Business models

Internet marketing is associated with several business models:

  • E-commerce: a model whereby goods are sold directly to consumers , businesses , or from consumer to consumer .
  • Lead-based websites: a strategy whereby an organization generates value by acquiring sales leads from its website.
  • Affiliate Marketing: a process wherein a product or service developed by one entity is sold by other active sellers for a share of profits. The entity that owns the product may provide some marketing material (e.g., sales letters, affiliate links, tracking facilities, etc.); however, the vast majority of affiliate marketing relationships come from e-commerce businesses that offer affiliate programs.
  • Local Internet marketing: a strategy through which a small company utilizes the Internet to find and to nurture relationships that can be used for real-world advantages. Local Internet marketing uses tools such as social media marketing, local directory listing, and targeted online sales promotions.

 One-to-one approach

In a one-to-one approach, marketers target a user browsing the Internet alone and so that the marketers' messages reach the user personally. This approach is used in search marketing, for which the advertisements are based on search engine keywords entered by the users. This approach usually works under the pay per click (PPC) method.[citation needed]

 Appeal to specific interests

When appealing to specific interests, marketers place an emphasis on appealing to a specific behavior or interest, rather than reaching out to a broadly defined demographic.  These marketers typically segment their markets according to age group, gender, geography, and other general factors.

 Niche Marketing

Niche and hyper-niche internet marketing put further emphasis on creating destinations for web users and consumers on specific topics and products. Niche marketers differ from traditional Internet marketers as they have a more specialized topic knowledge. For example, whereas in traditional Internet marketing a website would be created and promoted on a high-level topic such as kitchen appliances, niche marketing would focus on more specific topics such as 4-slice toasters.

Niche marketing provides end users of such sites very targeted information, and allows the creators to establish themselves as authorities on the topic or product.

 Geo-targeting

In Internet marketing, geo targeting and geo marketing are the methods of determining the geolocation of a website visitor with geolocation software, and delivering different content to that visitor based on his or her location, such as latitude and longitude, country, region or state, city, metro code or zip code, organization, Internet Protocol (IP) address, ISP, and other criteria.[citation needed]

 Advantages and Limitations of Internet marketing

 Advantages

Internet marketing is inexpensive when examining the ratio of cost to the reach of the target audience. Companies can reach a wide audience for a small fraction of traditional advertising budgets. The nature of the medium allows consumers to research and to purchase products and services conveniently. Therefore, businesses have the advantage of appealing to consumers in a medium that can bring results quickly. The strategy and overall effectiveness of marketing campaigns depend on business goals and cost-volume-profit (CVP) analysis.

Internet marketers also have the advantage of measuring statistics easily and inexpensively; almost all aspects of an Internet marketing campaign can be traced, measured, and tested.[citation needed] The advertisers can use a variety of methods, such as pay per impression, pay per click, pay per play, and pay per action. Therefore, marketers can determine which messages or offerings are more appealing to the audience.[citation needed] The results of campaigns can be measured and tracked immediately because online marketing initiatives usually require users to click on an advertisement, to visit a website, and to perform a targeted action

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