The e-commerce industry has been in business since 1979 but is at its peak now more than ever. From telephone lines to websites and mobile apps, e-commerce has evolved big time, and there’s still room for development.
As per the latest research by Statista, the now $5.7 trillion industry is expected to reach a whopping $6.51 trillion in 2023.
So how to get your share in this field full of giant enterprises? Simply by choosing the suitable business model.
This article will unfold the top 6 e-commerce business models that are bound to boom in 2023.
Stick to the end, and you’ll find a few tips for selecting a suitable business model.
Types of Ecommerce Models Suitable for 2023:
- Dropshipping (Ebay Marketplace)
If you’re hesitant about starting your venture, start with dropshipping, as it relieves you from certain entrepreneurial activities like warehousing and transportation.
Oberlo suggests that, the dropshipping industry is predicted to boost its worth to $243 billion in 2023.
In dropshipping, you only have to manufacture the product. You can start slow by starting an Etsy shop for a mediocre Etsy seller fee.
The additional amount you’ll save from transportation and retailing can be invested in marketing the products.
Ebay is another great dropshipping platform to market your products to over 135 million Ebay users. It is more advantageous than other dropshipping platforms due to its high sales profitability and user-friendly approach. Plus, you can list up to 150 products for free every month.
Dropshipping is a convenient business model because it requires low investments and offers diverse options.
The only downside of dropshipping as of now is its high competition and saturated market.
- Content generation/marketing
Content-based agencies are undoubtedly flourishing due to their rapidly growing demand.
Be it for blog-writing, copywriting, or YouTube script-writing, content-based agencies are making big bucks, and so can you.
Content generation might be the right business model if you’re passionate about writing and like to play with words.
Marketing is also not hard if you know the basics and have the will to learn.
The main benefit of the content generation or marketing industry is automation since it requires zero investment.
However, it requires top-level creativity, skills, and execution of complex strategies that are most time-consuming.
- Ecommerce/M-commerce store
Online shopping has become increasingly popular over the decade, which is the main reason for the rapid e-commerce growth globally.
Data indicates that m-commerce is expected to increase its total retail sales by 69.9%.
The convenient nature of online businesses is another reason that motivates people to launch a product on a website.
However, selling a product online is not a piece of cake. It requires marketing and lead generation through SEO and running ads on various social media platforms.
You can also sell on Amazon at a mediocre fee or on ebay to skip certain managerial costs.
If you’re worried about the Ebay seller fees or what percentage does Ebay take, loosen up because it’s recoverable through a few sales.
These business platforms are often confused with dropshipping-only platforms when individual e-commerce stores and drop-shippers can use them.
We recommend this business model mainly because it requires little yet consistent involvement. That being said, the profit margins are low and high capital is required depending on the product.
- Audio/video content
The entertainment and media market has always been in demand, but the rise in technology has increased its worth a hundred times.
People enjoy audio and video content like vlogs, tutorials, and podcasts because of entertainment and educational purposes.
The podcast industry is expected to cross $2 billion in 2023.
Other ways of content creation include YouTube shorts that have earned up to $100 Million for creators from 2021 to 2022.
Like other e-commerce business models, the audio/video content industry emphasizes building a brand, customer loyalty, and platform monetization.
This business model is a ten-on-ten as it opens pathways to bigger passive income streams and opportunities, apart from building goodwill.
The only con of this business is its hard-to-achieve and high conversion rates.
- Affiliate marketing
Affiliate marketing is a great way to earn passive income with little investment. It is a profitable business model expected to increase its value twice.
With the rise in e-commerce stores, people prefer searching for honest product reviews before buying the products, fostering the affiliate marketing business.
Starting the business is pretty easy if you’ve already selected a niche.
All you have to invest in is the domain and hosting of the website and development costs. You can promote a product or brand on your site with extensive online market research and earn lifetime commissions.
The affiliate marketing business can be scaled up, which makes it visually attractive.
People usually don’t prefer affiliate marketing because of the unavailability or high competition in specific niches.
The print-on-demand business model is another steady stream that can earn you a decent passive income.
This industry features a humongous market size estimated to be $6.17 billion and is expected to grow by 26.1%.
The digital product business allows you to customize white-label products like t-shirts and tumblers with vibrant graphics and memes.
You can sign up on print-on-demand platforms like Printify and Printful and upload designs to your store.
The platforms offer various custom products and shipping options to choose from.
This business model has a lot of room for creativity and is preferred by people mainly because it is outsourceable at affordable rates.
However, the high competition and unreliable product quality can often result in low-profit margins.
Tips on Selecting an E-commerce Model:
Finding it hard to select one Ecommerce business model? Head below to get some tips on selection and fasten up the process:
- Start simple and slow if you’re a newcomer.
- Analyze the managerial costs and capital to get a rough idea of the expenses.
- Select a digital product to avoid expenses on warehousing and manufacturing.
- Choose an income stream that drives you both active and passive incomes.
- Invest your time and effort in multi-channel selling.
- Conduct intensive market research to learn about the drawbacks of the industry.
- Get in touch with people already in the field to gain first-hand knowledge.
- Lastly, follow your passion and don’t jump on the bandwagon.
The above-mentioned e-commerce business models can earn you great amounts of active and passive income.
Although these businesses require the same effort as your regular non-tech jobs, they’re more flexible.
The important part is choosing the right business model that suits your skills and expertise, so select the business model wisely.