Chapter 2
1. What are the eight key components of an effective business model?
The eight key components of an effective business model are: value proposition, revenue model, marketing opportunity, competitive environment, competitive advantage, market strategy, organizational development, and management team.
The eight key components of an effective business model are: value proposition, revenue model, marketing opportunity, competitive environment, competitive advantage, market strategy, organizational development, and management team.
2. Describe the five primary revenue models used by e-commerce firms.
The advertising revenue model is used when Web sites offers it users content, services, and/or products also providing a forum for advertisements and receives fees from advertisers.
In the subscription revenue model, a Web site that offers its users content or services charges a subscription fee for access to some or all of its offerings.
In the transaction fee revenue model, a company receives a fee for enabling or executing a transaction.
In the sales revenue model, companies derive revenue by selling goods, information, or services to customers.
In the affiliate revenue model, sites that steer business to an “affiliate” receive a referral fee or percentage of the revenues from any resulting sales.
The advertising revenue model is used when Web sites offers it users content, services, and/or products also providing a forum for advertisements and receives fees from advertisers.
In the subscription revenue model, a Web site that offers its users content or services charges a subscription fee for access to some or all of its offerings.
In the transaction fee revenue model, a company receives a fee for enabling or executing a transaction.
In the sales revenue model, companies derive revenue by selling goods, information, or services to customers.
In the affiliate revenue model, sites that steer business to an “affiliate” receive a referral fee or percentage of the revenues from any resulting sales.
3. Why is targeting a market niche generally smarter for a community provider than targeting a large market segment?
Targeting a market niche generally is smater for a community provider because the community provider should start on a level in which the provider is familiar with. The provider should start with a niche that can be supplied and then move to a bigger market.
Targeting a market niche generally is smater for a community provider because the community provider should start on a level in which the provider is familiar with. The provider should start with a niche that can be supplied and then move to a bigger market.
4. Besides the examples given in the chapter, what are some other examples of vertical and horizontal portals in existence today?
Examples of vertical and horizontal portals in existence today are alot.com, itunes, michaelbasiden.com, and blackamericanweb.com.
5. What are the major differences between virtual storefronts such as Drugstore.com and bricks-and-clicks operations such as Walmart.com? What are the advantages and disadvantages of each?Examples of vertical and horizontal portals in existence today are alot.com, itunes, michaelbasiden.com, and blackamericanweb.com.
Virtual storefronts customers only have to connect to the Internet to check their inventory and place an order. The bricks-and-clicks are subsidiaries or divisions of existing physical stores and carry the same products.
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