Business Model Canvas Guide: Detailed Steps (2024)

Difference between Business Model and Business Model Canva

The term “Business Model” is often used interchangeably with “Business Model Canvas,” but they're not quite the same thing. A business model is a conceptual plan that describes how a business creates, delivers, and captures value. It can be presented in a variety of forms, including a text document, a PowerPoint presentation, or even a simple sketch.

The Business Model Canvas, on the other hand, is a specific tool that helps you visualize your Business Model on a single page. It breaks the model down into nine essential building blocks, making it easy to understand and modify your business model.

In summary, the Business Model is the overall concept, while the Business Model Canvas is a specific tool for visualizing this concept.

Canva Business Model: List of Key Steps

1. Customer segments

Before you sell anything, you need to know who you're selling to.

Customer segments help you understand your different customer groups.

Identifying Markets

To get started, ask yourself if you have only one type of customer or several.

For example, if you sell athletic shoes, your segments could be professional athletes, fitness enthusiasts, and people who are simply looking for casual comfort.

Creating Personas

Imagine a typical customer for each segment (= Persona Marketing)

Give him a name, an age, and imagine his needs and desires.

For example, Rebeca could be a 30-year-old woman looking for durable shoes for intense gym workouts.

Validate with Real Data

Use interviews or questionnaires to confirm that these Personas are representative. For example, you could do an online survey to see if Rebeca's needs are common among your potential customers.

You should now have a clear list of different customer segments, each with their own needs and wants.

2. Value Propositions

What makes your product or service indispensable for your customers? This is where the value propositions.

List the Needs of each Persona

Identify the problems or needs that you are solving for each Persona.

For example, Rebeca needs shoes that provide good arch support.

Define what sets you apart

Identify why your customers will choose your product over another.

In Rebeca's case, she might prefer your shoes because they're made of eco-friendly materials.

You should now have a list of value propositions that directly address the needs of your customer segments.

3. Channels

How are you going to reach your customers?

Channels are the routes you take to deliver your value proposition to customers.

Identify Existing Channels

Consider where your customers are currently going for similar products or services.

For example, Rebeca usually buys its sports shoes in specialized stores or online.

Choosing the most effective channels

Select the channels that are most effective in reaching your Personas.

If Rebeca spends a lot of time on social media, an Instagram ad campaign could be effective.

You should now have a list of channels that will help you reach your customers effectively.

4. Customer relationships

How are you going to interact with your customers from start to finish?

That's what we're going to explore in this step.

Identify the Points of Contact

Consider the different stages in which you will interact with your customers. For example, Rebeca could first discover you through an Instagram ad, then visit your website, and finally, make a purchase.

Define Relationship Type

Is it an automated relationship or is there human contact?

In Rebeca's case, she might prefer an online chat to ask questions before buying.

You should now have a clear idea of how you're going to interact with your customers at every stage of their journey.

5. Income flow

This is where the rubber meets the road. How are you going to make money?

Identifying Sources of Income

What are the ways in which you will earn money? For example, you could sell shoes directly to Rebeca, but you could also offer a subscription service for fitness accessories.

Set Prices

How much are you going to charge for each source of income?

For Rebeca, shoes could be priced at $100, while a monthly subscription for fitness accessories could be $20 per month.

You should now have a list of different income sources and know how much you are going to charge for each one.

6. Key activities

What are the essential actions to make your business model work?

Identify Activities:

What are the essential tasks to deliver your value proposition? For Rebeca shoes, this could include shoe design, inventory management, and marketing.

Prioritize

What are the most important activities? In the case of Rebeca, a high-quality shoe is essential, so design and production could be given priority.

You should now have a list of key activities that are critical to your business.

7. Key resources

Key resources are the essentials you need to keep your business running smoothly.

Identifying the Resources Needed

What are the essential elements for your business? For Rebeca, this could be a supplier of high-quality materials for shoes.

Assess Availability

Ensure that these resources are available and accessible. For example, Rebeca should ensure that its supplier can meet the demand.

You should now have a list of all of the key resources you'll need.

8. Key partnerships

Partnerships can often accelerate success, reduce risks, or give you access to critical resources.

Identifying Potential Partners

Who could help you reach your goals more quickly or more effectively?

For Rebeca, that could be an influential fitness blogger.

Evaluate the benefits

What does each partner bring to the table? In the case of Rebeca, an influential blogger could offer visibility to a large audience interested in fitness.

