Revenue Models and Building a Web Presence: A Comprehensive Guide for Businesses, Slides of Internet and Information Access

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Selling on the Web:

Revenue Models

and

Building a Web Presence

UNIT - II

Objectives

In this chapter, you will learn about:

• (^) Revenue models
• (^) How some companies move from one revenue model to another to achieve success
• (^) Revenue strategy issues that companies face when selling on the Web

Revenue Models

• (^) Mail order or catalog model
  • (^) Proven to be successful for a wide variety of consumer items

• (^) Web catalog revenue model
  • (^) Taking the catalog model to the Web

Books, Music, and Videos

• (^) Retailers use the Web catalog model to sell books, music, and videos - (^) Among the most visible examples of electronic commerce

• (^) Jeff Bezos
  • (^) Formed Amazon.com
• (^) Jason and Matthew Olim
  • (^) Formed an online music store they called CDnow
  • (^) Used the Web catalog revenue model

Clothing Retailers

• (^) Lands’ End
  • (^) Pioneered the idea of online Web shopping assistance with its Lands’ End Live feature in 1999
• (^) Personal shopper
  • (^) Intelligent agent program that learns a customer’s preferences and makes suggestions
• (^) Virtual model
  • (^) Graphic image built from customer measurements

Flowers and Gifts

• (^) 1-800-Flowers
  • (^) Created an online extension to its telephone order business

Digital Content Revenue Models

• Firms that own intellectual property have

embraced the Web as a new and highly

efficient distribution mechanism

• Lexis.com

• (^) Provides full-text search of court cases, laws, patent databases, and tax regulations

• ProQuest

• (^) Sells digital copies of published documents

Advertising-Supported Revenue

Models

• (^) Broadcasters provide free programming to an audience along with advertising messages
• (^) Success of Web advertising is hampered by:
  • (^) No consensus on how to measure and charge for site visitor views - (^) Stickiness of a Web site: the ability to keep visitors and attract repeat visitors
  • (^) Very few Web sites have sufficient visitors to interest large advertisers

Advertising-Subscription Mixed

Revenue Models

• (^) Subscribers pay a fee and accept some level of advertising - (^) Typically are subjected to much less advertising
• (^) This model is used by The New York Times and The Wall Street Journal

Advertising-Subscription Mixed

Revenue Models (continued)

• (^) Business Week
  • (^) Offers some free content at its Business Week online site
  • (^) Requires visitors to buy a subscription to the Business Week print magazine

Fee-for-Service Revenue Models

• (^) Fee is based on the value of a service provided
• (^) Services range from games and entertainment to financial advice

• (^) Online games
  • (^) Growing number of sites include premium games in their offerings
  • (^) Site visitors must pay to play these premium games