Businessmodel of Mailchimp

Customer Segments

MailChimp has a mass market business model, with no significant differentiation between customer segments. The company targets its offering at firms of all industries and sizes seeking e-mail marketing services. That said, a significant portion of its customer base consists of small businesses.

Value Proposition

MailChimp offers four primary value propositions: convenience, accessibility, risk reduction, and brand/status.

The company offers convenience by making its offering simple to use. It provides e-mail templates and collaboration options such as multi-user accounts. Its solution has an automation feature that ensures e-mails go to the right recipients at the right time. It also provides advanced reporting features that enable users to track website and sales activity, accessible from anywhere.

The company enables customization by providing personalization options. Its drag-and-drop designer creates flexibility, allowing clients to produce campaigns that fit with their style. Also, clients can target customers as recipients based on preferences, behavior, and previous purchases.

The company reduces risk by maintaining high safety and security standards. Its website provides updates on the status of its cloud platform. The firm also maintains the MailChimp Abuse Desk, a team of human reviewers who actively work to monitor and manage claims of e-mail abuse.

The company has established a strong brand due to its success. It serves over 12 million people who are estimated to send 200 billion e-mails a year. It has also won some prominent awards, including a “Top 100” Small Business Influencer Award in the Apps category by Small Business Trends (2015).

Channels

MailChimp’s main channel is its business development team. The company promotes its offering through its website, social media pages, sponsorships (people, projects, and events such as podcasts), and an e-mail newsletter with case studies, marketing tips, and best practices.

Customer Relationships

MailChimp’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 features a “Resources” section that includes reports and “guides” that provide information on all aspects of using its service. The site also has a “KnowledgeBase” section with answers to frequently asked questions.

That said, there is a personal assistance component in the form of e-mail support, and an “Experts Directory” through which customers can identify a local professional to assist them with tasks such as creating a custom project for their business.

Key Activities

MailChimp’s business model entails maintaining a robust cloud platform for its clients. The platform includes its website and suite of mobile apps.

Key Partners

MailChimp maintains partnerships with hundreds of web service providers through which its clients can integrate with the providers’ services in order to conduct various tasks. Examples of these tasks include creating targeted campaigns, sending back-in-stock messaging, and automating product follow-ups. The partnerships, called “integrations”, fall into four categories:

• eCommerce – These integrations enable clients to track visitors, obtain order information, and pass it back to their MailChimp accounts.
• CRM – These integrations enable clients to sync their customer data between their Customer Relationship Management (CRM) software and MailChimp.
• Social – These integrations enable clients to grow their lists, share their content, and advertise to their subscribers on their desired social networks.
• WordPress – These plug-ins enable clients to add a MailChimp sign-up form and track visitor activity to their sites, among other features. ### Key Resources

MailChimp’s main resource is its proprietary software platform, which serves over 12 million people.  It depends on its technology employees to maintain and update the platform and its customer service staff members to provide support.

Cost Structure

MailChimp has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions.

Its biggest cost driver is likely sales/marketing, a fixed cost. Other major drivers are in the areas of customer support/operations and administration, both fixed costs.

Revenue Streams

MailChimp has one revenue stream: revenues generated from the subscription fees charged for monthly access to its software-as-a-service platform. It maintains three subscription plans:

• Starting Up – Free; serves up to 2,000 subscribers with a limit of 12,000 e-mails per month.
• Clients can add more features for as little as $10 per month.
• Growing Business – Pricing starts at $25 per month; serves 2,000+subscribers. Specific features include marketing automation, targeting/segmentation, A/B testing, and team collaboration.
• Pro Marketer – Pricing starts at $25 per month, with an additional $199 Pro subscription charge; serves 2,000+ subscribers. Specific features include those offered in the Growing Business plan, as well as enterprise-level features such as comparative campaign reporting and multivariate testing.