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Advertising subscription mixed model
This model has been used for many years by newspapers and magazines. Subscribers pay a fee and accept some level of advertising. Companies that have most success with this type of model tend to be established already. The financial review offers this subscription . You are able to receive some content without subscribing but to obtain all the features and benefits you must subscribe. The financial review also offers a reduced rate if you subscribe to the printed format.
Most advertising subscription models utilize the advertising revenue as their main support. Many online newspapers use the advertising so that a reader can come in and read articles but to view the classifieds you have to subscribe to the service.
TD waterhouse offers a subscription service by giving investors real time quotes on stocks and shares. The general public can visit the site and look up a stock quote but the price quoted has a 0 minute lag time.
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The subscription model is a tough model to make profitable as most users of the web do not want to pay per view.
Advertising supported model
The advertising supported model is the most common business model in media today. This is also true on the internet. Webmaster provide the content for free to an audience along with advertising messages. The model works if the advertising revenue is greater than the operations of running the website and providing the content.
The success of web advertising has been hampered by not knowing how to measure and charge for site visitors views.
Successful advertising models include Yahoo.com.
Yahoo for many people is a starting point for people using the web. Yahoo has become a major portal on the internet and this has allowed them to charge advertisers to display their ads on their pages. Yahoo can charge advertisers extra because it has the ability to create smart advertising. Smart advertising allows the page to display an add that may match the search on the yahoo search engine. A web surfer may be looking for white goods. When the results come back the top banner ad could be customized to bring back a Harvey Norman advertisement. Retailers may be willing to pay more for this customization.
Web employment advertising has proven very popular with advertisers.
Fee for transaction model
The fee for transaction model works by receiving a commission or brokerage for each transaction that is conducted. A travel agency receives a commission for each transaction that is conducted. Online travel agencies are a good example.
Another company is whatif.com.au this website allows you to find to 5 star hotels and pay a discounted price. The website receives a fee for each booking that is made.
Many commodity type websites are fee for transaction model. Stock brokerage firms that offer no advice have been set up to capture this market. Online trading has increased significantly over the last 5 years.
TdWaterhouse.com.au uses a fee for transaction model. They charge their customers a commission for each trade that is executed. Online brokers are replacing traditional broker services because many investors do not see any value in using a broker and paying $100 per transaction when they can have their order executed via an online stock broker for as little as $16. It is interesting to note that TD waterhouse are increasing their online brokerage charges from the 15th September to $5.5 per transaction. This may be due to less competition as there have been quite a few online brokers close there websites as the volumes were not being produced to make the online system profitable. Time will tell to see if TD waterhouse will lose market share because of the price increase.
Selling Goods and Services
Selling goods and services on the web is based on the traditional mail order catalog business that have been going on for many centuries. Tis model works by the website establishing a brand that conveys the image that is trying to be emulated. Many business use their traditional bricks and mortar type establishments that already have a market or brand image. With mail order catalog type business orders can be taken via the website if they have the necessary merchant facilities.
Rivers.com is a good example of a company that has a good name via its qultity clothing that has expanded its marketing presence by setting up a website that allows the consumer to view clothes see wehat is in stock and order and pay online.
Other websites allow you to custom build a product to your specifications like DELL you can order your own computer made to the specifications that you choose. You have choices over the components that are available.
Selling Information and Digital Content
Companies that own intellectual property or the rights to IP can sell their intelligence over the web.
http//www.onlinestockdata.com/onlinestockdata/default.htm is a company that sells data of all the stocks and other derivatives of the Australian stock market and other markets across the world. This information is used by investors to analyse stocks to see patterns and help with their investing.
Rivkin.com.au sells stock analysis directly. Subscribers receive a weekly newsletter that describes various stocks and gives recommendations on what should be bought and if purchased what stocks should be sold.
