QUESTION NO.

During the early days of e-commerce, first mover advantage was known to be one way to achieve
success. On the other hand, some suggest that being a market follower can yield rewards as well. Which
approach has proven to be more successful first mover or follower? Choose two e-commerce companies
that prove your point, and prepare a research report (3 pages) to explain your analysis and position.

First-mover advantage (FMA) is the advantage gained by the initial major occupant of a market segment.
This advantage comes from the fact that the first one to get to that market segment can gain control of
the resources that the followers may not be able to match. However, the first mover is not able to
capitalize on its advantage and leaves the opportunity wide open for another player to gain the second-
mover advantage. “Originally made apparent by the ever booming Internet phenomenon, it has recently
been on the decline due to the recent economic downturn. It is important to note that the first-mover
advantage refers to the first significant company to move into a market, not necessarily the first
company. In order for a company to try and become a first-mover that company needs to figure out if
the overall rewards outweigh the beginning/underlying risks. Sometimes first-movers are rewarded with
huge profit margins and a monopoly-like status. Other times the first-mover is not able to capitalize on
its advantage, leaving the opportunity for other firms to compete effectively and efficiently versus their
earlier entrants. These individuals then gain a “second-mover advantage”. (First Mover Advantage.
http://en.wikipedia.org/wiki/First-mover_advantage , retrieved 5 April, 2011.)

First-mover advantage can arise from three primary sources- Technological leadership, Preemption of
scarce assets, and Switching costs and buyer choice under uncertainty. A company can gain FMA when it
has an upper-handed breakthrough in its research and development (R&D). Though starters in an FMA
market have complete control for a period of time, there is competition that competes to reach the
originators. First-movers will usually sell their products below cost in an effort to gain better
understanding of the market. Then they will turn the market around and control the markets cost. This
however reduces the company’s profitability but is quite necessary for breaking into new markets.

A market follower on the other hand is a company which is satisfied to follow the leaders in a market
place without challenging them. They usually take advantage of the opportunities created by the leaders
without the need for much marketing investments of their own. “Market followers tend to constitute
the majority of firms in a market albeit that their collective share may only account for 20-30 per cent of
total sales. While no market follower is likely to challenge the leader or its immediate competitors this is
not to say that they do not indulge in very active competition between themselves. Denied the
ECONOMIES OF SCALE which accrue to the larger firms the followers have to be particularly efficient in
their marketing and service policies if they are to survive and many of them choose to develop a
concentrated or market niche strategy. (Market Follower Strategy.
http://www.westburnpublishers.com/marketing-dictionary/m/market-follower-strategy.aspx , retrieved
5 April, 2011.)”
Amazon.com is an example of an FMA. They went online on the WWW in July 1995. They acquired IPO
in May 1997. The company’s stated strategy is “focus on the customer experience by offering (their)
customers low prices, convenience, and a wide selection of merchandise”. What began as a purely
online book retailer, Amazon.com expanded its product and service offerings. By 1999 new business
models were introduced, web hosting and fulfillment service partnerships with the traditional retailer
and consumer portals followed in 2000. Despite rapid growth of revenues (up from 15.7M USD in 1996
to 6.9B USD at the end of 2004), Amazon generated operating losses (1.4B USD net in 2000) and only
reached profitability in 2003. Since 2000, Amazon is the largest Internet retailer, reporting a customer
base of more than 27M active accounts by 2002. (Strategies to Achieve Market Leadership: The example
Amazon.com. https://docs.google.com/viewer?url=http%3A%2F%2Fpreibusch.de%2Fdocuments
%2FPreibuschS_FleckensteinM_Amazon.pdf , retrieved 5 April, 2011. 10-12.)

“Enter Barnes and Noble. B&N operated its stores as superstores (covering 6000m2 and stocking up to
175.000 titles) and mall-based stores (smaller in size and selection), but also offered mail-ordering
through catalogue services. B&N had a centralized logistics and distribution centre and could thus
leverage scale economies in procurement by sourcing books directly from publishers, obtaining higher
discounts than other book retailers, and avoiding high mark-ups from wholesalers. Due to centralized
stock, books could be shipped to the points of sale within a few days, avoiding delivery delays from
publishers. B&N installed an electronic store (management) system, enabling real time information
exchange among its stores, the distribution centre and wholesalers with access to a 2.5M title database,
though not accessible for customers.

