Chapter 3: Selling on the web

Revenue Models
Web Catalog
- Books & CDs
- Clothing & Apparel
- Computers & Electronics

Digital Content (IP): stuff you own the copyright too or licensed the copyright to - you have the right to distribute
- Journal Articles
- Research Studies
- Industry Reports

Advertising-Supported:
- Web Directories/Portals: (search engine, shopping directories, white/yellow pages)
Mixed Model Advertising-Subscription Supported: advertising fees as well as subscription fees for content products

Fee-for-transaction: every single sale, piece of that sale (in terms of profit) goes to the website - getting paid on each transaction and number of transactions
- travel agents
- auto sales
- event tickets
- stock brokers
- online banking
- online music

fee-for-service: paying for the value of service online

(Example question for exam)
1. Web Catalog:
- Listing of products with info and pricing
- Sell directly to customers online
- Need checkout and shipping process
- Returns and other policies (sales contract policies)
- Make money through standard markup and margin
Examples:
- NFLshop.com, Amazon, dell, Victoria secret, walmart, buy.com
2. Digital Content
- All the firms own the rights
- Databases
- Make money off selling the rights for the info they have
- View abstracts: to sell entire thing, you have to pay
- More academic and research focused
- Largely controlled by education institutions
Example:
- International trade commissioner, Harvard business journal, CBC learning online, ACM digital library

3. Advertising-Supported:
- Solely supported by advertising
- Counting systems for hits on ad’s : reach, CPM – how many impressions, CPC (clicks per thousand) – how many times someone actual clicks on it
- No subscription of service fees
- High traffic / highly targeting
-
Examples: newschoolers.com, monster.ca, yahoo.ca, google, msn,
4. Mixed model Advertising-Subscription Supported
- Has membership requirements
- Costs money to become a member
- Yearly fee for subscription
- May have to pay for product or info on the site
- Uses advertising to generate revenue
Examples: hotmail.com,
** to move someone from free-loader to subscriber: additional features, tell them they will get less advertisements
5. Fee for transaction
- Own the product after transaction
- Paying for a specific interaction with the firm (one time)
- Make money based on buying with volume discounts as a low cost
- Fee is for the transaction
- Log in
- Info/price
- Paypal/payment options – check out
- Remove the middle man – this is where the fees come in
- CIS: get the customer to do the work for you
Example: ticketselleronline.com,
6. Fee for service
- Don’t own product at the end of the service
- Access to the service for a certain time period
- Log in
- Privacy regulations
Example: www.macorr.com, www.adgcanada.ca

Strategic Issues (the back end)
- channel conflict/cannibalization
- alliances/distribution management:
- mobile commerce:

Web Presence
- attractive and easy to use
- ranks high on stickiness (not only attracting, but having them stay there and browse)
- provides quick links / content
- provides help and support
- portrays consistent image
- reinforces positive image
- builds trusting relationship
- engages for return ability: new content, social presence sites (forum)