The AI Advantage: Classic Business Models That Still Dominate

Photo by Andrew Neel on Unsplash

AI simplifies business development, but what type of business model do you want to create, like the internet oriented, direct sales, and others? It is very important. In this tutorial, you can learn about some basic business models that are not as complicated as B2B and B2C but require some understanding to start.

Free model

In this type of business model, you will attract more and more customers to provide products and services, but you only make revenue through advertising or selling added-value services. For example, Google and Facebook offer their services freely, but they make profits by providing additional value to customers.

Direct sales

In this type of business model, you will create a business that establishes a connection with consumers directly. For example, you will provide the subcontract products to the industry or sell your products with word-of-mouth communication. This business is often based on the human workforce and takes a longer time to achieve growth.

Retial chain

In this type of business model, you are replicating one successful business entity in other areas. For example, after successfully developing your brand, replicate or expand the brand to other areas. But before creating new branches, try to learn about the operating risks of new stores.

Capital Power

In this type of business model, you are using your capital to expand the business through financing, mergers, and acquisitions and trying to achieve rapid development and expansion. In this business model, you are always focused on amplifying the profitability and market share of the business entity.

Financial power

Not necessarily; it is the complete business model; it is also the sub-business model. This model requires raising, investing, and managing funds through financial methods to improve business profitability. For example, your business invests a portion of funds to obtain greater returns with smaller capital investments.

Industrial chain

It is similar to the chain business model, but it requires building an ecosystem that covers multiple areas of similar domain. The real advantage of this model is improved competitiveness in a particular industry, creating a monopolized system and being able to control the key resources and market.