Analysis of Oculus Business Model and Critical Success Factors

This report provides a comprehensive analysis of the Oculus business model, focusing on its integration with Facebook. It utilizes the Business Model Canvas framework to deconstruct the company's operations, examining key components such as customer segments (Y Generation, Gamers, Early Adopters), customer relationships, channels, key partners (Facebook, Samsung), value proposition (VR headsets), key resources (Oculus platforms, managing team), cost structure, critical success factors, downside risks (addiction, Facebook's influence), revenue streams, and key activities. The report also discusses potential changes to the business model, critical thinking on strengths and weaknesses, and provides recommendations for future growth. The analysis highlights the importance of understanding the VR market, competition and the critical success factors that contribute to its sustainability.

BUSINESS CANVAS MODEL

Executive Summary
The report comes up with the description of business model canvas of the company named
“Oculus integrated with Facebook.” This will examine the performance of the product in the
market as it was launched in 2018 for its target market and the customers. The operating
performance can grab highest customers by attracting them through advertisement
campaigns. The main goal of business is to serve virtual reality products and services to the
customers.

Contents
Introduction................................................................................................................................4
Business canvas model...............................................................................................................4
Building blocks..........................................................................................................................4
Customer segment......................................................................................................................4
Customer relationship................................................................................................................5
Channels.....................................................................................................................................5
Key partners...............................................................................................................................5
Value proposition.......................................................................................................................6
Key resources.............................................................................................................................6
Cost structure.............................................................................................................................6
Critical success factors...............................................................................................................6
Downside risk.............................................................................................................................7
Revenue streams.........................................................................................................................8
Key activities..............................................................................................................................8
Changes in business model........................................................................................................8
Critical thinking for strengths and weaknesses..........................................................................9
Attributes of communication......................................................................................................9
Recommendation........................................................................................................................9
Conclusion..................................................................................................................................9
Appendix..................................................................................................................................11

Introduction
With the increasing changes in the technology, several organisations have started using
Oculus Rift that would simplify enable virtual reality to large-scale deployments. This
product includes a dedicated software, which offer device setups, other management tools,
enterprise grade service, and newly user`s experience customised for the businesses. The
report bring out a discussion on business canvas model, which is based on nine elements and
building blocks to illustrate how the company uses it attain competitive advantage.
Business canvas model
Business canvas model is strategic management and start-up template for developing
documented and new business. This model comes up with visual chart with describing value
proposition, customer, finances, key resources, collaborating, aligning with the activities, and
infrastructure (Sparviero, 2019).
Building blocks
The core building block of each businesses include processes, customers, people, and
resources. Business leaders has the power to strengthen each of building block who weaken
and reject building blocks. Business canvas model is a business standard used by the
companies to design, describe and then identify value proposition, cost structure, key
resources, and revenue streams (Mu'min, Anggara & Maulana, 2018).
Customer segment
The customer segment are mostly Y Generation people, Gamers, and Early Adopters. Oculus
has customer segment, which the organisation have identified while serving (Robertson,
2020). This will include targeting niche market, which is based on specific segmentation and
needs of the clients for instance- Oculus has different categories with different features

Oculus Go (VR headset), Oculus Quest, HTV Vive Cosmos, with appropriate RAM storage.
The category is based on different preference style of customers such as Oculus Go, Oculus
Quest, and Oculus Rift S (Stein, 2018).
Customer relationship
The relationship between supplier and customer becomes stronger if the product is reliable.
The product avails new experience, purchase, maintenance, and digital experiences to the
customers (Sort & Nielsen, 2018).
Channels
The methods of distribution includes Oculus stores, release channels, and Oculus keys. First,
one will be the application on which the product is available for public. It needs more
scrutiny in dashboard and then submit it for reviewing store team (Urban, Klemm, Ploetner,
2018). It includes applications such as utility, creativity tools, interactive content, player that
may win and lose, and narrative drive experience, which is fully interactive but it lacks rule
set (Robertson, 2020). Oculus key has 25-letter long download codes, which generated by
developers. It can be an alternative plea to distribute the application with the help of keys for
attendees for a particular event (Stein, 2018).
Furthermore, one can upload the application to dashboard, which give a choice of uploading
several channels with STORE, BETA, RC, and ALPHA. With this exception, store channel
can grant revoking user level access to add and them remove test user`s email address
(Austin, 2020).
Key partners
The major partners for Oculus are Facebook, which is the owner, Samsung, acquisition for
tracking eye technology, distributors, suppliers, Game developer community, digital
entertainment platforms, and communities (Austin, 2020).

