Lecture at the Corvinus University of Budapest, at the MSc in Marketing program. Learning outcomes: Conceptualization of e-business models and model variants. Analyzing the recent trends globally and in Hungary. Discussing how business innovations rapidly change the industry setting, either in traditional or in online.

1. Faculty of Business Administration
E-business Models: Trends and Prospects in
Hungary
Online and Digital Marketing
March 6, 2013
Péter Móricz
peter.moricz@uni-corvinus.hu
Institute of Management
Dept. of Management and Control
H-1093 Budapest, Fővám tér 8.; H-1828 Budapest, PO Box 489.
Phone.: (1)4825377, (1)4825263; fax: (1)4825118
Internet: http://mgmt.uni-corvinus.hu

2. Business models reveal the core logic of what,
how and why are we doing
■ Business models are management tools that reveal, as an interconnected
system of elements,
– the policies and choices of the value creation (what to offer? why is it
valuable?) > value proposition model
– the network of the participating actors (forms of cooperation and
governance) > architecture model
– the sources and streams of revenues sustaining the value creation >
revenue model
E-business Models: Trends and Prospects in Hungary
Péter Móricz
2.

3. During the last two decades, the Internet was the
main driver of business model innovation
■ Radically improved and
creative value prop’s
(24/7/365, aggregation,
long tail, customization,
community building,
brokerage etc.)
■ New ways of
combining the roles of
the value creation &
delivery (C2C, web 2.0,
direct-to-customer etc.)
■ Ongoing experimentation with the revenue
flows (affiliate/PPC,
freemium, advertising,
subscription, dynamic
pricing, etc.)
New e-business models triggered fundamental changes in even more industries.
Online business models increasingly challange the industry status quo.
E-business Models: Trends and Prospects in Hungary
Péter Móricz
3.

4. Four fundamental patterns of e-business models
have specific characteristics
PORTALS
MARKETPLACES
SHOPS
UTILITIES
E-business Models: Trends and Prospects in Hungary
Péter Móricz
4.

5. The four fundamental e-business models have
specific ways of sustaining the value proposition
Content
sources
Portal:
content
User
(e.g. visitor)
Subscription,
advertisement
Sellers,
buyers
Marketplace:
participants
Transaction
Commission,
listing fees
Products,
services
Shop:
selection
Customer
Margin,
service fees
Infrastructure,
know-how etc.
Utility:
value-added s.
E-business
participant
Service fees,
price packages
E-business Models: Trends and Prospects in Hungary
Péter Móricz
5.

6. Portals
Main theme
■ Aggregation, rebundling
■ Community building
Model versions
■ Horizontal/vertical portals
(mainstream/longtail)
■ B2C/B2B portals
■ Navigators (search, link catalogs etc.)
■ Web 2.0 (blogs, social network etc.)
■ Mashups
■ Games, entertainment
Revenue streams
■
■
■
■
■
Advertising and promotion
User database yields
Paid premium content or function
Affiliate
Commerce
Trends
■
■
■
■
■
E-business Models: Trends and Prospects in Hungary
Three screens
Web 2.0
Open API
Tablets
Smartphones, location-based services
Péter Móricz
6.

7. Marketplaces
Main theme
■ Many to many
■ Intermediation
Model versions
■ B2B marketplaces (catalogs, auctions,
exchanges; horizontal/vertical)
■ Online malls
■ Price comparison
■ C2C auction, classifieds
■ Group buying, coupons and bonuses,
“name your own price”
■ Public e-procurement and e-auction
Revenue streams
■
■
■
■
■
Commission, PPC
Listing fee, maintenance fee
Extra services (shipment, payment)
Advertisements, highlighted items
Coupon fees
Trends
■
■
■
■
E-business Models: Trends and Prospects in Hungary
Fixed price “auctions”, B2C
Classifieds (C2C)
Coupon sites
First mover lock-in?
Péter Móricz
7.

8. Shops
Main theme
■ E-commerce
■ Online buyer-seller relationship
Revenue streams
■ Margin, sales revenue
■ Subscription fee
■ Cross-selling
Model versions
■
■
■
■
■
■
Classic webshops
Digital delivery webshops
Direct to consumer
Affiliate model
Private shopping clubs
B2B, e-procurement
Trends
■
■
■
■
■
E-business Models: Trends and Prospects in Hungary
From shops to malls
Large players’ plans
Straight-forward ordering methods
Recommendation engines, self-service
Consumer feedback, after-sales services
Péter Móricz
8.

9. Utilities
Main theme
■ Support activities
■ Standardized value creation
■ Know-how and/or economies of scale
Revenue streams
■
■
■
■
Fee based on usage/time
Off-the-shelf packages
Service fees
Commission
Model versions
■
■
■
■
■
■
■
Logistics
Payment
Ad brokerage
Consultancy, SEO
Webdesign, software
Webshop building / hosting
Hosting, ASP, SaaS
Trends
■
■
■
■
E-business Models: Trends and Prospects in Hungary
Delivery tracking
Straight-forward shipping methods
Mobile payment, NFC
Cloud computing
Péter Móricz
9.

