(4) Mind your own (e)-Business
Hello and welcome back to my 4th installment of Introduction to Internet. We will be touching on the topic on E-Business this week! It will be a little wordy as we will be talking about the different types of business models i have learnt in class!
E-commerce is the process of buying and selling of goods and services electronically
E-business is the use of internet and other digital technologies for performing internal business processes and coordinating with suppliers and partners together with e-commerce.
I believe that we have learnt about the different types of e-commerce but let me refresh your memory!
The different types of e-commerce are classified into two groups.
Classified by nature of market relationship
-Business-to-Consumer (B2C)
-Business-to-Business (B2B)
-Consumer-to-Consumer (C2C)
Classified by type of technology used
-Mobile Commerce (M-commerce)
However, we are not going to go into details on the different types of e-commerce as we’re already familiar with it
BUSINESS MODELS ON THE WEB
Prof Abel choy mentioned something interesting in class regarding the different types of business models that businesses adopt for their e-business. Let me share this mind-blowing chapter on ‘Business Models on The Web’.
I agree that business models are the most discussed at the least understood aspect of the web. You will hear people talk about their own business models for their own companies, but you will never know the details or the specifics of it even if they explain it to you. This is probably because there are simple and complex business models depending on their competing factors.
So, let me start on the 9 basic categories of business models on the web!
Brokers are market-makers and they bring both the sellers and buyers together to facilitate transactions. A fee or commission is usually charged by the broker for each transaction. B2B, B2C and C2C are common types of markets this business model is found in.
PayPal is a third-party payment mechanism for buyers and sellers alike to settle a transaction online securely. A fee is usually charged per transaction.
This model is an extension of the traditional media broadcast model. In this case, the web site provides content and services together with advertising messages in the form of banner ads. The banner ads may be the major or sole source of revenue for the broadcaster. Volume of viewer traffic is monitored to see if this model works.
This is a very common business model and one example will be Carousell where people are able to list items for sale or wanted for purchase for other fellow members to view and approach them for their listed products.
This model used the collected data about consumers and their consumption habits to be analysed and used to target marketing campaigns for businesses. This helps infomediaries assisting buyers and sellers understand a given market.
One example is the Nielsen Ratings where they track the online audience market on streaming sites when people view certain videos or movies.
Wholesalers and retailers of goods and services. Sales are based on list prices or through an auction
One example is the Apple iTunes Music Store. They deal with digital products and services and conducts both sales and distribution over the Internet.
The manufacturer reaches buyers directly and compressed the distribution channel, allowing better efficiency, improved customer service and better understanding of customer preferences
One example is Dell Computer. It have its own main manufacturer company and other shops who wants to sell their products have to get a license from them to be authorised (to sell their Dell products)
This model offers financial incentives to affiliated partner sites and the affiliates only must provide purchase point click-through to the merchant.
One example will be Amazon.com where there are plenty of banners placement among its own webpage.
This model, together with the rise of social networking, is based on user loyalty. Users will invest a lot of their time and emotion and revenue can be based on the sale of products, services, voluntary contributions, contextual advertising or premium services.
Social networking services use this business model generally. So they actually include Facebook, Twitter, Instagram, Friendster etc….
Another example is Wikipedia where openly accessible content developed collaboratively by a global community who work voluntarily.
This model charges users a periodic fee for their subscription to a service.
One example is Netflix, where subscribers have to sign up for an account before they are able to use the services and view the movies and television shows available to them.
This is also known as a ‘on-demand’ model and is based on metered usage or a ‘pay-as-you-go’ approach. This charges user based on actual usage rates, which is similar to electricity water and telephone services.
One example is Slashdot. Which allows subscribers to purchase access to content that they are interested according to the number of pages viewed.
FINAL THOUGHTS ON E-BUSINESS
Even though there are so many different types of business models on the web for companies to choose from, they have to choose the most suitable model based on the different types of goals that they prioritize. With that, companies can attract the attention of any reader by using large, professional quality photos, loud colors, fun phrases, attention grabbing fonts, and strategically used business models.
I hope that you have learnt so many things this week. This is a relatively important chapter as we might be having our own business in the future and we must remember that in order to choose the best business models for our own company, we have to put our goals of the company in mind.
Till then, and see you next week for our 5th installment.
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