Paper Title
Do You Know Your Customers? Do You Love Them? Reevaluating Value Creation for Customers through Business Model Innovation

Abstract
What customers want is one thing, but what they actually need and what they desire is something else. In this paper we define existing customer needs as something that customers know and are aware of, can express, and new customer needs as something that customers do not yet know and are not yet fully aware of. Just like in a Johari window. Companies usually go for the former because the latter is more difficult. Particularly when the customer desire is more psychological in character. Business models are valuable innovation tools because they can turn even an old and less novel technology into a successful innovation, but as stated by Chesbrough, at the heart, a business model performs two important functions: value creation and value capture. However, how can you create value when customers don’t know what they actually need? When they cannot express what they actually desire? Maybe a deeper interaction is required, interpreting the customer’s needs, reading between the lines, inferring what is going on underneath the surface, and collaborative prototyping. This study was based on an exploratory, inductive research approach influenced by grounded theory, studying three Swedish technological companies: Axis, HMS and Sectra. Using grounded theory coding techniques, a typology of seller and buyer needs was created based on four categories: unconstrained needs, undoubtful needs, unconventional needs, and uncertain needs. The results show that depending on which category the company resides, the typology can help managers decide when it is appropriate to listen closely to customers, and when it is not. When they want to fulfill existing customer needs and when they want to fulfill new customer needs. However, discovering new customer needs requires close interaction with customers. Especially when you want to discover not just what customers know that they want, but also what they do not yet know that they actually need. Intimacy is needed when you really want to come close to customers and really want to explore and understand their deep desires. Index Terms - Business model innovation, customer desire, typology of buyer and seller needs, value capture and value creation.