Online Social Entrepreneur - Essay Example

Objective To assess as to what business models are being followed by the mobile phone app developers and how they can be applicable to the social enterprises to achieve their overall objectives. Method This paper used the case study analysis to review and explore various apps being used for the purpose of social change. Besides, a systematic review of the business models being followed by the mobile phone apps has also been performed. This case study is mostly focused upon case study analysis as the main research methodology for this paper. Results It has been observed that most of the apps are offered free whereas some apps are offering combination of free and paid services. Apps following all such types of business models have been successful to some extent however, most of the apps also failed to achieve the desired results. It has also been observed that the apps are not offered as standalone products but are being used as tools to support the main web portals of the social enterprises. Mobile phone apps are offered as a mean to further strengthen and advance the services offered through main web based services. Conclusions Social enterprises can use free mobile phones app models to further support their web based services. However, mobile phone apps can also be used for the standalone purposes. It is recommended that the apps should be developed as a tool to further facilitate the existing customers and must be leveraged through the web-based services offered. Introduction Social enterprises are relatively different from the traditional commercial organizations in the sense that they apply business and commercial strategies for maximizing improvements in human and environmental well-being. As such, social enterprises are directed by the ultimate goal of making real change in the human life while not focusing on maximizing their own profits. There is therefore a fundamental difference between how social enterprises and commercial organizations approach the business. Mobile apps have been a new revolution in the international economy wherein small developers have been able to develop small applications fulfilling various purposes. Over the period of time, millions of applications have been developed for various platforms including Apple iOS, Google Android as well as Windows 8. These applications are sold through various business models wherein some are offered free, some are paid whereas some are hybrid in nature offering some features for free while premium features are paid in nature. (Chen, 2011). Apart from this, mobile apps are also part of the larger services offered through websites and applications support and facilitate the overall process of further facilitating the customers. As such, the business model offered by the mobile apps can be easily used by the social enterprises in order to achieve the desired results of social and environmental change. This research proposal will outline as to how business models followed by mobile apps can have potential applications for the social enterprises. This paper will comprises of a literature review, research question and methodology, analysis and results, discussions and the implications and finally recommendations and conclusion will be offered. Literature Review Social enterprises are present since long in different formats and under different tendencies. Over the period of human history, various endeavors have taken place which was aimed at developing commercial solutions for the improvement in human life. Social Enterprises use commercial and business strategies and apply them to the social enterprises in order to improve the human life and environment. The overall purpose of such organizations is not to maximize their profits but to maximize the overall welfare and benefits to the ordinary people. ( Bull & Crompton, 2006) Such organizations have been focused upon generating their own resources in order to create what is called a social economy. Such organizations can be either for profit or non-profit in nature and can also be mutual organizations, cooperatives, social businesses as well as the normal corporations and private limited companies. There are various mobile applications which are used potentially for social purposes including helping people to make positive changes in their habits, lose weight, free messaging services as well as other particular and specific mobile apps which are being used at the global and regional level for the purpose of social change and development. Sparked.com It is an app as well as a website offering social business opportunities to the organizations to better integrate themselves with their customers as well as other stakeholders. This application is based upon the concept of micro volunteering wherein users whether they are offline or online can micro-volunteer for some really small chunks of times to provide their feedback about the products and services of other organizations. Cause.it Cause.it is a mobile as well as web portal offering schools to engage with their students and increase their participation activities into different causes. Users actively donate their time for the causes and can participate into different other activities. Cause.it is specially considered as more viable for the non-profit organizations to increase their supporters’ base and also connect them with the local businesses. By connecting local businesses with the non-profit organizations, this app allows the users to help both the non-profit organizations as well as small local businesses. Mobile Rice This app is focused upon reducing hunger and through small vocabulary matches and on the correct answers, 10 grains of rice are donated to the UN World Food Program. This app is also offered in combination with the website as well as the app and is focused upon delivering a combined experience of app and web portal. Give Work1 This app is also truly social in nature as it helps the refuge workers to have their work checked for quality assurance by the users. This app is also being offered through a combination of both the web portal as well as the app and is focus upon offering micro work to the poor through digital means and also ensures that the quality work is delivered to everyone. This app is based upon a very simple idea of integrating community with each other in order to create social change. Business Models of Apps It is critical to note that the business models followed by the app developers are combination of different aspects and are offered through the companies offering platforms to distribute the app. Every paid app sold through either of the distribution channels i.e. Apple, Google or other channels are sold based upon the revenue sharing. Revenue is shared in certain percentage with the companies offering platforms to distribute.( Lee, 2013).  