How some firms are rewriting the rules of commerce by pursuing “ends”—actual outcomes—rather than selling “means”—their products and services.
Would you rather pay for health care or for better health? For school or education? For groceries or nutrition? A car or transportation? A theater performance or entertainment? In The Ends Game, Marco Bertini and Oded Koenigsberg describe how some firms are rewriting the rules of commerce: instead of selling the “means” (products and services), they adopt innovative revenue models to pursue the “ends” (actual outcomes). They show that paying by the pill, semester, food item, vehicle, or show does not necessarily reflect the value that customers actually derive from their purchases. Revenue models anchored on the ownership of products, they argue, are patently inferior.
Bertini and Koenigsberg explain that advances in technology have made it possible for firms to collect “impact data” that tells them when and how customers use their products and how those products perform, and that firms can draw on this data to turn products into seamless services. New revenue models will enable transparency, accountability, and efficiency.
Bertini and Koenigsberg offer real-world examples of how companies in health care, transportation, education, and other sectors are already playing “the ends game,” describing, among other things, the successes of Dollar Shave Club, Rent the Runway, and “pay as you fly” insurance for drone flights.Finally, they outline the challenges in adopting these new models, offering guidance on such issues as criteria for defining an outcome, concerns over data collection, and internal organizational obstacles.