Amazon redefined traditional book retailing through a radically different approach: online, over the
Internet. Traditional book retailing has several drawbacks. The selection of titles is physically limited by
available store space. Traditional retailers must invest in inventory, real estate and qualified personnel for
each retail location and it is impossible to provide “a customized store for every customer or to provide
customized recommendations without significantly increasing selling costs.” Internet retailers have the
advantages of centralized inventory management and low occupancy costs. A large and global group of
customers can be reached from a single central location, making the business model very scalable. It is
possible to track consumer purchasing patterns in order to better anticipate demand and to provide
personalized services such as customized store fronts. (Strategies to Achieve Market Leadership: The
example Amazon.com. https://docs.google.com/viewer?url=http%3A%2F%2Fpreibusch.de
%2Fdocuments%2FPreibuschS_FleckensteinM_Amazon.pdf , retrieved 5 April, 2011. 11-12.)”

“In this case, FMA Amazon has pioneered proprietary technologies for its web site management, search,
customer interaction, recommendation, transaction processing and fulfillment services and systems.
Amazon patented its 1-Click technology, as well as its Bid-Click auction bidding process, and in 2000 was
also granted a patent on its Amazon Associates Program and on its book recommendation service Book
Matcher, which generates automatic recommendations based on customer purchases. Amazon licenses
components of its EC platform to third party sellers and hosts third-party sellers’ websites providing its
shopping technology. Amazon realized a FMA with the concept of syndicated selling through its
Associates and Syndicated Stores programs. The members of the Associates Network, including Internet
companies such as AOL.com, Yahoo, Netscape, Excite and the AltaVista Search Service, recommend
Amazon products to their own visitors and earn a referral fee and a commission in case of completed
purchases. Amazon participates in cooperative advertising arrangements with some of its vendors, and
with other third parties. However, Amazon has not yet succeeded in the most difficult matter of course
in strategic planning: its Operating Efficiency is still low, overcapacities in operations and fulfillment
overshadow its business perspectives, and losses accumulated over years are a burden for the future.
((Strategies to Achieve Market Leadership: The example Amazon.com. https://docs.google.com/viewer?
url=http%3A%2F%2Fpreibusch.de%2Fdocuments%2FPreibuschS_FleckensteinM_

AMAZON
Amazon undoubtedly reaped first mover advantages in e-commerce. Amazon continues to steal market
share from traditional retailers year after year. Many in the logistics and financial industries have noted
with wonder that Amazon is not expected to be profitable. Financial analysts seem to reward them as a
first mover that has created the kind of scale and network and technology platform that will create huge
profits whenever Amazon decides to scale back the aggressive pace at which they make capital
investments.

In recent years we have seen Amazon make giant investments in logistics assets. Are those investments
aimed at making their traditional business more “profitable” or are they designed to turn Amazon into a
leading logistics company? According to Jeff Bezos, who spoke at a technology conference last week,
Amazon isn’t aiming to take over the last mile of delivery from UPS, FedEx, or the U.S. Postal Service. The
goal is to “supplement it heavily,” to support peak season fulfillment.

Should teke Mr. Bezos at his word? If we didn’t know this already, one thing we’ve learned this election
cycle is that CEOs (or politicians for that matter) don’t always speak the truth.

Does Amazon intend to compete as a last mile carrier?

Amazon launched an air cargo network from an air hub in Wilmington, Ohio that used to be the hub for
DHL parcel before DHL exited the U.S. market.

It became public in December that Amazon had purchased thousands of 53 foot trailers.

The company is leasing 20 Boeing 767s at a cost of about $300,000 per month.

The sortation centers and the domestic transportation assets can help Amazon reduce its shipping
losses, which are huge. Amazon reported $11 billion in shipping costs, but only garnered 6 and a half
billion dollars in shipping fees from customers. In terms of their shipping costs, analysts from Cowen &
Company estimate half of those costs are paid to UPS and FedEx. Amazon is creating its own hub and
spoke parcel network to defer those costs.

When UPS and FedEx are used, their rules require a customer signature before packages can be
delivered. This results in large numbers of failed deliveries, which are hugely expensive. Further, UPS and
FedEx sortation centers tend to be located further outside of metro areas than the new Amazon
fulfillment centers, which also increases costs.
Amazon’s investments in sortation centers, a hub and spoke plane network, and the enablement of long
haul shipments between consolidation centers creates a miniature parcel network for the giant retailer.
But this parcel network is nowhere close to the scale necessary to compete with FedEx or UPS. Finally, in
the 2013 holiday season there were widespread reports of delivery failures. Beginning to build their own
parcel network puts more control in Amazon’s own hands.

