When I wrote the article “A Good Business Model – Forbes Coaches Council” in 2017, my focus centered on the business model rather than my personal engagement with it. Surprisingly, the article has received much attention (over 3000 views), and many of the questions have been about the return on investment (ROI).
Could my ROI indicate yours? I wonder. My thought is as follows: We all have our own writing styles, publishing frequencies, favorite topics, and target markets. My ROI will neither imply the ROI-to-be of yours, nor will my ROI suggest whether or not you might also join Forbes Coaches Council.
Forbes’ business model is successful only when demand is strong. I understand that the annual fee has been increased, which evidences the demand of the last three years. Will the demand continue to climb? We don’t know.
A compelling example of a business model I have been tracking over the past few years is Airbnb.
Airbnb utilizes the sharing economy business model i.e. people opening their homes to strangers for payment for a short-term lease, often as an alternative to pricier hotel stays. Airbnb was found in 2008, and it first became profitable during the 2nd half of 2016. Its revenue grew more than 80% between 2015 and 2016. In the 3rd quarter of 2018, its revenue exceeded one billion.
Since 2016, more people have opened their homes as hosts because the ROI was good. Furthermore, more people are willing to stay at Airbnb sites. In 2018, the Airbnb market became saturated in some areas; i.e. suppliers surpassed demand, and so the occupancy rate decreased. Many conversations have surfaced around this – should I become an Airbnb host? How much should I charge to achieve better occupancy? Is the ROI good enough for me to open my home to strangers?
What does this business case tell us? To me, ROI is really a conversation based on the supply & demand, your unique offering and your measurement of expected returns.
Wouldn’t you agree, Coaches?