It took a tremendous amount of work to come up with our new business model that I am about to share with you. I ask that you spend 15 minutes, carefully reading this blog post and leave your feedback in the comments section below.
Your feedback is vital to me and all 22 of us working here at Finic, we want to know if our new business model makes sense to you. A big thank you in advance!
Finic has a problem. There are many large and established competitors that dominate the online and offline wall art industry.
When I first started Finic I wanted to build a service that would make the best quality wall art, provide the fastest delivery and best customer service.
We have tested the quality of our product with clients and are reassured that our quality compared to all our competitors is the best. Our time to manufacture and deliver the end product is 24 hours while all competitors take seven to fourteen days.
Time to start acquiring users right? We are better than all our competitors! I think many companies would start gaining users at this point, it seems natural to do so.
If we start acquiring users right now, our competitors will see us sooner or later since we’re going to take customers away from them.
When competitors take a close look at us, they will find that our only differentiator is superior quality and speed. How easy would it be for a large competitor to copy our quality and speed? I think it wouldn’t take much for established companies to copy us.
What will happen if our competitors feel a little threatened by what we’re doing? They’ll wipe us out without a blink, they’ll take short term losses just to kill us and I’m confident they will win. They will win because we are only competing on quality and speed.
Many awesome startups who start out doing something better than large established competitors end up dying this very way. They improve quality or speed, and the big guys swallow them as they move into their space. It’s just very easy to copy quality and speed these days.
I started to think of a new differentiator for our business, a differentiator that would prevent the big guys from being able to copy us. This differentiator would get rid of any direct competition we currently have or will have in wall art industry. We would have to tackle the entire experience of ordering and delivery of wall art.
I promised to write about our new business model in an earlier post. In this post, I’ll lay out the entire model. Before I do so, let me explain how we arrived here.
I’m sure you know or heard of a tiny little startup by the name of UBER. I talk about this startup so much at the office that people are starting to make jokes about my obsession with it.
UBER came into a taxi market that has not changed in the last 50 years with a radically different business model. This business model allowed them to differentiate from the existing taxi market so much that they created a brand new market all for themselves. They had no competitors who could copy their model.
UBER has three types of clients:
- People who used to use taxis, now use UBER because it’s better service and costs the same.
- People who use to drive everywhere on their own because taxis were just not as comfortable and now use UBER, because it’s just as comfortable and convenient (or perhaps even more)
- People who used private limo drivers, now don’t need to pay $80K per year because UBER LUX provides the same service but cheaper.
They started to test their concept for the first time in San Francisco, CA with a group of about 100 beta testers, who all wanted to have a personal driver, but could not afford it. A few drivers with their cars serviced 100 customers.
After a while, they received more interest from drivers and clients, so they started to grow. At first, the pricing for UBER was very expensive but with time as they scaled they began to add cheaper cars and became more affordable.
Our New Business Model is similar to UBER
As I thought about a new business model I looked at major problems with the wall art industry today:
Problem #1 Bad quality We tried out 30 different wall art services and found on average very mediocre quality.
Problem #2 Delivery time Almost all companies we tried had a seven-day manufacturing window and a day or two delivery at best.
Problem #3 Packaging It was horrific with all 30 companies we tried out. I wrote about specific issues in this post. I have no idea how companies can operate at such low level of quality.
These are visible problems that we saw and decided to solve right away. We solved these problems by creating a stellar service with best quality and speed. I felt this was not enough since we needed further differentiate ourselves (just like UBER).
I dug a bit deeper to find less apparent problems in the wall art market:
Problem #1 Trust I talked to a lot of people who simply do not trust online wall art services. I was given two main reasons for this: they have ordered in the past and received bad quality prints, and they cannot touch and feel the product
Problem #2 Installation Customers have to install wall art personally. In most cases, customers are not interior designers and don’t always know where and how to hang their prints. As a result, wall art is not evenly spaced and sometimes just looks odd or wrong once hung on the wall.
Problem #3 Hard to make decisions People do not order wall art because they just don’t want to choose the right sizes, colors, frames, and art on their own. They are ready to hang art all over their house, but they don’t want to make decisions about what goes where and which frame would work best.
