Business to Consumer (B2C) Models

Business to Consumer (B2C) Models – 10 B2C Startup Business Models.

  1. New Media – Example Twitter
    1. This model is actually the “no model required” model. If you have a business that acquires users via virality or K-factor, you don’t really need to start with a business model. But for the rest of us mortals, you’ll need to choose one model from the list that follows.
  2. Gaming – Example King
    1. When the app store launched, the model for games was the $0.99-$4.99 per download. This model was quickly replaced with in-app sales. Likely the world’s best business model – sell virtual stuff for real money!
  3. B2C Commerce – Example Amazon
    1. Amazon may not have been first, but it’s clearly the biggest e-commerce site on the web. They now sell some of their own products, but its start was in books, a product that was the same, regardless of where you purchased the product.
  4. Subscription – Example Netflix
    1. Netflix cracked the code on subscription for consumers. No freemium, just subscribe.
  5. Subscription – Freemium/Premium Example Spotify
    1. Spotify is a great example of free to paid version of subscriptions. The reason freemium subscription isn’t listed in B2B is that, usually, Business customers won’t purchase a de-featured product.
  6. Marketplace – Example eBay
    1. Ah, eBay! You have sellers (they came first) and buyers; they find each other and transact on your website. It’s a brilliant and really hard business – because you have to build both sides of the market at the same time.
  7. Transaction Fees – Example AirBnB
    1. I love AirBnB, they created underutilized inventory – vacant rooms and your house – and made it easy to book and transact over the web. For creating a market, they charge a transaction fee.
  8. Lead Generation – Example Groupon
    1. This one is super close to Mint, listed as B2B above, but the benefit is more tangible to the consumer vs. the business in this circumstance.
  9. Hardware – Example Jawbone
    1. Hardware is the classic example of retail pricing less cost of goods sold. It’s great to see sites like Kickstarter (transaction fee) helping launch more hardware companies by providing pre-paid purchases.
  10. Rental – Example Chegg
    1. Chegg was a great idea of taking something that was ridiculously expensive in the physical (text books) and making them available as a rental.