Valuetainment - April 08, 2020


Episode 452： 10 Types Of Business Models For Every Entrepreneur


Episode Stats


Length

4 minutes

Words per minute

177.13153

Word count

804

Sentence count

75


Summary

Summaries generated with gmurro/bart-large-finetuned-filtered-spotify-podcast-summ .

Every business has a different model of how they make money. Today we re going to talk about the 10 different business models of how to build your business around. These are 10 different ways of generating revenue and there are many ways to do it.

Transcript

Transcript generated with Whisper (turbo).
00:00:00.000 Every business has a different model of how they make money.
00:00:25.000 Today we're going to talk about the 10 different business models of how to build your business
00:00:28.480 around.
00:00:28.820 So let's get right into it.
00:00:30.040 These are 10 different business models of how to generate revenue.
00:00:33.920 There's many ways of doing it, but these are 10 different models.
00:00:36.640 The first one is you give the product away for free.
00:00:39.280 A lot of times people wonder, why are they giving away the product for free?
00:00:42.380 Because they make the money on the back end of advertising.
00:00:45.520 Example, YouTube.
00:00:47.140 Many companies do this.
00:00:48.720 This is one of the models.
00:00:49.700 The second model is the freemium model with a pay for upgrade.
00:00:53.020 LinkedIn is free, but if you want to upgrade, you got to go and subscribe to a certain cost
00:00:57.320 that they have, right?
00:00:57.900 It's an upgrade, $24.95, $49.99, $99.95, but you start up as a freemium.
00:01:03.320 So business model number three is pricing based on average value to customer.
00:01:06.660 Meaning, so you got five different customers, right?
00:01:09.820 It may be health insurance.
00:01:11.060 It may be auto insurance.
00:01:12.780 Somebody may be a great driver.
00:01:14.420 They don't have any issues.
00:01:15.240 Somebody may be a terrible driver.
00:01:16.580 They have a lot of issues.
00:01:17.340 They average that out and come out with a price point that's average to the customer.
00:01:21.940 And some may be paying a little bit higher.
00:01:23.640 Some may be paying a little bit less.
00:01:25.400 But it is what it is.
00:01:26.200 Like the health insurance, when it came out recently, they said, well, why am I paying
00:01:29.220 so much insurance?
00:01:30.480 When I'm younger and I'm healthy, I don't have any issues.
00:01:32.540 You're kind of paying for the insurance of the people that are not healthy, but they're
00:01:35.800 getting it.
00:01:36.180 So it's the average cost for the product they're selling.
00:01:39.040 Fourth model is price based on product cost plus margin.
00:01:43.340 This is traditional.
00:01:44.560 You buy these pants for $20, you sell them for $30.
00:01:47.140 You buy this, you know, whatever product you got for $15, you sell it for $40, right?
00:01:51.860 Number five is price with recurring low subscription payment.
00:01:55.600 Hence, Netflix.
00:01:56.780 It's a very common model today.
00:01:59.460 People say Netflix, $799, $999, $1299.
00:02:02.620 That's not a lot of money.
00:02:03.500 Times $150 million customers, it's a lot of money.
00:02:07.260 Number six is very basic.
00:02:08.540 Tier pricing based on volume.
00:02:10.100 So real estate, how much you buy, how much is your volume.
00:02:13.220 The more you buy, the less we charge you.
00:02:15.660 You know, if I'm getting a commission contract with an insurance company, if you sell this
00:02:20.220 much policies, we'll give you this much.
00:02:22.180 But if you sell more, we'll give you more.
00:02:23.460 So it's all volume based.
00:02:25.240 The more you do, the more leverage you have for negotiation.
00:02:27.920 The more you do, the less the cost is going to be to the customer because you're banking
00:02:31.740 on volume.
00:02:32.300 Number seven is revenue.
00:02:33.500 As a percentage of every transaction, commission, okay?
00:02:36.780 That's a commission that they're doing.
00:02:38.180 The revenue comes from a commission base that they're paying out.
00:02:40.820 Number eight, low product price, but support is extra.
00:02:44.180 This is everywhere.
00:02:45.260 The product isn't that much, but you want the extra support?
00:02:48.360 Here's $99 per year or $999, all that stuff additional that they tag on.
00:02:54.040 Number nine, low entry price with priced features additional.
00:02:58.800 So you're buying a car.
00:03:00.220 This car right here, I just bought a car and it's being delivered right now.
00:03:03.500 But if you want to add this, and if you want to add this, and if you get this, it's all
00:03:07.720 the additional add-ons that you have, right?
00:03:09.880 That's the additional add-ons.
00:03:11.060 And last but not least, number 10 is very simple.
00:03:12.960 Low price, but money is made based on disposable.
00:03:15.940 So I sell this razor stick, and I sell it to you for $10, but I know you got to come and
00:03:21.040 buy the razors every time you're done shaving because it goes from green to white.
00:03:24.420 You got to buy it.
00:03:25.360 I'm making my money on disposable.
00:03:27.420 It's a very, very big Procter & Gamble type of a business model, but it's very effective.
00:03:32.360 Again, it's all about how you want to set up your business model to generate revenue.
00:03:36.580 Thanks, everybody, for listening.
00:03:37.800 And by the way, if you haven't already subscribed to Valuetainment on iTunes, please do so.
00:03:42.400 Give us a five-star.
00:03:43.700 Write a review if you haven't already.
00:03:45.300 And if you have any questions for me that you may have, you can always find me on Snapchat,
00:03:49.300 Instagram, Facebook, or YouTube.
00:03:51.260 Just search my name, Patrick Bid David.
00:03:53.180 And I actually do respond back when you snap me or send me a message on Instagram.
00:03:58.000 With that being said, have a great day today.
00:03:59.820 Take care, everybody.
00:04:00.560 Bye-bye.
00:04:02.360 Bye-bye.