This should also make investors happy. Cowen & Company believes it would cost at least $20 billion to
compete with a FedEx or UPS in last mile.

OK, so we should probably take Bezos at his word that he does not intend to compete in the last mile
game. But what about as a 3PL providing warehousing and fulfillment services? Let’s review Amazon’s
warehousing investments:

In 2009 Amazon had about 30 global fulfillment centers, they built over 100 more by the end of 2015.
The company now has 125 million square feet of global warehousing.

Amazon has made huge investments in automation. The company spent $775 million to acquire Kiva
Robots in 2012, now called Amazon Robotics. Amazon then sucked up all the production internally;
Amazon has 30,000 of these robots in their fulfillment centers. They also have more traditional
stationary robots for loading cases onto conveyors. And miles of conveyors in each fulfillment center.

While 90 percent of warehousing space is in their fulfillment centers, about 10 percent is in sortation
centers and small metropolitan warehouses. There was one sortation center in 2013, by the end of the
year there will be 23 accounting for 8 million square feet. Sortation centers don’t store inventory. Rather
goods come in, are sorted by zip code, and then go out the same day. Similarly, Amazon had 7 small
format warehouse in North America in 2013.

Is Amazon looking to compete with leading 3PLs? Well in a sense they already are. The company offers a
service called Fulfillment by Amazon. However, this segment is small enough that it fits in the “Other”
category in their financial reports. That makes the revenues of Fulfillment by Amazon $1 billion at most
(and probably significantly smaller than that) last year out of total revenues of over $107 billion.

It is probable that the warehouse investments have little to do with a push into logistics and everything
to do with growth. The rule of thumb is that ecommerce warehouses require three times more square
feet to do the same volume of shipments as a traditional warehouses, so it’s not surprising that most of
Amazon’s giant fulfillment centers are larger than a million square feet. Further, according to John
Blackledge, an investment analyst at Cowen & Company, it takes three years for an Amazon warehouse
to reach peak output.

Let’s take a quick look at their growth. From 2009 to 2015 they grew from $13 billion to $107 billion, a
factor of 13. But the number of large warehouses increased only by a factor of four. It appears the large
investment in Kiva has paid off. The increased productivity of their mega warehouses is amazing.

The large warehouse investments were needed largely to support growth, but partially to support
improved service levels. In contrast, investments in smaller warehouses – Prime Now Warehouses – are
all about improved service. These warehouses are being used to support quicker deliveries to Amazon
customers. Prime Now is a service for Amazon Prime members that allows for one hour deliveries of
daily essentials using a mobile app in select metro regions. Such quick deliveries would not be possible
without inner city warehousing.

Finally, Amazon is dipping its toes into international freight brokerage. But without going into too much
analysis, this also from our point of view is aimed at reducing costs of bringing goods over from Asia that
they intend to sell on their web site, not at making them a competitor to the freight forwarding industry.

In conclusion, while Amazons investments in logistics assets have stoked fears among 3PLs and carriers
that they may be seeking to compete with them, this seems unlikely. That does not mean Amazon is not
affecting the logistics industry. There are certainly reports that Amazon is driving up wages for
warehouse workers in the markets where they build warehouses; and bringing parcel shipping in-house
will effect last mile carriers’ revenues to a certain degree (but less than you might think). But for now it is
really brick and mortar retailers who continue to have the most to fear from Amazon’s ongoing logistics
investments.

ALI BABA
Alibaba Group Holding has laid out its development roadmap for frontier technologies, including
quantum computing and AI chips.

Alibaba DAMO Academy, a global initiative by Alibaba to lead technology and science research, unveiled
plans to develop disruptive technologies over the next five years. The technologies are developed to
support the firm’s cloud and Internet of Things (IoT) businesses, as well as to explore new commercial
applications in various industries - from logistics, materials to pharmaceuticals - that require greater
computing power to achieve technology breakthroughs.

“Alibaba has been a leading technology innovator in cloud computing and artificial intelligence since we
announced our determination to transform into a technology powerhouse two years ago,” said Jeff
Zhang, CTO, Alibaba Group.

