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MIS213

Business On The Internet


Assignment Part 2

Simon Trinh: 213162538


Wind Kuo: 212109796
Verena Braren 214373922
Brianisha Mangan: 213117895
Geut Hazan : 214387386

Business Model Canvas


I-Design is an exclusively online business that allows consumers to redesign their homes
through the help of 3D simulations and our very own products. This business model canvas
has been generated to ascertain in detail the business structure and how it proposes to
continue a profitable business and remain solvent.
The Business Model Canvas is made up of the following sections:

1.
2.
3.
4.
5.
6.
7.
8.
9.

Key Partners................................................p. 1
Key Activities................................................p. 3
Key Resources.............................................p. 4
Value Propositions........................................p. 5
Customer Relationships.................p. 5
Channels.......................................................p. 7
Customer Segments.....................................p. 7
Cost Structure...............................................p. 8
Revenue Streams.........................................p. 9

1. Key Partners
Our establishment is a collaboration of works by our key partners to ensure that we can
provide a full service to our customers. Each partner is responsible for a main area of the
business thus allowing customers access to a wide selection of goods and services.
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Furniture manufacture One of our largest departments is the one of our furniture
specialists who develop and produce unique pieces and then release them to the
public through our website. We take pictures of this furniture in our own unique
system to create 3D images, that we upload to the 3D simulation program for

customers to see.
Designers We work with designers to give a service of interior decoration to the
customers. The designers need to be available so that customer questions can be
answered and to provide a thorough service. They work freelance but they are

obligated to provide the service we give.


Image processing company the one that gives us the technology to convert the
user's pictures into 3D simulation. They provide us the service of analyzing the

picture.
Moving company that will deliver the full purchase at once.
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Our Key Suppliers


Our key suppliers are the manufacturers of furniture, home decoration items etc. Our site
mainly shows products that will be supplied by the manufacturers themselves. However, we
also have our own stock of the most popular items that will be distributed from our
warehouse.
Which Key Resources are we acquiring from partners?
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The products we sell


The 3D and image processing services
Design services
Managing the website

Which Key Activities do partners perform?


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Processing the images that the customer uploads to the site


Processing the images that the furniture manufacturers upload
The designers provide the design ideas
Moving the products to the customers house

Motivations for partnerships (from the point of view of the partners)


-

Money Suppliers are paid on a commission basis only while partners are paid by

commission and by a percentage of profit.


Exposing them to new customers
Being at the top of the technology services
Providing a unique service
Another way to sell their products, have nothing to lose and only to gain

Optimization and economy we will be happy to work with as many furniture companies as
possible to give customers across to a wide selection of products. Our goal is to be the main
portal for furnishing that will group all the possibilities.
Reduction of risk and uncertainty means that by having nothing to lose, they do not pay
anything to be a part of our website, and only if purchases are made will a payment need to
be processed. Other means of reducing risk are detailed in the Revenue Stream section of
this canvas.
Acquisition of particular resources and activities The business has acquired the rights to
the technology and infrastructure needed to produce the image processing service thus we
are a pioneer of the technology.

2. Key Activities
In order to remain competitive in the market, providing a huge range of products and
services is the main competitive advantage of our company. There are several key activities
that our company execute to compete in the market and to retain our customers.
New products & services:
There will be new products or services released every 3 months. It can be new accessories,
promotions or packages to match our customers different demands. Furthermore, every
product and service is flexible so any arrangement can be made for customers. These
additional services can be discussed with the company to meet their demands. Most of our
products or services can be purchased on our official website and will be delivered within 3
days after purchase. There will be no additional charges for the delivery services if the total
of purchase is over a certain price.
Create/ Enforce customer relationships:
To ensure that customers will maintain a strong relationship with the company, after sales
services is the most important part. Free consultancy will be provided for our customers
within the valid contract. Our official website will be the main platform for customers to
contact us or send queries. Furthermore, our company provides access to other related
information for our customers in case they are facing problems with their purchases.
Co-marketing:
In order to expand our customer range we are collaborating with other companies. This will
allow us to create opportunities to reach new customers. Our company is able to provide
different types of resources to co-ordinate with our partners, which will create new
competitive advantages for all parties.