10. Summary
■ Content aggregation (portals), market making (marketplaces), online
selling (shops) and related support services (utilities) are the four main
areas of e-business models
■ Unpredictable dynamics: New (?) e-business models emerge rapidly
(coupons) while others unexpectedly decline (e.g. C2C auctions);
■ Competitors are not only those with the same model but also the other ebusiness models (e.g. auction site eBay versus Craigslist classifieds)
■ Successful e-business companies have multiple stakes in different
models and consciously experiment with new models (e.g. Amazon
EC2/S3, Allegroup’s Grando.hu)
■ Extreme technology dynamics calls for continuous innovation and renewal
(e.g. QR codes, tablets, smartphones, NFC, mashups)
■ In Hungary, incumbent companies have their strength in “sense-andrespond” to the local needs (e.g. GRoby), but multinational companies are
about to enter and grab some key positions (e.g. Amazon, Tesco)
■ Global entrants may threaten local companies (e.g. iWiW-Facebook) but
also enlarge the pie by mobilizing new users
E-business Models: Trends and Prospects in Hungary
Péter Móricz
10.

11. Further readings
■ Rappa’s e-business models: http://digitalenterprise.org/models/models.html
■ PhD thesis on Hungarian e-business models: http://phd.lib.uni-corvinus.hu/553/
■ Amazon’s business model evolution:
http://www.slideshare.net/faberNovel/amazoncom-the-hidden-empire
■
■
■
■
■
E-commerce market research worldwide: www.emarketer.com
Online retail in Eastern Europe: http://ystats.com/en/press/release.php?id=182
E-commerce market research in Hungary: http://www.enet.hu/en/
Tesco Home Plus in South Korea: http://www.youtube.com/watch?v=fGaVFRzTTP4
Coop@home Drive-in: https://www.youtube.com/watch?v=QYKI8ZQkhbI
– Auchan Drive [French]: http://www.youtube.com/watch?v=kSdOiuleqAc
■ Amazon Locker [funny!]: https://www.youtube.com/watch?v=hXokiEofKpQ
– Deutsche Post Packstation [German]: http://www.youtube.com/watch?v=HUF3f4tvJnM
E-business Models: Trends and Prospects in Hungary
Péter Móricz
11.

12. Faculty of Business Administration
Business Models’ Basics
Retrospective backup
Institute of Management
Dept. of Management and Control
H-1093 Budapest, Fővám tér 8.; H-1828 Budapest, PO Box 489.
Phone.: (1)4825377, (1)4825263; fax: (1)4825118
Internet: http://mgmt.uni-corvinus.hu

13. Business models à la carte
Value Proposition
Architecture
Revenue Model
■ Low-cost/discount
■ Full service/
aggregation
■ Long-tail
■ Involvement/creation
■ Customization
■ Acceleration
■ Feeling
■ …
■ Vertical integration
■ Integrated
(dominated) supply
chain
■ Value constellations,
partnering
■ Community/selforganized, web 2.0
■ …
■ Cross-subsidies/free:
e.g. advertising,
freemium, donations
■ Pay-per-use: e.g.
commission, service
■ Flat rate: e.g.
subscription
■ Selling: e.g. dynamic
pricing
■ …
E-business framework models: Portals, Marketplaces, Shops, Utilities
E-business Models: Trends and Prospects in Hungary
Péter Móricz
13.

14. Business models: The level of analysis
Strategy
Business model
Business processes
Competition &
differentiation
Value creation as a
system: elements and
connections
Efficient and
effective
implementation
and execution
Reshaped
strategic
environment
New
e-business
models
Enabler of
process
transformation
Internet had a profound effect at each level
E-business Models: Trends and Prospects in Hungary
Péter Móricz
14.

15. Business model representations
1 “Case”
2 “Map”
3 “Simulator”
Type
 Narrative
 Graphic
Focus
 Qualitative
patterns of a
success or
failure story
 Mapping the inter-  Formal model of
action between
the relationship
key elements and
between elements
factors
and factors
Typical
 Recommendations,  Understanding
applications advising
& generalization
Tools
examples
 Case study
 Concept maps,
benchmarking and
value webs
role playing
E-business Models: Trends and Prospects in Hungary
 Formal
 Sensitivity test and
scenario planning
 Spreadsheets
and business
games
Péter Móricz
15.

16. Visualization of business model maps
Map element:
Flexibility
of application:
Mainly factors
Mainly actors
Cause and effect map
Value network map
Business Model
Generation
e3value
Fix specification
Meta-model
(Osterwalder, 2004)
Guideline
Adaptable
Competing Through
Business Models
(Casadesus-Masanell &
Ricart, 2008)
E-business Models: Trends and Prospects in Hungary
(Gordijn & Akkermans,
2001)
E-Business Model
Schematics
(Weill & Vitale, 2001)
Péter Móricz
16.