While brainstorming about monetizing models in social media for a prospective client, we wavered to a discussion on business models that exist in the web2.0 world. I wanted to jot them down for comment and critique:
1. Freemium: Give away a Basic version of the software/service to users/”prospects” for free. Those prospects become customers, buy purchasing more space, superior service and/or enhanced features. There are three kind of upgrade transactions out there:
- Time based subscription, with recurring payments at monthly, quarterly or yearly periods
- Utility based billing, with payments related to bandwidth usage or number of transactions
- lifetime subscription, with a one time payment for a license
- limited trial, with the complete product or service available only for some limited time and continued usage is contingent to payment ( no “free basic version” , makes is slightly different from the other freemium models)
2. Free
- Advertisement supported: Applications with a targeted user demographic or a large user base
- Branded promotional web-applications
- Donor supported
3. Broker: Charging a percentage fee on the transaction from a third party, for a service .
4. Merchant: Selling data/products that were sold offline. This can further be divided into click and mortar, virtual & catalog merchants.
5. Affiliate: leveraging the existing customer base of an affiliated partner to sell ones product or service.
did I miss something ? do they overlap ?
