E-Business Models

Transcription

1 E-Business Models

2 Objectives After finishing this class the students will: Able to define a business model Able to define different kinds of business models for E-Business

3 Business models A business model is a method of doing business by which a company can generate revenue and to sustain itself (Electronic Commerce 2010 A Managerial Perspective, 6th Ed, Efraim Turban et al., 2010, Pearson, )

4 Business models A business model is set of planned activities designed to result in a profit in a marketplace (E- Commerce 2010, Business, Technology, Society, Sixth Ed, Kenneth C. Laudon and Carol G. Travel, 2010, Pearson, )

5 Business models Not always the same as a business strategy Business model explicitly takes into account the competitive environment (Margaretta, Joan. Why Business Models Matters, Harvard Business Review, May 2002).

6 Objectives of a Business model Describe the major business processes of a company Describe the supply and value chains Formulate the competitive strategy and its longrange plans

7 Objectives of a Business model Articulate the customers value proposition Identify the market segment Define the value chain structure Estimate the cost structure and profit potential

8 Business plan A written document of the business model

9 Business case A business plan for a new initiative or new project inside an existing organization

10 8 Key Elements of a Business Model Value proposition Revenue model Market opportunity Competitive environment

11 8 Key Elements of a Business Model Competitive advantage Market strategy Organizational development Management team

12 Value Proposition The statement of what benefits that a company s products or services provide to a company and its customers

13 Revenue Model A revenue model outlines how the company will generate revenue (Electronic Commerce 2010 A Managerial Perspective, 6th Ed, Efraim Turban et al., 2010, Pearson, ).

14 Revenue Model Sales revenue model Transaction fees revenue model Subscription revenue model Advertising revenue model Affiliate revenue model

15 Revenue Model

16 Sales Revenue Model Companies generate revenue from selling their products or services

17 Transaction Fee Revenue Model A company receives a commission for enabling or executing a transaction.

18 Subscription Revenue Model Customers pay a fixed amount to get some type of service or content.

19 Advertising Revenue Model A company provide a forum or sites and charge others for allowing them to place their advertisements on its.

20 Affiliate Revenue Model Companies receives commissions for referring customers to other websites.

21 8 Key Questions of a Business Model

22 EC/EB Business models An E-Commerce business model aims to use and leverage the unique qualities of the internet and the World Wide Web (Business Model for Electronic Market, Timmers, Paul, Electronic Market Vol 8, No. 2, 1998)

23 B2B Business Models Net marketplaces an Internet-based environment that brings together business-to-business buyers and sellers so that they can trade more efficiently online. Private industrial network Designed to coordinate flow of communication among firms engaged in business together

24 B2B Business Models: Net Marketplaces E-distributor E-distributor Exchange Industry consortium

25 B2B Business Models: Private Industrial Network Single firm networks Example: Wal-Mart s network for suppliers Industry-wide Often evolve out of industry associations Example: Agentrics

26 E-distributor Supplies products and services directly to individual businesses Owned by one company seeking to serve many customers Revenue model: Sales of goods Example: Grainger.com

27 E-distributor

28 E-procurement Creates and sells access to digital electronic markets Includes B2B service providers, application service providers (ASPs) Revenue model: Transaction fees, usage fees, annual licensing fees Example: Ariba.com

29 E-procurement

30 Exchanges Electronic digital marketplace where suppliers and purchasers conduct transactions Usually owned by independent firms whose business is making a market Revenue model: Transaction, commission fees

31 Industry Consortia Industry-owned vertical marketplaces that serve specific industries (e.g., automobile, chemical) More successful than exchanges Sponsored by powerful industry players Example: Exostar.com

32 Industry Consortia

33 B2C Business Models E-retailer Content Provider Transaction Broker Market Creator Service Provider Community Provider

34 E-retailer Online version of traditional retailer Revenue model: Sales

35 E-retailer

36 Content Provider Digital content on the Web: News, music, video, e- books Revenue model: Subscription; pay per download (micropayment); advertising; affiliate referral fees

37 Content Provider

38 Transaction Broker Process online transactions for consumers Revenue model: Transaction fees

39 Transaction Broker

40 Market Creator Uses Internet technology to create markets that bring buyers and sellers together Revenue model: Transaction fees

41 Market Creator

42 Service Provider Online services: e.g., Google: Google Maps, Google Docs, etc. Revenue model: Sales of services, subscription fees, advertising, sales of marketing data

43 Community Provider Provides online environment (social network) where people with similar interests can transact, share content, and communicate: E.g., Facebook, MySpace, LinkedIn Revenue model: Advertising fees, subscription fees, sales revenues, transaction fees, affiliate fees

44 Community Provider

45 References E-Commerce 2010, Business, Technology, Society, Sixth Ed, Kenneth C. Laudon and Carol G. Travel, 2010, Pearson, Electronic Commerce 2010 A Managerial Perspective, 6th Ed, Efraim Turban et al., 2010, Pearson, Margaretta, Joan. Why Business Models Matters, Harvard Business Review, May 2002

46 Dr. Ir. Muhammad Ikhwan Jambak, MEng