Revenue Models: The following are the common models used to generate revenue in collaborative-based networks and marketplaces.
Service fees: A company takes a percentage of the total transaction for successfully matching two sides of marketplace (e.g. hosts and guests, buyers and sellers, drivers and passengers).
Flat membership/subscription: A company charges a flat monthly or annual membership fee regardless of usage.
Tiered subscription: A company offers a range of subscription plans at different price points based on frequency of use or number of goods desired.
Membership plus usage: A company charges a one-off or annual membership fee (sometimes with different plans offered based on frequency of use). Additional fees are charged based on usage.
White label: A company creates a back-end platform that can be licensed and branded by other companies.
Freemium: A company offers basic services or use of the platform/app for free. Users then ‘trade up’ for additional benefits and exclusive features.
This post is an excerpt from Rachel Botsman’s recent post on Medium, “The Sharing Economy: Dictionary of Commonly Used Terms”. For more detail about revenue models, please view our deck on Slideshare.