Tuesday, March 27, 2007
Green conscience
Fly with a green conscience
WHAT do you do if you're a keen traveller but also passionate about saving the environment? Stay at home? Travel everywhere using a donkey that consumes only organic carrots and water from natural springs, and rely on beaches and hedgerows for your accommodation?
Each of us can, even at our microscopic level show some RESPECT to our environment thru simple actions (water, consumption, waste, energy,...). I agree with Julia that we should care about what we buy or do it with respect to energy and environment since this is one of the few things that we still have control on unfortunately !!
Let's not be selfish and preserve our precious yet endangered environment and life at least for our children and future generations.
Wednesday, March 21, 2007
Low cost airlines business model
Certainly low cost airlines have changed the nature of consumer behavior not just for airlines, but the entire travel industry.
Low cost companies (ex Ryanair and Easyjet) provides limited service at a price that is attractive to the cost-conscious consumer.
They have had an important progression during the last years especially in the EU airports.
Greatly inspired by Southwest (US), low cost airlines have targeted the “100 % internet” (ex EasyJet et Ryanair) in order to reduce distribution costs and thus propose low prices.
It’s quite adapted to « smart shoppers », those young travelers from above average socio-cultural and educational background and spending a lot of time on internet looking for cool and best deals.
Among the advantages of the low cost model are
For the customers:
- Low price for a minimal and satisfactory service,
- No overbooking problem since the booking online is immediate,
- No tickets issued (Ticketless). Customers can print boarding pass at home and thus reduce cost of service and transactions
- Low online registration fee of luggages
For the low cost companies:
- Internet remains the most rapid and cheapest media for transaction with no important workload or workforce associated,
- Important use of technology to deliver efficient and rapid service,
- Reduce number of intermediaries just like the “dell model”
- Due to online business they can have very efficient and up to date accounting system,
- Important growth (number of passengers, frequency, territory, routes, airplanes deal, ….),
- High brand awareness,
- Additional revenues (see examples below)
However some low cost companies still work with travel agencies where profits are made on call center service and treatment of dossier,
List of the revenue streams:
- Food / beverages and shopping onboard,
- Insurance for luggages and “rapatriement”
- Partnership with TO and hotels for hotel rooms bookings and car rentals,
- Transfer reservation fee (ex bus services),
- Access and usage fee for airport lounge during transits for example,
- Airport parking,
Thus commissions on the additional transactions are new source of revenue for low cost companies.
A few comments :
1. "low cost" can represent a danger for traditional airlines in Europe in the long term
2. To be on same traditional routes from international airports, low cost companies will have to face cost considerations
3. As a large number of low cost exists, it seems that a consolidation will occur at some time with only a few remaining. Till then cost and investment will be important issues to compete.
4. The low cost has created an awareness for customers in that they are now more used to seeing lower price for a satisfactory service
5. In this context it seems that the big companies are quite forced to adjust and reduce price deviation from "low cost" while preserving the characteristics proper to their business model (time management, global service, development of customer loyalty).
Additional revenue, customer development
Development of customer loyalty and membership
Other opportunities:
- Service sector providers, including mobile network operators and Internet Service Providers, could be the next to adopt a low-cost model.
- Others may follow like advertising agency (ex TVLowCost)
Thursday, March 8, 2007
Innocentive
What is it? Innocentive ( innovation and Incentive)
InnoCentive is a market place, renting brains of scientists, web-based community matching top scientists to relevant R&D challenges facing leading companies from around the globe. They provide a powerful online forum enabling major companies to reward scientific innovation through financial incentives.
Reduce costs of R&D with more capabilities.
2. Who owns it?
Elililly, Pharmaceutical company (business model)
3. What is the business model?
Community of scientists with leading companies, for competition
A fee is taken by the company,
4. What problems does it solve?
Scientific problems, research problems
Quiz eBusiness 08/03/07
OTHER than core revenue sources:-sale of goods and services-advertising-subscription
Please list 3 additional revenue sources in e-commerce.
Benefiting from the « Long tail eBusiness model »
You sell some star products which you use to attract customers on your site. But customers coming to your site have also access to similar products less known or services or other people’s preferences. As a matter of fact they become exposed to a whole lot of unknown, interesting probably products and services. So the total sale of these products account for an interesting part of the company’s business. That’s what’s called the long tail effect.
Benefiting from the Vente-privée concept
You can also create network of chosen customers who are looking for discounted brand products. These customers will in turn recruit others to the network with the possibility to register online to become a member. So membership is important here in this model and brands just push the products to vente-privée businesses without stock problems or image damage on discount operations. No competition with offline business where full price is practised. Brands pay to be there with their logo published. Also retailers do not need to have discounts and are preserving image and retail pricing on offline businesses.
