Chapter 2

E-commerce Business Models and Concepts

B2C E-Commerce Business Models

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 B2C Business Models
 Portal
 E-tailer
 Community provider (social network)
 Content provider
 Transaction broker
 Market creator
 Service provider

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 B2C Models: Portal
 Search plus an integrated package of content and services
 Types: Horizontal Portal , Vertical Portal or Vortal and Search Portal
 Horizontal Portal
Horizontal portals are directories like yahoo.com!. They're called "horizontal" because
their list of websites cover a broad range of topics (such as News, Search, Other Website
links, Premium Services, email and Online Storage etc.
Examples: Yahoo.com, MSN.Com, Google.com, Aol.com, pakistan.gov.pk 
 Vertical Portal
Vertical portals on the other hand are narrow, covering only one topic or one type of
Products or Services. Convert-Files.com 
Examples: Convert-Files.com, exportall.com, quicken.intuit.com
Facts: - No of user of portal Greater than vortal users
- Vortal users pay more than portal users

 Revenue model: Advertising, referral fees, transaction fees, subscriptions

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 E-tailer : Example Horizontal Portal

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 B2C Models: E-Tailer
 Online version of traditional retailer (Physical Retail Stores)
 Variations:
 Virtual merchant (Click-and-Click)
 Examples:- Shophive, tcs-connect, Amazon , BlueNile , DrugStore
 Bricks-and-Mortar (Only have Physical Store’s)
 Examples:- All offline Retailers
(Have no Presence over the Internet/Web | No have E-Commerce Website)
 Bricks-and-clicks (Online as well offline)
 Examples:- Jc-Penney , Wal-Mart, Staples
 Catalog merchant | LLBean.com (also process orders via email and Phone)
 Manufacturer-direct | Dell.com
 Shopping Mall | malloflahore.pk
 Low barriers to entry | Cost for entering into a E-Retail is low than startup a
Physical Retail Store.
 Revenue model: Direct Sales, Advertisement

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 B2C Models: Community Provider
 Provide online environment (social network) where people
with similar interests can transact, share content, and
communicate
 Examples: Facebook, LinkedIn, Twitter, Pinterest and
About.com . Visitors can share tips and buy recommended books
from amazon, giving about.com a commission on every purchase.
Well.com provides forum for technology and internet related discussions
Fool.com which provides financial advice , news and opinions.
 Revenue models:
 Typically hybrid, combining advertising, subscriptions, sales, transaction
fees, and so on

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 B2C Models: Content Provider
 Sell or provide digital content (News, music, video, text, artwork)
on the Web:
Examples: consumerreports.org, wallstreatjournal.com, CNN.com, espn.com

OR
 Sell or provide Intellectual Property on the Web
 Intellectual Property: refers to all forms of human expression
that can be put into a tangible medium such as text, cd’s or the web
 Revenue models:
 Subscription; pay per download (micropayment); advertising; affiliate referral

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 B2C Models: Transaction Broker
 Process online transactions for consumers
 Primary value proposition—saving time and money
 Site that processes transactions for consumers that are
normally handled in person , by phone or mail.
Examples: travelocity.com, xpedia.com, rozee.pk, ubl.com,
bukharigroup.com.pk
 Revenue model:
 Transaction fees
 Industries using this model:
 Financial services
 Travel services
 Job placement services

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 B2C Models: Market Creator
 Create digital environment (a C2C ecommerce
website) where buyers and sellers can meet,
display products , search for products and
establish a price for products.
 Examples:

B2C
B2C
 Priceline

 eBay
C2C

 Revenue model: Transaction fees, fees to

merchants for access
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 B2C Models: Service Provider
 Use IT / IS Infrastructure of well known companies . . .
 Web 2.0 applications such as photo sharing, video sharing and user-
generated content(Blogs, WIKI’S and Social networking sites) are all
services provided to customers.
 SAAS – Software as a Service Providers (Examples)
• Google Developing online applications such as
Google Maps, Google Drive, Sky Drive, Gmail, Salesforce.com etc.
 Value proposition
 Valuable, convenient, time-saving, low-cost alternatives to
traditional service providers
 Revenue models:
 Sales of services, subscription fees, advertising, sales of marketing
data

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