There are five types of e-business models that form the basic structure on which websites are based. These five models are vanity, billboard, advertising, subscription and storefront. Many sites also combine these basic models. All sites incur cost of development and maintenance, though they may not be deriving direct revenue from it. The five models of e-commerce have unique characteristics.
The Vanity model, as the name suggests, cater typically to individuals who start it as an outlet for expression, to share a hobby, promote a cause such as an environmental or social agenda, etc. The site then acts like an online forum, to bring people together. A very good example for such a site is greenpeace.org. The site brings together people who are conscious about the degradation of the environment and helps raise a voice against issues such as climate change, endangered species, deforestation etc. The revenue models for such Vanity sites build up through advertisements of related organisations, services and products. In the case of Greenpeace, the site is maintained mainly through donations. The costs of vanity sites are either born by the individual or by philanthropic institutions such as associations, universities or may be businesses.
This e-commerce model is designed to work like a billboard. Also called the brochure or information sites, Billboard models derive economic benefit indirectly through referred sales and reduced cost. The sites creates product awareness through the online medium, however, the actual buying and selling takes place off-line. Netizens surf and view the sites and the model functions in the same way as a billboard on a highway. The success of the site is measured according to the hits or viewership it gets. The site influences people to buy the product.
The perfect real world example of this model is billboard.com. The site gives you music news, reviews, articles, information about live shows and more. You can listen to music, and download free music. The site also ranks music and ranks the best songs for any genre. The revenue model, what is apparent from the site, are advertisements related to the music world. For example you can buy Billboard magazine from the site.
The Advertising model, in e-commerce, is similar to the model followed by radio, television and the print medium, among other things. The programme and the content are totally funded by the advertiser's money and the 'viewership' of the site decides the advertisement rate and volume. Surveys conducted by the websites can establish the 'viewership' of the sites and the advertising rates are decided likewise. The various forms of advertising for e-commerce are banners, sponsorships, ezine ads and other promotion methods.
The Subscription model, though very well established in the 'real' world, has not become so prominent in the e-world. Consumers have not yet accepted the culture of subscriptions on the web. The subscription models, on the web, target particular niches of individuals with specific needs. These sites are often specialized with expert content and timely information. The subscriptions fund the development and