2. If "market segments are dead", how are segments replaced? Why is it important to the digital economy?
Today on the internet we see new waves which have replaced segments:
- Community of customers is created according to tastes, common points, preferences, motivations, hobbies, habbits,…
- Referral network of users (mouth to ear, sponsorship, recruitment, ) are generated
What’s important today is who buys what, who is clicking, who is referring,….
3. How can 'free' generate revenue for an online business? Please include your favorite example.
By offering for free some services and products you can acquire a lot of customers.Once they become “addicted” or loyal to the service and knowing that they would want more you propose them for a premium price some value added services / products, more sophisticated / enhanced version of the free service, or an extension (functional or quantitative). The initial customer loyalty and attraction is very important. This is how he will be willing to pay for extra service since he know the quality of the basic product and has been using it for some time. The psychological effect is “Now I’ll pay for it since I used to benefit from it and I can see the real value !”In this way you have a return on investment for both the basic and the enhanced servicesShareware or open source software (Linux) use such a model. For example anyone can download a version of Linux from the internet. But once you are using the software you may need support and maintenance services as well as add ons.
Free tend to attract and keep loyal customers.Then the customer base composed of loyal customers start to pay off for extra service. Revenue is then generated which covers the company initial development effort. They see the value and is willing to pay now.I work for an IT company (CA) and we used to have such practice. We give limited, trial copies for free. We also give free pre-sales service to install the software in the customers environment to have proof of concept on our solutions. But once the solution is tested and approved and the customer want to enroll it on a larger basis or functionnal perimeter then full price is charged with access to upgrades, support and maintenance !Examples of online businesses that are successfully using this model.1) Boursoramahttp://www.boursorama.com/palmares/palmares.phtmlPeople go on boursorama to look at stocks behaviour and day to day rates.However loyal users are ready to pay subscriptions for extra services like volility studies, to have an expert view on stock rates (oeil de pro – Eyes of a pro), advice, or pay the service of a broker online to do the job for them2) Freewarehttp://www.ca.com/CA, a software company used to put trial version of its products on line ( these are limited either by the time or the number of users). If such a software is of an interest to someone or a company he can choose to transform the transaction into a professional paid one.3) Lettings service (Arguslogement.com, Meilleurtaux.com)/http://www.meilleurtaux-patrimoine.com/index.phpOne can look at advertissements for renting for free on the internet.However in a view to sell one can pay to have one’s property estimated before putting it on sale.4) Les echos,http://www.lesechos.fr/abonnement/index.htm#Newspaper offering free articles summary to internet users.They also offer for some subscription fee more advanced and specialized articles on particular subjects or the full paper.
Please list 3 additional revenue sources in e-commerce.
Benefiting from the « Long tail eBusiness model »
You sell some star products which you use to attract customers on your site. But customers coming to your site have also access to similar products less known or services or other people’s preferences. As a matter of fact they become exposed to a whole lot of unknown, interesting probably products and services. So the total sale of these products account for an interesting part of the company’s business. That’s what’s called the long tail effect.
Benefiting from the Vente-privée concept
You can also create network of chosen customers who are looking for discounted brand products. These customers will in turn recruit others to the network with the possibility to register online to become a member. So membership is important here in this model and brands just push the products to vente-privée businesses without stock problems or image damage on discount operations. No competition with offline business where full price is practised. Brands pay to be there with their logo published. Also retailers do not need to have discounts and are preserving image and retail pricing on offline businesses.
2. If "market segments are dead", how are segments replaced? Why is it important to the digital economy?
Today on the internet we see new waves which have replaced segments:
- Community of customers is created according to tastes, common points, preferences, motivations, hobbies, habbits,…
- Referral network of users (mouth to ear, sponsorship, recruitment, ) are generated
What’s important today is who buys what, who is clicking, who is referring,….
3. How can 'free' generate revenue for an online business? Please include your favorite example.
By offering for free some services and products you can acquire a lot of customers.Once they become “addicted” or loyal to the service and knowing that they would want more you propose them for a premium price some value added services / products, more sophisticated / enhanced version of the free service, or an extension (functional or quantitative). The initial customer loyalty and attraction is very important. This is how he will be willing to pay for extra service since he know the quality of the basic product and has been using it for some time. The psychological effect is “Now I’ll pay for it since I used to benefit from it and I can see the real value !”In this way you have a return on investment for both the basic and the enhanced servicesShareware or open source software (Linux) use such a model. For example anyone can download a version of Linux from the internet. But once you are using the software you may need support and maintenance services as well as add ons.
