online money
For online money-delivered digital products, most companies can charge customers to access content, sell customer information, or sell customers’ attention in the guise of online advertisements.
Companies can also integrate various revenue streams, for instance, charge customers for a subset of services and make additional revenues selling advertising or information. For instance, to make money from news online and companies have traditionally been concentrated on ad revenues but increasingly are providing subscriptions.
Models for revenue in music and film vary from selling by the song to advertising-supported and paid streaming. E-books are being sold by the book or leased. Game providers have utilized a large number of revenue streams such as in-app payments, subscriptions, advertisements, and buying, while software as a service is available for subscription or payment once. Having the freedom to choose from streams of revenue has expanded and made more complex a choice formerly limited to price.
First, for most companies, the selection between revenue streams is a trade-off that comes from the fact that raising revenue from one stream e.g., subscription most likely decreases revenue from another source e.g., advertisement or selling users’ information.
Second, optimally structuring each revenue stream is complicated. A company that makes online money by charging for access to services must make decisions about optimal prices, including the selection of selling versus renting or charging subscriptions versus micropayments. A company that wants to sell information about its customer base must decide what to sell and at what price. An online advertising revenue-generating firm is severely challenged in terms of measuring the performance of advertisements, reaching customers, make money, online money, online customers, and determining the impact of advertisement content on customer actions.
Revenue model selection
We suggest that the company has three methods of making online money revenues over the Internet. First, the company can sell content, or more generally services, to customers. Second, the company can sell data regarding customers for instance, in the form of cookies. Third, sell advertising space. This category is derived from the fact that in return for access to a digital good, consumers are able to provide money, information like personal data, or time usually in the form of attention. We then address the firm’s decision problem of choosing or mixing revenue streams before addressing issues related to the execution of particular revenue models.
In this case, the underlying trade-off is that shifting away from an ad-only revenue source to charging for content will diminish viewership and therefore damage ad revenues. New analytical studies suggest that higher competitive rivalry can make profits from charging for content larger and profits from advertising smaller.
Another perspective has the consumer heterogeneity effect of heterogeneity on willingness to pay to avoid ads and determines that, money online, make money, surveys money, money home, paid surveys, more often than not, one should receive both advertising and content payments. Other research has emphasized free units as a sampling of the paid goods, with findings showing free digital goods have the potential to raise long-run sales but sampling increases demand for subscription only at intermediate levels of advertising efficacy.
Selling the Service
First sale online money doctrine allows anyone who possesses an original copy of a tangible product to resell or rent it as he wishes. Reselling or renting electronic products is especially appealing because such commodities are non-rival where there is no technology or regulation stopping individuals from sharing. But it is nearly impossible to resell or lease a digital good without first creating copy which would be copyright infringement.
To keep consumers from copying, companies create locks using digital rights management, which is circumvented by the Digital Millennium Copyright Act. With legal resale markets closed off, companies must rethink their pricing strategy. Surprisingly, online earning, money online, make money, money home, survey money most companies employ inflexible pricing over time and content, primarily for convenience. Although the majority of songs on Apple’s iTunes store cost $1.29 and new standard definition films cost $14.99/$3.99 to buy/rent, content providers seek more flexibly priced content and wish to vary prices over time.
But Rao clarifies that these inflexible pricing mechanisms are actually price commitment-like and can benefit content providers with a credible commitment device. But when it cannot commit to a price trajectory, a firm must serve both rental and purchase online money markets since the option to buy facilitates indirect price discrimination. Unlike the traditional classical durable goods issue of time inconsistency, she observes that when consumers value having access to new content, they are less likely to wait for lower prices which raises the firm’s price power.
Open questions and challenges
Studies to date have investigated key questions regarding how companies earn money online and the trade-offs and challenges in executing a revenue model based on monetizing information, content, or advertising. The above sections each conclude with open questions in relation to these particular areas.
However, whereas the company’s necessity to compromise on selling content, information, or advertising is unchanged, developing technology and shifting behavior provide new opportunities to connect with consumers by means of pricing or advertising or to capture consumer data. This could have consequences for companies’ revenue models. An important finding is that consumers are increasingly relying on the mobile Internet. Early findings indicate that consumer response to information displayed on mobile screens could be divergent from that of a PC environment. Ghose demonstrates that displaying order information is more critical in the mobile Internet due to the limited screen view.
Up to now, there have been divergent findings on consumer reactions to mobile advertisements and their performance. Though other industry analysts would say that users like the ad-free version of the app more than paying, and only limited evidence is available on the interactions between mobile ads and other advertising. On the other hand, this can potentially enhance privacy issues. Additional studies to assess such trade-offs and best advertising strategies are required.
Conclusion
Throughout this review, we have examined how online money businesses generate revenue. We have highlighted the virtues and vices of the different revenue streams and the issues facing companies in generating revenue online. Literature has highlighted that it is possible for subscriptions, advertising, and information about customers to keep digital companies afloat, though such a study is in its infancy.
We survey studies of revenue models employed by online companies selling products. Those products are non-rival, and possess nearly zero marginal cost of production and distribution, low marginal cost of consumer search, and low transaction costs. Also, companies can easily monitor and quantify consumer behavior. We begin by inquiring what consumers can provide in return for digital goods. We propose that consumers can provide their money, individual information, or time.
We examine the firm’s trade-off between selecting from the various revenue streams, like providing paid content or free content with the dependability on advertising revenues. We then address particular challenges companies have in selecting a revenue model on the basis of either content, information, or advertising. We also address emerging revenue models that merge various revenue streams like crowdfunding content and information or blog information and advertising. We end with an overview of potential avenues for future research such as implications for companies’ revenue models from the growing significance of the mobile Internet.