In any business that you’re running the Revenue Streams section of your Revenue Roadmap your one page business plan is crucial. In fact it’s one of the best places to innovate.
First, identify sources of income
Revenue streams are the lifeblood of companies. What sources of income keep your business churning?
Look at similar products to identify a pricing model that appeals to your customers. Be sure to avoid overcomplicating your pricing model. Here are five potential inlets to get you thinking about your company specific revenue streams, of course, there are plenty more outside of the ones below:
1. Asset Sales: Customers pay to purchase ownership of your product, be it a book, camera or coffee mug.
2. Usage Fees: Payment for the number of uses of your product such as the number of minutes spent on a phone or nights in a hotel room.
3. Subscription Fees: Consumers pay for unlimited usage of a product for a given time period like a monthly gym membership or a yearly newspaper subscription.
4. Delivery or Installation Fees: Consumers pay for the installation and/or delivery of your product or service.
5. Advertising: Companies pay you to advertise their product or service on your site.
Innovation isn’t only what people buy. But how they buy it.
Let’s say you own a bakery and you’re selling muffins. Every other bakery in the city also sells very similar muffins. Yes, you might have a unique ingredient that you put in. Let’s say your hero item is a banana bread type muffin that you’re going to add cardamom to and that’s your secret innovation. But do you know that even your revenue base can still be innovated?
What would a bakery look like as a subscription?
For example, what would it look like if instead of a ‘dollar for a muffin’ revenue model, you actually made it a subscription. Perhaps you’re selling to office buildings. Perhaps you’re selling to people who are just coming out of the gym or just heading into the gym and need a healthy muffin, and they don’t want to carry money with them. So they pay you a subscription and just pick up a muffin every day on their way out of a workout. Same time same place, on the way in or out of the gym.
So have a look at your Revenue Streams part of your Revenue Roadmap and think about if there is a way that you can innovate there. What are other industries using as a revenue model? Because there are lots of different ways to price things. If you can create a revenue stream that is very unique for your business or your industry you might just have the beginnings of a really great business idea and potentially open up a whole new market that you’ve never considered before.
A thought experiment tool
To stretch your thinking about your own product or service, try to imagine what your business would look like if your core offering :
- Brought an offline behavior online
- Is sold as a subscription
- Was a rental to the market at lower cost
- Was free or very cheap
- Was an online marketplace of its own
- Is a discovery driven experience
- Produced original and exclusive content (videos, images, articles)
- As a streamline a process through technology
- As purely a messaging interaction. A conversation.
- An audio/voice interaction object (like Echo, Google Home etc.)
- Took a new consumption or creation format
- Enabled easier creation of something
- As a mobile-app
- As a blockchain technology
- Removed features to launch a simpler/better version
- Used AI to create a unique kind of value
- Targeted a crazily specific segment of the market
- Had a technology layer
- As an “On demand’ offer
- As an online community
- As a Peer-to-Peer sharing model
- As a service (if it is a product)
- As a product (if it is a service)