Business Model Canvas Deconstruction: Bluesmart Organization

This report provides a comprehensive analysis of Bluesmart's business model using the Business Model Canvas. It begins with a succinct description of Bluesmart, an international travel technology organization known for its innovative smart luggage products utilizing Internet of Things (IoT) technology. The report then deconstructs Bluesmart's business model by examining the nine building blocks of the canvas: customer segments, value proposition, channels, customer relationships, revenue streams, key activities, key resources, key partnerships, and cost structure. The analysis highlights the relationships between these building blocks and identifies critical success factors, such as technology innovation and effective promotional strategies. The report also addresses potential downside risks, including pricing strategy and technology issues, and suggests changes to the business model for improvement, such as website enhancements and diversified marketing efforts. The conclusion emphasizes the importance of adapting the business model to changing customer needs and market trends for sustained success.

Running Head: BUSINESS MODEL 1
Business Model Canvas: Bluesmart
Organization

BUSINESS MODEL 2
Table of Contents
Succinct Description about the Business.........................................................................................3
Business Model Canvas...................................................................................................................3
Relationships across Nine Building blocks of Business Model Canvas..........................................6
Critical Success Factors...................................................................................................................7
Downside Risk.................................................................................................................................7
Changes to the Business Model.......................................................................................................7
Conclusion.......................................................................................................................................8
References........................................................................................................................................9

BUSINESS MODEL 3
Succinct Description about the Business
Bluesmart is an international travel technology organization which produces and develops travel
products with the Internet of Things (IoT) technology. The company started its business
operations in the year 2014 (Bluesmart, 2018). In this year, this brand has introduced a carry-on-
suitcase on the crowd-funding website i.e. Indiegogo. This initiative assisted the organization in
raising $2.2 million in the contributions and it became one of the highest crowdfunding projects
for travel technology product (Bluesmart, 2018). It is headquartered in New York City, United
States and it is offering its products in various international markets such as China, India, and
UAE (Garun, 2016). The major products of this company include Smart Laptop Bag, Smart
traveller bag, Smart Passport Pouch etc. This organization is very innovative as it is producing
the smart bag with smart lock, charger, tracking system, smart weight system, trip planning and
digital alerts. The most innovative thing about Bluesmart is the use of Internet of Things in travel
bags.
Business Model Canvas
Business Model Canvas is template that is created by an organization to describe different
components of an organization. It is visual chart that shows various elements defining
infrastructure, value proposition, finances and customers (Osterwalder, et al, 2014). The business
model canvas for Bluesmart is given below;

BUSINESS MODEL 4
Key Partners
 Technology
partners
 Integrated
communication
solution provider
 Logistics
partners
Institutions
 Suppliers
 Retail partners
Key Activities
 Manufacturing of
smart luggage bags
 Implementing
technology
innovation
 Generating profits
and revenues
 On-time delivery
Value
Proposition
 First smart
traveller bag
manufacturer
 Utilization of
advanced and
smart
technology
 Variety of
products
 Travel bags
with smart
features
Customer
Relationships
 Use of
Innovative
techniques
 Offering
safety to
travellers
 Effective
advertising
and
promotion
 After sale
service
Customer
Segments
 Travellers
 Tech savvy
people
 Smart phone
users
 Mass
population
Key Resources
 Physical Resources
 Human Resources
 IT infrastructure
 Web and software
developer
Channels
 Mobile app of
Bluesmart
 Retail partners
 Web partners
 Online website of
Bluesmart
Cost Structure
 Cost of website maintenance
 Salary to mobile app developer
 Marketing costs
 Costs of raw materials
 Technology costs
 IT infrastructure costs
Revenue Streams
 Sale of travel bags
 Product crowd-funding
 Sponsorships
 Revenue generation from Targeted market
The business model canvas of Bluesmart includes nine blocks which are described below;

BUSINESS MODEL 5
Customer Segments
For offering its products and services, Bluesmart Organization has targeted different market
segments. The organization is targeting the people who travel for longer distance. The smart bags of
the organization provide safety travel experience to people as it includes smart locks and tracking
system. In addition to this, the organization has manufactured its products considering tech savvy
people and smart phone users.
Value Proposition
Bluesmart has introduced smart technology travel bags by considering the needs and wants of
customers. This business is creating value for the customers as a first smart traveller bag producer.
To attract the long-distance travellers, it has used smart technology and Internet of Things. It is
offering variety of products with smart features like smart lock, charger, tracking system, smart
weight system, trip planning and digital alerts (Amit, & Zott, 2012).
Distribution Channels
The organization has established various distribution channels through which it is offering its
products to customers. The major distribution channels of this firm are Mobile application, web
partners and online website of Bluesmart. The major retail partners of the company are Selfridges,
Sake 5th Avenue, Moma Design Store etc.
Customer Relationships
The organization has maintained better relationships with its customers. It is manufacturing the
bags by identifying the needs of customers. It is implementing effective advertising and promotion
strategies. It is using after-sales services and taking customers’ feedback on its products (Hatten,
2015).
Revenue Streams
This company is offering innovative products so it is able to generate significant revenues from the
sale of smart bags. It is raising revenues from product crowd-funding from websites like Indiegogo.
It is providing effective customer satisfaction that assists it in generating more revenues and profits
(Kohler, 2015).

