Project Part: Business Model Canvas Hypotheses and Testing
This part of the report is about getting real. Yes, you analyzed the market and saw how big it is. And, yes, you looked at the competition and saw who is doing what and what they are claiming to be good at. And, yes, you have an idea of what your product is, what it does, who may like it and willing to pay for it, and how you can make money on this idea?
It is time to know whether you are daydreaming, or you are really onto something. It is time to test your hypotheses.
What is a hypothesis? a supposition or proposed explanation made on the basis of limited evidence as a starting point for further investigation.
The below chart is Business Model Canvas, with its nine blocks. Each block holds a hypothesis.
Or, like the one below with an example.
What you saw above with the Facebook example is set of hypotheses. Facebook is constantly testing those hypotheses with their mini experiments. For example, recent change in the emojis was one of those experiments.3
Side 1 - Value proposition hypothesis- personalized experience by connecting with your friends at a deeper level
Customer segment hypothesis- personal users (requires more in-depth profiles on customers. Which personal users? Demographics & Psychographics) Revenue stream hypothesis - free
Side #2 - Value proposition - reach and relevance Customer segment - advertisers Revenue stream - ad revenues
Let's see how did the emoji change experiment turn?:
Here is part, named Hypothesis testing:
Section #1: Set out the hypotheses for each block of Business Model Canvas - you can do this on an empty business model canvas (more here: https://www.businessmodelgeneration.com/canvas/bmc) or, you can just write it on your
Section #2: You will be talking with people. Which people? Customers, clients, suppliers, potential partners. On the phone, face to face, with e-mail, with Skype/Facetime whichever communication method you choose. You will talk about your business idea and get an idea of how realistic your business idea is. Don't talk with average users, they will not know. Talk with people in "PAIN" who are aware of the problem and already looking for a solution. 5-10 people in total (I am considering that you have a team. If you don't, then 2-5 people).
This section will compile your findings. I am looking for four things: (1) Who did you talk to? (customer/client/partner/supplier/investor), (2) Why did you talk with them (3) what did you ask? (4) what did you find?
Section #3: Create a table with two columns: (1) This is what we thought (2) This is what we found
This is what we thought This is what we found
Section #4: What did you learn? Which hypotheses were confirmed? Which ones need modification? Did you learn anything different? What is the revised set of new hypotheses?
Attachment:- Assignment.rar