Business model innovation(BMI) is risky, but when companies do it with agility, they thrive. This article looks at how Return Path, the global leader in email marketing, met the challenge of applying BMI successfully. The authors interviewed up to 700 CEOs to better understand BMI drivers.
Business model innovators have emerged as high growth firms in the most competitive markets.1 While technological innovations fuel new customer applications, innovative business models are the engines of industry evolution. But business model innovation (BMI) is risky. After leading the revolution to digital music distribution, Apple went on to disrupt the mobile phone and portable computing industries while Napster was effectively sued out of existence.
Business model innovators do far more than adjust strategic positioning; they exploit non-intuitive entrepreneurial opportunities that become obvious only in hindsight. BMI is a leap of faith based on limited, unknowable information. Firms that bet on BMI must be flexible enough to adapt as information changes. Successfully balancing BMI with agility can launch the firm to industry dominance. Return Path, the global leader in email marketing, is an excellent example of agile, radical business model innovation. Return Path has captured 70% of the global email whitelist market, and is the recognized leader in email deliverability. Agile business model innovators like Return Path meet the challenge of implementing BMI in turbulent, unpredictable global industries.