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The Brilliant Business Model of Bagged Lettuce

6:33 PM Sunday June 15, 2008

Tags:Entrepreneurship

Bagged lettuce.

That's what I tell people when they ask me what Jamseed's business model is.

"But I thought it was some sort of site for musicians to get money," they ask. "And isn't that something they can already do? They don't need you."

Yes and no. Yes, we are trying to find ways for fans to support musicians. And yes, musicians can do everything our site offers by themselves: ask fans for money, sell their music, sell merchandise, promote themselves, interact with their fans, etc.

But no, what's really important to my startup company is the same thing that's important to every company: customers. And what customers want isn't a nifty idea--what they want is something that fills a need in their life.

Bagged lettuce.

A bag of pre-washed and cut lettuce costs around 4 times as much as a plain old head of green stuff. And yet, even though there are people who have a knife, colander, time on their hands, and been criticized by their smart-alecky friends for wasting money, my local supermarket still sells plenty of the bagged stuff.

And precut fruit. Presliced deli meat. Marinated pork chops. Precooked chickens. Entire prepared Thanksgiving dinners with cranberry sauce and plastic forks. Come to think of it, if people did everything for themselves rather than turning to businesses there'd be no supermarkets, no restaurants, no "middlemen" who provide value by doing things for you rather than making something of their own.

So the question is not "how good is our idea" but how easy are we making the lives of our customers, and what makes our bagged lettuce the one to buy?

Well, that's a blog for another day.

What do you think? Is bagged lettuce a good metaphor? Do middlemen serve a purpose or is the Internet all about removing intermediaries? Should entrepreneurs focus on providing unique value or the best value of an already well-understood commodity?

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Bagged Lettuce, Music & Innovation from TheYanec - Yaniv Yaakubovich:
David Silverman writes a blog called The Start-Up Diaries in Harvard Business blogs. On his June 15 post he uses an interesting comparison between Bagged Lettuce and his start-up company, Jamseed. His idea brings fans closer to the music they like as... More

Tracked on June 16, 2008 23:42

Comments

I think you are absolutely right. And I think “bagged lettuce” is an excellent metaphor. In the far, far past (say ‘round 2000) people might have believed that everything on the net was all about chopping and mixing your own tomatoes, lettuce, cucumbers and peppers. But now, that seems very obsolete. Social media, mash ups, RSS etc all make life much easier. Netvibes is my “bagged lettuce” of choice but I also use Twitter, Jaiku, Facebook and Myspace. All good bags, all serving different purposes.

- Posted by Johan Y 
June 16, 2008 3:29 AM

Bagged lettuce is a great metaphor. To Jonah Y's point, I found this post using Guy Kawasaki's Alltop (startups).

You might use Netvibes, but Guy bags lettuce for you over at Alltop.

In the FAQ in answer to "Couldn’t I build my own custom aggregation using a feed reader, customizable home pages, Netvibes, etc?"

The answer:

"Yes, you could—knock yourself out. While you’re at it, you could backup your hard disk, bake your own bread, iron your own shirts, floss daily, tune your own car, and bike to work."

Now that's a bagged lettuce business model.

- Posted by Chris 
June 17, 2008 9:05 AM

It's hard to quantify 'easy' or 'good idea'. But, it is easy to quantify time.

If you see that time is a commodity, then you can say that a business is a methodical way to save people 60 minutes, 60 days, or 60 years of their time.

Eliminating steps. Eliminating delays. Eliminating ambiguity. A good business is clear pattern of distinct efficiency.

Great questions!

-Nate.

- Posted by nate 
June 17, 2008 10:20 PM

Here's another example. I bought charcoal that lights without lighter fluid. It was nearly $9 for the bag. (Versus $5 for plain charcoal.)

I told the cashier, I was clearly paying a lot for convenience, and she responded with the most succinct reality I've ever heard:

"Honey, that's all we ever pay for."

- Posted by David Silverman 
June 18, 2008 10:33 AM

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David Silverman

David Silverman is the author of Typo: The Last American Typesetter or How I Made and Lost 4 Million Dollars (Soft Skull Press, 2007). He has worked at brand-new start-ups, Fortune 500 companies, and a few places in between. A business writing teacher, he grapples with the way we use words at work—to make it easier for the rest of us. If you have questions about how to manage a problem at work related to communication, please contact David at dsilverman [at] harvardbusiness [dot] org.

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