The Business Model Canvas (BMC) is a visual, one page model that maps in nine building blocks how your business creates, delivers and captures value. It was developed by Alexander Osterwalder and helps you see at a glance where your model is strong and where the open questions are.
Most explanations stop at a list of the nine blocks. This guide goes further: for each block you read not only what it is, but how to fill it in, with concrete questions and an example. At the bottom you will find a free template to start with right away.
1 page
your whole business model in one overview
9 blocks
from customer segment to cost structure
2010
created by Osterwalder and Pigneur
1 to 4 hrs
to fill in together
Download the Business Model Canvas
A blank, fillable one page template. Print it on A3 or larger and fill it in with your team.
The nine building blocks at a glance
For whom do you create value?
Which problem do you solve?
How do you reach customers?
What relationship does each segment expect?
What do customers pay for?
Which resources do you need?
What must you do really well?
Who do you need?
What are the biggest costs?
How to fill in each building block
Below you walk through the approach and an example per block. The example we follow is a premium webshop in design furniture, so you see how the blocks connect.
1. Customer Segments: for whom do you create value?
Start here, because your whole model revolves around your customer. Describe the groups you serve and what sets them apart in need, behavior or value.
How to approach it: split into segments as soon as they require a different value proposition, channel or relationship. For each segment, establish how large it is, how profitable and how well you know it. Avoid the overly broad “everyone who buys furniture”.
Example: our webshop serves two segments. Private buyers with taste and budget who want to upgrade their interior, and interior designers who buy for clients. Those two expect very different things, so you split them.
2. Value Propositions: which problem do you solve?
This is the heart of the canvas: the reason customers choose you. Describe which problem you solve or need you fulfill, and why that is better or different from the alternative.
How to approach it: tie each value proposition to a segment. Name the concrete gain (time, money, status, ease) and the pain you remove. Test your proposition with the question: would the customer miss you if you disappeared tomorrow?
Example: for the private buyer the proposition is “gallery grade design furniture, delivered to your door without hassle”. For the designer it is “a reliable partner with fast delivery and business terms”. A strong proposition deserves a brand that radiates it. That is where branding comes in: your positioning translated into an identity that builds trust.
3. Channels: how do you reach your customers?
Here you describe how you get your value proposition to the customer: how they discover you, how they buy, and how you deliver and support.
How to approach it: for each segment, walk through the phases of awareness, consideration, purchase, delivery and service. List the channels and judge which work best and deliver the most. Examples of channels are organic findability in Google, ads, social media, email marketing, partners and referrals from existing customers.
The most powerful and durable channel for most brands is organic findability. With strong SEO and AIO you get found by people who are actively searching for what you offer at that moment, without paying per click. This is one of our flagship services: we build findability in Google and AI from the first sketch. Read more in what is SEO and outsourcing SEO. And do not forget your most important channel: your website itself. A fast, conversion focused custom site ties all your channels together and turns visitors into customers.
Example: the webshop attracts private buyers through organic findability on terms like design dining table and through Instagram, and reaches designers through targeted content and a business portal on the site.
4. Customer Relationships: what relationship does each segment expect?
Describe what type of relationship each segment expects, and how you build and maintain it: personal, automated or self service.
How to approach it: for each segment, decide what fits the value and the margin. A high margin justifies personal contact, a low margin calls for smart automation. Describe how you acquire, retain and grow customers.
Example: private buyers get an automated but personal feeling journey, a welcome series, smart recommendations and proactive service. Designers get a dedicated contact. You build the automated side with marketing automation: follow up and service that run themselves, so your team has time for the relationships that deserve it.
5. Revenue Streams: what do customers pay for?
Here you make concrete how you make money: what value are customers really willing to pay for, and how?
How to approach it: name the revenue stream and pricing model per segment. One off sale, subscription, license, commission? Test your price against the value you deliver, not just your costs.