It is also critical to note that there are three types of business models which are being offered by the mobile phone apps. They are: Free Apps Most of the apps are free in nature wherein users are not charged for anything and are being downloaded for free. However, such apps also run advertisements within the apps and also collaborate with third parties to generate revenue. Most of the free apps rely on shared mobile advertising revenue however; some apps also rely upon the collaboration with third parties. Applications such as Foursquare attempt to generate their revenue through third party collaborations however they are offered for free. Paid Apps Paid Apps are offered to the customers against payments and range in prices from $0.99 to no upper limit. $0.99 is mostly the base price accepted by the platforms distributing the applications. It is also important to note that revenue is shared against these apps in different proportion and not all the proceeds go to the developers of the app. Users are directly charged by the platform providers. Freemium This model is unique in the sense that it offers some features in free whereas premium features are offered against payments. Though this model is mostly followed by the Game developers however, other app developers are also using this model. In Freemium companies offer most of the features for free however, to get something extra, users are charged. Subscription Based Services Apple Inc especially offer subscription based services wherein app developers can offer monthly subscriptions to the users rather than charging them upfront. Most of the magazines offering their apps charge subscriptions to their users rather than allowing them to read all the contents for free. Research question and Method This paper aims to explore the research question of how the mobile phone app business models can be relevant and applicable for the social enterprises. The overall purpose is to explore as to how business models used by app developers can be used by social enterprises to bring in required social change. This research paper will therefore focus upon using the case study analysis as the research methodology to collect and explore the required information on the subject. Case study analysis has been chosen in order to explore and understand what already has been researched and explored while at the same time focusing upon new ways of understanding and exploring the research question. Case study analysis is relevant for testing the research question also as the very nature of the research question requires case study approach to explore it further. Analysis and Results Case study analysis requires a detailed analysis of contextual analysis of a very limited number of cases. Case study approach therefore is mostly used in understanding the contemporary real life situations in order to understand as to how they have an impact on the life. This case study analysis will utilize the 4 step process of defining the problem, formulating alternative course of action, analysis of alternatives and finally the recommendation. This paper therefore also utilizes this four part case study analysis approach to explore and understand as to how business models followed by mobile phone apps can be used by the social enterprises. ( Shelton, 2013)  Considering the above case studies and various pricing models mentioned in the literature review, it emerges that most of the apps falling within the domain of social change are offered for free of cost. It is however, critical to note that apps are free however; they are followed or leveraged through much larger web based services which generate the revenue for the social enterprises either through donations or direct sales. As such, mobile phone apps are not sold or utilized on the standalone basis but rather are supporting the main web portals.( Australian Communication and Media Authority, 2011)  Certain apps such as cause.it however also offer paid services however, such services are also offered through the main web portals and apps are used for the purpose of further facilitating the customers in reaching most of their customers. However, such types of apps require a particular niche of customers. Discussion and Implications The above results suggest that most of the apps are offered free of cost however, they are supported through third party support. This support either comes through main revenue generated through the websites or through donations. Apps are mostly used for the purpose of supporting the main web service. Some of the apps however, are offering paid services which can be further leveraged through donations directly sourced through the apps. However, donations may not prove as a long term revenue source for the social enterprises to further expand themselves. These findings therefore suggest that the social enterprises may need to leverage their apps through their websites rather than developing mobile phone apps as standalone methods to achieve the desired objectives. The business models followed by the existing crop of apps are mostly free and as such may not result into sufficient revenue for social enterprises to sustain themselves for long. If this model is to be used, social enterprises need to develop alternative channels for generating their revenue rather than relying on mobile apps as the single source of revenue. Practically, social enterprises therefore need to focus on bundling their digital products and services rather than using them on standalone basis. It is however, important to understand that this research study is that of limited nature besides the overall number of notable apps used for social purposes are limited too. As more and more apps are used for the desired purpose, further models can evolve too. Conclusion and Recommendations This research paper focused upon understanding the business models being followed by the mobile phone apps and how they can be used by the social enterprises. In order to explore this research question, a case study analysis was performed to review and explore the existing apps being used for this purpose besides exploring the business models followed. It emerged that most of the mobile phone apps offer either free, paid or freemium pricing models wherein certain services/features are offered free of cost whereas certain features are offered by charging the customers. It has also been observed that the social apps are used in combination with their existing web based services. Apps used for the social change are mostly supporting the main digital services offered through web portals. As such it is critical to note that the social enterprise needs to develop a combination of apps and web portals in order to fully utilize the benefits of mobile phone apps. It is recommended however, that the social enterprises first develop better and more integrated web based portals to offer their products and services and then develop the applications to support such services. Offering online purchases through apps can result into sufficient revenue while at the same time catering to the needs of the customers and bringing the required social change.( Laurs,2013)  It is also critical to note that the social enterprises need to focus on dealing with physical goods whereas apps are mostly used for entertainment or information purposes. References Australian Communication and Media Authority (2011) Emerging business models in the digital economy— The mobile applications market. [Online] Available at: http://www.acma.gov.au/webwr/_assets/main/lib310665/emerging_business_models.pdf [Accessed: 07 April 2013] Bull, M & Crompton, H (2006) "Business practices in social enterprises", Social Enterprise Journal, 2(1), pp.42 – 60 Chen, T. F. (2011). Implementing new business models in for-profit and non-profit organizations technologies and applications. Hershey, PA, Business Science Reference. Laurs, I. (2013) Choosing The Right Business Model For Your App | Xconomy. [online] Available at: http://www.xconomy.com/san-francisco/2011/04/15/choosing-the-right-business-model-for-your-app/ [Accessed: 6 Apr 2013]. Lee, I. (2013). Mobile applications and knowledge advancements in e-business. Hershey, Pa, IGI Global (701 E. Chocolate Avenue, Hershey, Pennsylvania, 17033, USA). Shelton, T. (2013) Business Models for the Social Mobile Cloud: Transform Your Business Using Social Media, Mobile Internet, and Cloud Computing. New York: John Wiley & Sons. Read More