Abstract
Purpose: This article aims to examine the concept of business model innovation and to discuss the design of the key elements. Based on a detailed case study of Nespresso, it seeks to outline how business model innovation can be implemented successfully.
Design/methodology/approach: Based on a theoretical conceptualization of a business model, the authors conduct an in‐depth case study to draw conclusions for a successful implementation of a business model innovation.
Findings: A business model innovation comprises five components: an innovative, unique positioning, a consistent product and service logic, an appropriate value creation architecture, an effective sales and marketing logic and a profit formula that works. Success is based upon a unique, innovative and coherent design of the business model's components.
Originality/value: Based on Nespresso's business model, this paper illustrates what a business model innovation is, what its components are and how they should be designed to create and capture value.