Business Model Examples
Below are some examples of different business models.
| TYPE OF MODEL | HOW IT WORKS | EXAMPLES |
|
Affinity Club
|
Pay royalties to some large organization for the right to sell your product exclusively to their customers.
|
MBNA
|
|
Brokerage
|
Bring together buyers and sellers, charging a fee per transaction to one or another party.
|
Century 21
Orbitz
|
|
Bundling
|
Package related goods and services together.
|
Value meals
iPod/iTunes
|
|
Cell phone
|
Charge different rates for discrete levels of a service.
|
Sprint
Better Place
|
|
Crowdsourcing
|
Get a large group of people to contribute content for free in exchange for access to other people's content.
|
Wikipedia
YouTube
|
|
Disintermediation
|
Sell direct, sidestepping traditional middlemen.
|
Dell
WebMD
|
|
Fractionalization
|
Sell partial use of something.
|
NetJets
Time-shares
|
|
Freemium
|
Offer basic services for free, charge for premium service.
|
Linkedln
|
|
Leasing
|
Rent, rather than sell, high-margin, high-priced products.
|
Cars;
MachineryLink
|
|
Low touch
|
Lower prices by decreasing service.
|
Walmart;
IKEA
|
|
Negative
|
Lower prices by receiving operating payment before delivering cycle the offering.
|
Amazon
|
|
Pay as you go
|
Charge for actual metered usage
|
Utility Companies
|
|
Razor
|
Offer the high margin razor and printer below cost to increase volume sales of the low margin razor blades and ink
|
Printers;
Razor Blades
|
|
Reverse razor
|
Offer the low-margin item below cost to encourage sales of the high-margin companion product.
|
Kindle;
iPod/iTunes
|
|
Reverse
|
Set a ceiling price and auction have participants bid as the price drops.
|
Elance.com
|
|
Product to Service
|
Rather than sell a product, sell the service the product performs.
|
Zipcar
|
|
Standardization
|
Standardize a previously personalized service to lower costs.
|
MinuteClinic
|
|
Subscription
|
Charge a subscription to gain access to a service.
|
Netflix
|
|
User Communities
|
Grant members access to a network, charging both membership fees and advertising.
|
Angie's List
|
Source: Seizing the White Space - Mark Johnson - Harvard Business Review