Business is one of the ideal options when you want to scale up and move on in different life dimensions. It’s amongst the major drivers of the entire economy. But have you ever taken a step to identify some of the business models? Have you ever considered what is always behind a given business? This piece will, therefore, take you through different but common types of business models. Check them out.
Four Traditional Ecommerce Business Models
It’s common to see most people venture into e-commerce businesses. If you are one who’s considered venturing into an e-commerce business or rather, if you are already in an e-commerce business, then you should possibly lie into some of the different models discussed below. The types of business models have challenges, pros, and cons. Knowing the place, you fit in will always give you the chance of living creatively and progressing even in any small business.
Business to consumer
The types of businesses with such a model usually sell services and products to end-users. The model is common all over the world, and therefore, several approaches are incorporated in this model to make everything even more successful. Usually, buying stuff online, be it computer accessories, entertainment accessories, and more, can also be linked to this kind of model. The advantage of this kind of model is that the decision-making process is much shorter compared to business to the business model. This is made even much easier with the buying of cheaper products. Consider a case where you have to purchase a pair of trousers for yourself. This easier than for your company to plan, vet, and purchase new products and services. Therefore, it notably clear that Business to Consumer models have shorter life cycles. While this model has a shorter sales cycle, it is important to note that less money is spent on making sales. Most essentially, there are fewer recurring orders compared to Business to Business modes. Furthermore, business to consumer models doesn’t just restrict themselves to products only, but services too are part. With business to business models, we have seen the technological area flood the market with a good number of mobile applications and services related to business to consumer marketing. A good example is the Lawn Guru application. This application is essential in providing the best services to customers and sellers.
Business to business
Another key and common type of model is the business to the business model. Usually, this kind of model entails selling of services and products from one business to another. At times, the buyer serves as the end-user. The buyer can then sell back to the consumer. Unlike the Business to Consumer model, this kind of model has a longer life cycle.
Furthermore, it has more repetitive purchases and high order value. The innovators of business to the business model are always striving to extend the model day in day out. This is done through the replacement of order sheets and catalogs with e-commerce storefronts. Furthermore, they are also geared towards improving the hotspots, which are the market niches.
According to research done by Google, almost 50% of business to business buyers are millennials. This is a considerable double amount when compared to that of 2012. The future even seems brighter provided that young person’s venture into proper decision making. As a result, the online niche becomes bigger and bigger as the younger generation ventures into Business to Business trade.
Consumer to business
Another critical and essential e-commerce business model is the Consumer to Business model. This kind of model enables individuals to sell their goods and services to various companies. It’s also a common type of business. With this type of model, various sites can give customers a chance of posting work they want to be done and leave a chance of bidding from different businesses. A good example of a business that can be linked to Consumer to business model is the Affiliate marketing services. Upwork is a powerful example that aids businesses to hire freelancers from various areas of the world. There is competitiveness in this sector, especially when it comes to pricing for services and goods. With this approach, consumers can always gain the power to state their prices and also compete to meet other needs. Innovators in the current world are also associated with this model with connecting companies to social influencers who can, after that, market the products.
Consumer to consumer
Lastly, there is a Consumer to Consumer e-commerce business model. This type of model enables several businesses to connect their consumers to exchange services and goods. The business can make income through transactions and listing fees. Many companies are linked to this kind of model. A good example of these companies is eBay and Craigslist. They two are considered to be pioneers in the earlier internet days. Usually, businesses that have stuck to this kind of model benefit though growth by motivated sellers and buyers. Challenges set in when it comes to maintenance in technology and effective control. But then, the sector is gradually evolving to ensure enhancement in the provision of business services.
Business is a basic part of the economy. Many people rely on the business for financial growth, for survival, and more. But it is also essential to understand what the businesses entail. This comes in when the need to understand this kind of model arises. With this kind of model, you will understand which business to venture into, how to conduct it, and how to ensure it progresses effectively.