Revenue Models for e-Business on The Web

IT6305 e-Business Applications Revenue Models for e-Business on The Web

Upekha [email protected]

The Linear Model (Traditional)

Direct-to-Customer Model

Direct-to-Customer Model Can sell at lower prices Build to customer order Receive payment earlier Speed up new product release cycles

and faster delivery of goods Use customer data to provide

customized value added service Proactive decision making

Supply Chain Model (Horizontal Marketplace )

Supply Chain Model Information flow across the supply chain All parties have a strong electronic bond

and backend systems Some companies do/don’t own any part of

the value chain They have access to information about all

from suppler/manufacturer to the customer This enables very effective order

processing, product tracking and fast resolution of SCM issues.

Full Service Provider Model(Vertical Marketplace)

Full Service Provider Model

Has to know a lot about the customer Provides own products or services bundled with

third party products or services. Commission from third party products Can charge customers a service fee

Offers a wide range of products/services to the customer at a reasonable or lower price

Offers different channels Internet, face-to-face, phone, etc.

This is a very effective strategy to achieve economies of scale in delivery/distribution, channel usage and promotion

Digital Value Hub - eRegion

Digital Value Hub

Strong B2B partnerships and collaborations between nodes in the supply chain

The industry competitors willingness to work together

Trust relationships among the competitors in an industry

A strong force against foreign competition

Revenue Sharing Model

Revenue Sharing Model - ePortal The sellers get together through a Portal They Market/ Promote products collectively

to a larger market segment Sellers can work on larger projects/orders

as they work collectively Pose as a larger company with a wider product

range/capacity to get larger projects Collective bulk orders with suppliers

Reduce bargaining power of suppliers Resources as well as profits are shared

among companiesUses the synergy of a collection of SMEs to get the competitive advantage.

eAuctioneer eBusiness Model

eAuctioneer (Intermediar

y)

Seller 2 Buyer 1

Buyer 2Seller 1

eBay

eAuctioneer eBusiness Model

Intermediary does not take responsibility for the sale or the payment and the eAuctioneer owns the valuable customer relationship and data but not the transaction.

2014, 2013, 2012, 2011 , 2009 –

(30 Marks)