Choosing A Business Model For Your Online Business

Choosing A Business Model For Your Online Business
(c)Copyright 2004 by Leigh Butler
http://www.onlinebusinessresources.net

Whether you already have an online business or would like to
start one, developing a business model is a must. A business
model spells out how you are going to generate revenue from your
business.

If you really want to succeed online, then your must
determine how you are going to generate revenue and make profit.
Otherwise you won't be in business very long.

According to the small business administration, about 50% of
small businesses fail each year, and 95% of small businesses
fail within the first 5 years. I'm sure you don't want to be
included in those statistics.

That's why if you haven't done it already, you should choose
a business model, now. Ask yourself, how will my online
business generate revenue?

Here are 3 business models frequently used for online
businesses.

1)The Ecommerce Model

Revenue is generated by selling goods or services over the
Internet. Examples of goods and services include products such
as ebooks or candles and service such as consulting or virtual
assistance. Selling products from affiliate programs would also
be considered ecommerce. This is not an exhaustive list but it
should give you an idea of what ecommerce is.

2) Content-Rich Model

Revenue is generated by selling advertising on your site or
in your ezine. Lots of quality content is provided to
visitors/subscribers to attract them and to keep them returning
to your site or subscribed to your ezine.

The more visitors/subscribers your site or ezine has the
more you can charge for advertising. Generally,
advertisers pay a certain dollar amount per thousand
visitors/subscribers.

3) Membership/Subscription Model

Revenue is generated by charging subscribers for access to
your site or certain parts of your site. This model can also
be used with ezines. You can charge subscribers to receive your
ezine or generate a premium version of your ezine and charge a
fee.

These are the 3 basic business models online businesses
currently use. Of course these 3 models are not the only models
out there. There are others.

Many online businesses use a combination of models. For
example, you can develop a content-rich site about gardening and
sell advertising space on that site to advertisers who are
trying to reach people who are interested in gardening (content-
rich model).

You can charge visitors for access to a premium area of your
gardening site where you provide more quality content that can't
be accessed without becoming a member (membership/subscription
model). You can also sell gardening supplies and books from
your site (ecommerce model).

Choose a business model and you might succeed online.
Don't choose a business model and your business may not be
around next year or five years from now.

So choose a business model now so you can have success online!