Innovative business models for value creation in Spanish organic olive oil

Over the past years, the entire food sector including olive oil has been facing economic problems in particular the low income of farmers, environmental sustainability problems (protection of ecosystems and biodiversity, mitigation of climate change), and social problems (depopulation of rural areas, rural unemployment, precarious living conditions of many farmers). In this context, the Spanish olive oil sector has undertaken important steps in transition from traditional to sustainable models (especially organic production) as a solution to some of the problems mentioned above and value creation in the value chain of this product. Face to this background, the present study aims to analyzing the sources of added value throughout the organic olive oil value chain as a whole and among the different actors of the value chain, identifying the factors that positively and negatively influence the formation of added value. It also explores how new technologies, changing consumer behavior and regulation influence the business models of organic olive oil companies. To this end, a business model survey was conducted with the participation of a highly qualified panel of experts from the olive sector to develop innovative business models for the creation of value in organic olive oil. To the best of our knowledge, this is the first study using the business model methodology for value creation in the organic olive oil in Spain. The results show that the expected benefits of organic olive oil compared to conventional production are mainly higher income for producers, less soil and water contamination and more job creation in the rural zones. Creating value in the organic olive oil value chain would be essentially based on a market segmentation strategy where companies should orient organic olive oil to very health conscious consumers, people friendly to the environment and high-income people, both on the national and the export markets. Also, in the national market, the distribution of this product would be more efficient through specialized channels (bio concept), e-commerce, agrotourism, hypermarkets and supermarkets, small specialized shops, in this order. For export, distribution should be preferably through specialized channels (bio concept), small specialty stores and e-commerce. This is without forgetting the need to meet the requirements of local and international consumers through the production of high quality organic olive oil (extra virgin) packed in innovative crystal bottles and with a suitable price on the markets. Creating value and achieving a sustainable competitive advantage in the domestic and foreign markets will depend on the commitment and joint efforts of the different actors in the value chain, through the implementation of actions focused on quality through the adoption of good practices for harvesting and transporting olives, and the differentiation of the product through the adoption of sustainable production methods that go beyond organic production systems at the production stage. At the processor level, value creation depends on the adoption of good extraction and storage practices, the implementation of management systems to ensure the quality of the product and the respect of environmental requirements and traceability and the development of strong brands. To this should be added the necessary IV structural and organizational changes as well as the development of appropriate marketing strategies and promotional campaigns in collaboration with public institutions, the development and use of e-commerce platforms and the improvement of the positioning of organic olive oil in the priority consumer segments. Last but not least, a real-life case study of a Spanish organic olive oil company is presented as a practical application of business model innovation based on both the business model generation concept and the survey results as potential levers and solutions for business innovation and improvement. The main objective here is to illustrate how the results of the survey carried out can be implemented in a real organic olive oil firm to generate potential innovation areas in its business model.