Business model innovations in China: A focus on value propositions

Abstract

Prior studies that examine business model innovations lack consideration on how value propositions are best developed in specific contexts or how restructuring other components can deliver on value propositions. This article first identifies three types of Chinese consumption behaviors—imitation-based “good-enough” consumption, renqing consumption, and face consumption—and their corresponding value propositions based on value-hierarchy theory. We then look at Chinese companies that illustrate how business model innovations that focus on the targeted value propositions are initiated, formulated, and implemented. In particular, we identify four types of business model innovations: imitation-based “good-enough” business models, renqing business models, face business models, and hybrid business models. We conclude with practical implications for conducting and implementing business model innovations in China.