Assignment Topics: E-Business Model and Revenue Model

Subject: E-COMMERCE
Submit to: Sir Tahir Naeem
Submitted By Usman Ghani BBA 7th “A”
Reg#: MS120152069
Deptt: IBS KUST
E-Business Model
The business-to-consumer, or B2C, model of e-business sells products directly to retail
consumers online. Amazon.com is an example of a B2C model. The e-business has only an
online identity through which it offers a range of products to customers. Other B2C
enterprises include bestbookbuys.com and gartner.com. Most B2C models generate
revenue from direct sales and processing fees. B2C also is known as electronic retail or e-
tail.

The business-to-business, or B2B, model involves companies using the Internet to

conduct transactions with one other. B2B e-business accounts for more than 90 percent of
all electronic commerce, according to the U.S. Census Bureau. The main reason for this is
the complexity of B2B transactions. Unlike B2C transactions that involve sellers offering
products and services and buyers purchasing them, B2B transactions are multifaceted and
often involve multiple transactions at each step of the supply chain. B2B businesses
generate revenue from direct sales.

Consumer-to-business, or C2B, is a unique e-business model in which consumers create

value and demand for products. Reverse auctions are a common characteristic of C2B
models, in which consumers drive transactions and offer their own prices for products. The
airline ticket website Priceline.com is an example of a C2B e-business model. The website
allows customers to bid for tickets and offer their own prices. Shopping sites such as
cheap.com, gilt.com and ruelala.com also are C2B.

Consumer-to-consumer, or C2C, e-business models enable consumers to behave as

buyers and sellers in third-party-facilitated online marketplaces. Craigslist is an example of a
third-party marketplace. The company brings together disparate buyers and sellers to
conduct business. Other examples of C2C websites include eBay and PayPal. A C2C model
generates revenues in several ways, including personal ad fees, membership or subscription
fees, sales commissions and transaction fees.

Revenue Model
Ad-Based Revenue Model: Ad-based revenue models entail creating ads for a specific
website, service, app, or other product, and placing them on strategic, high-traffic channels. If
your company has a website or you have a web-based company, Google’s AdSense is one of
the most common tools get ads. For most websites, AdSense will earn about $5-10 per 1,000
page views.
Affiliate Revenue Model: Another popular web-based revenue model is the affiliate
revenue model, which works by promoting links to relevant products and collecting
commission on the sales of those products, and can even work in conjunction with ads or
separately.
Transactional Revenue Model: Countless companies, both tech-oriented and otherwise,
strive to rely on the transactional revenue model, an d for good reason too. This method is
one of the most direct ways of generating revenue, as it entails a company providing a
service or product and customers paying them for it.
Subscription Revenue Model: The subscription revenue model entails offering your
customers a product or service that customers can pay for over a longer period of time,
usually month to month, or even year to year.
5. Web Sales: This is an offshoot of the transactional revenue model, in which a customer
pays directly for a product or service, except that customers must first come to your company
via a web search or outbound marketing, and conduct transactions solely over the internet.
Direct Sales: There are two types of direct sales: inside sales, in which someone calls in to
place an order or sales agents calling prospects; and outside sales, which is a face to face
sales transaction.
Channel Sales (or Indirect Sales): The channel sales model consists of agents or
resellers selling your product for you and either you or the reseller delivering the product. The
affiliate revenue model is a good companion model to this one, especially if your offering is a
virtual product.
Retail Sales: Retail sales entails setting up a traditional department store or retail store in
which you offer physical goods to your customers. Keep in mind that the retail sales model
will require shelf space (that you’ll have to pay for) at existing stores, and is best suited for
products that require logistics to reach your customers
Product is Free, But Services Aren’t: This model is unique compared to others, in that you
have to give your product away for free, yet require customers to pay for installation,
customization, training or other additional services
10. Freemium Model: The freemium model is one in which a company’s basic services are
free, yet users must pay for additional premium features, extensions, functions, etc. One of
the biggest companies to use this model is LinkedIn, the most popular business/social media
platform