A business model is the method of doing business. A company produces goods or services and sells it to customer. three main functions: 1. Matching buyers and sellers 2. Facilitating commercial transaction 3. Providing legal infrastructure

1. E-business Models Based on
the Relationship of
Transaction Types
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2.  On the basis of value addition: addition of value to a product or service
 On the basis of control:
 At the high end of control there is hierarchical control.
 At the low end there is no control.
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4. Brokerage Model
 brokers, who bring sellers and buyers of products and services together to engage
in transactions
 The characteristics of the brokerage model
 ✓ The price-discovery mechanism is its key-principle.
 ✓ It is a meeting point for sellers and buyers.
 ✓ Auctions and exchanges are the modes of transactions.
 ✓ It is a 'Free Market'.
 ✓ It consists of Global Network of Buyers and Sellers.
 ✓ it is a Virtual Marketspace enabled by the Internet.
 ✓ it encompasses all types of organizations now.
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5. Advantages of the Brokerage Model
 C2C trading
 Global reach
 Direct buyer and seller communication
 Efficient access to information
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6. Auction broker
 different auction formats are aggregated on certain common
attributes.
 There are divided into several classification
 English auction (open-outcry auction) - selling art, and other
physical goods
 Dutch auction - developed in the Netherlands
the opening price is set extremely high.
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7. First – price sealed – bid auction
Two different Phases
Bidding Phase (All the bids are
collected )
Resolution Phase (bids are opened)
Vickrey auction -bids are sealed
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8. Info-mediary Model
 An organizer of virtual community is called an information intermediary or info-
mediary.
 An info-mediary may offer users free Internet access
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9.  Four types of Info-mediary
 ✓ Specialized agents - having closed relationships with both buyers and suppliers
 ✓ Generic agents - open relationships with both buyers and suppliers and involve no
relationship - Specific investment
 ✓ Supplier agents. - interest in selling their products
 ✓ Buyer agents - establish relationship with a core set of buyer
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10. Community Model
 groups of people meet online to fulfill certain needs
 Community Structures
 The Internet communities can be found structured in several
predictable ways as follows:
 ➢ Newsletters - one-way communication
 ➢ Discussion lists - allows a member to send a message to the list
address
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11.  There are three types of discussion lists:
E-mail discussion list - forwarded to other members
E-mail discussion list digest - collects all the messages sent to
the list
Moderated discussion list digest - limit the quantity and screen
the quality of messages
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12. Manufacture Model
 The manufacture model can be based on
 • Efficiency
 • Improved customer service
 • Better understanding of customer preference
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13. Advertising Model
 The banner ads may be the major or sole source of revenue for the broadcaster
 Types of Advertising on the Internet
 ▪ Portals - include varied content or services
 ▪ Classifieds - Lists items for sale
 ▪ User-based registration - user to submit demographic details by registration
 ▪ Query-based paid placement - Sells favourable link positioning
 ▪ Contextual advertising - developers who bundle ads
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14. Different Web Advertising Formats
 Banners. An ad appearing at the top of a Web page.
 Vertical columns. On a frame Web page positions alongside requested content (often as
form of sponsorship).
 Pop-up windows. Java script opens a browser window with an ad.
 Interstitials. Full screen ads that appear on a Web browser while a page is loading.
 Intromercials. Animated full-screen ads placed at entry of a site before a user reaches the
intended content (CBS Market watch)
 Ultramercials. Interactive online ads that require the user to respond intermittently in
order to wade through the message before reaching the intended content.
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15. Subscription Model
 Users are charged a periodic—daily, monthly, or annual—fee to subscribe to a
service
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16. Affiliate Model
 provides purchase opportunities wherever people may be surfing
 Banner exchange. It trades banner placement among a network of
affiliated sites.
 Pay-per-click. It is the site that pays affiliates for a user click-
through.
 Revenue sharing. It offers a per cent-of-sale commission based on a
user click through in which the user subsequently purchases a
product.
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