We solved the first three visible problems by improving the quality and speed of our service. We tested our solution to the market and received fantastic feedback from customers. We are positive we have these first three problems covered.
The last three less apparent problems we just cannot solve by improving our service, we need to change the whole service.
We thought long and hard about how we can change our entire business to solve these last three problems.
Without further ado here is our new business model that addresses all the problems listed above.
Let’s imagine you are our customer, here is a step by step of how Finic will work with you:
- We will conduct most of our work offline. In fact, you will not be able to order anything online. You’re able to browse and learn about our service, our product, our process, our company and book an appointment with one of our agents through the website.
- One of our agents picks up your request and contacts you to set-up an appointment.
- The agent arrives at your house, collects all needed information from you as well as takes pictures of your current wall space and interior.
- The agent leaves your home and promises to show you a custom presentation of how we plan to decorate your walls. Our team, of professional interior designers, comes up with multiple scenarios and options for you. We evaluate all the options and decide with one we want to proceed.
- We come back to your house to present the choices for your design plan, and the one we decided will be the best fit for you. If you are happy with the decision, we place the order immediately while we’re at your house, and you pay right there and then. If you are not satisfied for any reason with our work, we will send the order back to our design team with the feedback you give. We will come back to your house to show the improved version and go through it with you again.
- After payment is secured, the order is sent to a local shop where we print, assemble and deliver the entire order to you, using our courier and installation team within 24 hours.
- We install the wall art on your walls in the precise spots that were picked by our interior designers. We take away any packaging and clean up after ourselves.
- You are happy and tell your friends about us for which both of you receive presents and discounts.
Important aspects of our new business model:
- Although our ordering system for our agents and interior designers will be online, we will always have a local shop near our customers. We will add cities one by one to our coverage area.
- Our sales agents will work as contractors.
- Our local shops will be franchises (still deciding). They will not manufacture the materials, they will only print, assemble, deliver and install the order.
- Manufacturing will all be in one or two central locations in the U.S., perhaps in Colorado, North Carolina or Nevada. It will be 100% under our management and control.
- We will have several warehouses around U.S., where we will keep all our supplies and materials.
- Our custom built software will track and monitor orders to place orders for shipment of right materials, to the right shop, at the right time to fulfill an incoming order.
- Our software will all also monitor all the printing, assembly and installations done by our shops. Our customers will leave feedback after every order that our system will process and front up any issues or concerns it can identify.
- We will be completely transparent, you will be able to see all details about every shop, agent and interior designer on our website. Shops will compete in a monthly competition for the first place in the quality of service. They will receive bonuses for scoring in the first three places.
- We will have a very strict policy on poor quality and poor service with our customers. If any of our shops repeatedly break our system, we will be forced to close it down.
We are also thinking of offering additional services from photographers and graphic designers to help our customers take and improve their photos. In my interviews, I found that many of our clients do not have quality pictures to put up on their walls. Finic will offer a service to schedule a photo session with one of our hand-picked photographers from our network.
We will have a network of graphic designers who will improve old or poor quality images for our customers and make them look pristine.
We had another idea to let the interior designer build a virtual model. It would provide the interior of the house, after which our graphic designers will add the photos and wall art into the model so that the customer can see how everything will look before placing the order.
We have tons of ideas like these, all of them are lying neatly on a shelf right now and waiting for their turn.
In the middle of this post, I mentioned UBER, which came into an existing market with a business model that was very hard to copy for existing companies.
The same situation applies to us, the business model I laid out in this post is very hard to copy for existing companies in the wall art industry.
I truly believe we will transform the wall art industry. We are going to offer a service which has never existed before, our first customers will tell their friends about their experience.
I have a vision of how we will scale and grow our business, that I will share gradually through a series of blog posts.
Last week our team met to discuss how fast we want to build the business I described in this article. We decided we will take baby steps and build gradually. We will start with a superior quality and move forward adding one item from the model I described at a time.
In the next post, I’ll share the first steps we have taken to build a service based on this model.
At the beginning of this post, I asked everyone to read this post of our new business model and leave a comment with any feedback you might have. A big thank you to everyone who has read it and an even bigger thanks for leaving your feedback!