
HEALTH CARE
5
6
MEET YOUR NEW
PERSONAL TRAINER
7
CATEGORY LEADERSHIP
MORE THAN A COMMODITY SNEAKER
8
TO BRING INSPIRATION
AND INNOVATION TO
EVERY ATHLETE
IN THE WORLD.
INNOVATE
PARTNER
DE-COMMODITIZE
JUST DO IT
NIKE VISION
9
10
2010:
UPS DELIVERED
NEARLY 4B PACKAGES
RECEIVES OVER
26 MILLION
ONLINE TRACKING
REQUESTS PER DAY
11
UPS HAD TO
TRANSFORM
12
13
OUR GOAL IS TO SYNCHRONIZE THE WORLD
OF COMMERCE
BY DEVELOPING BUSINESS SOLUTIONS THAT
CREATE VALUE AND COMPETITIVE
ADVANTAGES FOR OUR CUSTOMERS.
BUILD ON CORE
CREATE SOLUTIONS
CHANGE YOUR STORY
UPS VISION
14
YellowPage Publishers – A similar story
History
Single provider of Yellow Page
print directories in Czech
Republic & Slovakia in
cooperation with the largest
public fixed line telephone
provider (until 2007)
YellowPage Company
Until 2011
Fourth largest “lead” generator for
businesses & information
provider for users on multimedia platforms
Multi-media Company
2007
2012
52% Revenue in multi-media packages
equality ca.:
• 20% in traditional products
• 70% in new online products
480 FTEs
1.025.973 monthly visitors online
State of the art support systems
New products & services
98% Revenue Print
381.444 monthly visitors online
Old online platform
820 FTEs
Manual support system
15
Czech Internet Market – 2007
4 000 000
45
41
11
0
4 500 000
TOP 15 + ZS + Inform
UV 11/06
500 000
72
9
28
5
16
0
1 000 000
17
4
1 500 000
13
76
07
6
12
78
66
2
10
94
10
8
10
08
43
7
97
29
09
93
29
35
81
75
12
78
48
26
2 000 000
29
18
95
37
8
18
48
15
1
2 500 000
20
68
4
3 000 000
24
69
07
4
24
23
50
2
24
23
07
7
3 500 000
Site
seznam.cz
novinky.cz
centrum.cz
atlas.cz
idnes.cz
super.cz
mapy.cz
lide.cz
spoluzaci.cz
stahuj.cz
sport.cz
sblog.cz
slunecnice.cz
horoskopy.cz
nova.cz
inform.cz
zlatestranky.cz
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0
Rank
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
60
64
NetMonitor 11/06
4
2
2
2
2
1
1
1
1
1
1
111
469
423
423
068
895
848
376
278
094
008
972
932
817
784
174
160
UV
045
074
502
077
429
378
151
076
662
108
437
909
935
512
826
285
729
Belongs to Seznam
YellowPage Company‘s Position
16
Online-oriented Directory Market CZ
Online directory (IYP) market represents larger market share than in other countries.
Mediatel has a small but growing market share.
Print & Online Revenue Market Split CZ
mEUR
Total
2007
76,2
2008
76,4
2009
64,6
2010
61,4
2011
66,8
2012
73,3
IYP Market CAGR 2005-2009 is 21,8%
IYP market dominated by Seznam
100%
90%
80%
70%
2013
79,6
52%
59%
69%
73%
60%
75%
76%
78%
MEDIATEL will strengthen its online position in 2010 –
2012 and has increased usage market share 2006 –
2008
50%
2000 – 98% direcotory Market share
40%
30%
20%
48%
41%
31%
27%
10%
25%
24%
22%
2010
2011
Online
2012
2013
0%
2007
2008
2009
Print
Online Usage Market Share
100%
IYP Reveue Market Share CZ
90%
0%
11%
0%
11%
0%
11%
0%
10%
0%
10%
0%
10%
0%
10%
80%
70%
60%
50%
78%
82%
83%
79%
79%
79%
17%
60%
18%
19%
40%
17%
20%
20%
31%
30%
34%
2 007
2008
2 009
79%
30%
20%
0%
11%
2007
Mediatel
7%
6%
2008
2009
Seznam
23%
23%
0%
40%
10%
4%
17%
5%
11%
15%
80%
100%
2%
14%
11%
11%
11%
11%
2010
2011
2012
Centrum
Others
2013
seznam.cz
centrum.cz
atlas.cz
idnes.cz
firmy.cz
zlatestranky.cz
17
The Digital Boat Competition
Google Digital
Other Digital
2007
2003
Zlaté Stránky
Digital
2007
Seznam
Digital
Centrum
Digital
1996
1997
18
The ultimate Transformation from Print to Online
From
What had to change
To
Print
Product
Digital
Single- product solution
Product
Multi-product solution
Long design time
R&D
Long delivery time
Distribution Channels
Value based physical product
Standard long processes
High margins - heavy infrastructure
Simple revenue model
Customer Service
Technology & Organization
Short design time
Flexible & fast delivery
Solution based products
Just in time customer focused
Organization
Lower margins – lighter infrastructure
Financial Modeling
Multi & more complex revenue models
19
Finding a new Market Hole – Multi-media Offer
SESEo
20
Proving Innovation –
new Products, Packages & Promotion
The Media Support has been great!
