Business model matching is the ultimate big kill device of homogeneous product competition

Editor's note: The English version of this article was published by Kavi Guppta in Strategyzer, the Chinese version by the Heaven Zhuhai Sub-rudder compiled.

David Pierce recently wrote in the Wired magazine that today's technology companies are creating products that are the same as streaming service music, the same efficiency application (Productivity apps), and even the most popular wearable devices seem to have the same value proposition. Is the smoke of innovation ever annihilated? Not really In this article, I will extend the Pierce's views to the point that, through the exploration and innovation of successful business models, winners will be able to swallow the bones of their businesses and draw the boundaries of those highly homogenous companies.

Product homogeneity competition heralds the end of innovation?

Admittedly, David Pierece is right: Today's technology companies do seem to be around the same value proposition for product or service creation, are struggling to the same group of users, trying to get everyone's favor. Google, Apple, Microsoft, and other smaller players all claim that the product they are building is designed to make life easier for customers.
But is this homogeneity a halt to innovation in the field of consumer technology? I beg to differ.

The only loophole in Pierce's argument here is that he did not mention the clear and recognizable business model (exploration and innovation) that would bring profits to these companies, which would allow their services to expand in these new areas. Keep in mind: if there is no good business model – no matter how great the value proposition is in the mirror of the flower water in the month.

So how is Google or Microsoft going to take advantage of the free efficiency app? Can Apple Music, the new iphone, rip a gap in Spotify's ongoing subscription-based streaming music model? Whatsapp,line, and Viber who will eventually win the mobile message this war? So far there's no way to see who can find a way to make enemies (because they haven't finished the third phase of the business model match mentioned below).

The right "match" is the end solution

You might say, "So what?" Google, Apple, and Microsoft all have a lot of money, what is the so-called? "Yes, these companies do have an existing business model that revolves around a known and effective" match "to earn stable revenue. But these business models are not always effective, which is why the importance of their own revolution when they are still successful, or they can only accept the fate of subversion. Apple's itunes is a great example of being subverted by Spotify's companies and the trend of streaming music.

We should invest the money we have earned from our proven business model into the future of the growth engine, and these future growth engines will have a different ' match '.

In our book value proposition design, one of the main concepts we mentioned is to find the corresponding "match". This "match" is the link between the products or services that your company can offer and the needs of your customers. In general, an enterprise needs to go through three stages when exploring their "match". Now, we are talking about these products with the quality of the competition of technology enterprises in fact, only to complete the three stages of the first 22 stages.

For a more detailed description of the match, see an earlier article Nabila Amarsy.

Phase 1: Problem solution matching

At this stage, you don't have enough evidence to prove that your client really cares about the value proposition of your product. This writing idea is still in writing, or just on paper.
Apple, for example, is "written" convinced that their Apple Music streaming services will provide more value to customers than Spotify is in terms of screening and personalization, and Apple is convinced that they can reshape the entire wireless broadcasting industry through the BEATS1 channel. These "matches" are in fact uncertain before the user actually tries to use their product.

Phase 2: Product/Market Matching

The exploration and innovation of product/market matching will be a long and iterative process, not overnight. Your team will constantly test the correctness of your assumptions around your value proposition.

You may also someday find that the ideas you "write on paper" don't actually generate customer value as you would imagine. For example, as the next few weeks test feedback on the use of Apple Music, Apple will find out whether its alleged "screening and personalization" really provides a way for Spotify to connect with users.

But is it possible to sell it? It's time to look at the next critical phase of the "match" quest.

Phase 3: Business model Matching

Business model matching is still a maze for these tech companies that doesn't come out. How these businesses can derive profits from the services they provide will determine their survival.

Designing a value proposition to create value for your customers and create a business model to create value for your company will be a dirty.

Here, let's take Apple for example. After Apple Music's three-month trial is full, we can see if you would like to sign up for a monthly paid subscription. Or are they going to stay in the arms of the original service providers like Spotify?
So far, you should see that the competition for products and services described earlier is now transformed into a sustainable and successful business model of exploration and innovative competition. Google, Apple, Microsoft, and other companies must continue to explore and innovate on the right value proposition and viable business models.

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Business model matching is the ultimate big kill device of homogeneous product competition