2. 2
Module M7 Monetizing your digital business
Competence
unit
U7.2 Spotting monetization
models
Learning
outcome
List possible revenue
models for my business
Type of
resource
PowerPoint Presentation
(PPT)
Type of
learning
Self-direct learning
Resource title Start-up revenue models
Learning
hours
1h
Contents
- Monetization and revenue model definition
- Definition and features of start-up revenue models
3. What Is A Monetization model?
Monetization - the final piece of a systematic
look at a business model
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4. “ Companies need to have a model that successfully
generates revenue.
A revenue model is the
strategy of managing a
company’s revenue
streams and the
resources required for
each revenue stream.
Source: https://fi.co/insight/the-10-most-popular-startup-revenue-models
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5. 5
Revenue MAY or MAY NOT
come from your users
Source: www.unsplash.com
5
6. 1. Direct Sales
2. Freemium Model
3. Ad-Based Revenue Model
4. Subscription Revenue Model
5. Affiliate Revenue Model
6. Transactional Revenue Model
7. Channel Sales (or Indirect Sales)
8. Web Sales
9. Retail Sales
10. Free Product, EXCEPT Services
START-UP REVENUE MODELS
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7. DIRECT SALES
Inside sales someone calls in to
place an order or sales agents
calling prospect
Outside sales: salesperson
interacts face-to-face with
customer directly
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Source: www.pexels.com
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8. FREEMIUM MODEL
The essence of the product is
free, but the customers must
pay for advanced functions,
features, updated versions, etc.
Example: LinkedIn
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Source: www. pixabay.com
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9. AD-BASED REVENUE MODEL
An advertising-supported
revenue model is a business
approach that emphasizes the
sale of advertising as a major
source of revenue.
Process: developing ads for a
specific website, app, or other
product, and placing them on
strategic, high-traffic channels.
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Source: www.pixabay.com
9
10. SUBSCRIPTION REVENUE
MODEL
It’s a model, when a customer
must pay at regular intervals for
access to a product or service.
In this case, customers pay for a
month to month, or even year to
year.
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Source: www.pixabay.com
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11. AFFILIATE REVENUE MODEL
Revenue is based on
commissions.
Process: reselling items from
other retailers on your site. The
reward of based on new
customers to the merchant who
is selling the item.
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Source: www.pexels.com
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12. AFFILIATE REVENUE MODEL: payment methods
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Pay Per Click (PPC) - Affiliate gets paid whenever the affiliate link is
clicked.
Pay Per Impression (PPI) - Affiliate is paid when someone lands on
the merchant’s site.
Pay Per Lead (PPL) - Affiliate is paid when someone clicks on
affiliate link and takes an action, e.g. completing a form to generate
a new lead.
Pay Per Sale (PPS) - Affiliate is paid when a sale is made. Affiliate
receives a percentage of the cost of that item.
Source: zuora.com - Affiliate revenue model example: How to increase monetization through the affiliate revenue model?
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13. TRANSACTION REVENUE
MODEL
This model is based on selling
goods.
It’s a direct method to generate
the revenue, as it entails a
company providing a service or
product and customers paying
them for it.
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Source: www.pixabay.com
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14. CHANNEL SALES
Indirect sales, involving a third-
party to sell your product for you.
Third party can be represented by
resellers, affiliate partners,
distributors, value-added
providers, independent retailers -
- basically, anyone who doesn’t
work directly for your
organization.
Source: A.Frost: The Ultimate Guide to Channel Sales
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Source: www.pixabay.com
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15. WEB SALES
customer pays directly for a
product or service.
BUT: customers must first come
to your company via a web search
or outbound marketing, and
conduct transactions solely over
the internet.
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Source: www.pixabay.com
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16. RETAIL SALES
Selling in a traditional
department store or retail store
and offering physical goods to
your customers.
This model is not ideal for digital
companies that offer digital
products.
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Source: www.pixabay.com
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17. FREE PRODUCT, EXCEPT
SERVICES
Products are given for free, but the
revenue is generated though
customer's payments of services
provided: educational, installation,
technical adaptations and other
additional services.
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Source: www.unsplash.com
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18. LET’S REVIEW SOME CONCEPTS
Monetization model Revenue model
Direct Sales Transactional Revenue Model
Freemium Model Free Product, EXCEPT Services
Subscription Revenue Model Channel Sales (or Indirect Sales)
Affiliate Revenue Model Ad-Based Revenue Model
Web Sales Retail Sales 18
19. This project has been funded with support from the European Commission.
This publication reflec ts the vi ews onl y of the aut hor , and the Commission cannot
be held responsible for any use which may be made of the information contained therein.
Project Number: 2018-1-UK01-KA202-047909
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