Online Business Models in E-commerce

Business models describe the rationale of how a commercial organization operate its activities and capture value. There are so many types of business models, an enterprise should choose its business models for obtaining economic benefits.

With the popularity of social networks and the development of mobile technology, the format of the retail industry has been completely changed. More and more markets decide to operate E-commerce business. The E-commerce is different from traditional retail industry. Retailer should consider this advancement of technology and change of behavior of consumers and grasp new methods and techniques to create and capture value.

There are some online business models that conform to evolution of Internet.

 

Web advertising

The web advertising is the first and the most important model. The web advertising is the extension of traditional media broadcast. This time, website provide the content of advertisement or retailer can sent message of advertisement through email. Moreover, influence of social network is tremendous. Merchant should collaborate with an influential person on social media to promote a product, service, or campaign. Because this influencer has dedicated and engaged followings.

 

Infomediary

Infomediary is a bright model. This model completely conforms to trend of Big Data. We are in the world of data. This model base on collecting data for producer and customer. Enterprise obtains the benefits through the provide of useful information for two sites of purchase.

 

Manufacture

The manufacture is allowed by advancement of Internet. The web permit producer to search buyers and sell directly product compress the distribution. Products in this model is cheaper than other.

Before, the manufacture model is not efficient because there is limit of distance. Factory is far away from customer. Distribution is necessary if producer want to sell more. But nowadays, Internet solve this question. Buyers can visit website for looking product and buy it online.

 

Affiliate

Affiliate is another good choice for online retailer which means that retailer could find some popular website for affiliating with those. The goal is that the link of own website can appear in web affiliated. Affiliate model provides more possibility of broadcasting own website because buyers could enter the website from wherever people surfing.

 

Subscription

Many web service providers choose this model. User of service of site should pay periodically a fee.

Usual practice of online service provider is following: there are two parts of service. One part is free to use. These services are uncompleted or normal quality. If users want completed function or high-quality service, they pay a fee monthly.

 

All in all, no matter which model the merchant choose, merchants should consider the evolution of technology and the situation of enterprise for capture maximally value.

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