Adult entertainment is still the biggest and probably most profitable sites by selling digital content. The adult industry has been at the leading edge with most technology to help the web from compression techniques to credit card transactions
Auction Models
The auction model is an intermediary role between the buyer and the seller. The auction site offers a wide variety of goods and services. The exchange of goods is done through negotiationor bargaining between two entities.
Ebay is the market leader in auctions. The auction model that is used is the highest bidder model. A seller of a good fills out a form with description of the product, register in a category and possibly attach an electronic image. Once the goods or services are listed buyers are then able to start the auction. The auction is time bound so that when the time expires the highest bidder wind the auction. Ebay also show what the reserve for that item is as well.
In a reverse or Dutch auction, the price is initially set at a very high level, and drops at regular intervals. Participants can pick the price at which they want to buy, and have to determine the chance that someone else will find a higher price acceptable.
In a variant of the reverse auction, customers indicate a product or service and a price, which they are willing to pay. Suppliers indicate a price at which they are willing to provide that product or service, and the auction service tries to match customers and suppliers. The intermediary pockets the difference between the price paid by the customer and the price paid to the supplier (US 5,77,17; US 5,74,07). This model is popular with high-priced items like automobiles or airline tickets
Buyers club model
The buying group model allows several business owners to pool together there buying power to improve their negotiating power. With their market knowledge and expectatations and knowledge of legislative restrictions, the buying groups act as intermediaries for negation with suppliers. The buyers club handles all the distribution of product cateloges, financial transactions and delivery of merchandise.
The xxxxxx Website makes the most of this business model by offering an electronic tendering service via the Internet. This Website allows firms from the private sector to get access to public sector contracts. It displays calls for tender from all Government levels such as Federal, Provincial and Municipal in addition to hundreds of Universities, hospitals and school boards across Australia. xxxxx takes care of distributing and managing the information. Indeed, every day, this Website provides access to procurement opportunities for a certain fee.
xxxxx also facilitates the work of companies from the public sector as well as the different Government levels by taking care of the management process of call for tender notices and displaying them on their Website, therefore allowing for a larger distribution.
Barter Model
Just like in the good old days, the community alliance or barter model allows goods and services to be exchanged without money. Via the Internet, a business owner can barter physical space or other things with another company. For instance, a company can make its warehouse space profitable by offering another company the possibility of storing its products there temporarily. Or a company that manufactures wooden furniture can barter sawdust and old wood with a company that produces plywood.
The second variation of this model is the most virtual. In this case, the companies or people with access to this e-business model are members of different associations or companies. This type of site favors shared expertise and knowledge. For instance, a computer programmer with difficulty in finding a solution to a code can go to a community alliance site which is specialised in computers, communicate with other programmers, answer questions (if possible) and find a solution to his or her problem. Participants often give their codes for free in exchange for another service.
The Linux.com Website is the best example of the community alliance model. Linux, which offers a new alternative for a server operating system is in direct competition with Microsoft. However, Linux is unique as it seeks to use the computer communitys knowledge by offering the possibility to share knowledge and it allows a number of computer programmers to have access to its code. As described earlier, the strength of this e-commerce business model is to use the Webs advantages ) on-line discussions (chat) and e-mail ) to bring closer specialists and their experiences on a Website that favours exchanges. This system can be used for social purposes but it is particularly appreciated for technical support purposes
Virtual Mall
A virtual mall is a site that hosts many merchants, service providers, brokers and other businesses. The virtual mall operator typically charges a fee for setting up and maintaining the merchants booth, and for including him in the site-wide catalog. Additionally, he may charge a fee for every transaction the merchant performs. Virtual malls can operate within the context of a larger site, such as a portal.
The virtual mall can act as an intermediary between individual customers and the business it hosts, for instance by facilitating payment and guaranteeing a full refund if a merchant does not deliver in time.
When the virtual mall offers services such as payment facilitation or catalog browsing, it has the ability to create aggregated user profiles on the customers that visit any of the businesses in the mall. This can lead to the development of highly specialized malls (e.g., oriented at kids or sports lovers
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