As entrepreneurs increasingly find the Internet a lucrative business opportunity, what are the different ways to earn revenues beyond advertising?
There has always been a big question on the role of the Internet in business. While no one questions its disruptive influence, there have been questions on how exactly the power of the Internet can be converted into hard cash.
The crash of the first wave of Internet companies and the failure of their valuation models only helped to sharpen the question rather than to provide answers. Is it a market place? Is it the media? Is it the message?
The second wave of the Internet business revolution is upon us and these questions are still largely unanswered. The standard answer to the question of Internet revenues is advertising and the standard example and enabler is Google and its AdSense program. But by now, it is obvious that plain vanilla advertising, particularly the type mediated by advertising networks like AdSense cannot sustain and make profitable all types of Internet businesses.
For this article, we analyzed the existing revenue models and specific examples of web businesses to figure out how they seek revenues. We have looked at a mix of businesses that weathered the early crash as well as some that are part of the new wave.
Established Revenue Channels
The three major revenue channels commonly used on the Internet are products and services sales, ad space, and affiliate marketing.
Products and services sales: Depending on the type of website, revenues are earned directly through the sales of goods and services or as a commission on the sale that happens on the hosting site.
| E-Commerce Market (in Rs Crores) | ||
| Market Size for the Year | 2006-07 | 2007-08 |
| Online Travel Industry | 5,500 | 7,000 |
Online Non-Travel Industry - e-tailing - Online Classifieds - Pain Content Subscription - Digital Downloads | 1,580 850 540 20 170 | 2,210 1,105 820 30 255 |
| Total B2C/ C2C e-comerce Market | 7,080 | 9,210 |
| Source: I-Cube Study 2006. Note: Figures are estimated | ||
The I-Cube 2006 study by the Mobile and Internet Association of India estimated the Indian e-commerce industry to be worth Rs 9,210 crore at the end of 2007-08. According to the report, the top reasons given by consumers for buying online were savings (time and effort), convenience, variety, discounts, and quick reviews. The study also reveals that the online travel industry is the most used e-commerce activity, and the non-travel part includes e-tailing, online classifieds, paid content subscription, and digital downloads.
As for services sold online, there is the model of basic membership for free and paid premium services. For example, marriage sites like simplymarry.com allows you to register for free but you can contact other registered members only upon payment of a fee, job portals such as Naukri and Monster have extra services like resume making, sending your resume to consultants, etc. that comes at a price.
| HOW ARE THEY MAKING MONEY? |
Naukri.com EBay LinkedIn Google Rediff Solutions Wikipedia The List is Only Indicative |
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written by Ramirez, March 17, 2011
written by Christian-Dior-Mens-Belts, December 21, 2010
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