Internet Business Models

Internet Business Models: Innovation At Full Sprint


The world wide web has come to completely revolutionize how businesses are conducted using this relatively young medium.

Traditional business models have completely turned outside down. Some have completely disappeared, while others reinvented themeselves. Internet business models have given birth to total innovation revolution!

The traditional marketing or distribution channels have been broken. For instance, businesses can sell directly to customers cancelling-off intermediaries. This allows consumers big savings.

Entire business operations online save companies a lot of money that they would otherwise use for renting expensive premises.

In the past, business models had somehow a limited reach. Today with the internet, the possibilities are endless. This medium has opened up doors to unlimited innovation paths. It’s all up to those who figure out new ways to conduct business operations and transactions online.

An internet business model is not just about generating revenue but most importantly, value to the consumer, to in turn generate profits.

For instance, the travel industry has adapted very well to the new way of doing business. A whole new array of business operations have been born. Another goog example is the book publishing industry, where the middle man (the publishing houses) almost disappeared.

Internet business models are diferent ways of doing business, but they have also disrupted the way income is generated. This new way of doing business has also opened new real online income opportunities integrated into just one business model.

Models best suited for the web:

Affiliate Marketing:
Pay for performance model. It involves pay per click, banner exchange, revenue sharing. Merchants reward affiliates (sales army) for their efforts in bringing new paying clients to their businesses. How does affiliate marketing work?
Reservations and Bookings:
Services that can be booked via reservation system directly online. For instance, travel, hote accommodations, restaurant reservations, doctor's appointments, catering services, wedding planning, shows, special presentations, spa and saloon appointments and many others.
Business Directory Sites:
Online listings of companies with company description, names, addresses, phone numbers and websites if available. They are organized by category based on products and services they belong to and also by location. Think of it like the old yellow pages concept, but online. This model is supported by advertising, by charging for listings or both.
The simplest function is the posting of a classified ad (similar to advertising in a newspaper) indicating that a service is for sale. Car dealers, personal, used items by owner, new items by owner, and everything in between. This internet business model is supported by advertising, by charging listing fees, or both.
Community Portals:
Web spaces where people with common ideas, interests, likes, and thinking come together to network, share their thoughts, ideas and also help each other. These sites are supported by advertising.
Drop Shipping:
This model involves some wholesalers who want to work with individuals or entrepreneurs by shipping products on the name of entrepreneurs who place products for sale on their websites. This is great for those starting out and don't want or can't invest on stock. Learn more...
When a customer buys, the entrepreneur processes the credit card orders and sends them a receipt. Then, sends the wholesaler the order with all the buyer's details so that the wholesaler packs and ships the product to the end consumer.
E-Commerce - Digital Products:
Websites that sell all kinds of digital products like e-books, videos, presentations, images, illustrations, photos, graphics, web templates, music, training series, podcasts, and anything that can be delived electronically.
E-Commerce – Physical Products:
Online retail stores that sell everything that can people can feel, touch, smell, taste. People order from the business website and goods are delivered via courier or regular mail.
Employment portals:
Websites where job seekers and employers come together to connect and negociate possible employment relationships. It generates money by charging employers a fee for their listings and its free for job seekers who send their resumes to vacancies they might be interested in. Then when the employers find a match, they get in touch with the applicant and negotiations start.
Finder’s Fees
A commission paid to an intermediary or the facilitator of a transaction. The finder's fee is rewarded because the intermediary discovered the deal and brought it forth to interested parties. Depending on the circumstance, the finder's fee can be paid by either the transaction's buyer or seller.
Information sellers are called infopreneurs. They are in the business of providing and selling information packed in many different digital publishing forms. They also take many differnt forms for instance, web content publishers are infopreneurs, book publishers, video publishers, training publishers, specialized content publishers, technical content, premium content, news, specialized research, special knowledge, and experience. Learn more.
Lead generation:
This is a marketing and sales technique used to generate interested prospects and sometimes actual sales. However, with the internet it has also become a business model upon which many companys have build entire businesses. For instance, the collected information is sold to a third party.
The main purpose is to first acquire the prospects information to evaluate the quality of the lead. This means that a sort of filter is used to figure out whether the lead is more likely to take the desired action. This is not a new business model, but it has adapted well for the internet. For instance
Market places:
A growing number of e-marketplaces provide online automatic ordering systems where you can create a corporate profile of preferences in order to avoid repeat data entry. As a manager, you can use these applications to set budgets, track spending online, and enforce purchasing policies.
Business model that involves charging recurring fees (monthly or yearly) for access to specialized content, premium content, software, products, services, e-books, videos, software, training.
Real Estate:
Portals with rental properties, on-sale properties, commercial, property management, vacation rentals, relocation services listings. It is the central command for tenants and landlors.
Here the tenant search for the best property options available, while the landlors list their offerings. Then they get in contact to start evaluating the spaces and negotiating pricing and terms to finally close the deals and agree on legal terms. These sites also generate revenue via advertising or featured listings.
Referral Marketing
This involves a method of promoting products or services to new customers through referrals, usually word of mouth. Such referrals often happen spontaneously but businesses can influence this through appropriate strategies.
Products or Services Review Sites:
In this model, reviews and even ratings are posted on the site by users about products, services, companies, individuals and organizations. Users give ratings or plain reviews about their experiences with them.
Many shoppers value more this informatin when making purchase decisions. This model generates revenue via advertising or could charge a fee for featured listing. The reviews may also come from publishers that conducted their own research.
Produts or Services Comparison Sites:
This model is similar to review sites but it compares specific features, benefits, pricing, and service quality that businesses offer. These sites work as search engines, but these focus on particular segments of the web. This kind of engine is called vertical search. They also generate revenue via advertising.
Selling Ad Space on Website:
Website owners may sell ads on their sites in many different forms. One is by using advertising networks like Bing Ads or Google Adsense for starters. There are many others. Or, the most profitable for you is to sell the sponsorships or advertising space directly to advertisers and charge them directly. This can be done with advertising management plug-ins.