Most Common Online Business Models


You will greatly increase your chances of success if you take the time to research the best model for your internet business.

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What online business model is right for you?

Online businesses can use one of three business models. You can choose which one best suits your needs. You can:

You can sell a physical product.

Affiliate marketing is a popular way to make money online if you don’t want to handle the manufacturing, storage, shipping, or shipping of physical products. Affiliate marketing refers to the practice of promoting products or services from other people and receiving a commission whenever a sale occurs.

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These models will be described in greater detail in the following sections.

Sell Physical Products Online

This is the most popular model. You can create a physical product that is shippable and sell it online. You can either sell it through your own ecommerce storefront or an auction site. Or, you could also sell your products on third-party sites like Amazon.

Selling physical products online has many benefits.

Online selling has many advantages over selling products in a physical store. Customers can first view your product offerings online, rather than visiting your physical location (if any).

Customers can see all your options, including customer reviews, ingredient lists and similar recipes. Customers can see your product in action and the FAQ section to get more information than they could in a brick-and-mortar store.

Online presence will allow you to reach more customers and increase sales, since more consumers are shifting to online shopping.

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There are some drawbacks to selling physical items online.

It is essential to actually create something. Then store it. Then ship it. It is possible for physical goods to spoil, so it can be time-consuming to make, inventory, and ship them.

Then there are the returns. Inventory control can be difficult when dealing with physical goods. You lose if you make too many and the product spoils. If you make too much and run out of stock you can lose sales potential and clients who may look elsewhere for a better supply.

Selling Services Online

Online sales are ideal for services. Two main ways services can be sold online are:

A website can be used as a sales tool. Many businesses that deliver services in person use their website to sell products and services. The site is more like a brochure for the company than a shopfront.

Online, you can search for a dentist, a carpenter or a massage therapist and be qualified. All of their services are physical. This is a great way to generate qualified leads for service-based businesses.

There are some drawbacks to selling services online.

Particular keywords are subject to high competition. It might be difficult to rank for the keyword “Seattle plumber” if you are a Seattle plumber.

These keywords return over 2.5 million results in a Google search. This means that you need to have a robust content marketing strategy. Engaging blogs with videos are important in this business model because you rarely have the opportunity to build a personal relationship with your customers.

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Facebook advertising is one of the best ways to promote service-based businesses. Facebook advertising allows you to target your audience by their geographic location, demographic information, or targeted interests. The good news is that Facebook is still affordable and cost-effective for small businesses, compared to other advertising media.