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    E-Business in Hospitality 8

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    Tsea Caron
    The document discusses various e-business revenue models that companies can use including web catalog models, digital content subscription models, advertising models, and transaction based fee models. It also covers challenges like cannibalization and the importance of usability and building trust and loyalty with customers online.

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    E-Business in Hospitality 8

    Uploaded by

    Tsea Caron
    14 views19 pages
    The document discusses various e-business revenue models that companies can use including web catalog models, digital content subscription models, advertising models, and transaction based fee models. It also covers challenges like cannibalization and the importance of usability and building trust and loyalty with customers online.

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    The document discusses various e-business revenue models that companies can use including web catalog models, digital content subscription models, advertising models, and transaction based fee models. It also covers challenges like cannibalization and the importance of usability and building trust and loyalty with customers online.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    14 views19 pages

    E-Business in Hospitality 8

    Uploaded by

    Tsea Caron
    The document discusses various e-business revenue models that companies can use including web catalog models, digital content subscription models, advertising models, and transaction based fee models. It also covers challenges like cannibalization and the importance of usability and building trust and loyalty with customers online.

    Copyright:

    © All Rights Reserved
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    You are on page 1of 19

    E-Business in Hospitality

    L8: E-Business Revenue Models


    Introduction
    • Not ALL electronic commerce initiatives have
    the goal of providing revenue; some are
    undertaken to reduce costs or improve
    customer service.
    Web Catalog Revenue Models
    • In traditional catalog-based retail revenue model,
    the seller establishes a brand image, and then
    uses the strength of that image to sell through
    printed information mailed to prospective
    buyers.  Mail Order/Catalog Model
    • Companies can take this catalog model online by
    replacing their print catalogs with information on
    their Web sites. It is called Web catalog revenue
    models.
    Example
    • The leading computer manufacturers
    including Apple, Dell, Hewlett-Packard,
    Samsung.
    Combined Traditional and e-Business
    Models Together
    • Some retailers combine the benefits of these
    two marketing channels by offering in-store
    online ordering.
    • This allows customers to examine a product in
    the store, and then specify exactly the
    features they want by placing an order on the
    retailer’s Web site from the store.
    Digital Content Subscription Revenue
    Models
    • Firms that own written information (words or
    numbers) or rights to that information have
    embraced the Web as a highly efficient distribution
    mechanism.
    • Most of these companies use a digital content
    revenue model: that is, they sell subscriptions for
    access to the information they own.
    • Most of these digital content providers specialize in
    legal, academic research, business or technical
    material.
    Advertising-Supported Revenue Models
    • The advertising-supported revenue model is
    the one used by broadcast network television
    in the United States.
    • Broadcasters provide free programming to an
    audience along with advertising messages.
    • The advertising revenue is sufficient to
    support the operations of the network and the
    creation or purchase of the programs.
    Face to two major problems

    • No consensus has emerged on how to


    measure and charge for site visitor views.
    • The second problem is that very few Web sites
    have sufficient numbers of visitors to interest
    large advertisers.
    Advertising-Subscription Mixed Revenue
    Models
    • In an advertising-subscription mixed revenue
    model, which has been used for many years by
    traditional print newspapers and magazines,
    subscribers pay a fee, but also accept some
    level of advertising.
    Fee-for-Transaction Revenue Models

    • In this model, businesses offer services for


    which they charge a fee that is based on the
    number or size of transactions they process.
    • The removal of an intermediary, such as a
    human agent, from a value chain is called
    disintermediation.
    • The introduction of a new intermediary, such
    as a fee-for-transaction Web site, into a value
    chain is called re-intermediation.
    Fee-for-Service Revenue Models
    • Companies are offering an increasing variety
    of services on the Web for which they charge
    a fee.
    • These are neither broker services nor services
    for which the charge is based on the number
    of size of transactions processed.
    Revenue Strategy Issues
    • Channel Conflict  Cannibalization
    – Companies that have existing sales outlets and distribution
    networks often worry that their Web sites will take away sales from
    those outlets and networks. Such a channel conflict can occur
    whenever sales activities on a company’s Web sit interfere with its
    existing sales outlets.
    – The problem is called cannibalization.
    • Strategic Alliances
    – When two or more companies join forces to undertake an activity
    over a long period of time, they are said to create a strategic
    alliance.
    – Advantage: It can increase the number of businesses on the web
    site to attract more consumers to visit.
    Web Presence Goals
    • Attracting visitors to the Web site
    • Making the site interesting enough that visitors stay and
    explore.
    • Convincing visitors to follow the site’s links to obtain
    information.
    • Creating an impression consistent with the organization’s
    desired image
    • Building a trusting relationship with visitors
    • Reinforcing positive images that the visitor migh already
    have about the organization.
    • Encouraging visitors to return to the site.
    Web Site Usability

    • How the Web is Different


    • Meeting the Needs of Web Site Visitors
    • Trust and Loyalty
    Connecting with Customers
    END

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