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3 Common Online Business Models




1. Web-Based Business Model

2. Mobile App Business Model

3. E-Commerce / Social Media Customer Loyalty Model


1. Web-Based Business Model

This type of online business model has multiple ways to take off and can be utilized by individuals wanting to market their products without having to develop physical infrastructure to do so. A great example of a web-based company is a site like eBay, where users can list all items of interest to the public for sale.


The main attraction here is that it’s free to use and doesn’t require any registration or other form of payment. The second attraction is that there’s no hassle whatsoever in listing a particular item or a particular brand because just search online and see what you like. In addition to listing, customers may also be able to make purchases on the website such as purchasing an item by using some sort of code. This creates much less friction in buying your next car or even renting a home. You can buy as many cars as you want with this program. However, being part of a big company does come with its drawbacks; once the auction ends, buyers are given a 10% discount.


The disadvantages would include the limited amount of space to advertise their listings which makes them not able to post more than 15 pictures per page. Their advertisements would be placed in the small time frame between each listing on their website. This could cause issues when it comes to getting new listings accepted by Google Adwords or Bing Ads. They would have to start again from scratch if they don’t get good results within the first few days. Another disadvantage would be the difficulty in creating new links on your social media pages since most people like to follow along with trending topics on Facebook & Twitter.


2. Mobile AppsBusiness Model

This is the most popular choice among entrepreneurs when starting their businesses. It offers more opportunities for growth since you can start small with a couple of applications and gradually build up into your empire. For businesses this business model comes with several advantages; one of the most important advantages is the ability for users to customize whatever they want to include in the application. Users can add any content they want and leave it available in the store.


Users can also browse the store to check the various items that can be sold in the store, while a user can click on the product title and view some photos showing the quality of the product. Another benefit is you can earn money when customers buy items in the store. Also, customers can create coupons for specific items in the store. When one buys something, he or she automatically receives a coupon code for the same item. Lastly, there is also a way to promote your products outside of the app through websites and social networking sites such as Facebook, Instagram, etc.


The disadvantages are when there are too many applications and it becomes difficult to manage and control. There’s also the issue of getting updates to the application since different organizations update their technology periodically. To deal with these obstacles and make sure your application remains relevant in the market, can cost more than $1000,000.


3. E-Commerce / Social Media Customer Loyalty Model

The third mobile app to come up would be Amazon FBA (Freemium As We Sell) App. With FBA, users pay a certain price to give away something to someone in exchange for a commission. For both small and large enterprises, this model offers great benefits. One advantage is to make the most money possible by reselling your services to the customer. Therefore, since you offer so many services, you’re better poised to attract customers because you don’t have to maintain the costs. Having millions of customers in the world is a huge blessing and you can only charge a very low fee to keep them happy. On the flip side, having people who sell their products to other businesses is very beneficial. Since Amazon FBA can be used anywhere in the world, it allows you to expand even faster and expand with your operations which will eventually increase profits.


The advantages of selling your goods through Amazon FBA include unlimited access to a worldwide network of retailers, great opportunity for making sales and marketing campaigns, you can offer discounts on some products so that they become more attractive to the consumers, and in case you have a higher budget than other competitors might be able to compete. The disadvantages include high charges due to the size of the business, and Amazon’s reputation, but the value proposition is worth every penny.

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