Effective Online Business Models
An online business model describes the methodology or rationale for which an online organization or company creates value, delivers that value, and earns and sustains profits and growth. So, in simple terms, it is the vehicle you use to run and maintain your business. The web has created many more opportunities than the traditional brick and mortar environment. With these new opportunities have come a number of new online business models to fit this new paradigm.
So Many Choices:
Wasn’t life easy when there was just vanilla and chocolate icecream (for those old enough to remember)? Today there are as many online business models as there are personalities to match. Even though there are many paths you can take to online success, my recommendation is to pick just one online business model to commit all of your resources to.
Which one? First, take a personal inventory:
- Interest: Both in business and in your personal life.
- Hobbies: Which are you the most passionate about? What are your levels of expertise?
- Skills: What skills do you bring with you from your previous or existing job?
- Finances: Do you have adequate finances to implement your online business model?
- Lifestyle: What new changes or enhancements do you hope to make in your life?
Once you know where you have been, and what you hope to achieve in the future, you will want to take a look at the possibilities of one of the following online business models to see if they perk your interest.
My Top 3 Online Business Models:
Here are my top 3 online business models. The models below are very broad and have each spawned numerous sub-models and will continue to do so as the online world expands and evolves.
The Reseller Model:
Purchasing and selling someone else’s product(s). This model has been around for thousands of years and shares many of the same concerns as its ancestors, but online it brings a whole new level of efficiencies that did not exist in the brick and mortar setting.
In the Reseller Online Business Model one still has to be concerned with basic retail concepts like pricing, selection, mass marketing or specialty niches and your competition to name a few.
In a conventional store could you meet your financial goals by serving a local community or city? What would happen if you could open your stores doors to the whole world? As you dig deeper into this online business model you will find efficiencies not only in reaching your customers but advertising, product delivery, and overhead costs.
The Efficiency Model:
Of course we must look at the internet itself as the biggest force in making commerce of products and information more efficient.
The Efficiency Online Business Model is based on the efficient collection of information, products or services on one web site to make it easier for the consumer to gain information or select products and or services. Today we can go to a web site and efficiently sell used goods from the people in our community to people across the globe. Another example would be a web site that focuses on the reviewing of products, movies, restaurants, vacation spots etc. to help customers make informed decisions.
The Niche Model:
The third model is based on bringing together visitors based on similar interest. You might think your hobby of collecting pink unicorns is not shared by many in your city or town, but when opened up to the entire world you may be surprised by the amount of interest.
Once you have defined your potential members or customers, you can refine your information and or product offerings to suit their needs.
By using the Niche Online Business Model you will be able to take an interest and/or hobby you are passionate about and turn it into a renewable revenue stream.
No matter what your interests, talents, or skills are, I think you will be able to find an Online Business Model to suit your personality and help you help others and generate income at the same time.