Website Business Models

If you want to build website for your business, it’s important to know the models of it. Here we go.

The portfolio site: like a business card on the Web
These sites offer information. Their target users go to them to find out more about a business. The sites don’t specifically sell anything, but they do support sales by generating leads or making the viewer’s buying decision easier.

What we call portfolio sites are the millions of websites that don’t really sell anything but present the equivalent of sales literature on the Web. The restaurant sites that post their menus, the legal and accounting practices that post professional biographies and related information are just a couple of examples. The Web started with these kind of sites because they are relatively inexpensive to produce and provide significant benefits.

The basic commerce model: sales and profits
The simplest website business model is based on making sales and profits. A classic commerce website like Amazon.com or Buy.com sells products, takes orders, charges credit cards, and ships goods. Software and some information sites have the advantage of being able to deliver what they sell online, at the time of the transaction.

These sites normally offer their target customers the benefit of ease of use and selection. Amazon.com, for example, set the standard for commerce sites by offering a huge selection and a wealth of additional information on the products it sells.
The content model: based on advertising

The content sites work economically like mainstream network television in the United States, free content to users paid for by advertisements that users put up with. This is also a lot like the classic newspaper and magazine business, content paid for mainly by advertisers, with the exception that most magazines and newspapers sell for a small price while getting most of their revenue from advertisers. The “business model” isn’t really new, just the fact that it is offered over the

Internet.
Consider Yahoo! And competing Internet portals, newspaper and magazine sites, entertainment sites, and other types of sites that are free to browsers and make money by charging advertisers or sponsors for banner advertising and sponsorships. These are content sites that depend on Internet advertising for their revenue.

Community sites
Consider the business value of the bulletin board in a local supermarket. The market doesn’t charge for posting notices on the board, nobody pays to read them, but the business takes the trouble to manage the board. The underlying business benefit, we guess, is that the sense of community builds traffic and loyalty.

This value is similar in the Internet community site. A typical community site offers email, bulletin boards and forums, a common focus for some group that has a common interest. Community sites are often started by groups, clubs, and government organizations. Some of the best of them, however, are sponsored by businesses that want to take advantage of the common interest. For example, a rock climbing community site might be sponsored by a local store.

Most sites are really hybrids, combinations
In truth most sites offer a combination of target user benefits. It combines content and community with a touch of portfolio and commerce. Amazon.com combines commerce with content and community; Yahoo.com also combines content, community, and commerce.