What type of revenue model is characterized by earning income from individual transactions?

What type of revenue model is characterized by earning income from individual transactions?

• A. Subscription Model
• B. Transaction Model
• C. Freemium Model
• D. Two-Sided Platform Model

Answer: (B)

The revenue model characterized by earning income from individual transactions is the transaction model. This model is built around the concept of making money directly from the sale of goods or services, where each transaction generates revenue. For example, businesses like e-commerce platforms or retail stores often use this model, as they earn revenue every time a customer makes a purchase. Customers typically pay for a specific service or product each time they engage in a transaction, making it straightforward and easy to measure the revenue based on sales volume. This model is particularly effective for businesses that can scale their operations to handle more transactions as demand increases. In contrast, the subscription model generates revenue through ongoing payments for continued access to a service, while the freemium model offers basic features for free but charges for premium services. The two-sided platform model typically involves revenue earned from two different customer segments, such as buyers and sellers, rather than from individual transactions alone.

The revenue model characterized by earning income from individual transactions is the transaction model. This model is built around the concept of making money directly from the sale of goods or services, where each transaction generates revenue. For example, businesses like e-commerce platforms or retail stores often use this model, as they earn revenue every time a customer makes a purchase.

Customers typically pay for a specific service or product each time they engage in a transaction, making it straightforward and easy to measure the revenue based on sales volume. This model is particularly effective for businesses that can scale their operations to handle more transactions as demand increases.

In contrast, the subscription model generates revenue through ongoing payments for continued access to a service, while the freemium model offers basic features for free but charges for premium services. The two-sided platform model typically involves revenue earned from two different customer segments, such as buyers and sellers, rather than from individual transactions alone.