We have been discussing a little about the revenue logic through the blog posts. However, we wanted to wrap it all up into one single picture. So before we discuss about the events during week 8, here are our business model and revenue logic explained:
Revenue logic:
Picture 6: Potential revenue logic:
Our revenue logic is based on the value we give to our customers and stakeholders. These values are showcased by arrows in the picture 6
Car manafacturers: Our app makes using an EV easier, since it helps the owners to find the free charging stations efficiently. Thus, it makes owning an EV a more tempting option and could increase the revenue of the EV owners if they provide access to our app via smart phone or integrate it to the driving computer
EV Owners: Our app helps EV owners to find free charging stations, which is felt to be difficult at the moment. By providing a system that is easy to use and makes for example payment possible, our app gives them a great value.
EV charger owners: Our app helps EV charger owners to lease their plugs while they do not use one themselves. Thus, our app helps them to gain money which has a direct value to the EV charger owners.
Based on the value we provide, in our opinion there are three potential ways to generate money from the three actors:
Car manufacturers: Car manufacturers could pay a license fee for us, in order to make our service available to all their customers
EV owners: We could be able to generate money from the users either by showing them adds or different types of payments like access to a premium model.
EV Charger owners: We will take a small fee of every transaction to generate revenue. (Main source of revenue!)
-> The core of our revenue logic is to make a freemium app that has a wide customer base and get a somewhat 30% fee of every transaction.
Business model canvas:
Our business model is provided through the same link used in blog post 6:
https://docs.google.com/presentation/d/1sn7YicEVp8jHiKhCFaiN-oSQ3neebo4puXeuhX2-2CE/edit#slide=id.p3
Key partners: Our key partners are car manufacturers, EV charging station manufacturers and public sector. Both types of manufacturers provide parts of the essential infrastructure. By co-operating with them, we could find new potential customers and get usefull insight about for technical issues related to loading the EV:s (experience icon in the previous picture). Public sector is also very important partner, since they could provide for example subsidies in order to enhance EV driving, or other type of support.
Key activities: Our key activity should not be forgotten! We are foremost an intermediator between EV driver and owner of the charging station. Our mission is to bring these two parts together, nothing else!
Key resources: First of all, one key resource is the wide customer base. Noone wants to use an app of only 10 or 20 poles. Then we have to be able to use the location data of the car and the poles to bring them together. Futhermore, while the app is all about the user experience, an user-friendly user interface is a key resource to the success.
Cost structure: Our running costs are low, as we don't have to do much after the launch. Our service should be coded so well, that there are no bugs or any other failures and the service could more or less to run on its own. Of course we need some staff to work around the tech support and development, in order to develop the service and answer customers inquiries.
Customer relations: Our customer relations are based on the active presence in social media. Social media is an efficient way to reach the targeted group and does not cost much, that is very important issue for a small startup. As been said, an active collaboration with the stakeholders is equally important, since the app requires not only customers but infrastructure to work.
Customer Segments: As been named, our three customer segments are EV owners, EV charger owners and car manufacturers, of which the two before mentioned are much more likelier.
Channel: Our app will be available for free in different app stores. In the future EV manufacturers might want to include it directly to their EV:s
Value Proposition and Revenue Stream: These two have been discussed thoroughly in the previous section.
The size of the business
At the moment, the cost of loading an EV could be something around 2€ per 100 kilometres. Because of the amount of EV:s is low at the moment in Finland, our app would not be very big business instantly. In addition, our comission has to be reasonable. For example Virta takes rough 30% of every transaction, which means we would propably get fees that are on average 1-2€ or even less per loading. In order to get the first clients, our app has to be more or less a freemium version so the payments from the EV drivers would not generate much money either.
However, since the concept is great and the amount of EV:s will propably sharply rise in the future, our idea could be a perfect startupp for 3-5 persons. Once the team gets a reasonable amount of customers into the app, in our opinion it would rise the interest of huge car manufacturers. B2B - type pricing model would generate much more revenue. Also, there is always a possibility to lauch the app abroad as well. So it is fair to say, that our concept has at least some potential to become a medium sized business. However, we wanted to be realistic and not base our revenue logic to assumptions.
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