Assessing financial viability of the freemium model for supply chain service value networks: a case study of the container management service industry Online publication date: Tue, 17-Mar-2015
by Konstantinos Panou
International Journal of Integrated Supply Management (IJISM), Vol. 9, No. 3, 2015
Abstract: While service value networks (SVNs) continuously seek new linkages among partners to create value, service providers are compelled to restructure their business models to become more customer-centric. A consequence of this has been a shift from the traditional focus on production to a focus on relationship building with clients and suppliers. This implies the assessment of customer lifetime value (LTV) and the alignment of business strategies with customers' worth to the network. To address this issue, we develop a customer LTV model customised to the business requirements of SVNs with the aim to help service partners in assessing the viability of their networks. By merging the conceptually rich LTV approach with the more innovative 'freemium' business model concept and by applying it to a supply chain SVN, our model provides means for the appraisal of the market potential of emerging e-services.
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