Many of these new start-ups use the internet as an exclusive channel for most business activities, because it requires a significantly smaller initial investment, therefore also reducing risk, and it also facilitates offering your solution or service on the global market.
It’s clear that the digital revolution influences certain changes in business, and requires the undertaking of activities to defend its market position, margin and profits, but it’s not simple to determine how.
The most simple and common way is to delegate the digital transformation to the IT department, which introduces the internet as a channel for some business activities, mostly marketing, but sometimes also sales. Looking at it from a business standpoint, all of the income still comes from the old ways of doing business, and there is no real change, but who likes changes anyway? The common excuse is that the industry branch that the company belongs to is not under the influence of digital economy, and will not be for some time.
This is something often heard when we begin a conversation on digital revolution, transformation and change that is imminent for all the branches of industry. The digital transformation is a process of analysis and careful consideration on how to improve and update all nine elements of the business model canvas, and how to combine them all into a new business model that will enable growth in digital economy.
In the previous part, we have discussed value propositions for different client segments, and this is the next step in business model innovation that relates to channels of communication, marketing, sales, supply, support, maintenance and all other business activities. This is an important step in business model innovation, but only as a part of comprehensive consideration of all nine elements of the business model canvas.
The internet has become a new and very important channel for most business activities. In some cases, such as communication (e-mail, messaging, image and video clip exchange), news access, information, air ticket purchasing, hotel reservations, various bank transactions, shopping and many more, the Internet has become the dominant channel. The latest analyses show that over 90% of ticket sales is done online, and is preceded by detailed searching and offer comparison of internet offers, including the ones that don’t end online. Many of these new start-ups use the internet as an exclusive channel for most business activities, because it requires a significantly smaller initial investment, therefore also reducing risk, and it also facilitates offering your solution or service on the global market.