BUSINESS MODEL

BUSINESS MODEL
 A business model is the way that a company sells
products to its customers. It describes how a business
creates, delivers, and captures value.

Different types of Business Model:

1) Business-to-Business (B2B)

2) Business-to-Consumer (B2C)

3) Consumer-to-Consumer (C2C)

4) Business-to-Government (B2G)

5) Consumer-to-Business (C2B)
EVOLUTION OF INTERNET BUSINESS MODELS

E-Business established themselves in 2 phases: The

first phase comprised the following trends:
1. Business organizations rushed to establish an e-
commerce website.
2. Little or no regard was given to check how reliable
the site needed to be.
3. It was a matter of beating competition.

Drawback: There was no or little integration with the

production side of the business .
Reasons: Growth of consumer base , Request for real-
time order status and Return of products .
 In the Second phase , organizations started
planning about integrating the back-end and real
time transaction processing .

Business are using Internet Technologies and

integrating their systems and processes more
efficiently are now breaking the barrier .
This has been possible due to :Capitalizing on a
continuous business proposal and correctly applying
technology .
BUSINESS-TO-BUSINESS MODEL
 This model needs two or more business organizations that
do business with each other . It entails commercial activity
among companies , through the Internet as a medium.
Types of B2B :
1) Supplier Oriented
2) Buyer Oriented
3) Intermediate Oriented
For example, an automobile manufacturer makes several B2B
transactions such as buying tires, glass for windscreens, and
rubber hoses for its vehicles. The final transaction, a finished
vehicle sold to the consumer, is a single B2C transaction.
BUSINESS TO CONSUMER (B TO C)
 Business or transactions conducted directly between
a company and consumers who are the end-users of
its products or services.
 This model enables consumers to browse , select and
merchandise online from wider variety of sellers and
at better prices .
CONSUMER-TO-CONSUMER (C2C)

 Consumer to Consumer (or citizen-to-

citizen) electronic commerce involves the
electronically facilitated transactions between
consumers through some third party. A common
example is the online auction, in which a consumer
posts an item for sale and other consumers bid to
purchase it.
BUSINESS-TO-GOVERNMENT
 An example of a business to government company is a
firm that offers IT consulting services to a government
agency. The government uses the B2G arrangement in
order to keep its technology up to date and in working
condition, while at the same time limiting expenses by
not taking on full-time staff.
CONSUMER-TO-BUSINESS (C2B)

 Consumer-to-business (C2B) is a business model

in which consumers (individuals) create value and
businesses consume that value. For example, when a
consumer writes reviews or when a consumer gives a
useful idea for new product development then that
consumer is creating value for the business if the
business adopts the input.
BUSINESS MODEL :6 COMPONENTS
 Value Proposition
 Market Segment

 Value Chain Structure

 Creation of revenue and profits

 Place in the value network

 Competitive Strategy
ROLE OF A BUSINESS MODEL

Technical Business Economic

Inputs Model Outputs
REVENUE MODEL VERSUS BUSINESS MODEL

 A revenue model is part of a business model. A

business model shows the framework for an entire
business and allows investors and bankers as well as
the entrepreneurs themselves to have a quick way of
evaluating that business.
 The revenue model is a key component of the
business model as it is an essential factor for
delivering products or services with high margins
and funding the business