Professional Documents
Culture Documents
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History of e-commerce
Began in 1995 and grew exponentially; still growing at an annual rate of 16% Rapid growth led to market bubble While many companies failed, many survived with soaring revenues E-commerce today is the fastest growing form of retail trade in U.S., Europe, and Asia
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Retail e-commerce revenues have grown exponentially since 1995 and have only recently slowed to a very rapid 16 percent annual increase, which is projected to remain the same until 2010.
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Global reach
The technology reaches across national boundaries, around earth
Universal standards
One set of technology standards: Internet standards
Richness
Supports video, audio, and text messages
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Information density
Vast increases in information density the total amount and quality of information available to all market participants
Personalization/customization
Technology permits modification of messages, goods
Social technology
The technology promotes user content generation and social networking
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The typical distribution channel has several intermediary layers, each of which adds to the final cost of a product, such as a sweater. Removing layers lowers the final cost to the consumer.
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(1/11)
Multichannel store operating both physical stores and an online store E.g., Hyundai department store, Kyobo bookstore Channel conflicts: For multi-channel e-tailers, each channel may have real or perceived differences over incentives, rewards, policies or support can cause serious problems
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(2/11)
(3/11)
What can your company provide that other companies do not or cannot? E.g., freshest food, lowest prices, transaction convenience, personal/customized offerings, best customer services, variety, etc.
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(4/11)
How the firm will earn revenue and produce profits greater than alternative investments
There are many different EC revenue models (can be one or combinations of multiple models)
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(5/11)
A website provides a place for advertisements and receives fees from advertisers (Yahoo, Google)
(6/11)
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(7/11)
What marketspace do you intend to serve, and what is its size? Refers to a companys intended marketspace and revenue potential in each of market niches in which company hopes to compete
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(8/11)
Refers to the other companies selling similar products and operating in the same marketspace Influenced by
How many competitors are active How large their operations are What is the market share for each competitor How profitable these firms are How they price their products
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(9/11)
What special advantages do your firm bring to the marketspace? Capability to create superior values that allow your company to outperform rivals Most competitive advantages are short term
How we sustain the competitive advantages has become an important issue
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(10/11)
How do you plan to promote your products or services to attract your target audience? How do you maximize/sustain your competitive advantages to outperform your rivals over a long time period?
A good market strategy is the major source of firms competitive advantages (Michael Porter)
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(11/11)
What types of organizational structures within the firm are necessary to carry out the business plan? Describes how the company will organize the work that needs to be accomplished
Management team
What kinds of experiences and background are important for the companys leaders to have? Employees of the company responsible for making the business model work
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Understanding these forces can help companies develop their strategies to increase their profitability
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Other strategies
Brand Scale Network effects Switching costs Alliances Patents
Management Information Systems
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(1/6)
Providing digital content, such as digital news, music, photos, or video over the Web
E.g., ESPN, iTunes, WSJ, HBR, etc.
Online syndicators
Aggregate content from multiple sources, package for distribution, and resell to third-party Web sites
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(2/6)
Provide a digital environment where buyers and sellers can meet, search for products, display products, and establish prices for those products
E.g., eBay.com
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(3/6)
Provide Web 2.0 applications such as photo sharing and interactive maps, and services such as data storage
E.g., Google maps, YouTube.com
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(4/6)
Supersite that provides comprehensive entry point for huge array of resources and services on the Internet
E.g., Naver, Google, etc.
Virtual storefront
Sells physical products directly to consumers or to individual businesses
E.g., Amazon.com
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(5/6)
Transaction broker
Saves users money and time by processing online sales transactions and generating a fee for each transaction
E.g., financial services, travel services
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(6/6)
Business-to-business (B2B)
Transactions between business organizations
Consumer-to-consumer (C2C)
A market creates a marketplace where consumers can transact goods directly to others E.g., auction (eBay.com), buy/sell community websites
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(1/3)
Web sites are bountiful source of details about customer behavior, preferences, buying patterns used to tailor promotions, products, services, and pricing Clickstream tracking tools
Collect data on customer activities at Web sites Used to create personalized Web pages
Collaborative filtering
Compares customer data to other customers to make product recommendations
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(2/3)
E-commerce Web sites have tools to track a shoppers every step through an online store. Close examination of customer behavior at a Web site selling womens clothing shows what the store might learn at each step and what actions it could take to increase sales.
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(3/3)
Firms can create unique personalized Web pages that display content or ads for products or services of special interest to individual users, improving the customer experience and creating additional value.
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Mobile Commerce
(1/5)
M-commerce services and applications Although m-commerce represents small fraction of total ecommerce transactions, revenue has been steadily growing
Location-based services Banking and financial services Wireless advertising Games and entertainment
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Mobile Commerce
(2/5)
M-commerce sales represent a small fraction of total ecommerce sales, but that percentage is steadily growing.
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Mobile Commerce
(3/5)
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Mobile Commerce
(4/5)
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Mobile Commerce
(5/5)
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(1/4)
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(2/4)
Uncertainty about product quality can also be a problem for buyers in the online environment
Bidders may not have easy access to information regarding the true quality of the product
(3/4)
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(4/4)
Buyers are willing to compensate reputable sellers with price premiums to assure the safe transactions
<feedback score : 115 : US $ 222.5>
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(1/3)
Not just focusing on the center or the head, but also paying attention to the long tail and the edges
Chris Anderson
The long tail (e.g., Amazon) No more 20/80 rule in the traditional sense Can create revenue from selling low-demand products (traditionally, stores are forced to sell only big hits due to the storage and distribution costs)
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(2/3)
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(3/3)
Chris Anderson claims that the biggest money is in the smallest sales
Wise companies will stop relying on blockbusters and focus on the profits to be made from the long tail (niche offerings)
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