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Hello, my dearest readers nice to see you again. Today, I’m going to share one of the topics about e-commerce with you. As we know, revenue is the main objective in every business transaction so there is no exception for online activities as well. Hence, I would like to share the information about “Revenue model for Google, Amazon.com, and eBay” with you.
A revenue model is made up by five revenue models, which includes sales revenue model, transaction fee revenue model, advertising revenue model, subscription revenue model, and affiliate revenue model. Advertising is the main revenue model for Google which generates higher profits than other model. Google AdWords, Google AdSense, Google Answers and Froogle are included in the Google’s advertising revenue model.
Google AdWords is the pay per click advertising program of Google which is designed to allow the advertiser to present their advertisement to interested people that are trying to search for the relevant information which offers by the advertiser in the advertisements. An advertiser has to pay the fee to Google whenever there is a click on the advertisements in Google page.Google AdSense is an ad serving program which allows the website owners to enroll the text, image and video advertisement which will be presented in their website. Revenue for these ads is generated by either on per-click or per-thousand-ads-displayed basis. I have provided a AdSense picture so that you will have a clearer picture.
Google Answers is a service provided by the researcher to answer users’ queries or questions. Then, the user will pay for the service. 25% of the service payment will be kept by Google, and the rest will be paid to Researchers.
While, Froogle is a price engine website launched by Google that enable users easily get information about products that are selling online.
Amazon
On the other hand, unlike Google, the main activity for Amazon is online sales. Interested buyer can buy the new or used products from the seller through Amazon.com in Amazon Marketplace. Commission rate will be charged by Amazon based on the selling price, transaction fee, and variable closing fee. Therefore, sales and transaction fee can be considered as the main revenue model for Amazon.
Affiliate revenue model is another model that generates revenue for Amazon. An affiliate marketing program has been set up by Amazon. Website owner is able to create an online store in their own site through an Amazon affiliate product which is known as store. A referral fees will be paid to the website owner and normally it is in the range from 4% to 10% of the product price.
Ebay
Ebay
Ebay is also providing online shopping but it does not have inventory like Amazon. It is an online auction and shopping website which allow business transaction to be performed in places around the world. Insertion fees, promotional fees, final value fees, and reservation fees model revenues are the revenue generated by Ebay.
Insertion fees are generated when an item is listed or showed in Ebay and this is non-refundable fee. Promotional fees are generated when additional listing options such as highlighted and bold listings are edited. While, final value fees is commission charged to the seller at the end of the auction. Lastly, reservation fees are charged when the product is not sold out.
Here are some of the useful links with is related with this topic:
iii)Google
iv)Amazon.com
v)Ebay
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Hui Chew,
Week 3
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