3. Key resources
Our online infrastructure, in particular system servers, need to be strong enough to handle
any degree of traffic that comes to our website. To ensure our website is user friendly we
must employ the Best Practise approach into our coding and design.
Our staff is also a key resource in regards to the analysis of our customers, decision making
and design. Innovative staff members who go above and beyond in terms of customer
service and ingenuity are essential.
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Warehouses and the supply networks around Melbourne need to be efficiently managed to
reduce expenses. This will ensure that the value produced is maximised for the lowest
possible cost. Similarly we need to guarantee the delivery of stock in a quick and timely
manner.
In order to support the business start up expenses, it is essential to maintain a good working
relationships with banks, credit unions and potential investors to ensure that we have an
open line of capital. This means that financial assistance is readily available in the business
early years.
I-Design has employed the very best and talented website developers and IT people to
maintain the website and keep it up to date. These industry leaders are instructed to keep
the website in a format that is easy to navigate around and thus consumer friendly. This
includes a competent team of image processor personnel to optimize and further improve
the stability and accessibility of the 3D rendering software.
Exclusive contracts with unique and the top suppliers from around the globe have been
developed to secure high quality, in fashion and unique products to differentiate ourselves
from competitors.
An innovative marketing team exists to advertise globally in several different mediums such
as TV, radio, newspaper and throughout the web in a way that encourages visitations and
participation on our website. The Marketing objective is to pull customers in, not push the
products towards them, therefore our marketing is not considered aggressive.
In the physical component of the supply chain, only the very best machinery and equipment
is used to unload and move shipments quickly. Warehouse staff is also trained to abide by
the highest work safety regulations whilst still being efficient to maximise productivity.
For delivery of our products, we use an intermediary. By shifting that responsibility to a
monopoly Australia Post, it reduces our costs and allows the process to be streamlined so
that stock can be delivered on time.

4. Value propositions
The value that we deliver to the customer is an online home decorating, renovating and
gardening service. A 3D interior simulation will allow the customer to try out different looks
for their home online, before physically implementing the changes. Another option is online
consultation via Skype or our website chat box, which can be used for both interior design
and gardening queries. Once the customer has chosen and ordered their products, our team
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will deliver and arrange everything, such as painting, flooring, gardening etc. Our company
also takes care of the disposal or recycling of customers old furnishings, if required.
Our services will save the customer a lot of time, money and energy. Through our digital
home decorating program, the customer can straight away see how their styling ideas will
look in their house, even without any interior design experience. The customer will also get a
quote for the entire decorating job before order, which eliminates the risk of costs getting out
of control and adding up once the work has started.
Our service will satisfy customer needs such as Newness (it provides a very modern way of
interior design), Customization (easy way of designing your home just the way you want it),
Getting the Job Done (quick, easy and effective), Design (modern designs of furniture and
dcor), Price (the service comes in a package with the selected products, which can be
cheaper than doing everything separately from different companies), Risk Reduction (our
company guarantees good quality products and services), Accessibility (accessible online,
easy to use the dcor program), Convenience/Usability (our service is very convenient, as
the customer only decides online and we take care of the rest).

5. Customer relationships
Our customers expect us to treat them with respect and give them the assurance that we
can provide a worthwhile service. This means that we can provide a website which is easy to
navigate and can be used as a tool to stimulate creativity. We need to build the trust of
consumers and demonstrate that we will do what is right by them to protect their identity by
placing internal controls, which safeguards their privacy such as personal information and
payment details. We want to give customers the confidence to shop with us and know that
we can leave them better off having satisfied some of their demands. Collectively they also
expect transparency so to fulfil this necessity, we will ensure that shipments are prompt and
that customers are notified of the progress of their order.

Young adults would expect us to consistently keep them updated with news feeds that they
can receive through email about promotions, sales, creative ideas and new season
additions. Young families would expect us to personalise our marketing promotions to
specifically target families through the life stages of their children. Another way in which we
will build a relationship with these families is to provide excellent customer care over the
phone or through email as well as provide personal interior design and decorating
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assistance to ensure they chose the best mix of products and services to transform their
house into a home.
Busy young professionals in particular need to access information quickly therefore we have
developed a mobile application which provides full access of our main website in a simplified
step-by-step process which will in return, save time. The amateur designers are the most
challenging customers to please, because they are trying out the site for the first time.
Therefore it is important to make sure our instructions are clear and the system is easy for
them to use. Failure to create a positive reaction from the customer can result in negative
reviews. With those in the middle-aged segment it is essential to develop a very intimate
relationship, because that level of consummation in a traditional way is something they are
used to. For this reason we would like to send out a physical copy of our design ideas mini
magazine so that they know we care about their needs as well and are encouraging them to
use our site.
So far, we have established good relationships with young adults to the amateur designer
segments. However, we have not deployed our plans for the Middle Aged segment yet,
purely because the idea is still being developed. Whether its feasibility will generate a
positive return is still being analysed.
The processes we have put in place for each of our segments are in line with our business
model. Our main goal is to position our segments to feel strongly about the site thus we have
deployed marketing strategies to capture the greatest number of consumers in a cost
efficient manner.

