I’m sure all of you will surf net everyday. However, do you even think about how the net you are surfing being survived, how they earn their income in order to maintain the website. This blog will tell you the revenue model of Google.com, Amazon.com and ebay.com.
Firstly, let us discuss about Google.com. All of us will know that Google.com is a famous search engine, however, besides that; Google is also the top employer in the world. It has more that 12,000 employees and it has over 40 offices which located in more than 20 countries. How Google maintain the huge amount of expenses? What is it revenue model?
The main sources of revenue generate by Google.com is from advertising. It has a system calls Google AdWord. Google generate almost 90% of its revenue from Google AdWord. Google AdWords is a pay per click advertising program. It is designed by Google to allow the advertisers to present advertisements to people at the instant the people are looking for information related to what the advertiser has to offer. The advertisements are shown in the right hand side or above the main search result. Once the users click the advertisement link, the advertiser has to pay as his ad received a click. This calls Pay per Click Advertisement. The Advertisers decide the keywords relevant to their offer that should display their ad and the maximum amount they are willing to pay per click for that keyword. So, you and I can be the people who help Google earn revenue. Just click on the advertisement which display beside the search result!!!:)
Secondly, I will discuss about Amazon.com’s revenue model. Amazon is a well-known on-line bookstore, but it soon to be diversified of DVD, computer software, video games, etc. The revenue model of Amazon.com is by earning transaction revenue. There have 2 types of transaction revenue model which are match maker and distribution. The transaction revenue model which use by Amazon.com is the distribution model. In the distributor model, the intermediary takes ownership of the product. As a result, it realizes the total revenues it gets off the product's sale. For example, a supplier purchases a product for $1.00 and resells it for $2.00. The $1.00 is the supplier's margin before costs. Once cost is factored in, however, the gross margin can be substantially less.
Lastly, I will introduce the Ebay.com revenue model. Ebay is an online auction and shopping website in which people and businesses buy and sell goods and services worldwide. Ebay.com earn transaction revenue but with match maker model. In this model, the product is owned by the supplier. Ebay will receive commission for the product sale. Under this approach, the portal extracts a toll from each transaction. The fee will determine by the complexity of the transaction.
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