Oculus has its implementation team, which help them to deliver several product features to
the customers (Oculus VR, 2019). In order to implement and widen the scope of product, the
company can propose big project, and regional implementation that include consultants,
managers, and teams to accomplish needs to improve the customer benefits. System
integrators can act as a distributor of hardware and software development. The company
provides installation guidebook to clients with the product (Sparviero, 2019).
Value proposition
Oculus Go is an all in one headset created for entertainment. The Oculus is quite easy to use
and it is portable. It bring experiences to life with vibrant colour. Its ergonomic design uses
breathable fabrics and foam moulding, which allow to feel light weighted and comfortable. It
comes up with effortless control, which recognises hand motion for seamless navigator in
Visual Reality (Oculus VR, 2019).
Key resources
The main resources symbolises by the product includes Oculus platforms, managing team,
creativity, developer community, and high technology. The organisation have internal
intangible assets (Rizal & Rokhani, 2019).
Cost structure
The cost structure is associated with value driving, materials, manufacturing cost, staff, and
cost of software development. From the very beginning, the company has started incurring
logistics expenses (León, & Hipólito, 2016). Oculus engage in shipping to all nations as
Oculus for business is availed. It is designed for the organisations to look and deploy number
of headsets. Each bundle includes 64GB headset with internationally charger enabled with
two interfaces- for $299 USD each (Oculus VR, 2019).

Critical success factors
Its success factors lie in its features such as taking closer look into all-in-one headset to watch
entertainment. This product has many different types offering for different customers (Oculus
for business, 2020). For instance- Oculus Go is all in one VR headset, which gives amazing
experience without hassling in wires.
(Source: Oculus for business, 2020)
Another success factor associates with littlest big screen with vibrant colour, crystal clear
optics, and optimised 3D graphical screen which work together for highest visual clarity.
Downside risk
The real risks associated with Oculus and Facebook is it may succeed very fast. Zuckerberg
sees virtual reality as new communication platform, which not only allow spending moments
with friends but change whole experience. Facebook wants access to experiences, which face
fear for gamers withy the disappointment for kick-starter businesses (Carter & Carter, 2020).
The risk for Oculus Rift is losing faith when it appears to be in Facebook`s income. Facebook
has been wisely using saving its investment by giving Oculus autonomy holding. The product
face engineering risks issues. More associated risks is the threat of addiction as liabilities for

both the companies. Facebook is challenging development cycle of Oculus Rift and
guarantee, which take unbeatable leadership position in Virtual reality industry. The game
can affect the emotional state and people would just take care of their kids, which may face
risks blamed for a harmful technology (Keane, Cormican & Sheahan, 2018).
Revenue streams
Oculus Rift has earned $100 million while contracting VR content sales. Furthermore,
Facebook has been pumping billions of virtual reality and it may take back to investment.
The figure has several different headsets, which Oculus stores has generated $100 million
revenue. Zuckerberg has noted that 20 percent of the revenue was sold in just four months by
suggesting that users of new headset have been spending cash (Oculus for business, 2020).
Recently the company has observed that that company see low friction items as best ticket for
mass users and the milestone has been generating hundreds of million in content especially
when Facebook does not show any sign of slowing investments.
Key activities
The main activities include design, VR software development, testing, content generation,
customer services, marketing, sales, distribution, social interaction, integration, aggregation,
and IT operations (Keane, Cormican & Sheahan, 2018).
Changes in business model
To deploy changes in business canvas model, Oculus Rift and Facebook can use
collaboration with more implementation teams that can provide faster services. The company
can hire its personal logistics and supply chain so that it can deliver its products within
appropriate time. To speed up the production due to high demand, the company can employ
diversified-cultured people at workplace so that they can change the models and introduce to
meet the demands of the customers. The company has to employ advertisement campaigns in

malls to give practical experiences to the customer regarding its hybrid model to generate
revenues and its features so that it can attract the customers (Jerusalem & Fitrihana, 2019).
Critical thinking for strengths and weaknesses
The weaknesses of the product is that customers are not ready to spend high amount just to
access an application.
Strengths are attributes of the product, which gives it place in customer’s eyes such as virtual
reality technology with colourful graphical presentation. It does harm eyes and brain as far as
scientific research had been made on use of Oculus Rift and virtual reality (Oculus for
business, 2020).
Recommendation
As a recommendation, as the company already provides several channels for distribution so it
is recommended that several functionalities of Oculus Rift platform have many features to
open the dashboard and then play around it to familiarise the client`s knowledge. The
company has to adjust its costs because people feel that it is worthless to spend saving of
many months just on an application.
Conclusion
From the above report, an evaluation and examination of business canvas model of Oculus
Rift has been presented. The organisation who uses Oculus Rift identify opportunities in
business environment. The product will make best efforts in identifying opportunities, then
attract the existing clients, and introduce new advertisement campaigns to attract new
customers.

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Appendix
(Source: https://vizologi.com/business-strategy-canvas/oculus-business-model-canvas/)