Tuesday, February 3, 2009

Identify and compare the revenue model for Google,Amazon,com and eBay

Hello there again readers. Today, i am going to talk about the various revenue growth models for the 3 most famous online sites which are Google, Amazon.com and eBay. Google's revenue model aims at increasing the visibility and traffic of its small business partners, streamlining their marketing costs, qualifying their leads and helping track returns on investment. Google's revenue model includes Google AdWords, Pay per Click Advertising, Google AdSense, Froogle, GoogleAnswers and their latest advertising program which is Cost per Click model. It earns most of its revenue by allowing other website owners to advertise on their search result pages or by placing these same text ads (AdSense) on other sites based on relevance.

90% of Google's revenue is generated by Google AdWords. Google AdWords is a pay per click advertising program that is designed to allow the advertisers to present advertisements to people at the instant the people are looking for information related to what the advertiser has to offer. As such, the role of AdWords in Google’s growth is very important.
Pay per Click Advertising (PPC) is an online advertising payment model in which payment is based on qualifying click-through. An advertiser has to pay every time his advertisement receives a click. This function is a very useful function and will continue to bring about an increase in income especially if the number of people clicking on these ads increase

AdSense is an ad serving program run by Google. Revenue is generated on a per-click or per-thousand-ads-displayed basis and the ads are administered by Google. The advertisers are required to pay Google a fee each time a user clicks on one of their ads displayed on Google Network members’ web sites.

Amazon.com provides a wide range of advertising channels to reach the most demographic availability. It generates revenue mainly by selling books, videos, electronics, and kitchen equipment on its Amazon Marketplace. Amazon Marketplace is an online marketplace that allows sellers to offer their goods and for buyers to purchase new and used items sold directly by a third party by using Amazon Marketplace. The sales strategy has been profitable for Amazon.com. It charges a commission rate based on the sale price, a transaction fee, and a variable closing fee. Moreover, Amazon.com also generates revenue by Affiliate revenue model. Amazon was one of the first online businesses to set up an affiliate marketing program. AStore is an Amazon.com affiliate product which website owners can use to create an online store on their site. Website owners pick products from Amazon’s store and earn referral fees on the products purchased by their readers

EBay's reaches out to people of all ages and walks of life providing nearly everything that can be sold. EBay’s main source of revenue is charging fees to list an item up. EBay also obtains its revenue by charging a picture service fee. The first picture uploaded in its site is free but the subsequent pictures incur fees. Besides, it provides various services to help its users to enhance their advertising or promotion of products but for a fee of course. They also charge final value fees. It is charged when there is a closing bid. Reservation fees are only charged if the item listed is not sold.

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