How Google, Amazon.com and eBay generate their revenues?

Google, Amazon.com and eBay are corporations that well-known of their success of online revenue generation. Let’s take a quick view of their revenue generation model:
Google:

Google is a global technology leader focused on improving the ways people connect with information.

Google generates revenue primarily by delivering relevant, cost-effective online advertising. For the year 2007, Google has generated 16 billion dollars of revenue. It is amazing that 99% of this figure is generated from advertising services given by Google. The balance of 1% is derived from licenses of other products and services such as web search technology and search solutions to enterprises.

Google is adopting an automated online program named AdWords, which enables advertisers to place text-based and display advertisement on its websites. Most of the AdWords customers pay Google on a click-per-click basis. Google has many network members, such as Youtube. 35% of its advertising revenue is derived from its members’ website. For more information, please visit http://investor.google.com/order.html

Amazon.com:

Amazon.com Inc. is an American e-commerce company which is one of the first major companies to sell goods by Internet. Amazon.com started as an online bookstore, but soon diversified to product lines of CD, DVD, mp3, computer software, apparel furniture, toys, etc.

Amazon.com has made revenue of 14 billion dollars for the year 2007. The primary source of revenue is the sale of wide range of products and services to its customers. 55% of the sales derived from North America and the balance are derived from international market. Based on the growth rate of these two primary markets, revenue from international market tends to exceed North America in few years time. For more information, please visit http://phx.corporate-ir.net/phoenix.zhtml?c=97664&p=irol-reportsAnnual

eBay:

Founded in 1995, eBay Inc. connects hundreds of millions of people around the world every day, empowering them to explore new opportunities and innovate together. eBay Inc. does this by providing the Internet platforms of choice for global commerce, payments and communications.

There are 3 primary business segment operated by eBay currently: Marketplaces, Payments and Communications. The marketplaces provide online transaction platform such as eBay.com, Shopping.com, StubHub, Half.com and Rent.com. The payment segment such as PayPal, enables users to securely, easily and quickly send and receive payments online. Lastly, the communication segment, which consists of Skype, enables VoIP calls and provides low-cost connectivity to mobile telephones.

eBay has generated about 7 billion dollars for the year 2007. 96% of the revenues are generated from transaction. The balance of 4% consists of advertising and other income. Marketplaces have generated greatest revenues for eBay while the communications segment is the least. For more information, please visit http://investor.ebay.com/annuals.cfm.

In conclusion, the main difference of these 3 corporations is the way they generate revenues. Google made their revenues mainly from advertisements, while Amazon.com generated from online retailing and eBay's revenues mainly gained from services provided. Print this post