Income model
The word revenue model is a term from the economy , which during the New Economy has become popular. It describes from which sources and in which way a company generates its income.
Income model in business models
While through the value proposition ( value proposition the selected) and value chain architecture the cost side of the business model is defined, the business model also contains a description of the sources and how the company generates revenue. The margin structure of the business model and thus also the value that the company generates for its owners results from the earnings model and the costs.
Examples of sources of income for companies in e-commerce are subscription fees , advertising income, sponsorship fees and income from transactions , which in turn can consist of fixed transaction fees, commissions for referring customers, fixed or variable sales commissions or the direct sale of goods.
With the freemium model, a free service (e.g. in the form of a free consultation) is given, while the income results from the subsequent purchases that are stimulated as a result.
Revenue / revenue model in e-business
The development of e-business has resulted in new forms of revenue generation, see also Popp, Meyer. These are defined, among other things, by the following factors:
- Type of products and services that are being sold
- Role of buyer
- Type of determination of the revenue values
The following four forms according to Wirtz are suitable for classifying revenue models, as they represent a common denominator for other forms. It should be noted that mixed forms are often used in practice.
Transaction-dependent direct revenue generation
With this model, the revenue is generated through connection and usage fees. The provider's service flows directly to the customer. Conversely, the flow of money takes place directly from the customer to the provider. A third party is not involved.
This model is divided into revenue generation via individual transactions (connection fee) and transaction fees (usage fee). The amount of the transaction costs can be fixed or calculated as a percentage.
In the revenue model through individual transactions, the customer pays directly for the product or service for each individual transaction.
Example:
This model is typically used in e-shops (e.g. Amazon). The customer acts as the buyer of the goods. Ordering these corresponds to the transaction. The company's offer is self-determined from its point of view, since the offer and the presentation can be controlled.
When generating revenue through transaction fees, the customer does not pay directly for the product or service, but for the use of a platform. This is made available to him for action by the operator.
Example:
The best known example is eBay. The customer acts both as a buyer and as a seller. In this case, the offer is externally determined from the company's point of view, since the offer and presentation are controlled by the customer (seller of the goods).
Transaction-dependent indirect revenue generation
In this model, the core service flows from the seller to the buyer. This transaction creates an ancillary service for a third party. The turnover is generated by the fact that a third party pays the ancillary service to the seller.
The most common form of this model is the commission for arranging a service. These revenues are only indirect if the advertising party offers a separate core service and the advertising platform for generating commission revenues offers an ancillary service.
The amount of revenue can be fixed or defined via the sales value or other transaction-specific factors. Another option is gain sharing, in which the broker of a service passes on a share of the savings to the seller.
Examples:
- e-shops that include partner products in their range.
- News magazines that refer to other companies in their editorial content.
- Affiliate programs in which links are made to other products and a commission is earned when the products are sold via the link (e.g. Medion; 3.5% of the sales value).
Transaction-independent direct revenue generation
With this model, the proceeds are achieved through membership fees, usage or setup fees. The core service flows from the seller to the customer. The customer pays a fee that does not apply to each individual transaction.
Usage and setup fees are paid once. The membership fees are regular fees to be paid. The premium principle is often used here. This consists of a free and a premium area. The service is initially offered free of charge and includes a basic service. The user must pay a regular amount for the additional services in the premium package.
Examples:
Collaboration platforms and premium memberships (e.g. Xing, membership free of charge, additional services for 4.95 euros per month)
Transaction-independent indirect revenue generation
This model is characterized in that the operator of the website, in addition to a core service, also provides an ancillary service for which he is paid by a third party. This payment is made independently of individual transactions with regard to the customer of the core service.
There are, among others, the following forms of this revenue model:
- Banner advertising
- Sponsoring / donations
- Data Selling ( Data Mining )
- Syndication (content syndication)
In banner advertising, a certain area on an Internet page is reserved for advertising - the banner - of the advertising customer.
Sponsoring and donations differ in that in the case of sponsorship by the beneficiary, the “sponsored”, consideration must be provided, whereas a donation is granted without the demand for consideration. Such consideration can be given in various ways, for example by naming the sponsor or by placing the sponsor's content on the website.
With data mining, the website operator is paid to provide the most comprehensive possible data about the users or the use of his Internet offer. The company that pays for it hopes to gain certain insights from this data that will enable it to generate higher sales through more targeted advertising.
Syndication is the transfer of content for integration into other websites or other further use. This is an indirect model insofar as it is not the users of your own website who pay to view content, but rather third-party services generate sales through the use of the content or hope for other business value.
Example:
An example of syndication is the FAZ, which the rights of use to their texts z. B. sold to online bookstores such as buecher.de.
literature
- Paul Timmers: Business Models for Electronic Markets . In: Electronic Markets . Vol. 8, No. 2, 07/98 doi: 10.1080 / 10196789800000016 .
- Dave Chaffey: E-Business and E-Commerce Management. 3. Edition. Harlow (UK) 2007.
- Tobias Kollmann: E-business: Basics of electronic business processes in the net economy 3., revised. and exp. Edition. Wiesbaden 2009.
- Karl Michael Popp, Ralf Meyer: Profit from Software Ecosystems: Business Models, Ecosystems and Partnerships in the Software Industry. Norderstedt, 2010, ISBN 978-3-8391-6983-4 .
- Thorsten Weber: Software reference architectures for business models of e-business with special attention to their revenue models. Dissertation . University of Leipzig, 2006.
- Bernd W. Wirtz: E-Business. 2., completely revised and exp. Edition. Wiesbaden 2001.
- Bernd W. Wirtz: Media and Internet Management. 6., revised. Edition. Wiesbaden 2008.
Web links
- Business model definition by Patrick Stähler
- Donation deduction - requirements and differences to sponsoring
- Lecture Introduction to E-Business and Market Design
- Business model in electronic business - inventory and qualification (PDF; 130 kB)
Individual evidence
- ^ Text taken with the permission of the author: Stähler, Patrick (2001). Business models in the digital economy: characteristics, strategies and effects, Josef Eul Verlag, Cologne-Lohmar, p. 47.