Awareness is high
More to come
Mediatel Multimedia Platform
Let’s makes the most out of it!
21
Improving the Place among the Competition
Spontaneous & prompted sources of company information
Q1. Where on the internet do you most often search for
information or contacts for companies. Please state all
websites you use.
• Spontaneous awareness of Zlatestranky.cz is
Q2. Which of the following websites have you ever
used to find information or contacts for companies?
Spontaneous
quite a lot lower than some of its main
Prompted
competitors. Seznam.cz and its associated
portal Firmy.cz in particular have scored very
69
Seznam.cz
96
38
Google.cz
73
13
Firmy.cz
47
Topkontakt.cz
23
0
4
1
3
ARES
Tiscali
• Even though a fourth of respondents said they
have used Zlatestranky.cz in the past to find
information on companies, it does not seem to
be widely known online company information
0
1
4
Atlas.cz
Justice.cz
Centrum.cz.
37
2
Zlatestranky.cz
Najisto.cz
awareness, and similarly have Google.cz and
8
Centrum.cz
1188.cz
high in both spontaneous and prompted
media yet.
3
2
1
• That’s why we decided to reinforce the message
from our latest campaign and continue with
current concept.
In %
n=510
Note: Only sources/websites that were mentioned by
a minimum of 1% respondents are displayed.
22
The Cost of Transformation
KODAK
2005 digital sales went up to 40%
Film went down to 18%
Innovation & RD hit the bottom line
23
YellowPages continue to focus on Products
• Changing perception in traditional products
• Developing multi-media offers
• Transition from print to multi-media
• Pushing innovation with products (example CZ)
• First on the market with 3D Visits
• First on the market with mStranky
• First on the market with Augmented Reality
•
Changing product reach
• Better reach through communication
• Targeted distribution channels traditional products
•
Smart product packaging & pricing
24
Just like Kodak:
Progress – Yes
Bottom Line Growth - Difficult
Sales
Sales go down
because of lower
cost products
Cash Gaps!
Costs
Costs go up because of
innovation
25
So what can a Company do?
Go back and ask simple questions!
“The ant moving a mountain”
26
Explore who they are
Print Ad Providers?
Website Providers?
Mobile App
Developers?
PRINT AD
PROVIDERS?
WEB SITE
PROVIDERS?
MOBILE APP
DEVELOPERS?
27
Who are we?
ARE WE …
SEARCH
ENGINE
OPTIMIZERS?
28
Who are we?
ARE WE …
SOCIAL MEDIA
STRATEGISTS?
29
WHAT IS OUR PLUS?
WHAT DO WE LOVE?
WHY HAVE YELLOW PAGES BEEN A
SUCCESS IN SO MANY COUNTRIES
OVER SO MANY YEARS?
BECAUSE…..
30
LOVE TO HELP
SMALL
BUSINESSES
MAKE MONEY
31
LOVE TO MAKE
LOCAL
Original Graphic
BUSINESS’
PHONE RING
Replacement Suggestion
LOVE TO
GENERATE
TRAFFIC
FOR THEIR WEBSITES
33
BECAUSE WE ARE THE AD AGENCY
Original Graphic
Replacement Suggestion
FOR LOCAL BUSINESS
STOP
NO. WE ARE NOT
OUR PRODUCTS
35
So, we must transform the Business Model
ASSETS
Products
STRENGTHS
Access to SMBs
History, Trust,
Experience
WEAKNESSES
History, Productoriented
Redemption Phase
Purpose:
Consultant SMB
on to help them
getting new
customers
What tools do
we need?
