Businessmodel of Deem

Customer Segments

Deem has a multi-sided business model, with two interdependent customer segments that are both needed in order to operate:

• Merchants: Vendors provide their contact information and services description in the database so that they can be evaluated.
• Businesses: Organizational employees locate vendors, assess their offerings, contact them if interested, and form a contract if they come to an agreement. ### Value Proposition

Deem offers three primary value propositions: convenience, customization, and brand/status.

The company’s platform creates convenience by providing the following all-in-one solutions:

• Employee Spend Suite: This suite features applications that enable firms to manage all aspects of indirect spend and reimbursement. Specific applications are Travel, Expense, Shipping, and Shopping, all of which are provided on a single interface. The suite integrates preferred vendors, negotiated rates, and company policy, avoiding noncompliance issues and out-of-policy spend.
• Procurement Professional Suite: This suite features applications that enable finance departments and procurement officers to measure employee spending and find/contract with vendors. It covers all aspects of the vendor selection process from RFP creation to vendor identification to the renewal of contracts. Specific applications include Sourcing, Contract Management, Spend Analytics, and Catalog Management.
• Car Service or Operators Suite: This suite features applications that enable advanced vehicle reservations, ride hailing, and ground transportation management. Specific applications include Fleet Management, Deem Driver, Deem Mobile, and Affiliate Connect. The company’s platform facilitates customization by enabling top companies to white-label all of its network capabilities under their brands through its configurable applications and APIs.

The company has developed a strong brand due to its success. Its ecosystem includes more than 100,000 vendors, 34,000 business customers (including many Fortune 500 firms), and 40 channel partners. It features 11 million products and services that lead to billions in annual transactions.

Channels

Deem’s main channel is direct sales, through which it acquires most customers. The company also markets its products through its website and social media pages.

In addition, it promotes its offerings at conferences and conventions it attends throughout the year.

Customer Relationships

Deem’s customer relationship is primarily of a self-service, automated nature. Customers utilize the service through the main platform while having limited interaction with employees. The company’s website includes several resources for self-help, including fact sheets, white papers, videos, and a blog.

That said, there is also a personal assistance component as the firm offers phone and e-mail support.

Key Activities

Deem’s business model entails maintaining a common platform between two parties: businesses and merchants.

Key Partners

Deem partners with many companies in relevant industries to help deliver its commerce network to customers. Partner groups are as follows:

• Business Services: The company works with NetSuite.
• Travel Services: The company works with Adelman Travel, American Express Global Business Travel, Carlson Wagonlit Travel, Direct Travel, Enterprise Holdings, and Travel Leaders.
• Travel Management: The company works with over a dozen firms, including ATC Travel Management, Executive Travel Consultants, Peak Travel Group. Deem operates the Preferred Partner Program, through which it encourages anyone to provide leads on partners. If a submitted lead closes within the space of 180 days, the provider receives a bonus based on the deal’s total booking value.

Key Resources

Deem’s main resource is its proprietary software platform, through which it connects 34,000 business customers and 100,000 merchants. The company also depends on engineering and service staff to enhance the platform and provide support to customers, respectively.

The company places a priority on its intellectual property, and has 41 issued patents with 24 more on file.

Lastly, as a startup, it has relied heavily on financial resources, raising $492.5 million from 15 companies as of July 2014.

Cost Structure

Deem has a value-driven structure, aiming to provide a premium proposition to customers. Its biggest cost driver is likely research and development expenses, a fixed cost and an area in which it makes significant ongoing investments. Other major drivers are in the areas of sales/marketing, and administration.

Revenue Streams

Deem has one revenue stream: the subscription fees it charges merchants and businesses for access to its platform. No information is available regarding pricing.