The following is a list of six digital businesses along with their e-business and revenue models:
Company: Google
E-Business Model: B2C
Revenue Model: Advertising fees
Traditional print and TV advertising focused on the client’s needs, online advertising like Google, on the other hand, focuses on the customers' needs. Consequently, there is a huge demand for customer data. Therefore, e-businesses based on the advertising revenue model have to track users' browsing history, attention span, and how much time they spend on particular websites in order to build a detailed customer profile that is used to serve targeted ads (Bhalla, 2018) . Customers’ reaction to unexpected and accurate targeted ads may cause distrust regarding privacy.
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Company: Facebook
E-Business Model: B2C
Revenue Model: Advertising
Like all other advertising revenue model based businesses, Facebook depends on user data for targeted advertising. The recently enacted General Data Protection Regulation in the EU has reduced revenue and significantly changed Facebook’s operations because they now have to go back to European users and ask for consent to use their data (Bhalla, 2018) . Facebook sells its ads in an auction, finding the equilibrium between the value Facebook ads provide and the marketers’ willingness to pay is a constant challenge.
Company: Netflix
E-Business Model: B2C
Revenue Model: Paid Subscriptions
When a company based on the paid subscriptions revenue model scales, pricing flexibility challenges emerge. In the case of international expansion, new challenges emerge where the site has to be translated into another language and the business has to accommodate different VAT rules (Gilani, 2018) . The business deals with very many customer subscriptions, payments have to be automated. As a result, new challenges emerge which include: customers providing expired credit card numbers and businesses renewing active subscriptions without the customer’s approval.
Company: Amazon
E-Business Model: B2C
Revenue Model: Sales
Growth and expansion have been a challenge for online retailers especially Amazon. Expansion into foreign countries has proved difficult due to language barriers, shipping, and taxation. It has also made necessary changes in the branding of the company to make it be perceived less as a foreign invader (Gilani, 2018) . The business model depends on price margins and customer trust, Amazon uses recommendation to upsell more items to customers. The customers, however, like to feel unique and do not like depending on a machine to tell them what to buy.
Company: eBay
E-Business Model: C2C
Revenue Model: Transaction fees
eBay offers product listing for sellers and takes a commission when buyers purchase. Acquiring new users has been a constant challenge for eBay, Google’s search algorithm has constantly made it harder for eBay to surface in organic search engine results (Bhalla, 2018) . Another big challenge it is facing eBay is fraud. One out of every several thousand transactions is a fraud. This affects customers trust and consequently the company’s ability to attract and retain quality customers. Security breaches have caused a decline in traffic due to incidences where customers are deceived into giving away credit card information.
Company: Up Work
E-Business Model: C2B
Revenue Model: Transaction fees
Up Work is a digital services marketplace where freelancers bid for projects and Up Work takes a commission off the winning bid. The challenge facing the business model is when the freelancers and project owners successfully exchange contacts and bypass the website to work on their own terms causing lost revenue for the company (Bhalla, 2018) . Taxation is also a major, where freelancers are deducted income by the government.
References
Gilani, N. (2018). Types of E-Business Models . [online] Yourbusiness.azcentral.com. Available at: https://yourbusiness.azcentral.com/types-ebusiness-models-1144.html [Accessed 20 Sep. 2018].
Bhalla, P. (2018). Types of eCommerce Business Models, Pros, and Cons - KartRocket . [online] KartRocket - India's Leading E-Commerce Platform. Available at: https://www.kartrocket.com/blog/ecommerce-business-models-types-pros-cons/ [Accessed 20 Sep. 2018].
