Businessmodel of Corning

Customer Segments

Corning has a diversified market business model, with customers that have very different needs. The company targets its offerings at firms in a wide variety of commercial and industrial markets.

Value Proposition

Corning offers three primary value propositions: accessibility, innovation, and brand/status.

The company creates accessibility by providing a wide variety of options. Its products are used in a broad range of industries, from telecommunications and consumer electronics to life sciences and transportation. As a result, they are used in a diverse array of products – for example, emissions-control products for cars, trucks, and off-road vehicles; damage-resistant cover glass for tablets and smartphones; products that accelerate manufacturing and drug discovery; and optical fiber, wireless technologies, and connectivity solutions for high-speed communications networks.

The company has embraced innovation throughout its history. Its breakthroughs include:

• A bulb-shaped glass encasement for Thomas Edison’s incandescent lamp
• A heat-resistant, low expansion glass for signal lanterns
• A heat-resistant glass for cookware and lab products, later to be known as Pyrex
• The first low-loss optical fiber
• A process for the mass production of TV picture tubes
• The fusion process, which forms specialty glass suspended in mid-air
• Electricity-conducting coated glass and fused silica
• Photochromic glass, which darkens when exposed to light
• Hub machines, which are used for cutting hot glass into various shapes and sizes Corning also operates the Emerging Innovations Group, which identifies new opportunities for its materials in the automotive, architecture, and antimicrobial markets.

The company has established a powerful brand due to its success. A Fortune 500 company, it generated $9.8 billion in revenues in 2015 and employs 40,000 people across five continents. It bills itself as the largest producer of glass substrates for LCD displays. Lastly, it has won many awards, and is a four-time National Medal of Technology recipient for its process and product innovations.

Channels

Corning’s main channels are its direct sales team and a network of distributors. The company promotes its offering through its website, social media pages, and participation in trade shows.

Customer Relationships

Corning’s customer relationship is primarily of a self-service nature. Customers utilize its products while having limited interaction with employees. The company’s website provides self-help resources such as a gallery of informative videos and an infographics library. That said, there is a personal assistance component in the form of its Customer Service Department (CSD), which is available to assist customers through every step from product shipment to invoice processing.

Key Activities

Corning’s business model entails designing, developing, and manufacturing its products for customers.

Key Partners

Corning’s key partners are the suppliers who provide the raw materials and components it uses to manufacture its products. It most commonly obtains ores, minerals, polymers, helium, and processed chemicals from these third parties.

Key Resources

Corning’s main resource is its intellectual property, which includes more than 7,750 patents (3,250 of them U.S. patents) as of the end of 2015. The company also relies heavily on its research and development staff, which consists largely of scientists and engineers.

Lastly, it depends on physical resources in the form of its 89 manufacturing plants and processing facilities in 17 countries (34% of which are located in the U.S.).

Cost Structure

Corning has a value-driven structure, aiming to provide a premium proposition through frequent product enhancements. Its biggest cost driver is cost of sales, a variable expense that includes raw material consumption. Other major drivers are in the areas of sales/marketing, research/development, and administration, all fixed costs.

Revenue Streams

Corning has one revenue stream:  revenues it generates from sales of its products to customers. The products are typically sold through the formation of long-term contracts.