People
Access to
Products
Trust
36
How do we help small & medium businesses?
From Product oriented
To Consultants
Web
Mobile
Print
Websites
Mobile Web
Print ads
IYP
Mobile IYP
Verticals
Ranking
Ranking
SEM
Locationbased SMS
Facebook
Enhanced
print ads
Video / 3D
Skype, Call4free
RFP / RFQ
37
We help small & medium businesses
7 days/week, 24 h/day
Media
Consultant
Small
Businesses
38
Key Elements to Success
1. People
Do we have the right people?
–
–
–
–
1/3 embrace change, 1/3 accept, 1/3 can not accept change
Change 50% FTE
Train the leaders
Measuring success with remuneration
• Quarterly
• Yearly
• Group
• Individual
– Give people good atmosphere to work in
39
Keeping the right People
Sales Representatives
Sales Force Analysis
+
+
•Good analytical skills
•Not solution oriented
•Lack training
•Weak time management
•Little motivation to sell new
products
•Too high objectives
=
Sales FTEs retained
Sales Managers & Directors
+
+
•Customer Oriented
•Selling web presence
•Productivity above average
•Finding new customers
•Ability to learn sales skills
•Managers with motivation
& better Management skills
=
40
Key Elements to Success
2. Customer Loyalty
• Fulfilling your promise
• Constant Communication
• NPS - & KPI Measurements
• External Focus, not Internal
– Example: do no measure only on quantity, but quality
41
Back Office Efficiencies
- Turn-around time (days)
ALL PRODUCTS
WEBSITES
• Stabilization of work efficiency
• Performance based pay introduced in
back-office to boost productivity
• Eliminating intermediate steps
Mediatel Czech Rep., Annual Average
42
Metered Ads – Proving Value
Retraining & Sales tool
43
Key Elements to Success
3. Speed to Market is critical
• Priority Setting & Vision
• Complete Go-to-Market Plan
• Cross department communication rules
• Excellent Project Management & Skills
• “Time is Money” Moto
• Building a new Market Image
44
Simple Customer Service Story
(Example of CZ Customer Pamphlet)
45
Key Elements to Success
4. Business Measurement Systems
• Clear KPIs across all channels
• Correct KPIs
• Weekly / daily measurement
• Excellent Planning Process
• Policies & Procedures
• System Simplifications
46
Consolidate Systems
– Improved Processes & Lower Costs
Old environment
Unstable/weak
Optimized
Consolidated
New
Migrate to CRM
47
Key Elements to Success
5. Understanding Sales
• Finding correct Channels
• Understanding Customer Segmentation
• Finding correct Remuneration Systems
• Ensuring right Training
• Right Sales Support
48
Sales Force Alignment
– Approach to Market
Dedicated Teams
Telesales
• Customer Teams
• FLEXI Teams
Business Segments
1) Clearly defined targets by
segments for each team –
year round / month
Premise
Customer Teams
• Media Consultants
• Senior Media
Consultants
• Future Key Accounts
• Affiliate Marketing
1. New multi-media marketing
solutions
2. 3rd Party product offers
2) Advanced segmentation to
maximize 12 months sales
potential while considering
•
Product Portfolio
Business needs
Market dynamics
Seasonality
Existing CHO structure
Competition moves
Geography
Etc…
3. Moving from standard
package approach to
customized business offers
with high added value
3) Specific segments assigned
to teams with special skills
& know how
49
Segmentation Groups
Segments
Market size
(# of customers)
Automotive
21.000
B2B
35.000
Culture
18.000
Retail
55.000
Professional services
50.000
Construction
35.000
Hospitality
33.000
Institutions
50.000
Wholesale
10.000
Home improvement
55.000
Beauty
23.000
Health plus
7.000
Health
40.000
Other
170.000
TOTAL
602.000
50
Ensure you love your Customers!
51
If you do all this
it does not mean you win the battle but…
The Blue Line will be significantly over
the Red Line!
52
Thank you
Kimberli Jo Lewis
[email protected]
53