Choosing the right business model is crucial for any type of new company. There are often plenty of alternatives for any type of business, whether it is consultancy or a tangible product. A popular one for software companies is the multi-sided business model.
Building a product and giving it out for free, usually makes us think “who will pay?”. Glimts is an example of a startup choosing a multi-sided business model. In other words, one group of customers pay little or nothing and enjoys the product where the other party pays to access or interact with this first group of customers. So how is Glimts going to succeed with that?
– Glimts is about giving companies and its fans, followers and customers a new way of interacting. Never before have users been able to see behind the scene of their favorite company in this way, says Jimmy Antonsson CEO and Co-Founder at Glimts and continues; Never before users have been able to watch with ease new commercials, videos and photos before they have been published from companies of their choice. By watching content from companies, the user is also providing his/her reaction.
Glimts is a new social media app which captures and delivers an authentic reaction to each message. The receiver is being recorded by the front camera while watching, and this reaction is automatically sent back to the sender. In this way, you will always get a human reaction to your message.
Glimts is another example of a multi- sided business model, where companies pay to to be able to interact with its fans, followers and customers like for example Facebook. The user decides who to follow, and can at any time stop following, i.e. stop getting exclusive content from that company. Frequent examples of a multi-sided business model are newspapers and online communities, where the companies make money for instance from advertising. Getting both parties involved with the business is also critical to success. Airbnb is dependent on both the interest of apartment owners and the renters. Because what is the point for a tourist in Paris to enter Airbnb if there is no parisians offering their flat? It is a typical example of the chicken-and -egg dilemma.
How did i decide to go with the multi-sided business model?
– It was quite of a coincidence. At a partner meeting I understood the real interest of getting reactions to marketing content. After investigating if the users would be fine with this, to find out that they would actually like to see targeted and exclusive content from favorite companies, we had found it, declares Jimmy Antonsson, CEO and Co-founder of Glimts.
For any type of multi-sided business model, the platform is crucial for success. This leads to “why is Glimts only available on iPhone? The biggest market is on Android.”
– We launched on iOS, on iPhones, first because it is easier to develop and above all it is easier to track technical issues and update the app. However the Android version is soon going live! We are in the last refining stage.
Facts about the multi-sided business model:
A multi-sided business model brings together two groups of customers. One of the groups basically need the other group to be present in order to succeed. It can often lead to a chicken-and-egg issue. The business model increase in value as the number of users increase, also called the network effect.
Famous examples: Visa, Google, eBay, Financial Times