What are the business models of the Internet

Most of the business models adopted by Internet companies are product matrix, if there is only one product to cut into the market, then there are only two business model choices: one is the product to the user direct charges; the other is to give their own users to play someone else's ads, the product is free.

1. Users pay

The product charges, and then the gross profit is greater than the cost of customer acquisition, which is the most common business model.

In the highly transparent and brutal competitive environment of the Internet, the competition between similar products is free if you can, can not be free to spread the gross profit to the thinnest, than the operational capacity, who has low operating costs who survive.

Operating ability on the one hand embodied in the reduction of customer acquisition costs, on the other hand, embodied in the enhancement of user value, cost-effective products, low pricing, thin profit and more sales.

In the memory of the month, when the old lining of the idol Lei Jun, founder of LeiMei, is the model of the leader, in addition to hardware e-commerce, **** enjoy, travel, group purchasing, takeout, and other products in fact, are this business model.

Lei Mi cell phone:

Early through SNS selling goods to reduce the cost of customer acquisition;

Reduce the cost of hardware through large orders and manufacturers bargaining;

The extreme control of the team's costs, which also includes the extreme of the product design;

Research and development of their own cell phone system, and enhance the value of the user through the cell phone system software product matrix;

R&D and investment in hardware product matrix ecology, again enhance user value.

Under this circumstance, it is impossible to get profit under the premise of the same positioning of other similar products, LeiMi has not only grabbed the market through cost-effective products, but also gained the user's word of mouth, and created this operation mode of fan economy.

At a later stage, Lemi has developed a matrix of products such as charging treasure and smart bracelet. According to the advantages of their own product user acquisition cost of 0, once again using the pricing of the eyeglasses, sweeping away small and medium-sized competitors, at the same time became a huge unicorn in the Internet company, of course, is also a very respectable company.

2. Free for users

The product is free, and sells users' attention to the product to advertisers for profit.

Free users have a value of 0 until a certain base, so the relationship between the number of users and their value is not linear, but inflection point.

When the number of users breaks through a certain inflection point, the value of users rises exponentially, very typical of the Internet product business model. Most of the products under this model are tools and content products, beauty, search, social, portal, communication, video, self media are user free business model.

The user free model mainly acquires users' time and attention. Because the value of users before a certain base is 0, so the product in the inflection point before the customer acquisition costs are generally compressed to the minimum, no or very little marketing budget, more on the product's own ability to obtain traffic.

Kill Time (entertainment time) products, the core is the instinctive emotion of happy satisfaction, beauty, games, social, gossip, video and other products are in this list.

Save Time (work time) products, the core is to correct errors and eliminate redundancy. Products such as search, finance, education, security, healthcare, collaboration, etc. are in this category.

For a long time, when talking to friends in the imperial and magical capitals, Shekuei would skip Guangzhou when talking about the topic of Internet regions.

She couldn't help but shout out and list the great products of Guangzhou Internet: Cool Woof, Dragon Eyes FM, Goose Letter, Twist, etc. Many of these products are also typical cases of user free model, among which she is most familiar with the Goose Letter and Twist.

Relationship chain, early goose letter to meet the acquaintances of the communication, twisted to meet the game team voice collaboration, these strong relationship between the communication needs of the low-cost access to the seed users;

Identity card, goose letter pure real identity settings, twisted symbolic identity settings, in the development period, respectively, the development of these identity settings of the social needs of the low-cost access to the growth of users;

Identity card, goose letter pure real identity settings, twisted symbols identity settings, in the development period of these identity settings under the social needs of the low-cost access to user growth;

Scenario, goose letter semi-public chat environment, the late birth of the circle of friends ads this business model; twisted private chat environment, was also born in the live room to send props business model.

3. Monthly Summary

Kill Time products compete for the length of time users stay, Save Time products compete for user attention.

User free mode products because of access to user time and attention, so inherently have the attribute of traffic distribution, there is the possibility of becoming a traffic entrance, so most of the free products design product matrix, such as Goose letter wallet, XiongDu posting, Apple, Android system within the self-contained application, and so on.

Content products that rely purely on advertising to realize cash can not be separated from the operation of social relations, to fully consider the relationship chain, identity settings and scenarios, such as the fast gathering of twisted netroots, goose letter of the public number.

The user value in the user-pay model is easy to calculate, and you can directly formulate the corresponding budget for customer acquisition costs based on the user value, and the higher the user value, the higher the customer acquisition budget.

User free mode in the user volume of a certain base before the user value is 0, customer acquisition budget is also 0, so the first pre-product-driven to obtain the user volume, to reach the user value inflection point, and then into the paid mode of the user value of the budget.