6. Channels
Our customer segments want to be reached through online mediums such as email, as it is
one of the easiest forms of communication. They also want to have their questions answered
instantly. Therefore there will be a service where customers can instantaneously speak to
our customer representatives through a built in Messenger on the site. Some of our older
members prefer to receive catalogues through the postal services in order to stimulate
creativity.

To begin with, we were using email and phone services as a main point of contact. Recently
we have integrated our business systems so that customers have other avenues to reach
us, we will maintain an active Facebook, Instagram and Twitter.
The most responsive channels are our social networking sites that not only provide a lot of
information about our customer segments, but also allow our business name to circulate with
minimal effort. Customers want to stay updated on the news of our site, therefore by
providing information on these social sites the news can easily be viewed from their feed.
The most cost efficient channels are our social media networks, as our posters need to be
designed by a visual communications designer, and then can easily be uploaded to
Facebook and Instagram.
Through statistical analysis we have identified that the greatest traffic that exists on our site
is in the afternoon and night time in most countries. Therefore our news is programed to be
released at those times where they will receive the most exposure.

7. Customer Segments
The type of market we are targeting our products towards is based on segmented marketing.
Segmented marketing is where we divide the market into groups of buyers, dependant on
particular characteristics, and then focus on them to maximize profit. The entire market
would be too broad, so we chose which segments to look into. Our model uses
demographics, more specifically the age lifecycle, to distinguish which market segments we
will target. This was specified in the customer relationships section.

The young adults (18-25)

The young families (ages 22-30)

The young professionals (25-35)

The amateur designer (22-40)

The middle aged (36-50)

Our most important customers are our amateur designers. Those who do not have any
design education but are willing to design the interiors and gardens of their home for fun and
for a change. If these people like the service we provide once, then they are likely to become
return customers and to recommend our company.

8. Cost Structure
The core structure of our business model will be more focused on value we provide for our
customers, rather than focusing on our costing. This is due to the fact we need to maintain
return customers first.
The most important costs are inherent from technologies: We first needed to get our system
developed to our requirements and since then it has been maintained and improved by our
IT specialists. We release a new range every season so to inform our customers through
communication channels, we need to develop posters through detailed visual
communications designers. Simultaneously we also develop home design solution displays,
which are showcased in our catalogue. This requires the expertise of interior designers and
decorators.
To excel in our business endeavours, we need to acquire and maintain key resources.
Although we focus mainly on a supply chain in which the ordered products are sent straight
from our partners to the customer, we still need minimal warehouse space in convenient
locations to store core products. It is also essential to maintain a distribution network to
transport goods to customers in the most efficient manner. Our cost structure is heavily
dependant on exclusive agreements with suppliers around the globe. By negotiating with
them we can cut out process in the middle and pass on the savings to our customers.
Fundamentally our business revolves around the use of 3D image processing developed inhouse for the use of our customers. This will allow them to prepare their rooms to their
desire prior to purchase and installation. In line with our customer service experience, we
need to ensure our employees are trained to a high standard and understand how to
communicate in a well-mannered way with them.
Securing permits and planning transport routes is a key part in our service. This will allow us
to cut cost and time in the delivery stage as we utilize the most efficient transport method.

9. Revenue Stream

Our customers are willing to pay for high quality products and a wonderful online experience.
The service needs to be easy to use, without any other distractions on the page such as
advertising of other websites. However, our current revenue stream focuses on the Clicks
per thousand, which is a helpful way to ensure that we are generating income indirectly from
other avenues. To not disturb the customer, these advertisements will be displayed only in
particular areas of the site, such as at the bottom of a page or along one side.
Previously, customers were only limited to paying via credit card. However we recently
expanded our payment methods, so that almost any card can be used to pay online. For our
business there will be various payment methods to cater for all people. These payment
methods include direct bank debit, Paypal and all major credit cards.
The commission of our service, in particular the 3D rendering and installation of products,
will be one of our main revenue streams. The other one would be through the sale of
products for which we add a mark-up value to. Since we are buying directly from suppliers in
bulk, we are making significant savings.