Types of Business Websites and Models

Types of Business Websites and Models

Preamble

Before you create a business website, you should have some idea about the types of business websites, to clearly define what sort of business website you are creating, as there are several types of business websites.

This is a fairly common question, but its good understanding will let you more effectively build your site in terms of its purpose, structure, and content. Not all business websites are built the same way. Each type has its own features, therefore, it is important to know what business models for websites exist.

So, you’ve decided to start making money on the Internet, knowing what great opportunities it offers. But do not be fooled from the start, aiming to make money online very quickly and easily. You’ll need to learn a lot and do a lot of work. Often, you even don’t think of the hours and you’ll only pay attention to working to make your business website success. But once you start to achieve success and your website will be visited, you will find that this is one of the best ways to earn for a living.

Of course, you first of all, must be interested in what are the best business models for websites for making money online. That’s why we start the discussion in this section with a description of the existing online business models. Each model is characterized by its purpose and complexity. Those, that require more work and time, as a rule, can give more profit. The choice of the business models for your websites depends on how much time and effort you want and you can invest in your project.

So, here we discuss:

  • Main Types of Business Models
  • Which Business Model to Choose?
  • Conclusion and Notes

1. Main Types of Business Models

Types of Business Websites and ModelsBusiness model – is a method of doing business in which you receive income (or plan to receive income). Any business model is characterized by two principal components: Value of Business Proposition (what the specific needs of customers the business will provide) and Revenue Model (how the business will bring profit).

Of course, these components strongly influence on types of business websites that online marketers use.

The purpose of this section is to help you to identify and describe your online business model at starting steps. This is a very important point, as it can help you to better understand the critical moments in your online business formation, including main sources of income and potential competitors.

The most common and successful on the Internet are the following business models for websites

  1. Advertising Model
  2. Affiliates Model
  3. Brokerage Model
  4. Merchant Model
  5. Subscription Model
  6. Information Model
  7. Community Model

Let’s take a brief look at the main features of each of the models, which will help you better understand the types of business websites at the stage of starting an online business.

1. Advertising Model

The Advertising Model is probably the most common and widely used for business websites, recently it has been used for mobile phones also. Its essence is that the website owners place ads of the well-known advertising companies, such as AdSense, MediaNet, RevenueHits, Bidvertiser, Infolinks, Chitica, etc. These third-party ad-share sites pay for advertising. The calculation of the payment can be made on the basis of: cost per click, cost per impression, and fixed cost. Each of these companies has its own rules and restrictions. We examine this question in more detail in “Monetization“ section of our website.

The main principle of work:

You register at an ad-share site, for example, at AdSense; you create advertising campaigns using keywords; for each advertising campaign you get and copy the code for a special banner (text or graphics) and place it on your web pages. When visitors click on banners your account is updated.

The main advantage:

first pictureThis model provides the easiest way to monetize the website, as you do not have to think where to find and how to get advertising for your website, and can fully concentrate on content and traffic.

The main disadvantage:

first pictureHowever, we must say that many marketers are not satisfied with the amount of earnings by use of this model and use it in combination with other models, for example, they place some affiliate advertising in addition. Furthermore, some of these websites (especially AdSense), have very strict regulations and may close accounts.

2. Affiliate Model

The Affiliate Model exists due to the existence of the affiliate programs on the Internet and it is the favorite model of many marketers, as it can generate a big income (read about the best affiliate programs). In this model, the website owner is rewarded every time when the visitor of his site to purchase a product or service (filling the appropriate form of the buyer). For example, the company sells the product for $ 50 at an affiliate commission of 50%. This means that every time they purchase will happen from your site, your affiliate account will be credited with amount of $ 25.

The main principle of work:

You register for affiliate programs like Amazon, ClickBank, Commission Junction, JVZoo, etc.; you get all needed promotional material, including your affiliate URL; you place ads on your web pages and provide traffic.

The main advantage:

first pictureThis model can generate a big income and you are not responsible for delivery of the sold products or services (this is done by the owner of affiliate program).

The main disadvantage:

first pictureIt requires the permanent and extensive work on selection of the most profitable products. The original brief description (or reviews) is needed to attract attention of the website visitors. The good news is that there are many high-quality WP plugins for the major marketplaces that significantly automate the selection of products.

3. Brokerage Model

By use of Brokerage Model marketers (brokers) bring buyers and sellers together and assist transactions. Brokers play a frequent (and sometimes permanent) role in business-to-consumer (B2C), business-to-business (B2B), or consumer-to-consumer (C2C) transactions in different markets (for example, like the TOP brokerage websites TDAmeritrade EtradeScottrade, etc).

The Broker charges a commission or a fee for each transaction made with his participation. For example, very often such types of business websites may encounter when buying or selling real estate. Of course, this type of business models for websites requires specific knowledge and experience.

The main advantage:

first pictureThese business websites are developing stable and the market for them is growing. People always buy something or sell something, so the fight for the brokers to receive commissions, is very sharp.

The main disadvantage:

first pictureWebsites using this business model may require recruitment of staff from the starting steps. To monitor activities for such business websites types, you need to have good knowledge and practical experience.

4. Merchant Model

You probably know a lot about this model. It is an online store, as, for example, Amazon. The merchant model is used in all online wholesale and retail sales of products and services. In some cases, the sellers exist solely online, and in other cases, sellers exist as real stores and their websites are just their advertising web storefront.