“The establishment of Alibaba DAMO Academy and its achievements over the past year underlies our
strong commitment to technology leadership. Moving ahead, we are confident that our advantages in
algorithm, data intelligence, computing power and domain knowledge on the back of Alibaba’s diverse
ecosystem will put us at a unique position to lead real technology breakthroughs in disruptive areas,
such as quantum and chip technology.”

Quantum computing

In quantum computing, the academy has embarked on developing its own quantum processors.
Quantum computing represents an exponential increase in computing power as the basic unit of
computing, the qubit, can theoretically store much more information than the bit, which is the basic unit
of computing in use today.
The Hangzhou, China-based quantum hardware team is developing high-precision, multiple-qubit
superconducting quantum processors. In the meantime, the academy will continue its efforts in driving
quantum development. This includes building cloud-accessed, quantum-classical heterogenous systems
for delivering quantum computing power as a utility, and searching for super-fast quantum-classical
hybrid algorithms to solve fundamental problems in machine learning, optimisation, and physics
simulations. The expansion to hardware reflects the academy’s conviction that the co-development of
hardware and application will expedite the realisation of quantum computing’s revolutionary potential.

In addition, the academy will nurture and expand its network of partnerships to explore quantum-
enhanced solutions for industries such as e-commerce, logistics, finance, materials and pharmaceuticals.

Chip technology

The academy plans to launch its first self-developed AI inference chip — the AliNPU — in 2H19. This chip
could potentially be used for autonomous driving, smart cities and smart logistics applications. The
Academy will also boost research and development in AI chips for training on the cloud and for Internet
of Things (IoT) applications. The goal is to build robust, cloud-based IoT infrastructure, providing
computational power for the company’s data centres, as well as advancing IoT businesses ranging from
smart homes to smart logistics.

During the conference, Alibaba also announced the establishment of a chip company, a subsidiary under
Alibaba Group that will focus on customised AI chips and embedded processors to further support
Alibaba’s growing cloud and IoT businesses as well as to provide intelligent solutions for different
industries.

“Alibaba has been a leading technology innovator in cloud computing and artificial intelligence since we
announced our determination to transform into a technology powerhouse two years ago,” said Zhang.
“The establishment of Alibaba DAMO Academy and its achievements over the past year underlies our
strong commitment to technology leadership. Moving ahead, we are confident that our advantages in
algorithm, data intelligence, computing power and domain knowledge on the back of Alibaba’s diverse
ecosystem will put us at a unique position to lead real technology breakthroughs in disruptive areas,
such as quantum and chip technology.”

Alibaba DAMO Academy has over 300 researchers worldwide focusing on five major areas including
machine intelligence, robotics, fintech, data computing and quantum computing. Global partners of the
academy include the University of California, Berkeley and Stanford University in the US; Nanyang
Technological University in Singapore, and in China, Tsinghua University, Zhejiang University and The
Chinese Academy of Sciences.

In the past year, the Academy released Taizhang, a quantum-circuit simulator leveraging Alibaba’s
powerful classical computing infrastructure, which has successfully simulated a significantly more
complicated family of quantum circuits than previously achieved. The milestone was an important step
in the field and has raised new discussions around defining the boundaries of where a quantum-
computing device may be considered exceeding the capacity of all classical computers. An extended
version of Taizhang will soon be released as a tool for both hardware and application development.

The Academy further programmed an ultra-low latency and high performance deep learning processor
(DLP) on a field-programmable gate array (FPGA) in an effort to balance the low latency and high
performance requirements for tasks such as image recognition and analysis.

Alibaba additionally announced the Alibaba Global Mathematics Competition, a global math competition
to discover and nurture next-generation math geniuses and raise awareness about the importance of the
subject. Mathematicians, including Yurii Nesterov, Professor at Catholic University of Louvain, Belgium;
Frank Kelly, Professor at the University of Cambridge in the UK; Gang Tian, Distinguished Professor at
Peking University in China; Jianshu Li, Chair Professor at The Hong Kong University of Science and
Technology; and Yitang Zhang, Professor at the University of California, Santa Barbara in the US will
mentor select students from the competition

ebay
More than 11 years have passed since author Adam Cohen published his insider's chronicle of eBay,
called "The Perfect Store."

EBay (EBAY) earned that lofty title because it offered a way for folks to buy and sell items via an easy-to-
use online auction system. Its auction website could be tapped to sell everything from bric-a-brac and
old records to Cadillacs and $40,000 computer servers.

