About the Author:
Marnie Pehrson, founder of C.E.S. Business Consultants
and the International
Association of Computer Professionals,
develops products that help computer professionals market
and manage their businesses.
She is author of
Run a Successful Computer Training Business,
Get & Keep Customers for Your Computer-based Business
Your Sanity in a Home Business.
also develops business plans, marketing strategies,
financial projections, & proposals for Internet
projects. Her plans and strategies have garnered clients
an average of $100,000 each in seed capital.
lives on a Georgia farm with her husband and their six children.
C.E.S. Business Consultants
Model the Best for
Most of us plod along
with our Web sites using them to gather leads,
disseminate information, or sell products/services.
We may reach our goals in a meager to moderate way.
But what about sites that generate millions or even
billions in revenue? How do they do it? There are
several factors that come into play: product type,
speed to market, financial backing, strategic focus,
technical excellence, outstanding management, etc.
Even if we do not have
financial funding or technical expertise, there are
two key elements of the best that we can analyze and
mimic -- their revenue and marketing models.
A revenue model tells
us how the site makes money. Here are five major
revenue models used:
- Direct Sales
Model - this model is probably the most
popular model for the average Web site owner.
Revenue is generated by selling products or
services to visitors.
Model - this is a common model used for
high traffic Web sites. It includes selling
banner ads, classified ads, sponsor ads,
pop-up ads, etc. Revenue at Yahoo,
Webcrawler, and Geocities is generated this
- Pay for
Content Model - this is where visitors
pay for viewing information. Many find
difficulty using this model successfully, but
a few sites are generating profits this way: Wall Street Journal and Dun & Bradstreet. I also use this model
with success on the International
Association of Computer Professionals.
Provider Model - these sites/services
usually stream content (i.e. news stories,
articles, horoscopes, etc.) directly onto
other Web sites for a monthly licensing fee.
For example, Reuters is a content provider for My Excite.
- Private Label
Model - sites or services that generate
their revenue in this way develop
personalized versions of their Internet
tools, sites, or Web technology for other Web
site owners and charge a licensing fee for
their development and/or use.
A marketing model is
the way the products/services are promoted. Four
common marketing models follow:
Marketing Model - this model includes
methods you're probably using like e-mail,
banner advertising, e-zine advertising,
direct mail, word of mouth, press releases,
and print advertising.
Model - this is where you build a network
of other Web sites that resell for you. This
may be in the form of a custom-designed
e-commerce store that lets people order your
products while they stay on another site. Or
it can be a simple hyperlink to a form on
your site that gives the sending site credit
for the sale. This is the model used by Digital River (for software), Amazon (for books), Music Boulevard (for music), and LearningUniversity (for software
- Point System
Model - this is a system where visitors
or members are paid in points for viewing Web
sites, viewing ads, or filling out surveys.
The points earn visitors cash, free services,
or discounts on products and services. Prolaunch, Juno, and CyberGold employ this model.
- Free Web Site
Model - sites using this model give
people free web sites in order to build
traffic or sell products. For example, Geocities offers free web sites
and then shows banner ads or pop-up ads on
all "free" web sites.
Successful Web sites
combine different revenue and marketing models to
produce results. For example, Amazon uses the Affiliate
Marketing and Traditional Marketing Models
combined with the Direct Sales Revenue Model
to sell books. Geocities uses the Free Web Site
Marketing Model combined with an Advertising
Revenue Model. On my Web site, I combine the Direct
Sales, Pay for Content and Advertising
Revenue Models with Traditional Direct
Study these models and
decide which combinations will work best for you. By
combining one or more revenue models with one or more
marketing models, you can leverage your Web site to
produce greater results than ever before.