Digitalbuisnessmodals

• Digital business models are an aspect of e-business/digital business. 
• Stands for changes in the business world as a result of ongoing innovations in networked IT and the innovative application concepts developed from it. 
• Digital business models are changing the structures of organizations, value chains, industries and markets. This is what terms such as structural change and digital transformation stand for. 

In modern companies, technology and business models are inseparably linked through business processes. IT can act as an intelligence amplifier in an organization.

• Trend towards self-services – reversal of the nature of services
• Disintermediation (bypassing players in the value chain)
• System access from almost anywhere and at any time (location independence)
• Greater transparency through availability of information
• Video conferencing
• Postal mail → E-Mail → Messenger
• IT forms the infrastructure for coordination of global value creation

A business model outlines how a company creates, delivers, and captures value within its operational context. It's the blueprint for how a business operates and competes in the market.

IT offers significant potential for creating competitive advantages through innovation, improved efficiency, and customer engagement. However, its limitations include rapid obsolescence, security vulnerabilities, and the potential for creating operational dependencies.

IT and IS are deeply integrated into value creation processes, enabling organizations to operate more efficiently, innovate, and deliver enhanced value to customers. 

Examples from the slide set might include how businesses leverage IT for data analysis, customer relationship management, and operational efficiencies.

• Consumers are hybrid → They behave differently in different situations. 
• Consumers have a choice → They choose the offer that best suits their current needs in the respective situation. E.g. buying the same thing once as a gift or investment or to impress someone or in everyday life are all different situations. 
• Customers' decisions also depend on the respective needs situation and the available purchasing alternatives. 

1. Value Proposition
   1. What are their needs?
   2. Who is target group?
   3. How do we generate value for target group (how do we address their needs)
2. Architecture of Value Creation
   1. How do we create such value and in what ways?
3. Revenue Model
   1. How is revenue generated?

• Generic business models describe widespread company types, e.g. of retailers or mail companies, etc. 
• Individual business models describe the individual design for an individual company. 

Economy has become more differentiated and complex where Networked IT is an enabler for a variety of new concepts of value creation:

• Simple & Traditional Model of Value Creation: suppliers – my company – customers. 
• Nowadays, the diversity of value creation concepts can hardly be represented with this simple model anymore. 
• New concept needed: Business Models. 

• customization of software applications provides a competitive advantage.
  • IT, through the development of customizable software solutions, allows companies to tailor their applications to specific business needs. This customization creates a unique value proposition, making it difficult for competitors to replicate the exact functionality and user experience. 

They need to have 2 focuses:

• software company, with a focus on individual application development.
• platform company, with an emphasis on collaboration, an ecosystem, and a comprehensive framework for whatever niche they are in.

• If software is not robust, up-to-date, or well-integrated, it could become a bottleneck rather than a facilitator of success. 
• Poorly designed or difficult-to-use software could hinder employee productivity and job satisfaction. 
• If software systems are not well-integrated, it can lead to inefficiencies, 

• software shapes and supports the business's fundamental structure. 

Technology is at the core of modern business success.

Inseparable Link Between Technology and Business Models:

• Pay per use (number)
• Pay per time (duration)
• Pay per volume (e.g. data volume)
• Sharing
• Subscription
• Flar Rate / Membership
• Anything as a Service
• Examples:
  • Lings: Insurance on a daily basis
  • BlackSocks: Sock subscription
  • Mobilzone: Renting out tablets to businesses.
  • Veloplus: E-Bike Subscription

• two-sided business models with indirect network effects.
• Google, Facebook, Instagram, WhatsApp, Pinterest, YouTube, TikTok, Spotify, etc.
• They offer users on the consumer side superior services, often free of charge. This will create traffic and permission to collect the resulting data and use it commercially.
• They offer suppliers a wide range of opportunities to achieve visibility among users selected based on profiles, to interact with them and to present concrete offers.
  • The platforms generate income: on providers side from advertising opportunities, data sales in the form of targeting and possibly commissions from brokered purchases,
  • on the user side through optional premium services in the freemium or subscription model.

• two-sided business models with indirect network effects.
• useful where there are no established supplier-customer relationships.
• Horizontal marketplaces, such as Ricardo or eBay, sell products and services from different industries side by side.
• Vertical marketplaces, e.g. jobs.ch, limit themselves to a specific market segment and try to bundle the widest possible offering.
• Horizontal and vertical online marketplaces are available with and without transaction support.
  • with transaction support such as Ricardo, a legally binding purchase is concluded on the platform. For this, the seller pays a commission.
  • without transaction support such as anibis.ch, also known as classifieds marketplaces, are pure advertising platforms. Transactions are carried out outside the platform.
• Transactions on marketplaces can be carried out by simply accepting sales offers or through various auction procedures.

It can be advantageous to also view the relevant stakeholders in the business model as a target group and try to make them a supporter of your own positioning through providing them a benefit.

Most service industries are characterized by special business ecosystems that must be included when developing business models. Developing a business model in a service industry first requires a precise examination of the industry structures, framework conditions and dependencies.

• In Consumer Goods
  • Retailer becomes owner of the purchased goods.
  • Retailer assumes risk of loss.
• In Ticketing
  • Intermediary becomes agent (NOT owner) for access to a service (e.g. an event)
  • This means that intermediary never owes the buyer to provide the service as a substitute in case the organizer cannot provide the service.
  • Intermediary is obliged to provide the buyer with compensation owed if provider does not provide service (e.g. event cancellation).
  • To ensure that intermediaries are able to make such potential repayments, they are legally obliged to protect consumer funds collected until service has been fully provided.

• Direct Sales
  • Provider selling own service.
  • Own Ticketing Application (SBB, Swiss)
  • Ticketing as a Service (BLT)
• Hybrid Sales
  • Provider selling own + other party’s service.  
  • E.g. Swiss, BLT, SBB
• Indirect Sales
  • Provider is a commercialization service.
  • E.g. Ticketcorner, Starticket  

- Train Tickets

- Parking

- Monthly Subscriptions for public transport

- Hotels

- Flights

- Streaming Services for Music, Movies, Series, and Audiobooks

- Online Gambling (Casinos, Horse Races, Poker, Bingo)

- Insurances

- Online Gaming (mobile & Computer & Console)

- Digital Media (Newspaper, E-Books)

- Goods Commerce: Approx 60%

- Service (& Travel) Commerce: Approx 40% (23% services, 19% travel)

-The focus of the services is the exchange of electronic business documents (offers, orders, invoices, etc.) supplemented by additional services such as

– Mail Box Services

– Service and format conversions

– Data mutations, data additions, e.g. classifications

– Tracking, evidence functions

– Digital signature (e.g. for electronic invoices) by specialized e-invoicing service providers)

– Transaction assurance (dealing with disruptions)

- Most service providers focus on specific application areas.

- Complexity of e-business is the basis of numerous business models of IT service providers.

- Example: Service provider Contentis for the Exchange of high-quality product master data.

- Electronic connection in B2B business relationships is not always entirely voluntary.

• Procurement controlled by inventory management module of the ERP system.
• Demand for direct goods derived from customer orders or sales planning, both managed in ERP.
• 4 Concrete Steps, which are all managed in ERP:
  • Step 1: Plan Needs
  • Step 2: Allocate Stocks  
  • Step 3: Trigger External order or production orders
  • Step 4: Record goods receipt and keep inventory up to date