Most clients I see can clearly articulate their Business Model, but struggle when it comes to describing their Economic Model.
Simply put:
- Business Model = customer-focused
- Economic Model = owner-focused.
Amazon and Wal-Mart share a similar low-cost, wide-selection retail model. However, their Economic Model is quite different, since one business is a virtual store and the other a physical store.
Within the Economic Model, there are four key elements:
Do you differentiate your business model from your economic model?
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