A solid business model is the cornerstone of any thriving business: it outlines how your company creates, delivers, and sustains value for customers and stakeholders alike.

However, crafting a robust business model is a complex process. It requires understanding your customers, defining your core value proposition, exploring revenue streams, and coordinating with teams and stakeholders.

We understand these hurdles because we’ve faced them too, and based upon our experiences over the years we have created a simple, workable model that you can benefit from as well.

In this article, we’ll guide you through practical steps to build a business model that works

Click on this image to see an example of how a team is building their business model.

Essential steps to build a solid business model:

1. Identify Customer Segments

Start by understanding your audience. Breaking down your potential customers into specific segments based on demographics, behaviors, and preferences can help you to design offerings that truly resonate with different communities of people who could use your product.

Research is key here; survey potential customers or analyze existing data to pinpoint who you’re serving and what they need most. You can use the available data on Statista to better understand who you’re going cater to.

Analysing Google Trends and using Google Analytics makes your segmentation more reliable and accurate.

2. Draft Value Propositions

Once you know who your customers are, it’s time to figure out what makes your product or service stand out. Your value proposition should clearly address the problems your audience faces and how you solve them better than anyone else. Don’t worry if it’s not perfect the first time;this step benefits from iteration and customer feedback.

Here’s a template we created to give you a good headstart in drafting a solid value proposition. Feel free to download, modify, and create your own version of it: Value Proposition Template

3. Explore Channel Options

Deciding how to reach your audience is just as important as defining what you offer. Explore a mix of online and offline channels to see which works best for connecting with your customers. Think about social media, email campaigns, partnerships, or even in-person events, depending on your audience’s preferences.

Semrush has a great article that can help you choose the best channel for your business: https://www.semrush.com/blog/digital-marketing-channels/

4. Research Customer Relationship Types

Customer relationships are more than just transactions; they’re about engagement and loyalty. Consider how you’ll interact with your audience. Will it be personal and hands-on, automated and scalable, or community-driven? The right approach depends on your product and customer expectations.

If you’re unsure where to begin, a structured approach can make this process easier. To help you get started, we’ve created a detailed guide that walks you through researching customer relationship types effectively.

Download the Guide: How to Research Customer Relationship Types

This guide covers everything from identifying customer personas to leveraging analytics and mapping customer journeys. Use it to refine your strategies and build meaningful connections that foster long-term loyalty.

5. Explore Revenue Generation Methods

Revenue streams are the foundation of any sustainable business model. Whether it’s through subscriptions, one-time purchases, or advertising, explore various options to see what aligns with your offering and audience. Don’t be afraid to test different methods before finalizing the best approach.

To help you dive deeper into this process, we’ve created a comprehensive guide that outlines actionable steps to explore, validate, and optimize your revenue generation methods.

Download the Guide: How to Explore Revenue Generation Methods

This guide will walk you through everything from understanding your value exchange to leveraging analytics and diversifying revenue streams. Use it as a roadmap to create sustainable and scalable revenue strategies for your business.

6. Plan Key Activities

Think about the core activities your business needs to perform to deliver value. This could include production, marketing, customer support, or innovation. Breaking these activities down into smaller, actionable steps will help you stay organized and focused on what truly matters.

7. Identify Key Resources

Every business requires resources, whether physical, intellectual, or human. Identify the ones essential to delivering your value proposition effectively. This might include tools, technology, or skilled team members. Knowing your resource needs early can save time and money later.

8. Explore Potential Partnerships

Collaborations can amplify your capabilities. Look for partnerships that complement your strengths or fill in gaps. These could be with suppliers, distributors, or even other businesses that share a similar audience. Partnerships often lead to creative solutions and expanded opportunities.

9. Refine Value Propositions

Your value proposition isn’t set in stone;it should evolve as you learn more about your customers and market trends. Regularly revisit this step, incorporating feedback and insights to keep your offering relevant and competitive.

10. Choose Channel Strategies

Once you’ve tested different channels, focus on the ones that work best. Optimize these channels for consistent communication and delivery of value. This might mean doubling down on a social media platform or refining your email outreach strategy.

11. Define Customer Relationship Strategy

Customer relationships thrive when they’re built on intentionality. Whether you’re engaging through personalized emails, loyalty programs, or community forums, ensure your approach reflects your brand values and keeps customers coming back.

