#10 The traditional e-commerce business model
Last but not least, it's the somewhat old-fashioned, but still viable, revenue model for straightforward online retail firms
So can good old fashioned e-commerce survive amid a profusion of different sales and marketing models? Of course it can. If you want to buy a shirt or an iPad online, you’ll probably pay for it in the usual way and assume ownership.
However, what about those segments of the online marketplace where traditional purchasing models have been under pressure? For instance in the music marketplace, Apple recently acknowledged a sharp decrease in downloads at a time when subscription-based and advertising supported streaming is on the up.
It’s easy to see why this is happening. If Spotify offers unlimited digitised music for £9.99 a month why pay £7.99 for a single album download. Suddenly the barrier to conversion looks quite high. It’s a similar story in the app market where an advertising-funded free app is likely to trigger more downloads than one costing £5 or £10.
But again it’s a numbers game. An app funded by pay-per-click advertising may be popular with consumers while failing to deliver sufficient affiliate/commission revenues. The less popular paid-for app, on the other hand, generates instant revenues.
So which is the right course revenue model for your business. “Deciding on an appropriate revenue model for your business is important but unless you understand your target market you could be wasting your time,” concludes MyHealthPal founder Mike Barlow.
This is #10 out of 10 ways to make money from your tech business idea.
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