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Ever tried to create a business plan and ended up running for the hills?

Not surprising. Exceedingly dreary, and unless you’re applying for investment or loan from the bank, it’s highly unlikely you’ll ever need to do one. The Lean Canvas can be the solution to your business planning rough patch.

Though it’s been around for a few years now, The lean canvas is the newest, most succinct way to get your head around your business goals. The idea behind it is to get your goals down on paper, in front of you, as quickly as possible so you’ve got time to start working toward your goals rather than dithering around with a long-form plan that nobody will read.

Until recently it’s been more commonly used in the tech space.

How to Use the Lean Canvas for Your Ecommerce Business

Today I wanted to show you how you can apply the same plan to your small business. The lean canvas process can also be applied to single products, so if you’re thinking about introducing something new, it’s worth filling out a canvas to make sure you’ve got all your ducks in a row.

To make it easy for you, there are 9 components to the lean canvas. This makes it super simple to break down into easy to digest chunks.

This is important for anyone viewing the canvas but also really helpful for you because it provides you with a framework to easily manage your thoughts and existing data points.

Get Started with Your Lean Canvas

You’ll need a lean canvas template to get started – you can draw one up or use a template. A whiteboard or big sheet of paper is great the first time around. Draw up your grid like this, including the headings in each cell:

lean canvas

The numbers in each cell represent the order in which you’ll be addressing each issue – don’t be alarmed that they are two “5’s” and two “1’s” – you’ll be looking at these two together.

Now it’s time to get writing – the idea here is to simply put down your thoughts in one sitting without overthinking things.

A couple of handy tips to keep in mind as you go

  • Don’t agonize over anything – if you don’t have the answer right now, move on to the next cell and come back at the end.
  • Leave sections blank if you need to, rather than putting in something that doesn’t quite ring true.
  • Think about the present. Don’t get too caught up in what your business or product could be in the future – think about what you can work on right now.
  • Think like a customer. A customer-centric approach to the canvas will keep you in the right frame of mind when it comes to identifying problems and solutions.

Cell 1/1: Top 3 Problems

Think about the top 3 problems your ideal customer has. Try and get as specific as you can – for example, if you’re a health coach, perhaps the issue would be that as a man in his 40’s, your customer can’t easily find healthy recipes that he can cook for his family of 6.

Or perhaps if you’re selling a physical product such as Brazilian swimwear in a UK market, your customer’s problem would be that they can’t find fun, sexy swimwear that’s on-trend and stylish.

Next to the problems you list, write down any existing solutions or alternatives.

This not what you’re going to offer, but something that’s already in the market or something that the customer does to solve this themselves.

For your healthy recipe guy, this might be that he currently substitutes healthier ingredients in recipes that he finds in family cooking magazines, and for your swimwear girl, it may be that she currently spends extra money dropshipping swimwear from Brazil to follow the latest trends.

Cell 2/1: Customer segments

List any possible target markets or customers for your product – write down as many ideas here as you can. A health coach selling an ebook of healthy recipes designed for large families might have something like this:

  • Health-conscious men and women in their 30s and 40s with large, young families
  • Men and women with families that like to pre-prepare their meals for the week due to a busy lifestyle
  • Health-conscious grandparents who entertain their extended family regularly
  • Budget-conscious families, perhaps on a single income

Identify the early adopters in this group. Trendy, health-conscious consumers would be much keener to adopt new and healthy recipes and also share their finding with their peer groups through social media.

Cell 2: Unique Value Proposition

This is quite possibly the most important cell to get right. Start with what’s different about your product or business that makes you stand out from the crowd and offer a different solution to what’s already out there?

Having a clear UVP will also be seriously valuable when it comes to hooking in early adopters. You might feel that your UVP is too bold or exclusive, but early adopters don’t want to be spoken to in the same way that the potential mainstream customer will.

You’ll also need to think about the benefit of your product. Your UVP isn’t an opportunity to rattle off features – you want to make sure you’ve addressed the needs of your customer by understanding why a certain feature will be of benefit.

It can be hard to distill this down to one or two short sentences but it’s important to make sure have a quick and succinct way to get your message across. Having this handy will really help you out when you’re doing other work on your ecommerce business like writing product listings, naming categories and creating banners.

Cell 3: Solution

Looking back to the top 3 problems that your customer is having, now list a solution for each problem. If you’re a health coach and your customers’ problem is that there’s no easy way to access healthy recipes for big families, the solution might be a digital cooking video series that allows the customer to watch easy and fast healthy meals being prepared for big families on their iPad.

Continue until you’ve matched each problem with the solution that you can provide.

Cell 4: Channels

Once you’ve identified the customers’ problems and the solution that you’re providing with your product, you’re ready to think about how you’re going to reach your customer.

There are a few avenues to consider, especially if you’re at an early stage in your product or business. There are paid channels like AdWords and Facebook advertising, or free avenues like social media and content marketing.

Think about your customer and where they hang out online and offline. You might get great initial traction through Instagram, or perhaps in-person events are an effective way for you to gauge interest in your product. List as many as you think may apply to your business.

Cells 5: Revenue streams

How are you going to make money from your business? You may have an obvious answer for this one, such as “selling bikinis from the online store” but listing other opportunities here is also important. A swimwear seller might introduce new lines such as beach towels or sunglasses, or think more broadly and consider digital options like making money from their travel blog where they review resorts and travel destinations.

List prices here as specifically as you can, and remember to make sure that your prices reflect your brand correctly.

For example, if you’re positioning yourself as a high-end swimwear brand but selling your products for $20, then you’re actually damaging the perceived value. The same applies for overpricing – think about your customer, what they would spend on your solution and why.

Cell 6: Costs

Not so complex, but critical for you to understand and scale your business, you need to be aware of every possible cost in your business.

List here the cost of your raw product, any ongoing costs offline and online, marketing costs and staff costs. Don’t forget to cost in your time here. Being brutally honest in this section will help you kick some financial goals down the track.

Cell 7: Key Metrics

How are you measuring your success? You can’t grow what you can’t measure, so being able to identify and track your key performance indicators is essential. This also applies to moving forward, so identifying goals and milestones is another part of this cell. Think about what matters in your business. Some obvious metrics:

  • Revenue
  • Gross and net margins.
  • Volume of sales
  • Traffic to site

The milestones might look more like:

  • Create a landing page and marketing campaign for registering interest in recipe ebook
  • Create ebook according to demand
  • Launch ebook

There you have it! Your first Lean Canvas look at your ecommerce business. Don’t forget that the lean canvas is designed to be flexible and change to fit your business, providing you with a framework to test your ideas and grow.

We’d love to hear what value you got out of this exercise and if you have any tips for first-time canvassers building an online ecommerce business. Leave us a comment below.

About the author

Melissa Whidjaya

Melissa Whidjaya

Melissa is the co-founder of Bloombox Co. Bloombox Co works to connect flower growers and flower buyers, creating a distribution system that reduces waste, improves profitability for growers, and removes barriers to consumption, providing flower lovers with a fresher, more sustainable product than ever before.