Shapiro and Varian wrote about newspapers, books, music, movies, and computer software
Introduction
Shapiro and Varian wrote about newspapers, books, music, movies, and computer software, but as we all know, the world has changed since then! Some new forms of information goods are podcasts, MOOCs, and smartphone “apps”, as well as a range of web-based information goods. Further, music is now available in a variety of modes, including CDs, streaming subscriptions, YouTube videos, and even vinyl!
Write a 300 word discussion and include the following:
1. Identify one information good that you’re using.
2. How are you acquiring the good(s);
3. that is, what’s the business model?
4. What are alternative business models for your information good and why didn’t you choose those models?
5. Can you think of a better way to distribute this information good?
6. Can you suggest alternative business models for a classmate’s information good? (choose one that is not the same you are writing about)
7. Why would that model be more (or less) successful?
Be sure to use the concepts from this module where relevant.
Here’s a partial list:
Product differentiation
Commoditized
Substitutes/complements
Bundling
Personalized pricing
Versioning
Experience goods
Maximizing control vs. maximizing value
Example:
I do weekly podcasts on three subjects. I use the bundling business model to distribute my goods. Bundling allows me to create differentiation for my services and increase the value of the services. Besides, bundling makes it easier to meet my clients in the middle and straightforwardly.
The alternative business models for my goods would include personalized pricing and versioning. I did not settle on these business models because they would limit my services’ and clients’ value. Unlike bundling, personalized pricing and versioning keep clients from accessing the podcast they want, even on a low budget. Besides, personalized pricing and versioning business models are less accommodative and flexible. Furthermore, my podcasts are not widely diversified, making versioning less applicable. Generally, bundling gives my clients more autonomy in selecting the package that best suits them according to their budget.
Integrating versions of my podcasts will be the best way for distributing my goods. However, since my niche is small, it would not be possible to produce different versions of my podcasts. With the prospect of my niche expanding in the future, I would incorporate versions. I believe that the version business model will be more effective when integrated with the bundling business model.
To a classmate looking forward to distributing podcasts, I would suggest they integrate several business models. Using more than one business model will maximize the services’ control and value. Besides, using more than one business model makes the service packages more appealing and affordable to potential customers. Besides, a “hybrid” business model approach will be more attractive to new clients. Clients will naturally want to have more autonomy and freedom over the services.
(I do not actually do weekly podcasts this is just an example if you’re wondering)
Answer preview to Shapiro and Varian wrote about newspapers, books, music, movies, and computer software
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