12. Finalize Revenue Streams

After testing and refining your revenue strategies, settle on the ones that align with your business goals. A solid revenue model ensures financial sustainability while supporting future growth.

13. Establish Key Partnerships

Formalizing partnerships can add significant value to your business. Look for opportunities that align with your goals, whether it’s resource sharing, co-marketing, or distribution agreements. Strong partnerships often open doors to new markets or capabilities.

14. Finalize Customer Segments

This is the culmination of your research. Synthesize data from market analysis, demographic studies, and customer feedback to clearly define your target groups. By understanding the unique needs and preferences of these segments, you can tailor your products or services to deliver maximum value. Finalizing this step ensures precision in your offerings and marketing strategies.

Avoid These Pitfalls When Building Your Business Model

Even when following the essential steps to build a business model is crucial, the process often brings hidden challenges. Addressing the following pitfalls can set the stage for smoother execution and pave the way to simplify and enhance the process.

1. Struggling with Incomplete Customer Insights

Understanding your audience is foundational, but fragmented data often leads to unreliable segmentation. Without a centralized way to consolidate customer insights, businesses risk creating value propositions that miss the mark. Without a proper tool to organize and analyze data can stall progress and leave teams guessing instead of making informed decisions.

2. Drafting Value Propositions Without Collaboration

Value propositions thrive on iteration and feedback, yet miscommunication or disconnected teams often lead to underwhelming results. Without a platform for seamless collaboration, valuable ideas get lost, and refining your proposition becomes a lengthy, frustrating process.

3. Choosing Channels Without Real-Time Visibility

When exploring ways to reach your audience, businesses often struggle to track the effectiveness of various channels. Teams working in silos may choose conflicting approaches, creating inefficiencies and missed opportunities. A clear, visual way to experiment with and evaluate channel options is key.

4. Misaligned Customer Relationship Strategies

Customer engagement requires intentionality, but disconnected workflows can lead to misaligned or poorly implemented strategies. Without a structured system to map customer journeys and relationship types, businesses risk alienating their audience instead of building loyalty.

5. Overlooking Revenue Stream Validation

Testing revenue streams is essential, but it can quickly become a fragmented process without a centralized approach. Relying only on spreadsheets often results in missed opportunities to identify the most profitable and scalable options.

6. Losing Track of Key Activities and Resources

Defining core activities and essential resources is critical for success, yet many teams find themselves overwhelmed by the sheer number of tasks. Without a tool to break these down into manageable steps, it’s easy to lose focus on what truly matters.

7. Coordination Issues with Partnerships

Exploring and managing partnerships requires clarity and accountability, but poor communication and misaligned expectations often lead to friction. A system to track partnership opportunities and formalize collaborations can make the difference between success and stagnation.

Using The Right Tools

Check how this company overcomes Business Modeling challenges

Check out how this virtual workspace is designed for the each step of the business modelling process. From identifying customer segments to finalizing revenue streams, this ensures that every detail is accounted for while making it simple to see the progress at a glance.

This workspace is entirely created in Kerika. Tools like Kerika provide an intuitive framework that makes it simple to plan, execute, and refine your strategy.

Ready to dive deeper into how this workspace works for business modelling? Let’s get started!

Take a Closer Look at This Company’s Business Model Board

1. Add Tasks for Each Business Model Step

At the core of this process are the tasks that make up your workflow. This is where new tasks like “Identify Customer Segments” or “Draft Value Propositions.” created to break down each step into actionable tasks ensures that no part of your business model is overlooked.

2. Customize Columns to Match Your Workflow

Each column represents a stage of the business modeling process. You can rename, add new, or rearrange them to suit your workflow. This customization allows your board to adapt to the unique requirements of your business model.

3. Manage Board Access

This allows you to manage who’s incharge of the board, who can make changes, and who can only view the board. This avoids the overlapping of responsibilities and ensures that every stakeholder knows their role in the process.

4. Communicate With Everyone

Use the Board Chat to address your team and help them focus on the goals. This ensures everyone stays informed and aligned, eliminating the confusion caused by fragmented communication channels.

5. Collective File-Sharing

This is where you can share files with everyone on your team without needing additional permissions. This keeps resources organized and eliminates the hassle of manual sharing, streamlining collaboration.

