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Manish Bhalla

6 Possible Revenue Streams For Entrepreneurs in E-Commerce Business

Manish Bhalla
6 Possible Revenue Streams For Entrepreneurs in E-Commerce Business

E-commerce being the buzzword in the world of entrepreneurs, it is inevitable to hear of new e-commerce ventures coming up each day. E-commerce has emerged as the favorite business option for entrepreneurs. One big reason for being preferred over other businesses is the proportion of revenue investment, which is apparently better than other options and requires less investment. To make millions online, you just have to be cognizant of the multiple revenue streams available out there.

For those who want to start an e-commerce website or make some more money from their existing e-commerce ventures, here is a list of some revenue generation methods.

Commissions

This is one of the most popular and guaranteed revenue generation methods followed by most of the e-commerce portals. The model is really simple – the seller sells and the buyer buys, and you make money out this transaction. Wondering how?

Let me explain: The website owner predefines a percentage (commission) that is  charged on each product which is sold on the e-commerce website by various merchants (sellers). This percentage (commission) can be set keeping in the view the market scenario and of course your business goals.

Subscriptions

For many websites, it’s the primary source of revenue generation. Such sites earn revenue by charging a subscription/membership fee from buyer or seller to access/avail/buy/sell the services or products available on the website.

For instance, online learning platforms earn from subscription that is paid by students to access various video lessons for 3/9/12 months. 

Advertisements

Site owners can charge advertisers for displaying their ads on site. Ads may be served by the site owners own ad server or through third party networks like Google AdWords. The revenue can vary depending upon the type of advertisement i.e. CPC (cost per click) or CPM (cost per thousand).

Featured Listings

Due to high level of competition that vendors/sellers are willing to pay more to showcase their products and services on top. This applies to P2P marketplaces where you being the site owner act as a connector  and buyers and sellers meet through your website.

As they say - competition is always good, as long as you are winning. So having a featured listing functionality in your e-commerce website can be a good decision considering it will bring extra revenue to your pocket.

Affiliate Partnership

E-commerce websites can partner with other third party websites and serve as their affiliate partners. By doing so they redirect visitors to third party sites and earn commission whenever their redirected visitor makes a purchase on the third party site. This is quite a steady and painless way of earning more revenue as you don’t have to worry about storage, shipping, etc. Online fashion social networks like Wanelo.com work on affiliate marketing model.

Sponsored Emails

This marketing tactic is widely controversial as different marketers have different views on it- some consider it good and some bad. But we always look at the sunny side of the story. If your email/newsletter subscribers have given their consent that they are happy to receive emails from you or third parties, then there is absolutely no issue in sending them emails until and unless the emails and newsletters are of use to them. So charging money for adverts placement in newsletter or delivering a separate email on behalf of advertisers is probably a good way to earn more revenue.

Keep in mind that advertisement should be related to your business. As nobody, who is expecting emails on fashion would welcome advertisement emails on financial products. So choosing the right advertiser is the key to earn from sponsored mails. 

Strategic Partnerships

Counting revenue in monetary terms is not always appropriate. Sometimes there are other things like brand value, goodwill, credibility, etc. which equally matter. Coming together for something like this is always a good option and can also indirectly increase monetory gains. One such example is of Amazon and Motorola. In May 2016, Motorola chose Amazon as its exclusive partner for selling the newly launched G4 phones. This news created buzz amongst customers and even rivals and helped Amazon get the edge over competitors.

The decision of revenue streams if taken before setting up  the eCommerce website can yield better results and prove more productive. And, even if you missed planning your revenue model efficaciously while setting up your store, you can make changes to your website now for adding new revenue streams. Updating your business site may be require in few cases. 

In case, there are more revenue generation methods for e-commerce business in your mind, do let us know. We would love to include that in our list! Please mention them in the comments.

Manish Bhalla is the founder and CEO of India’s e-commerce web development and marketing agency FATbit Technologies. He acts as an e-commerce strategist and leads the way for businesses looking for secure space in a specific industry. Manish is acknowledged as an e-commerce expert who has helped many startups find strong footholds online with customer driven-solutions and high-powered growth. For latest marketing strategies and insights, you can follow Manish through his company’s Twitter profile.

Comments

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Ray-Moulade
And what's the difference between Commissions & Affiliate...?
Manish Bhalla
Manish Bhalla
Ray-Moulade
Commission: The owner of an ecommerce store can fix a certain percentage of commission to earn through an ecommerce store. There can be many ways of earning through an ecommerce store and setting up the commission is just one of them.

Affiliate: Individuals, who partner with an ecommerce store as an affiliate, earns a commission that the earning depends on the conditions of an affiliate program. Common conditions for earning through an affiliate program include commission per lead and commission per buy.
amit sharma
amit sharma
Campaign could be paid or free, it all depends upon what mediums you opt for advertising. Leads can be generated through free campaigns as well. All matters to execution of right marketing approaches.

Please let me know if you have any further queries. Feel free to send your direct queries at Twitter. @amitsharma720
Noname
Is it possible to generate lead without a campaign?
Manish Bhalla
Manish Bhalla
Yes, leads can be generated without a campaign. There are many ways to generate leads and the most common ways include using social media, blogging, guest blogging, and more. In addition to these, word of mouth marketing can also be counted as an effective way of generating leads.
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