The main principle of work:

If you want to use this module you should be provided with a reliable source of products and the delivery system of the products to the customers. In the absence of own stores (own products), you should be able to enter into contracts with real suppliers of the products you are going to sell from your website, otherwise the model can’t work.

The main advantage:

first pictureUsing this model, you get complete control on profit, as you control the products. Since you have the products in your hands, you get to decide what to do with the money you earn. Also, this model is about the best payback, as you have control of prices.

The main disadvantage:

first pictureIt is clear that due to the fact that you own the products, you have a lot of work to make. For example, you have to support customers and to worry about the delivery of products on time. You also have a high level of risk because of the investment required to start an online store.

5. Subscription Model

The subscription business model is sort a business model where the clients must pay a subscription price to have the accessibility to the product or service (daily, monthly or annual). This model was launched by magazines and newspapers, but now is used by very many online businesses. This business model for websites is very good when you have your own products or services.

The main benefits of these types of business websites is that instead than to sell products individually, a subscription sells products periodically. Thus, a one-time sale can become a repeating sale and can build you a brand respect and good profits.

The main advantage:

first pictureThese business websites are developing stable and the market for them is growing. The availability of providing the quality own products is a powerful basis for such websites.

The main disadvantage:

first pictureThe mandatory registration on the website narrows the number of potential customers, which leads to the fact that it is necessary to conduct additional advertising campaigns.

6. Information Model

The business website built on this model gives the customers information and facts they are prepared to pay for. So, these business websites types ordinarily sell hard-to-find information to the buyers. The information can be sold in a variety of digital formats such as MP3, MP4, eBooks, PDF Reports, Webinars, etc (for example, websites like IDplr, PLR Dealer, Niche Content Packages). Usually the money is made through direct sales from the website.

For such types of business website, the data about buyers and their consumption practices is valuable, especially when that information is properly examined and utilized to target the promotion campaigns. Individually accumulated data about producers and their products and services are beneficial to consumers when taking into consideration a purchase. Some firms operate as the information intermediaries, assisting buyers and sellers to understand a given market.

The main advantage:

first pictureThe information model of business websites, form a highly profitable segment of the market, as the quality and the new information has been always at a good price.

The main disadvantage:

first pictureSuch types of business websites, strongly influenced by market conditions, which makes the owners of the website at all times to keep the finger on the pulse. Furthermore, in the area of information model business websites types, there is really a serious competition.

7. Community Model

This model is used for business websites that build communities of users with common interests. Despite the fact that the main options on these sites may be for free, the owners of these sites can charge a small fee for certain premium options that make the website easier and more efficient to use. For example, such websites may offer free software, but then ask for some payment for provided support, access to manuals and other documentation, etc. The number of business websites that are using this model is growing, as more and more free products appear on the Internet and these products require versatile support.

The main principle of work:

This business model is characterized by the presence of a business theme that may be interesting to many people, and this interest may incorporate people. The theme should also have some interesting paid services to generate income.

The main advantage:

first pictureSuch websites can be considered as a powerful platform for advertising products and services, that can generate very good income. Moreover, they are very popular

The main disadvantage:

first pictureThis business websites model requires the additional costs for site maintenance (additional admin staff), as you need to constantly communicate with the visitors and answer their questions.

2. Which Business Model to Choose?

Here we draw attention to two aspects:

  • First, it should be noted that this is one of the most critical stages at starting any online business. The business model selection for your business website should be done not only by considering the experience that you have or not, but rather, by considering the fact that you’ll be very interested in a chosen business topic and it’ll generate interest in permanent work. For example, if you really want to have the online store for specific products, then create a store.
  • Second, the clean use of just one type of business models for the website creation in practice almost never occurs. Usually a combination of several types of business models is used (hybrid models).  For example, you can have a WordPress business website created with a combination of the Information Model and Affiliates Model, which is very popular today

What to choose, if I start from scratch?

Of course, Affiliates Model!

This model is the easiest to understand and implement. It can be implemented both by having (creating) the own website, and without your own website.

If you decide to create your own website and use this business model, it means that you’ll place ads on your web pages by the use of affiliate programs (for example, like ClickBank, JVZooWarriorPlus, etc.). You also will have to accompany the ads with some original content, reviews, comment, etc. If you successfully select the products (ads) and learn well how to get stable targeted traffic to your website – it’ll mean that you have mastered this model.
If you do not create own website, then you’ll have to advertise your affiliate URLs (affiliate web pages, which you get from the Affiliate Control Panel of the program owners) and you provide traffic directly to these pages.

So, make concrete steps in choosing from types of business websites, create your own website  and start making money online!

3. Conclusion and Notes

So, correctly understanding this fairly common question lets you more effectively build your website in terms of its purpose, structure, and content!

As each type of business model for websites has its own features, it’s important to know what business models for websites exist and which one you’ll use.

Read some notes on the subject:

Analyze what business model for websites your competitors have implemented and to what extent they were able to realize business objectives by using the selected model.   

Remember, for website creation there is a large variety of website platforms (CSM, Content Management System), which greatly facilitate and simplify the website creation. The most popular of them are: WordPress, Drupal and Joomla. Using website platforms, you can build many types of business websites.

* * *


Leave a Reply

Your email address will not be published. Required fields are marked *