Building a Good E-Commerce Business Model

By Cesar Beltran

Using the internet as a platform to earn money has earned itself the title ‘e-commerce’- and it’s the electronic basis of this business model that can make engagement with it so profitable. With barely any overheads, e-commerce whizzes are able to harness some of the internet’s many benefits in order to transact with consumers.

But, while e-commerce sites are relatively straight-forward to set up, there’s no guarantee that yours will draw in the traffic, or will present the right kind of web design, that’ll generate sales and revenue for your online company. There are various types of e-commerce business and it is vital as a business owner to be familiar with how to build a model that maximizes your site potential. 

Types of E-Commerce

E-commerce has seen a steady and continued rise since the advent of payment platforms on the internet – and monetizing structures that help site owners make money. These can be categorized into two types of site:

  • Online Stores– Websites acting as storefronts to sell products or services, just as traditional, pre-digital stores sold products in physical locations in towns and city centers.
  • Marketing and Advertising – These websites, sometimes called vanity sites, make their money through the advertising that they support on a blog or subscription service, or through the commission earned through affiliate marketing

Online Stores

Online stores are, in some ways the simplest business models to set-up, but in many ways, they’re the hardest to perfect. After all, you’re competing with the many possibilities and products presented on the world wide web. To really make it with an online store, you’ll need the right balance of web development and product presentation. You can always look to other sites for inspiration here.

Naturally, online stores require far less investment than their physical cousins in town and city centers. Nonetheless, in order to see a return on your investment, you’re going to need some of the tips provided below, and the help of Shopify experts, to maximize your traffic and the profits that generate.

Marketing and Advertising

You’ll be a little less aware of those websites that make money through advertising and affiliate marketing. Advertising is easy to spot, though if the website or blog you’re browsing is good enough, you’ll be too distracted by the excellent content that they publish – and that’s the trick for e-commerce sites that rely on traffic for their cash.

Affiliate marketing employs a commission-based business structure in order to make small amounts of money from the promotion of other people’s products. The money is generated when web users click through provided hyperlinks to the e-commerce platform that you’re partnered with.

So, there are various ways to transact with web users online, and each method requires a different business model to optimize sales and profits. As online stores are the most-common and most-profitable e-commerce platforms, well focus on those primarily.

Business Models for E-Commerce Stores

You’re looking to build an online store and the business model that’ll be most appropriate to generate sales and profits for your company. The first thing you’ll need to do is engage with one of our Shopify web developers- someone who’s well-versed in the mechanics behind online sales – in order to make customer journeys as frictionless as possible.

The idea is to get web users on-site, and to intrigue, excite and guide them towards an eventual sale. You’ll want to focus on the following aspects of web design:

  • Smart categorization of your products
  • Elegant and professional photographs and design
  • Informative, characterful text that captures consumers’imagination
  • As few clicks required as possible from your home page to the point-of-sale
  • Integrated payments platforms that help you process consumers’ payments with ease

In terms of your business model, these elements are more vital than you might think. After all, your only investment in your website will be your webpage, your marketing, and the third parties that you pay to help your business attract customers.

Business Models for Marketing and Advertising Sites

There are also sites that are more interested in traffic than anything else. It should, therefore, come as no surprise that business models for e-commerce stores that rely upon click-throughs are built upon exposure – often through quality content.

Again, Shopify experts and developers can help you find different web demographics, and draw more traffic to your site if you’re in the affiliate marketing or advertising revenue space. 

Remember that this online business requires you to partner with either other websites (to market their products) or advertising providers (to earn a small amount of cash per site visitor) in order to find yourself in profit. The way you negotiate these deals will determine just how much cash you earn through your site.

Hybrid E-Commerce

Now we’re getting into the realms of even more profitability. It takes a little time, admittedly, to find yourself in sure enough waters to go for a hybrid marketing e-commerce business model– but if you do, you’ll be enjoying two entirely separate revenue streams that make perfect business sense when you examine the model.

The usual hybrid e-commerce model fuses your online store with affiliate marketing, in order to cover more bases when it comes to the products or services you supply. 

Let’s imagine you sell shoes online through your e-commerce platform. Adding a sock-selling partner won’t draw sales away from your shoes – but, as consumers are already purchasing foot-based items, they’re likely to click through to buy socks too. That’s where you enjoy your bonus affiliate marketing boost. As always, you’re going to want to look to the expertise of Shopify web developers to set this kind of business up for you.

Be Dynamic and Reevaluating

Businesses that work online are those that are constantly reviewing their performance and finding ways to get ahead in an already crowded marketplace. You’ll need to be both flexible and willing to make changes to your e-commerce business model over time if you will enjoy optimal performance from your online store.

If you want to find out more about e-commerce business models and how our team can help you build and integrate them, you need only contact our team for advice and expertise that’ll help you find an optimal level of business online.

***

Once again, thank you for keeping up to date with our Insider Blog @ Blackbelt Commerce. Be sure to check out our portfolio and our other great services.

Furthermore, we also have other terrific blog articles such as What are the Vital Elements of Good E-Commerce? and Best Design Practices for an E-Commerce Store — We are Blackbelt Commerce, a TOP Shopify & BigCommerce developer.

As well as great blog posts, we also offer support. If you have any questions please write them in the comments below.

What are the top Shopify stores doing?

Take what we've learned and use it to your advantage.
Get our exclusive research: Insights from over 500 Shopify Stores.

Powered by ConvertKit
Tell others about this post

Add Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.