“Business models themselves do not offer solutions; rather, how each business is run determines its success. So the success of e-commerce businesses will hinge largely on the art of management even as it is enabled by science and technology.”
From “The Truth about Internet Business Models,” by Jeffrey F. Rayport. Source
“A business model is quite simple: it is a brief statement of how an idea actually becomes a business that makes money. It tells who pays, how much, and how often. The same product or service may be brought to market with several business models..”
From “Anatomy of a Business Model” by Stever Robbins. Source
Frank Hertz, Co-founder of Newmediary.com, founded in 1999, says that unlike many of its fellow dotcoms his business is surviving. Hertz, Newmediary’s vice president of operations, told us about his company’s business model and what makes it different.
“We build, host, and manage private-label online directories for leading publishers and portals. We sell companies enhanced subscriptions (listings in the directories), and access to sales leads, or RFPs (Requests for Proposals) on behalf of those directories, and return a portion of that revenue to the partner.
The partner gets a no-cost revenue stream; we get to sell a product with an established brand name on it, and keep a large portion of that revenue, as opposed to having to build our own brand.
So, this is how we’ve differentiated ourselves in the market: essentially, by not caring if people (other than partners) know who we are. It’s worked up to this point. And all those dotcom companies that raised, in some cases, hundreds of millions, to establish a brand name, are now out of business. So we’re happy we embarked on the ego-less business model of what’s termed Application Service Provider (ASP).”
“In the most basic sense, a business model is the method of doing business by which a company can sustain itself—that is, generate revenue. The business model spells out how a company makes money by specifying where it is positioned in the value chain.”
From “Business Models on the Web” by Michael Rappa.
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