Moo

Product Model






MOO

MOO is an online retailer company with a niche in personalized stationery, offering a variety of product lines including business cards, postcards, letterhead, etc.; it is an example of a product business model, offering small-batch, personalized and customized stationery products (created online by end-users) for print and delivery. MOO provides a website that entices stationery retail customers through ease of use, simplistic design, the online inspiration gallery and helpful design advice in the ‘expert tips’ drop-down/tab. In-turn, customers are given the right set of tools along with the design space, ability and creativity needed to create a customized piece of stationery product—suitable for each customer’s pertinent occasion.

MOO scales its business through cushions in delivery time, according to delivery location and urgency within the order placed. CEO and Founder, Richard Moross, believes that quality printing can be scaled, as long as you start off with that mindset and build to deliver what is promised (Index Ventures, 2014). “You just need to design with scale in mind. We’re printing on machines that can print hundreds of millions of cards per year. Our paper is sustainably sourced and all the ink comes from companies that have been making trillions of gallons of it every year. If all the inputs are highly scalable, you can just continue to knock it out” (Index Ventures, 2014).

HISTORY

Richard Moross, MOO’s founder, launched MOO in London in 2004 (Index Ventures, 2014). MOO serves customers in more than 200 countries (Index Ventures, 2014). However, according to the founder and CEO, Richard Moross, this number does not quite represent the company’s development since its foundation in 2004: “A better way to look at it, is that we’re a UK-registered and headquartered printing business, where 80% of our revenue is not from the UK” (Index Ventures, 2014). As of March 2014, about 60% of MOO’s revenues came from America (Index Ventures, 2014). A recent Press Release details that there are further plans to expand market share in the US (icrossing, 2014).

CUSTOMERS – WHO THEY ARE:

MOO predominately caters to two different markets: (1) the commercial or business market (e.g. business cards, letterhead, etc.) and (2) the consumer market (e.g. stickers, gift cards, greeting cards and other print-ables). Moreover, MOO creates a space in which amateurs and professionals can design, innovate and create their stationery needs/desires. The company currently serves the US, UK and greater EU.

ENGAGEMENT – VALUE CREATION PROPOSITION:

MOO creates value through (1) its website’s ease-of-use and simplicity, (2) its custom batch ordering print and delivery system, and (3) high volume savings.

MOO allows customers to save project design work for up to 90 days, and will send email reminders to customers about their in-process work that has been saved, up to the 90-day mark. Customers have a high degree of customization available to them, to design their own products. This is available to customers at no extra cost.

DELIVERY – THE VALUE CHAIN:

Manufacturing has remained in-house in London and its US (regional) hub in Rhode Island (Index Ventures, 2014). The founder believes that given the high value that customers place on materials/design/packaging, it makes sense to be close to the product (Index Ventures, 2014). Despite this current manufacturing design and location, Moross says and reasons that eventually, manufacturing “will have to be moved at some point, because it’ll just get too big” (Index Ventures, 2014).

MOO’s website provides an online platform/catalogue and design center, which allows business customers and consumer retail customers to design, innovate, create and order their customized stationery needs, with the benefit of printing and delivery added on. MOO determines its own product line, sets prices, handles payment and deals with any customer complaints/refunds/exchanges/etc. MOO handles the purchase, warehousing, printing, and inventory management, and contracts with third party logistics companies for delivery. Urgent (next day or 2-day) delivery is available in the UK and in some areas of the EU. In order to check delivery turnaround times, customers can simply use the “online turnaround time calculator”.

MOO also handles all payments, order changes/complications and any further customer issues or complaints. If a customer has an issue, s/he has the option to ‘chat’ with, call or email MOO.

MONETIZATION – VALUE CAPTURE:

Customers pay for purchased goods using debit/credit cards and/or through PayPal within the individual online account portals. MOO offers a 20% discount to students (valid for one use per student per year). As part of a loyalty/new user programme, MOO has created MOOlah, or ‘credit’ points that current customers can obtain by referring new customers. The ‘MOOlah’ is then a credit on the referring customer’s account, in order to be used towards a next purchase.

Sources:

Anderson, E. (2015, March 21). Achica falls to loss despite rise in sales. Retrieved May 6, 2015, from The Telegraph: http://www.telegraph.co.uk/finance/newsbysector/re...

Elfman, L. (2014, March 27). Counterintuitive Business Thoughts from moo.com Founder Richard Moross. Retrieved May 10, 2015, from General Assembly: https://blog.generalassemb.ly/counterintuitive-bus...

Giftware Associations (Giftwrap Interview). (2014). News (About the GA). Retrieved May 6, 2015, from Retailer: Achica, a new type of gift and home retailing: http://www.ga-uk.org/about-the-ga/news/index.htm/r...

icrossing. (2014, November 7). MOO hires iCrossing as global SEO agency. Retrieved May 10, 2015, from icrossing insights - press releases: http://www.icrossing.co.uk/moo-hires-icrossing-dig...

Index Ventures. (2014, March 24). MOO: 'Scaling Can Be Painful'. Retrieved May 10, 2015, from Index Insights: https://indexventures.com/news-room/index-insight/...

Rushton, K. (2011, July 30). Balderton Capital buys stake in Asos co-founder's retailer. Retrieved May 6, 2015, from The Telegraph: http://www.telegraph.co.uk/finance/newsbysector/re...

Sillitoe, B. (2014, May 15). Essential Retail. Retrieved May 6, 2015, from Big interview: ACHICA CEO Steve Robinson: http://www.essentialretail.com/news/article/53748c...

Disclaimer:

Written by Kelsie Langley and edited by James Knuckles under the direction of Prof Charles Baden-Fuller, Cass Business School. This case is designed to illustrate a business model category. It leverages public sources and is written to further management understanding, and it is not meant to suggest individuals made either correct or incorrect decisions. © 2016

Published 21 April 2016



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