Practical sheet | REF: FIC1003 V1

Who pays? A key question for reinventing the innovation business model

Author: Michel BARTH

Publication date: August 10, 2024 | Lire en français

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 INTRODUCTION

"Who pays" is a central question when rethinking a business model for a product or service offering.

In most cases, this question is limited to determining the selling or subscription price. In some cases, a "free" service model financed by advertising is adopted. Habit often guides choices.

In fact, a more analytical approach to the revenue model is potentially a source of new value-creating ideas, especially when several categories of direct and indirect service beneficiaries can be identified. To do this, company management will first need to identify :

  • the players and their roles ;

  • the contribution of each stakeholder group.

It will then be possible to make the best choice of revenue model, after imagining the various possible options:

  • make the revenue model a factor in differentiating the offering;

  • make the revenue model a barrier to entry;

  • optimize the type of revenue model.

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Who pays? A key question for reinventing the innovation business model