A business model is the way a company creates, delivers and captures value. It covers who the business serves, what it offers, how customers pay, how the offering is delivered and how the company generates revenue.
Business models need to change when market conditions, customer expectations, technology or regulations make the existing approach less effective. A model built for yesterday's conditions can gradually lose ground to businesses that adapt to today's market.
Common business models include subscription, transaction-based, service-based, marketplace, advertising, freemium and licensing models. Many businesses combine more than one model depending on their products, customers and revenue streams.
No. A subscription suits some businesses, but changing a business model can involve pricing, delivery, customer segments, products, services or revenue streams. The right change depends on what customers need and how the business can deliver value sustainably.
Digital transformation can change how businesses deliver products and services, reach customers, automate processes and generate revenue. It can create opportunities for subscriptions, self-service, digital delivery and data-driven services.