Free tend to attract and keep loyal customers.Then the customer base composed of loyal customers start to pay off for extra service. Revenue is then generated which covers the company initial development effort. They see the value and is willing to pay now.I work for an IT company (CA) and we used to have such practice. We give limited, trial copies for free. We also give free pre-sales service to install the software in the customers environment to have proof of concept on our solutions. But once the solution is tested and approved and the customer want to enroll it on a larger basis or functionnal perimeter then full price is charged with access to upgrades, support and maintenance !Examples of online businesses that are successfully using this model.1) Boursoramahttp://www.boursorama.com/palmares/palmares.phtmlPeople go on boursorama to look at stocks behaviour and day to day rates.However loyal users are ready to pay subscriptions for extra services like volility studies, to have an expert view on stock rates (oeil de pro – Eyes of a pro), advice, or pay the service of a broker online to do the job for them2) Freewarehttp://www.ca.com/CA, a software company used to put trial version of its products on line ( these are limited either by the time or the number of users). If such a software is of an interest to someone or a company he can choose to transform the transaction into a professional paid one.3) Lettings service (Arguslogement.com, Meilleurtaux.com)/http://www.meilleurtaux-patrimoine.com/index.phpOne can look at advertissements for renting for free on the internet.However in a view to sell one can pay to have one’s property estimated before putting it on sale.4) Les echos,http://www.lesechos.fr/abonnement/index.htm#Newspaper offering free articles summary to internet users.They also offer for some subscription fee more advanced and specialized articles on particular subjects or the full paper.
Swicki
What is a swicki?
A swicki is new kind of search engine (scan data indexed in Yahoo Search, additional sources specified).
It allows U to focus and go deep into areas of interest to U.
What's interesting is that U and your community choose what's interesting of not (vote for or against). In this way U access valuable, scanned and chosen information by people of your community
A buzz cloud is created which gets updated by further searches in the community.
Their is also a swicki directory where U can find swicki search engines of interest to you.
Just wondering how the community is built though. Probably one has to advertise one swicki to others in order to determine the community and the common interest...
I would appreciate to have more info on this community constitution...
Monday, March 5, 2007
Freemium Business Model
What is the model?
Offering for free some services and products with the main objective of acquiring a lot of customers.
Once they become “addicted” or loyal to the service and knowing that they would want more you propose them for a premium price some value added services / products, more sophisticated / enhanced version of the free service, or an extension (functional or quantitative). The initial customer loyalty and attraction is very important. This is how he will be willing to pay for extra service since he know the quality of the basic product and has been using it for some time. The psychological effect is “Now I’ll pay for it since I used to benefit from it and I can see the real value !”
In this way you have a return on investment for both the basic and the enhanced services
Shareware or open source software (Linux) use such a model. For example anyone can download a version of Linux from the internet. But once you are using the software you may need support and maintenance services as well as add ons.
How does 'free' in fact generate revenue?
Free tend to attract and keep loyal customers.
Then the customer base composed of loyal customers start to pay off for extra service. Revenue is then generated which covers the company initial development effort.
I work for an IT company (CA) and we used to have such practice. We give limited, trial copies for free. We also give free pre-sales service to install the software in the customers environment to have proof of concept on our solutions. But once the solution is tested and approved and the customer want to enroll it on a larger basis or functionnal perimeter then full price is charged with access to upgrades, support and maintenance !
2 examples of online businesses that are successfully using this model.
1) Boursorama
http://www.boursorama.com/palmares/palmares.phtml
People go on boursorama to look at stocks behaviour and day to day rates.
However loyal users are ready to pay subscriptions for extra services like volility studies, to have an expert view on stock rates (oeil de pro – Eyes of a pro), advice, or pay the service of a broker online to do the job for them
2) Freeware
http://www.ca.com/
CA, a software company used to put trial version of its products on line ( these are limited either by the time or the number of users). If such a software is of an interest to someone or a company he can choose to transform the transaction into a professional paid one.
3) Lettings service (Arguslogement.com, Meilleurtaux.com)/
http://www.meilleurtaux-patrimoine.com/index.php
One can look at advertissements for renting for free on the internet.
However in a view to sell one can pay to have one’s property estimated before putting it on sale.
4) Les echos,
http://www.lesechos.fr/abonnement/index.htm#
Newspaper offering free articles summary to internet users.
They also offer for some subscription fee more advanced and specialized articles on particular subjects or the full paper.
5) Etude du marché par un cabinet de Conseil (Gartner, IDC,…)
http://www.idc.com/
Some consulting company can put summaries of their studies online for free.
Companies willing to have a view at the complete picture should however pay to have the complete story and analysis.
6) Viadeo.com (job search, contact, network)
http://www.viadeo.com/connexion/
It’s a collaborative network built by registering online to the site. Its objective is to bring employers and job seekers together on the same network. You consult advertisements but once you want to advertise your own profile, you have to pay to get to be known.
A new article about Freemium (Why It Pays to Give Away the Store)
Your customers will do the publicity for you if your products quality is good and provided....
Here are nine tips from venture capitalists and entrepreneurs.
http://money.cnn.com/magazines/business2/business2_archive/2006/10/01/8387115/index.htm
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