Example: the webshop earns from one off sales with a healthy margin, plus a recurring stream from designers who buy each quarter. An extra stream is a paid styling service. Good conversion rate optimization touches this block directly: a higher conversion means more revenue from the same traffic.
6. Key Resources: which resources do you need?
The most important assets that make your model work: people, technology, stock, brand and capital.
How to approach it: for each value proposition and channel, ask which resources are indispensable. Mark what you have and what is missing. Do not underestimate digital resources: your website, your data and your findability are often your most valuable asset.
Example: for the webshop the key resources are the supplier relationships, the stock, and a fast, reliable website with strong findability. That last one is exactly the kind of foundation we build.
7. Key Activities: what must you do really well?
The most important things you must do to deliver your value proposition and make your channels and relationships work.
How to approach it: derive the activities from the previous blocks. Which activities does your proposition require, which your channels, which your relationships? Distinguish what you do yourself from what you outsource.
Example: for the webshop the key activities are sourcing and curation, logistics, and maintaining findability and conversion. Those last two, findability and conversion, the webshop outsources, so the team can focus on curation and service.
8. Key Partners: who do you need?
The partners and suppliers that strengthen your model: what do you do yourself and what do you bring in from outside?
How to approach it: decide which partners reduce risk, provide resources or take over activities. A good partner does something better, faster or cheaper than you can alone.
Example: the webshop works with furniture makers, a logistics partner for delivery, and a digital partner for web, findability and automation. That digital role is where Viralistic steps in: design, technology and findability under one direction.
9. Cost Structure: what are the biggest costs?
The most important costs your model brings, derived from your resources, activities and partners.
How to approach it: list the biggest cost items and decide whether your model is mainly cost driven (as low as possible) or value driven (premium experience). Compare your costs with your revenue streams to see whether the model holds up.
Example: the biggest costs are sourcing, logistics and marketing. Because the webshop chooses organic findability over expensive ads, the marketing cost per customer falls as the SEO gets stronger. That is the beauty of this channel: it gets cheaper while it grows.
The canvas is a starting point, not an end point
The BMC makes clear where the open questions are. Which channels really work? Is it clear who your segments are? Treat the canvas as a living document you update as you learn more.
How to run a canvas session
Print the template on A3 or larger. Use a sticky note per idea, so you can move and revise easily without filling up the overview.
Begin with the customer segments and the value proposition. Only once those are sharp do you fill in the rest. Otherwise you build a model around an assumption.
First fill in all blocks roughly for the overview. Then go deep per block. A first version in an hour beats a perfect one that never arrives.
Use a different color to flag what you are not yet sure of. Those points are your research agenda and show where your biggest risk is.
From canvas to execution
A filled in canvas is only valuable once you execute it. And that is exactly where the blocks meet the places we help brands move forward. Your value proposition and segments translate into a brand and identity that build trust. Your channels you make strong with findability in Google and AI, our flagship service, and with a custom site that turns visitors into customers as your central channel. Your customer relationships you keep efficient with automation. That way the canvas is not a paper exercise, but the basis under a brand that grows online.
Download the Business Model Canvas
Print it on A3 and fill it in with your team. A blank, fillable one page template.
Frequently asked questions about the Business Model Canvas
What is the Business Model Canvas?
According to Viralistic, the Business Model Canvas is a visual, one page model that maps in nine building blocks how your business creates, delivers and captures value. It was developed by Alexander Osterwalder.
In what order do you fill in the canvas?
Start on the right with the customer segments and value proposition, because everything revolves around them. Then work toward channels, customer relationships, revenue streams, and finish on the left with key resources, key activities, key partners and the cost structure.
How do you fill in the Channels block well?
For each segment, walk through the phases from awareness to service and list the channels. For most brands organic findability through SEO and AIO is the strongest, most durable channel, because you get found without paying per click. Your website is your central channel here.
Is the Business Model Canvas free?
Yes. The model is free to use. You can download our template above as a free PDF and fill it in right away.
From strategy to a site that converts
Got your model clear and want to translate it into a strong online presence? Book a free call with Viralistic.
