Page 102 - Transforming an Idea Into a Business with Design Thinking

S tage 3: Craft Business to Know Viability ◾ 81

understand the effectiveness of their marketing campaigns in a man-
ner not possible in the past.
– Cross-industry reach has blurred the lines between industries. This
trend has allowed competition from players in industries outside
the typical boundaries to disrupt historical business models. A
prime example includes Apple, which is not just a consumer prod-
ucts company delivering technology-based products but is also a
mobile phone provider and an entertainment provider that sells
digital entertainment (video, music and games). Apple is now ventur-
ing into health care through its wearable devices and also provides
cloud-based storage capabilities to consumers. Another example is
Amazon, which started as an online bookstore and is now the big-
gest online general retailer and the fastest-growing retailer. Amazon
is also a home-services provider, with grocery delivery and retail
outlets (the Whole Foods chain is owned by Amazon) and is the
leader in cloud services through Amazon Web Services. Amazon is
also venturing into the prescription drug market and aiming to dis-
rupt the health care industry through its joint venture with Berkshire
Hathaway and JP Morgan Chase. More and more cellular service
providers are looking for ways to leverage their vast infrastructure to
provide other services, including banking services and entertainment
content distribution.
– Customer experience has become a competitive weapon for new-
comers. Just over the past 11 years, since the advent of the first
iPhone back in 2007, consumers’ expectations of consumer experi-
ence has altered dramatically. Even though when the iPhone 1 was
launched it had less than 50% of the features of the existing smart
phones in the market – Blackberry, HTC, and so on – the consumer
experience of the iPhone was so much better that consumers flocked
to buy it, even though the iPhone was more than three times the
cost of the existing smart phones. Since then, companies have real-
ized that they can compete and build their business model around a
superior customer experience.
– As-a-Service business models have emerged over the last decade as
a viable competitive alternative. Consumer behavior is moving away
from owning products to consuming the service those products
offer. This can also be thought of as a utility-based business model.
What happened to utilities (electric and gas) decades ago is now