8. Models and Strategy
8.1 eBusiness in Context: US Scene
8.2 Strategic Management
8.3 Grouping by Strategy
8.4 Business Models
8.5 Customer Segments
8.6 Customer Channels
8.7 Customer Relationships
8.8 Key Resources
8.9 Key Partnerships
8.10 Key Activities
8.11 Value Propositions
8.12 Cost Structure
8.13 Revenue Streams
8.14 Internet Revenue Models
8.16 Company Valuation
8.17 Measures & Ratios
8.18 Fundamental Analysis
8.19 Efficient Markets
8.20 Neoclassical Economics
8.14 Internet Revenue ModelsThe Internet has profoundly changed the nature of business in many market sectors, and there is debate over whether the change is one of type or degree. Nonetheless, most observers believe that the same basic rules apply to Internet businesses as to any other business, and Internet revenue models are commonly grouped as follows:
B2B: Business to Business
Businesses sell to other businesses. Much the most important grouping, ten times the size of the B2C market.
Private Industrial Networks
Private Industrial Networks or Private Trading Exchanges are digital networks that coordinate the flow of information between companies that do business together. They constitute some 75% of all B2B expenditures by large companies. Examples are Wal-Mart, Inc. and Procter & Gamble Co.
B2B: Business to Customer
Retail: businesses that sell to customers. The grouping can be further distinguished in many, sometimes overlapping, ways, but below is a common one.
Online Retail Stores: E-Tailers
A varied grouping ranging from giant stores like Amazon to Mom and Pop sites selling handicrafts. Estimated at $3.9 trillion in 2009 for the United States. The low barriers to entry make this an extremely competitive sector. Examples: Amazon, Inc. and Wal-Mart, Inc.
Not only text but CDs, photos, audio and video files are marketed in electronic form in a market that generated revenues of $3.9 billion in 2009. Example: Netflix.
Customer to Customer
Peer to Peer
A technology that allows consumers to share files and service, not always legally. Example: 4Shared.Com.
A growing sector that uses wireless technology for many of the groupings above. Example: PayPal mobile.
The Gold Rush model: less than one percent of the half million miners who descended on California in the Great Gold Rush became wealthy, but companies supplying their needs often built long-lasting empires in banking, real estate and clothing. The representatives in the Internet age are as follows.
Companies assembling computers and servers. Example: Dell, Inc.
Software: Operating Systems and Servers
Example: Cisco Systems.
Software: Ecommerce Systems
Software: Customer Relationship Management
Software: Streaming and Rich Media
Software: Payment Systems
Software: Performance Enhancement
Software: Site Hosting
Consulting: Search Engine Optimization
Consulting: Ecommerce Gurus
1. Describe, with examples, a common three-fold grouping of Internet businesses.
2. Describe the essentials of five types of business to business Internet transactions.
3. Briefly describe B2C Internet businesses.
4. Name as many eBusiness enabler types as possible.