BUSINESS MODEL 6
Key Activities
Key activities of Bluesmart Organization are manufacturing the smart luggage bags by using
effective technology innovation (Amit, & Zott, 2012). It has focused on delivery the traveler bags
on time and it is fulfilling the order on time.
Key Resources
The key resources at Bluesmart are such as physical resources, finances, human resources, and IT
infrastructure and software developer. The organization is managing its human resources by
conducting training program so that they can learn new and innovative things.
Key Partners
Key partners of this organization are technical partners, retail partners, logistics partners and
suppliers. These are the partners which are assisting the organization in completing Bluesmart’s
business operations (Yang, 2014).
Cost Structure
Cost structure includes different costs like technology costs, administrative costs, salaries to people
and costs of website maintenance. It has managed its cost structure with the transparency and
effectively.
Relationships across Nine Building blocks of Business Model Canvas
There is an effective relationship between nine building blocks of business model canvas of
Bluesmart. By the above analysis, it can be stated that all the blocks are related to each other as
Bluesmart needs all the business components for reaching to the top position in smart luggage
industry. To start its key activities, Bluesmart needs to target a specific customer segment
considering its key resources. Value proposition of the company can assist it in developing relations
with the customers. The organization that develops business model canvas needs to establish
coordination among each and every component (Gil, 2018). The organization is able to generate
significant revenues by managing its key activities and resources. Bluesmart is working on the
interrelated functions like reliability and responsiveness. So, it is very important for managing the
relationships between all the blocks of business model canvas.

BUSINESS MODEL 7
Critical Success Factors
At Bluesmart Organization, one of the major success factors is innovation that is implemented by the
organization in its Smart luggage bags. The organization is manufacturing its products by adopting
technology innovation. Technology innovation is the type of innovation that includes updated
technology in production process. Bluesmart produces Internet of Things travel products and bags
that is the major attraction towards its products (Dijkman, et al, 2015). There is an application of
Bluesmart that controls the suitcase and bags. The major technology of smart cases includes the
smart lock that enables the users to unlock and lock the bags using phone application. In this sensors
can lock the bags automatically when it is detached from users. In addition to this, the promotional
strategy of the company is very effective (Garun, 2016). Another success factor of the company is
that it is able to fulfill the needs and wants of targeted customers. It has provided committed
products to its customers. The company is crowd-funding through websites for selling its products. It
has proven key success factor of Bluesmart Organization. Thus, these are the factors which the
company has to get right to attain sustainable success.
Downside Risk
Downside risk is a forecast of security to suffer a decline in the value of products if there will be
changed in the market conditions. At Bluesmart, one of the major contributions to downside risk is
its pricing strategy. The company is manufacturing its products by the use of updated technology
that increases its cost of production. So, company charges higher prices to the customers for its smart
luggage bags. In the country, there are various people who are still not aware about the smart
technology that is used in smart traveller’s bags. They are not using smart bags that can affect the
business of Bluesmart Organization (Ang, Chen & Xing, 2006). Moreover, the organization may
face the risk due to technology issues. There may be possibility of defects in the smart technology
system such as smart locks, charger and tracking system. The organization should prepare a pre-plan
and strategies to overcome the future downside risks.
Changes to the Business Model
In the case of Bluesmart Organization, some changes can be introduced to improve its business
operations and activities. First, the organization needs to innovate its website and make it more
attractive. It can make it more customer-friendly so that they cannot face any issue while surfing it.

BUSINESS MODEL 8
The technology innovation in the products should be at the fullest (Andersson, et al, 2016). It should
not cause any technical issue to the customers. The business will provide effective technical training
to product and software developer. Under business model, Bluesmart can expand and diversify its
key activities. In addition to this, I would like to make changes in its pricing strategies. The current
prices of the company’s products are very high so it needs to lower its prices. However, the business
model of Bluesprint Organization is effective and consistent but it needs to update the business
model and products time to time. Looking at the market trends, it can be seen that people are very
much active on social media networking sites so this organization can advertise its products on
social media sites such as Facebook, Instagram and Twitter (Johnson, Christensen & Kagermann,
2008).
Conclusion
Thus, the above report concludes that Bluesmart is one of the most innovative organizations that
have started its business operations within last five years. The organization has introduced its
products with smart technology. The report includes the business model canvas for Bluesmart
Organization. It shows that organization has managed all of its components effectively. For a
company, it is very important to update its business model so that it can update the products
according to changing needs and trends of targeted customers.

BUSINESS MODEL 9
References
Amit, R., & Zott, C. (2012). Creating value through business model innovation. MIT Sloan
Management Review, 53(3).
Andersson, U., Dasí, À., Mudambi, R., & Pedersen, T. (2016). Technology, innovation and
knowledge: The importance of ideas and international connectivity. Journal of World
Business, 51(1).
Ang, A., Chen, J., & Xing, Y. (2006). Downside risk. The review of financial studies, 19(4).
Bluesmart. (2018). Bluesmart | Home, retrieved from http://www.bluesmart.com/about.
Dijkman, R. M., Sprenkels, B., Peeters, T., & Janssen, A. (2015). Business models for the
Internet of Things. International Journal of Information Management, 35(6).
Garun, N. (2016). This smart bag can charge phones, weigh itself… and nearly got me kicked off
a flight, retrieved from https://thenextweb.com/gadgets/2016/01/30/welp/.
Gil, D.S. (2018). How Diego Saez Gil built a smart luggage company into a multi-million dollar
company, retrieved from https://mixergy.com/interviews/bluesmart-with-diego-saez-gil/.
Hatten, T. S. (2015). Small business management: Entrepreneurship and beyond. Canada:
Nelson Education.
Johnson, M. W., Christensen, C. M., & Kagermann, H. (2008). Reinventing your business
model. Harvard business review, 86(12).
Kohler, T. (2015). Crowdsourcing-based business models: how to create and capture
value. California Management Review, 57(4).
Osterwalder, A., Pigneur, Y., Bernarda, G., & Smith, A. (2014). Value proposition design: How
to create products and services customers want. US: John Wiley & Sons.
Yang, S. H. (2014). Internet of things. In Wireless Sensor Networks (pp. 247-261). London:
Springer.

BUSINESS MODEL 10

BUSINESS MODEL 11