6. Make Sure Nothing Gets Overlooked

This is where you filter out tasks that matter to you the most. Find out what’s assigned to you, what needs attention, or what’s overdue to prioritize your workflow effectively. This helps you ensure that critical tasks don’t get overlooked and helps your team stay focused on high-priority objectives.

7. Adjust the Board to Fit Your Needs

The settings menu in the top right corner of your board is packed with options to fine-tune your workspace. Here’s a closer look at its seven key features and how they can help your team.

• Overview

The Overview tab provides a quick summary of your board’s status, including completed, ongoing, and overdue tasks. You can name your board, write a description for added context, and even manage translations to accommodate team members working in different languages. Archiving old boards or exporting tasks into Excel is just a click away, making it easy to keep your workflow organized and accessible.

• Settings

The Settings tab offers control over privacy and functionality. You can decide who can view the board, restrict it to team members, open it to anyone with the link, or keep it private. Features like Work-in-Progress (WIP) limits help maintain focus by capping the number of tasks in each column, while options like auto-numbering tasks or enabling tags allow you to further refine your workflow.

• Columns

In the Columns tab, you can customize your board’s structure by adding new columns for workflow stages like “Backlog” or “On Hold.” You can also rename existing columns or rearrange them to better reflect your team’s process. Deleting unnecessary columns keeps the board clean and focused, ensuring only relevant stages are visible.

• Tags

The Tags tab helps categorize tasks for better organization. You can create new tags like “Critical,” “Feedback,” or “Milestone” to sort tasks efficiently. Managing tags is just as simple, edit existing ones or delete those that are no longer relevant to keep the workspace tidy and easy to navigate.

Break Down Tasks Into Manageable Steps (illustration of task card)

Task cards are where your team can organize all the details needed to complete specific steps of your business model. Here’s how you can use them effectively:

• Add key details like the objective, questions to address, and methods for completing the task. For example, outline research methods or demographic analysis for defining customer segments.
  
• Update the task’s progress by marking it as ongoing, needing review, or completed to keep everyone informed about its current state.
  
• Assign deadlines to ensure tasks stay on track. For example, set a due date for completing customer segmentation research.
  
• Break tasks into smaller, actionable steps. Add subtasks like conducting surveys, analyzing trends, or reviewing data to ensure nothing is overlooked.
  
• Categorize tasks using labels to prioritize or group them by themes like collaboration, documentation, or high importance.
  
• Share important files directly within tasks so your team can access resources like reports or presentations without searching elsewhere.
  
• Keep discussions focused by adding comments or updates specific to the task, ensuring communication is clear and organized.
  
• Assign teammates to tasks so everyone knows who’s responsible, promoting accountability and efficiency.

With all these features designed to simplify the business modeling process, streamlined collaboration, centralized information, and actionable task management, Kerika provides everything you need to plan and execute your strategy effectively.

Ready to get started? Let’s walk you through setting up your Kerika account and creating your first board!

Set Up Your Kerika Account

Setting up your Kerika account and creating your first board is a straightforward process that lets you dive right into planning your business model. Here’s how to get started:

1. Signing up is free and easy at kerika.com:

2. If you already use Google Apps, click on the SIGN UP WITH GOOGLE button.
3. If you are already using Office 365, click on the MICROSOFT button.

No additional setup is required, simply follow the prompts, and you’re in!

Kerika comes in 38 languages so you and everyone else can work in the most comfortable setup that you prefer!

Create Your First Board

1. Once logged in, click on the Create a New Board button.
   
2. Select the board type that best fits your needs (e.g., Task Board) and name your board.

You now have a visual workspace ready to help you organize tasks, track progress, and collaborate with your team, the next step is to customize the columns, add tasks, and start building your own business model.

Wrapping Up: Your Roadmap to Business Success

Building a business model can be a complex journey, but with a well-structured workflow and the right tools, you can simplify the process and ensure nothing falls through the cracks. This demo board illustrates how you can break down every critical aspect of your business into manageable tasks. From identifying customer segments to defining key activities and partnerships, every card offers a stepping stone toward creating a robust and actionable business strategy.

By following this approach, you can foster better collaboration, enhance organization, and maintain a clear focus on your goals. Whether you’re refining existing plans or starting from scratch, these cards and their methodologies provide a framework to tailor your own business model. Ready to take the next step? Start turning these insights into action and watch your business vision come to life!