You should now have a list of potential partners and what they bring to your business.

9. Cost structure

Now, it's time to look at the less glamorous but equally important side of the business: costs.

List Fixed and Variable Costs

What are the costs associated with running your business? For Rebeca, fixed costs could include rent for office space and salaries, while variable costs could be materials for shoes.

Balancing with Revenues

Make sure your sources of income can cover these costs. Rebeca should ensure that shoe sales and subscriptions can cover all of the costs listed.

You should now have a clear idea of your cost structure and how it relates to your revenue.

10. Analysis and Next Steps

Now you have a complete Business Model Canvas, but the work doesn't stop there.

Review and Adjustment

Take a step back and look at the big picture. Does everything make sense? For Rebeca, that would mean ensuring that all the elements align to serve its target customer base.

Action Plan

What are the next steps to put this plan into action?

Rebeca may decide to start with a targeted marketing campaign to generate interest before the product is launched.

Benefits of the Canva Business Model

The Business Model Canvas offers several benefits that make it a popular choice for entrepreneurs, startups, and even large businesses.

• Collaboration: The visual format of the Business Model Canvas facilitates team collaboration. Everyone can clearly see where the business is at and where it wants to go, making it easy to discuss and make decisions.
• Simplicity: One of the biggest benefits is its simplicity. It breaks down complex concepts into more manageable blocks, making it accessible even for those who are new to the business world.
• Flexibility: The Canvas Business Model is incredibly flexible. It can be used for a variety of business types and is easy to adjust when market conditions change.
• Effectiveness: Because the Business Model Canvas fits on a single page, it allows for rapid analysis, which is especially useful in rapidly changing business environments.

By using the Business Model Canvas, you can benefit from a powerful tool that offers both simplicity and depth, helping you navigate the complex landscape of starting and running a business.

Best Software to Build a Business Model Canva

If you're looking to create a Business Model Canvas, you'll quickly realize that the right tool can make all the difference. Dedicated software can help you visualize your business model, collaborate with your team, and adjust your strategy in real time. Here are three of the best software programs that can help you do that.

1. Canvanizer

Canvanizer is an online tool that focuses primarily on creating Business Model Canvas.

It is particularly useful for beginners thanks to its simple user interface.

Features

• Intuitive user interface specially designed for the Business Model Canvas
• Real-time collaboration options
• Export in various formats (PDF, PNG)
• Pre-designed models for different types of business models

Rates:

• Free for basic use
• Pro subscription at $12 per month for advanced features
• 🔗 Give Canvanizer a try

Canvanizer is ideal if you are looking for a simple and straightforward tool to create a Business Model Canvas. However, its simplicity can be limiting for more complex needs.

2. Lucidchart

Lucidchart is a versatile online charting tool that includes features for creating a Business Model Canvas.

Features:

• Variety of models including the Business Model Canvas
• Drawing and charting tools for complete customization
• Team collaboration with integrated feedback and chat
• Integration with third party tools like Google Drive and Slack

Rates:

• Free version with limited features
• Pro subscription at $9.95 per month
• Team membership starting at $20 per user per month
• 🔗 Give Lucidchart a try

Lucidchart is a solid choice if you need more than just a Business Model Canvas.

Its wide range of features can be a bit intimidating for beginners, but it's incredibly useful for more complex projects.

3. Miro

Miro is an online whiteboard that provides visual workspace for a variety of tasks, including the Business Model Canvas.

Features:

• Visual online workspace for the Business Model Canvas
• Post-it and drawing tools for intuitive planning
• Real-time collaboration with multiple users
• Integrations with popular tools like Asana And Jira

Rates:

• Free plan with basic features
• Paid plans starting at $8 per user per month
• 🔗 Give Miro a try

Miro is perfect for anyone looking for a collaborative and visual tool for their Canvas Business Model.

It might be a bit excessive if you're looking for something simpler, but when it comes to team collaboration, it's hard to beat.

Conclusion

Now you have a complete Business Model Canvas and an idea of the next steps to make your vision a reality.

There you have it, now you have a comprehensive guide to creating your own Business Model Canvas.

It is not only an academic exercise, but a living tool that will evolve with your business.

Use it as a roadmap for navigating the exciting but sometimes confusing world of entrepreneurship. Good luck!

Need a step-by-step methodology to launch any type of business with confidence? Take a look at this Entrepreneur Kit