What is the real deal of “Online Businesses”?

Let’s check out the three major models of online businesses.

There is much confusion about the things that consumers can do online that providing a distinction between the different interactions that happen there has gotten too difficult. The functions alone that an online user can do can overlap with another process classified under a different business venture. So if you are an online marketer, you might end up in limbo about what exactly you are doing in the Internet is called. In order to define what an online business is, let us take a look at three models first.


Long Tail. This category of online business is concerned with the provision of goods or services to consumers in little amounts. An example would be Amazon and Netflix. These are leading companies who purely conduct their business electronically. Whereas Amazon enables people to buy books, Netflix allows people to rent DVDs. If these companies are to operate offline, you can look at one of the biggest malls in America as their actual store.


Platform Networks. This category of online business enables people to get in touch with one another by using efficient mediums that cannot be used offline. Examples are Skype, JobStreet, and Craigslist. Skype is software that sells credits for consumers to communicate in a more effective manner. Monster is a website that brings together employers and professionals in search for a job. Craigslist hosts practically everything from finding a date, a job, an apartment, and even a pet. These companies or services operate under the platform business model.


Information Transmission. The final category of an online business model is concerned with the delivery of information in a faster manner than offline. Email, online bills payment, and Google Search are few examples. Email beats the speed of snail mail, online bills payment is faster than mailing a check, and Google Search is more efficient that when in the library. When a website or a company offers a speedier way of obtaining or transmitting information, it falls under this business model.


Now, once you have established a business model, you have to ask yourself if what you are currently doing has the following characteristics:

  • Is it considered a profit-making strategy?
  • Does your company name hold commercial value?
  • Are your activities something similar to an already recognized business?
  • Are you operating on a model by planning, organizing, and implementing a goal?
  • Are your activities usually something that causes you to use money?
  • Do you consider your activities different from a hobby?
  • Do you often use electronically based technology and communication to reach out to other people?

If your answer to the above questions is yes, then what you do is called an online business. Therefore, an online business is defined as a commercial endeavor that operates under a business plan and follows a specific model to engage consumers to avail of a product or business in a manner that they cannot do offline.


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Paul Agabin is the Founder and CEO of Wooka Interactive. He is an internet marketer based in the Philippines which deals with varied topics such as local industry news, seo strategies, content marketing, inbound marketing, social media management, website reviews, and the like. You can contact him at 0917-5069839.

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