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Friday, July 12, 2019

Catching up with new business models, they will make current ones obsolete

Ateneo Professor on Entrepreneurship

Rizal Philippines
July 12, 2019





Several years ago while teaching entrepreneurship,  I had a topic entitled BMI.  Business model innovation.   Indeed while others work hard on product development or marketing,  but used on an old business model will not work, if competitors are riding a new model...  The business model has to be innovated and even changed....

Some examples of has been trying too hard:

1.  A softdrink company having more adspend although the PTM and needs and wants of customers (and thus the MVP) have changed from need to be refreshed to one of health and nutrition.  Other drinks have come out and have prospered. (Others suggested that the firm market their drink as a household cleaner)

2.   A computer company which has been bought to be private by the founder will not longer be healthy (as was done by a large computer company) which sold its compter company to a Chinese company.   His old business model will not longer win vs the mobile and smart phones.  People hate the heavy lap tops.  People prefer the light mobile device which does everything for them:   time keeping, calendar, alarm, watch, text call, and web access:  email, you tube, etc.    And they are cheaper....  The computer companies:  HP, Dell, will only be fraction of what they used to be.... The world will be populated by smart phones and the computer lap tops will remain with a few hundred million offices and schools...

3.  Gasoline cars will give way to:

     1.  Hybrids
     2. Bicycles
     3. Uber and grab... Why buy a car when you can grab this.?

4.  I was too late to learn the shift in what sells and what does not sell among watches.   I used to be enamored with automatic mechanical watches.  While I invested only in replicas, they cost me a lot of money.  And then I reflected on functionality of watches. 

What is the function of the watch? 1.  To tell accurate time.... and 2.  as jewelry...

     1. To tell accurate time, you need quartz watches which will set you back $20 to $1,000.  which
          accurate between 15 to 20 seconds per month....

     2.  The more accurate ones are so called atomic watches, which are linked to atomic clocks by
          radio control  (to 6 sites around the world) GPS (which drains the battery) and /or blue tooth
          which are connected to cellphones which are linked to atomic watches.  Which makes the
          watches which can cost you up to $2,000 each nothing more than electronic display board of
          the celestial satellites, or your cp.

     3. Which is the better alternative - the smartwatches or wearable which does these things:

          1.  telling time, alarm
          2.  support phone for exercise (up to 21 exercises from cycling, yoga, walking etc)
          3.  pedometer
          4.  gps
          5.  multiple watch faces;
          6.  wifi connectivity for cp calls and texts

         This new product/MVP spells troubles for:

          1. Quartz and mechanical watches (no wonder their prices are dropping and they sell for as low
              as 70% discount)

          2.  Smart phones.  Since some of these watches can be loaded with SIM, have speakers and                       can  access apps, these watches can render the smartphones obsolete.  (since the                                  smartwatches are doing these) cp manufacturers must hedge their bets with the wearables.
              Some predicted that wearables will be nothing in the future.  They are wrong.

   4.  Will brick and mortar malls survive with all the traffic and all the expenses incurred by the
         tenants and the lessor.  With electronics, fast and reliable couriers, you can have goods deliver-
         ed to your homes paid with credit card, fast, can return those you dont need, first hand or  pre
         used.... No traffic, no accidents, no pollution.   Mas mura producto kasi walang mayors permit
         walang rental, (vat?)  Iyan ang huhulihin ng BIR ngayon....

        Mas mura, mas mabilis.... Yong mahirap bilhin na search mo.... From the master producer -
        China
           

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