Revenue modelling in action
Let’s imagine there’s a new retailer in your local shopping centre: Philippa’s Patisserie.
They offer specialty cakes and pastries all made fresh on the premises. Customers can eat in or takeaway.
Within a few months they gain a loyal customer base. Word gets around about their delicious cakes for all occasions and they receive many enquiries outside of their local area. Soon after, they commence a delivery service to a 20-kilometre radius.
With their popularity on the rise they start selling branded merchandise: T-shirts, reusable coffee cups and oven mitts, and the piece de resistance, they publish a book featuring their prized recipes. The book sells like hot cakes, but customers want practical advice. Workshops are run on cake decorating sharing the tips of their trade.
So from humble beginnings of selling cake products, Philippa’s Patisserie embraced business opportunities. It changed its original revenue model by introducing other revenue injecting streams:
- a new service (delivery) resulting in an increase of cake orders
- events (workshops) a fun way to engage a loyal following who share the passion
- expanded product range to non-perishable items (branded merchandise) allowing a wider pool of sales.