Digital Business Models: The New Value Creation and Capture Mechanisms of the 21st Century

A business model basically describes the way a company makes money. Yet, often we use digital services for free (e.g. Facebook, Google or WhatsApp) or for what seems to be a relatively minor price (e.g. Blablacar, Airbnb, and Amazon). Digital business models are different to traditional business models. Digital Business Models explains the key challenges and characteristics of the various business models that are used by digital businesses. These companies can be a source of inspiration for traditional bricks-and-mortar companies that aim to go digital and/or revamp their traditional business model. Most businesses rely on some form of digital technology for their marketing communication, customer relationship management, supply chain or distribution, yet digital transformation entails a complete reassessment of the way value is created and captured. Digital Business Models details the successful customer acquisition tactics and the development of business ecosystems by digital players. Using the relevant academic and managerial body of knowledge, the authors define the concepts, describe the various ways digital businesses create and capture value and propose some useful tools for managers to analyse a situation, formulate or implement a strategy. Different digital business types are evaluated, such as multisided platforms, digital merchants, subscription-based model, freemium, social media and sharing economy. Each chapter is illustrated with several examples and the appendix comprises four full-length case studies.

Frontmatter --; Preface --; About the Authors --; Contents --; 1 Beyond Digital Ubiquity: The Digital Business Model Iron Triangle --; Part 1: Mastering the Power of Networks: Who is Creating Value? --; 2 Looking Behind the Scene: Assessing the Value Drivers Behind Digital Business Models --; 3 Digital Platforms: Unlocking the Power of Networks --; Part 2: Reshaping Markets: How is Value Configured? --; 4 Marketplaces: Better, Faster, Stronger? Removing Frictions in E-commerce --; 5 “Social” at the Core of a Digital Busine --; 6 Unlocking the Sharing Economy: Scaling Trust with Digital --; Part 3: Capturing (and Locking) the Value: How Is Value Captured? --; 7 Brokerage Model: Scaling with Fees on Marketplaces? --; 8 The Magnitude of Subscription: Monetisation of “Everything-as-a-Service” --; 9 “Free” is Not a Business Model: Business Models Behind Free --; 10 Looking Forward: Is Winter Coming? --; Appendices: Illustrative Case Studies --; A The OLIO Case Study: A Social Enterprise App Tackling the “Chicken and Egg” Paradox --; B Amazon Versus Alibaba: Amazon is Amazing, but can Alibaba Dethrone it? --; C BlaBlaCar: Value Creation on a Digital Platform --; D Hubspot: A Complex Subscription Model for Inbound Marketing --; E AirBnB: Managing Trust and Safety on a Platform Business --; List of Figures --; Index