Ecommerce Business Models
Running a business over the Internet seems to be the next big thing, at least for most folks who consider themselves ‘tech-savvy’ or power internet users. And of course, all this starts with a website. It’s pretty obvious that obtaining a website and setting it up has costs involved mostly in the interest of generating revenues for the business in question. And in order to find success, revenue models have to be adopted much like strategies that businesses in the real world adopt.
As the intent is to not have your eyes glaze over while perusing through ‘jargon’, one can classify three different revenue models that are common over the internet.
Revenue Model #1: Also known as the ‘retail model’, where you sell or auction products online from either your own online store or using established sites like eBay etc. What needs to be kept in mind is that the products you pick are crucial to success as well as the option of either using established sites or your own online store.
Revenue Model #2: This one is known as the ‘affiliate model’ in which you can promote or sell other people’s products online. One does not have to deal with every aspect of the business (as it is not your business anyways) such as its customers or their orders and supply. All you have to do is pick who you want to work with and then proceed to sell their products for a commission of about 5% to 75%.
Revenue Model #3: This one is the toughest of the lot which requires you to create your own products and services, and appoint other people to sell them for you. Popular items such as eBooks, CDs, DVDs and software can easily be sold, and can prove lucrative and a long lasting business.