What is a Social Entrepreneur?

Social Entrepreneur is a leader, who is willing and has the power to resolve some social problems that the government or the associations cannot deal with. He is trying to change the world for a better place. So he is not only there to make the margins, but contributing positively to the society as a whole.
He is able to sustain sound financial development of his enterprise to generate the revenue and procure it to finance at least partially for his social activities
Social entrepreneur is innovative, ambitious and persistent. “They are both visionaries and ultimate realists, concerned with the practical implementation of their vision above all else.”
He is charismatic person that makes people not only talk about problems but also ACT and ENGAGE and CHANGE.
‘There is nothing as powerful as a new idea in the hands of a first-class entrepreneur. While a business entrepreneur might create entirely new industries, a social entrepreneur comes up with new solutions to social problems and then implements them on a large scale.’
I think it’s a real shift, because the world is more and more concerned about the social problems, big companies having even Sustainable Development Departments. This is good for the company’s image. At the same time the help resolve difficult issues, and at the same time they promote the company for the customers, but also within the company to motivate the employees, create a hero, and make them understand that they contribute to the society.
Of course, the revenue should be taken into account, a comprehensive financing from the government or the associations should be assured.

Vente-privee.com


1. Vente-privee.com – the six year old French company that holds invitation-only closeout sales over the Internet. It attracts over 1 mln visitors per day, generating over 40,000 sales of items.

It’s the first of kind mover in the completely new online business called Vente Privée.

Vente Privée previously only the off-line activity is the sales normally of the known brands within the frame of 2-3 days with discounts that go from 30 up to 70%. Items for sale include luxury apparel, accessories, wine and Champagne, household linens, baby clothes, and small household appliances. It works on the basis of invitation. Now luxury marks have turned to an online alternative.

Vente-privee.com proposes a completely new channel of distribution for brands. It has a unique approach to merchandising, what other closeout sales don’t develop at all.

2a. Consumers get the luxury brand products with up to 70 % of reduction. They are warned couples of days in advance of the upcoming sales. They considerable save their time and energy.
Internet Business model and thoughtful merchandising system makes the vente privée a pleasant experience. Products are easier to find. Whereas off-line Vente Privée were usually conducted in “bare rooms with cement floors and florescent lighting”, with lots of people, and no merchandising whatsoever.
Loyal customers are rewarded for their fidelity (e.g. magazine Rosebuzz)

Thanks to invitation (‘parrainage’) system the customer feels important and privileged to enter the so called ‘closed clubs’. Thank so the mailing the customer is always up-to-date with the upcoming sales.
By recommending the site to his friends, a user gets ‘les bond d’achat’

2b. The main advantage for the suppliers is that they are able to ‘dump’ their overstock in a very efficient way.
Furthermore they have more control of the brand image. The company proposes a unique value-added merchandising, using models, make-up artists, hairdressers, and photographers, and creates original music for advertising trailers to depict the products in the best possible light.
Another important thing is that the margins are twice more than in traditional closeout sales. The costs are minimised, both stock and sales. They have gained an entirely new channel of distribution. It helps to bring in new customers on- and off-line.
The relationships between the brands and venteprivee.com are really well established, thus they have gained on trust, which is really importation notion in today’s business.
Another important thing they are still able to maintain is the discretion, only the subscribed customers are informed about them.

2c. Partners. The only partner I have found is the MTV who recommends the CD they have recorded. I think it helps to the image of MTV as being young, innovative, close to customers, modern and up-to date with the tendencies.

2d. For the owner the main advantage is of course the revenue – roughly a half-billion dollars, up 40% over 2006. The company claims being beneficent from the beginning of its operation. It is 30 times larger than nearest competitor.
The business model allows the owner to but the merchandise after it has been sold. The costs of stock are still being paid by the supplier, and the owner has only to reserve the items to be sold.
The percentage of return is rather low (around 2-5%).
Being the first in this Business Model has permitted to create a huge advantage over the competitors, building its strong brand name, consolidating the knowledge on the market, and establishing loyal strong relationship of trust with the suppliers.

3. The customers:
The customers are price-sensitive still attracted to known luxury brands. They are time-concerned as well, so they prefer to buy their products online.

4. Venteprivee plays the role of a middleman. They gain a margin from 20 to 40% per item.
Recently they have also created a CD featuring original music for advertising trailers created by their recording studio.

Nevertheless they still have to assure the costs of sales, site construction and the logistics.

5. The competitors are numeroud sites of Vente Privée that have occurred reacently, e.g. BuyVIP or Gilt Group

6. The model can apply offline, as this is how it has started.

7. I think the model is sustainable, as people are always rushing for sales. And in this model sales are all year long! The Internet is booming, buying online in closeout sales is much more pleasant experience than in real-life.

8a. I think they have already done a god job, by offering 8 euros for those who invite their friends. I think now it’s the time to invest more in Communication, to put ads online, or on the radio if it’s legal. If not then I would recommend creating a buzz.

8b. I would probably launched a line of cloths or different products with the VP logo, that would be connected with the fashion tendencies they are describing on their sites. Probably make this production also in limited series, to keep the business model and make the product more unique.

8c. Obviously, they need to expand in different countries of Europe, what they are already trying to do and Asia, probably South America.
Adding other industries to this Business Model, which they have already done too, eg.
Voyageprivee. Another example could be the cars, CDs, electronic devices, mobiles, etc.


