Cyber-Bargains

Revenue model outlines how the organization or e-commerce companies will earn revenue, produce profits and produce a superior return on invested capital. 5 major revenue models nowadays are sales, transaction fees, subscription fees, advertising fees, affiliate fees and other revenue sources.

Google has multiple revenue models. The main source of Google’s revenue is from advertising such as AdWords, a pay per click (PPC) advertising program which allow advertisers show relevant or related advertisement from what users searching for. Google also have another revenue model which also an advertising form calls Adsense. Website owners can enroll in the program to enable text and video advertisement which the advertisers are required to pat Google a fee for each time a user click on the advertisement.

eBay, the world’s largest online auction site and shopping web in which people perform businesses such as buying and selling goods and services worldwide. eBay generates revenue by way of various fees and commissions, such as insertion fees, promotional fees, and final value fees. Thus, the major revenue of eBay is through Transaction Revenue Model from sellers and Buyers. eBay targets different types of consumer behavior in its affiliate program to earn affiliate fees of Affiliate Revenue model but rather than pay a commission on sale of goods.

Amazon started as an online bookstore, but soon diversified to vary product lines. Amazon generates revenue primarily by selling books, videos, electronics, and kitchen equipment on domestic and international websites, such as Amazon Marketplace. Amazon Marketplace is something like eBay. It is a fixed- price online marketplace that allows seller to offer their goods alongside Amazon’s offerings and it is using sales revenue model to earn its income. Moreover, users are allowed to comment on reviews. Amazon provides an optional budging option for reviewers to indicate that the reviewer is one of the top reviewers.

In the conclusion, the revenue models adopted by Google, Amazon and eBay are slightly different in terms of their natures of business. However, there is a common ground among themselves which they are mostly relying on the advertising to generate income.