Business Models of Youtube, Google, Amazon, Ebay, Expedia, and Priceline

These two travel websites provide customers with the ability book hotels, purchase airline tickets, reserve rental cars, and purchase vacations and cruises. Rappa (2006) pointed out that Priceline follows a brokerage model, and its main role is as a business-to-customer company. I think Priceline consist of two brokerage models: one is the Demand Collection System, and the other is Search Agent. Customers can “name-your-price” on Priceline or they can also simply search for the best price available (Rapp, 2006). Expedia’s brokerage model is Search Agent which provides customers with the ability to search for the best price available. One special feature of Expedia is the company partnership with Groupon Getaways to provide customers with deals on lodging and vacation packages. On these two websites, there are also advertisements such as banner ads from travel related services. Both Expedia and Priceline can make profits by offering web page space to others to advertise on their website. Google and Yahoo

Google and Yahoo adopted the Advertising Model and they are search engines. As Rappa (2006) indicated that there are two types of Advertising Models applied to Google: Query-based paid placement and Content-Targeted Advertising. For example, when I typed in Rockville Pluming, the search results show all paid ads that relate to my search keywords. Once I navigate to a specific webpage, the Content-Targeted Advertising makes sure the advertisements there are based on the webpage contents. Yahoo uses Portal Advertising Model according to Rappa (2006). It is an advertising method to target users’ demographics. When users set up MyYahoo or email account, they answer question such as location, age, gender, interests, etc. Every time users log in to their profile targeted content ads or local ads are displayed on the users’ web pages. Amazon and eBay

Amazon uses the Brokerage Model as a Virtual Marketplace and the Advertising Model as a Virtual Merchant (Rappa, 2006). Also, Amazon provides the service for sellers to sell their products with Amazon provided marketing services to increase sellers’ product exposure. Being a virtual merchant, Amazon sells their product solely online. For example, Kindle vs. Nook. Customers can only purchase Kindle online, while customers can try out Nook first at the bookstore. Amazon provides other services for sellers to create websites through Amazon and set up advertising for “Cost-Per-Click” (Amazon.com, 2013). eBay uses the Brokerage Model as an Auction Broker and makes profit from listing fees, additional advertising fees, and commission per item based on the final selling price (Rappa, 2006).

References

Amazon.com (2013). Amazon product Ads. Retrieved from http://www.amazonservices.com/product-ads-on-amazon/pricing.htm?ld=AZPADSFooterAS Rappa, M. (Dec, 2006). Business models on the web. Retrieved from http://digitalenterprise.org/models/models.html Rothaermel, F. (2012) Strategic Management: Concepts and cases. McGraw-Hill Irwin