Follow this link to see the article I have been using.

http://en.wikipedia.org/wiki/Mashup_(music)

Business Model Evaluation Easy Group


1. Easy Group founded was by Stellios, Greek businessman. His first brand was EasyJet, cheap flights. Then he expanded into other industries: cruises, cars, buses, pizzas, internet café, cinemas…etc, based on the same low-cost concept, making the products no-frill, cheap, available for the masses. In other business the customers are being ripped off. ‘It’s about value for the many, not the few’. Easy companies are based on the principles of the yield management, where customer pays less the further in advance they buy. Wikipedia gives the links to all the brands. We have also used the links that gives Wikipedia to the articles and the last year’s article “There could be a fight”

2. Customers can save their money and get the products that were before unaffordable for some of them. It gives more choice, some of them just don’t need the additional frills to the services, and they prefer to economize. It gives them the value, they feel respected and understood. As Stellios uses the same services, they don’t feel like the company is above them. In general he lowers the prices of the industries.

Suppliers benefit from the success of the company and increase their turnover.

Partners see more possibilities in developing their business and use the name of Easy to attract the customers. The number of customers increases and they can reach other social levels of people than they are used to.

For the owner of the business the comprehensive low-cost structure and internet booking helps to develop the business and assures the healthy profit margins. The company is one of a kind it’s a leader in low-cost sector and can compete with the real industry giants and conduct the price wars. They challenge the price elasticity.

3. Easy Group customers is the mass market, they are price-sensitive. They prefer to buy in advance to pay less. They are not concerned by the frills of the product, what they need is just the core product, no additional fees.

4. Having the low-cost structure plus increasing the volume of sales by proposing low prices helps in generating the healthy profit. The planes are fully booked, the pizza oven are operational over 50 percent of the time, and so on. They have less expenditure in staff and distribution as they sell generally online, product is really basic. The scandal makes the buzz, quite often contributes to good image, so promotional costs are reduced too.

5. In the airline business there are more and more direct competitors, amongst them:

Sky Europe

Ryanair

6. To ensure the low-cost structure the most of the business should be on the Net.

7. We think that in the middle term the model will be of a success, for the moment it’s the turnover is increasing. This is true for some industries, like airline, busses, cruises, cars. For new industries where Easy Group enter even Stelios is not really sure which one will work out.

8. If we owned the business we would have create more of the partnerships. We would have proposed a package of services like Easy Jet+Hotel+Car and create like Easy Voyage. We would have also promoted image of the responsible company who cares about their customers.

In order to expand revenue sources once again, we would have created EasyVoyages and we have also an idea of creating EasyGym, where customer could freely choose the dates and the period of his subscription, from tomorrow till one year and from 1 day duration till 1 year.

In the conventional methods of yield management, the company start to sell the products at a certain price, then lower if it isn’t selling fast enough, and rapidly high the price in the peak seasons or when the fixed costs are covered. Stelios did completely the opposite with Easy products. He starts the price with low headline price that grabs attention, and then raise it according to the demand. But the customer doesn’t know how high it will go, or how quickly.

EasyCruise works on the basis of other Easy Companies. It sails on different destinations now, and targets independently minded travelers at the age 20-40s. So the age of travelers differ a lot, because normally these are more aged people. This is due to the fact that Easy Cruise stays up to the morning at each port, so passengers can really enjoy the nightlife at each port. This repeats every night. Plus passenger can get up and get down whenever they want, with 2 nights minimum and 14 nights maximum on the board, so they are free to choose how long they want to cruise.
The itineraries are designed so that you can take a weekend, short break or a week away at any time of the year. Ships are designed in Easy “Orange” way. There is no spa pool, but there is a small gym. The design is rather simplistic. There are no windows
Prices are based on availability; early bookers got cabins lower price. The cleaning, food excursions, and other services are not included, but can be purchased separately.
Easy Cruise has touched younger generation, made Cruises more available, and appealed to people who have not previously considered of taking a cruise in their life. The cruise industry has become mass-market, it has democratized. This is become fast growing industry sector.
At the same time there is a growing protest from ecologically minded people.

The young adults seem to be interested by this offer. It’s getting popular. And people are switching from other means of transportation to take a cruise that has become as accessible as any other way of traveling. Cruising has become another sort of traveling package.

‘Freemium’

In the world of direct mail, the word freemium (in use since at least 1988) refers to a sample of the company's product that is sent along with a marketing piece (think: tiny boxes of cereal, "personalized" pens, detergent samples, etc.).

freemium adj. Relating to a business model that offers basic services free, but charges a premium for advanced or special features.


Skype gives some of their services for free. And then charges premium for extra services. They same we have seen with Musicovery on our last class. Another example Winamp

Free + premium = freemium

Attract users with free services, then charge them a premium for special features.
Give your service away for free, possibly ad supported but maybe not, acquire a lot of customers very efficiently through word of mouth, referral networks, organic search marketing, etc, then offer premium priced value added services or an enhanced version of your service to your customer base.

Freemium 2.0. Or, the business model known as Google.

Here is the site I used to get the information.
+ reduced costs of communication
+ Freemium 2.0 by giving the services for free you can become an intermediary that is a platform between businesses and the users whose attention you have and whose intentions you understand.

- Word of Mouth maybe not enough go get all the customers as you would have gotten with marketing advertising as the mainstream buyers need to be pushed to buy the products anyways
- Works only if the product is REALLY good and worth recommending