Cutline
Business models, explained
How the main business models make money, with real examples, the numbers to watch, what goes wrong and one thing to do this week if you want to try one.
SubscriptionCustomers pay a fixed amount every month or year for as long as they keep using the product.FreemiumA useful free version brings people in, and a small share of them pay for more. How the freemium model makes money, real examples, the numbers to watch and…MarketplaceYou connect buyers and sellers, and take a cut when they trade. How the marketplace model makes money, real examples, the numbers to watch and what goes…DropshippingYou sell products online, and a supplier ships them directly to the customer. How the dropshipping model makes money, real examples, the numbers to watch and…Print on demandYou sell designs, and a printer makes each item only when it is ordered. How the print on demand model makes money, real examples, the numbers to watch and…Affiliate marketingYou recommend a product, and earn a commission when someone buys through your link. How the affiliate marketing model makes money, real examples, the numbers…AdvertisingPeople use the product for free, and companies pay to reach them. How the advertising model makes money, real examples, the numbers to watch and what goes…LicensingYou let other companies use your brand, technology or content for a fee. How the licensing model makes money, real examples, the numbers to watch and what…FranchiseOther people pay to run a copy of your business under your name. How the franchise model makes money, real examples, the numbers to watch and what goes wrong.Direct to consumerYou make your own product and sell it straight to customers, without shops in between. How the direct to consumer model makes money, real examples, the…AgencyA team does skilled work for clients, usually on projects or monthly retainers. How the agency model makes money, real examples, the numbers to watch and…Productized serviceYou sell a service like a product: one fixed scope, one fixed price. How the productized service model makes money, real examples, the numbers to watch and…ConsultingCompanies pay for your expertise, advice and judgement on a specific problem. How the consulting model makes money, real examples, the numbers to watch and…Software as a serviceCustomers pay a subscription to use software online, instead of buying it once. How the software as a service model makes money, real examples, the numbers…Razor and bladesYou sell the first product cheaply and earn on the refills that keep being bought. How the razor and blades model makes money, real examples, the numbers to…Pay as you goCustomers pay only for what they use, so the bill grows with them. How the pay as you go model makes money, real examples, the numbers to watch and what goes…MembershipFans or members pay regularly for access, community and things only they get. How the membership model makes money, real examples, the numbers to watch and…Transaction feesYou charge a small fee each time money moves through your product. How the transaction fees model makes money, real examples, the numbers to watch and what…Lead generationYou find people who want something, and sell their enquiry to the businesses that offer it.Open coreThe basic product is free and open source, and companies pay for what they need around it. How the open core model makes money, real examples, the numbers to…
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