This week we cover Nimber and produce a business model canvas for them. Nimber is one of the sharing economy startups. Their big idea is that there are people driving all over the country. There are also people who want to send packages all over the country. Using the app they hope to match them up. They launched in Norway and then moved to the UK in 2015
Introduction
The idea of Nimber is that they fit into a niche where national postal services and courier companies aren’t interested. The things to be transported are too bulky for their standard processes. At the same time, the packages are too small or being carried too far to be of interest to a freight haulier or local delivery company. Put simply for many items the cost of a man an van to transport them is prohibitive, but perhaps if someone is going that way…
Click here to go straight to the Nimber business model canvas and skip the analysis
Customer Segments
Nimber has 2 customer segments. Bringers and senders. Senders are people with an item to send whilst senders are the people who pick the package up and deliver it to its destination.
It’s difficult to delve down deeper than that as Nimber seems to be pre-traction in the UK with only 1 delivery/day in July/August 2015 and the current number of items available for delivery between 2 major metropolitan areas in the UK is less than 10.
I went through their social media channels and the strongest segmentation marker that I saw was a concern about saving CO2 emissions. But it wasn’t a strong appeal to Greens – more of let’s chuck it in.
I think that there is a big issue about who the bringers are going to be and how they are targeting them. There are obviously clear target audiences – students with cars would be one. Moonlighting tradesmen (with their blue vans is another)
With Senders – A table, a motorbike, a set of keys a plastic carrier bag. What is clear here is that the offer is focused on people for who the normal delivery services don’t work. Volumetric issues mean that tables and motorbikes are expensive to ship. Whilst keys don’t have the responsiveness required. I’m guessing that there would ideally be a 10:1 radio of senders to Bringers to make the site work
Value Propositions
I’ve touched on the value proposition above. It’s like Airbnb for sending things. The issue though is that people spend a lot on travelling and they do it a lot. If you account for holidays and business travel that could easily be $1000/head. For postage and sending things in the UK, I feel that the current market size is less than $100/head. So it’s smaller and more infrequent which makes making a powerful VP difficult.
The core of the Nimber VP is that it is cheap and easy. You meet someone on the site and they pick up and deliver. So you have the convenience of a door to door courier service at the same price as going to the post office but without the hassle of dropping it off and filling in all the forms.
I think that this works if you have the network density – as Nimber has recognized by moving from Norway to the UK – but if you don’t then the value proposition fails because you simply don’t have enough bringers or senders in the network to liven the VP.
There’s also a recognition of this weakness in that Nimber is looking for a hub to hub carrier with bringers then being focused on the last mile delivery which is where most of the expense is incurred for courier companies. In many countries, FedEx and DHL outsource the last mile to franchises or local contractors.
Customer Relationships
The customer relationships are fairly straightforward. Nimber puts bringers and senders in contact with each other and creates an online marketplace. There is customer support and a number of policies to ensure that the marketplace functions well but mainly it is self-serving and self-operating with little requirement for direct customer interaction from the Nimber team
Channels
So Nimber has a website that is not hugely popular. It has a page authority of 29 which is really low for a B2C site and would indicate tens of thousands of visitors a month (boosted by the PR links from newspapers). It has iOS and Android apps. It is also setting up traffic partnerships with other sites where it looks to be listing items to be sent – probably via API
Social media seems to be a fairly generic mix but honestly doesn’t look like huge traffic sources. Stuff to be sent or brought doesn’t get great responses. Case studies look as if they could be a powerful marketing mechanism but these aren’t used. (and diving back into the segmentation there are some great stock images but very little personification and personalization with real user success stories that would be powerful in making their channels far more effective)
Revenue Streams
Nimber’s revenue streams: This was hard to find. It looks like there is some dynamic pricing mechanism in play that will charge up to 20% as a matching fee. Having had a quick play this is not obvious on the front end and I only found it buried in the T&C so I am guessing that they are looking for traction first and will then slowly increase the matching fee depending on how price elastic the market is.
Key Activities in the Nimber Business Model
The platform looks as if it works fine. It’s a sunk cost though will obviously need loads more development as the site matures (a key activity). There are a bunch of different ways that they can pivot and this will require further development as well
They look as if they have a fairly decent CRO team in place so the big activity is marketing and getting traction. So marketing, marketing and marketing. They need to figure out the chicken and egg problem.
It looks, and remember I am an outsider speculating, that they need to do some seriously hard work doing manual scaling and signups with a city by city focus (as Uber, AirBnb, LinkedIn all did in the day). They need to sign up a community of bringers – a single university per city and then do a geo-focused marketing campaign to use all those newly signed up bringers.
Key Resources
The key resources for a site like this are the networks of people that they connect. The platform is actually secondary – it could all be done on pen and paper – which would probably be cheaper pre-scale ;). What matters is the network. Getting sufficiently dense networks with strong route corridors to most major destinations.
The other is staffing. Here again, I think that they are weak. The problem that they are essentially trying to solve is based on finding the best channels/routes for non-standard packages. That’s a big data problem with serious analysis of traffic flows to work out which are the best cities and segments to target
Basically it can be treated as an inventory and stock turnover problem. How much do I have to invest to acquire and retain a stock of bringers and does the demand for that SKU justify the investment that I am making in that stock?
So the key thing is to identify the best products to be moved, acquire users to shift those products and then identify products senders. There needs to be someone focusing on generating those insights – and they are not fundamentally digital insights – but economical and behavioural ones that come from multiple data sources
Key Partners
Key partners – these are the bringers and sellers in the Nimber business model. They need to be acquired and kept satisfied. Nimber has a number of other key partners though it’s unclear how significant these are. First, they are looking at having partnerships with hub-to-hub carriers.
These will enable the company to pivot to a focus on the last mile if the VP is not attractive to bringers. Secondly, they are starting to use partner sites for traffic generation and there could be some great opportunities by tying up with more sites that are involved in the sharing economy but for whom transportation is not part of their core offering.
Cost Structure
The cost structure is the platform development costs and marketing. The platform development is now essentially a sunk cost so the focus is on generating leads, conversion and retention.
The cost structure to move to a new country as far as IT infrastructure is concerned is small – principally localization – whereas the marketing is a significant investment with each new country – a restart from scratch almost
Nimber Business Model Canvas
This is the Nimber business model canvas.