Founded in 1995, at the dawn of the dot-com era, eBay enjoyed a first-mover edge in Internet auctions.
It quickly proved that buying and selling online could be a mass market. EBay's success was copied by
others, who launched online stock trading and business-to-business trading networks.

"EBay's first-mover advantage played a tremendous role in the company's early success," Jason Moser,
an analyst for the Motley Fool financial website, told IBD. "The biggest hurdle companies had to
overcome in the beginning of the dot-com era was convincing people that their platforms actually
worked. Today the assumption is that they will, of course, but back then there were a lot of unanswered
questions, particularly around payments, security and functionality.

"EBay very quickly established itself as the name consumers were familiar with and trusted, which put
the company miles ahead of its competition."

10-Year Run For Ex-CEO

EBay's rise was led by founder Pierre Omidyar, a French-born Iranian-American computer programmer,
and Meg Whitman, its first CEO. Whitman, a former Walt Disney Co. (DIS), Dreamworks, Procter &
Gamble (PG) and Hasbro (HAS) executive, became eBay's CEO in 1998. At the time, eBay had 30
employees.

Whitman guided eBay until March 2008, when she resigned and was replaced by current CEO John
Donahoe.
In 2002, eBay was the most visited e-commerce website, with 1.6 million daily visitors and 20 million
registered users, mostly in the U.S. More than 75,000 Americans made their living selling goods on eBay,
according to the company.

By the end of 2013, the San Jose, Calif.-based company had 128 million registered users. Tracker
comScore says eBay had 61.5 million desktop visitors in the U.S. in February alone. EBay says more than
500 million items are listed for sale on its website.

The company, though, executed a strategic pivot starting in 2002, thrusting into online payments, e-
tailing and mobile e-commerce. This has offset slowing growth in eBay's flagship Marketplaces business,
which includes a now mature auction business.

PayPal, a hot payments startup that eBay acquired for $1.5 billion in 2002, has played a key role in this
evolution. It provided a fast-growing cash cow and began to overtake auctions as the company's chief
growth engine after 2003. PayPal is the No. 1 online payments provider. It operates in 193 markets and
has 143 million active, registered accounts worldwide.

PayPal's leap energized eBay stock during its 355% run-up from mid-2002 to the end of 2004. (This
followed a 2,900% surge from its September 1998 IPO until the March 2000 peak of the dot-com
bubble.) The payments unit's performance also powered the stock's nearly 500% rise from March 2009
to Feb. 28, when it touched its all-time high of 59.70.

"One of the biggest question marks in the early days of e-commerce revolved around payments and
whether consumers would actually make that leap," Moser said. "The advent of PayPal and its early
success on eBay's platform was what drove the eBay acquisition of the company. And because PayPal
was a proven e-commerce payments platform, at that point I think investors saw that as a tremendous
driver of future growth for eBay. That enthusiasm certainly played out on eBay's stock price in a good
way."

EBay and PayPal work hand in hand and that's been "instrumental in the evolution and turnaround of
eBay," eBay CFO Bob Swan told IBD in an email interview.

Swan, 53, joined eBay as CFO in March 2006. He's been with Electronic Data Systems (EDS), TRW,
Webvan and General Electric (GE).

"As part of eBay Inc., PayPal is able to leverage the company's technology capabilities, commerce
platforms and relationships with retailers, brands and large merchants worldwide," Swan said. "Payment
is part of commerce; and, as part of eBay, PayPal drives commerce innovation in payments at global
scale, creating value for consumers, merchants and shareholders."

The auction king has pushed into the e-tail platform provider business through its acquisition of GSI
Commerce in 2011 and by expanding into offline payments and mobile e-commerce.

"We've continued to stay focused on driving significant growth and profitability," Swan said. "And we've
delivered significant shareholder value as (eBay's share price) has risen more than 440% in the past five
years, outpacing the S&P and Nasdaq."

But at times, the stock has lagged. S&P Capital IQ equity analyst Scott Kessler says the stock
underperforms benchmarks like the S&P 500 and Internet peers in many three-year, one-year and year-
to-date marks.

Marketplaces Rebound

From the bursting of the dot-com bubble in March 2000 through 2009, sales growth slowed for its
Marketplaces business. But Marketplaces has rebounded since then as eBay retooled its auction and
other offerings and made them more attractive to users.

"I think that (rebound) surprised a lot of people, and eBay's management team should be credited for
that," S&P's Kessler said.Swan says eBay's future is bright.

"We have an enormous opportunity ahead of us as we compete in the $10 trillion commerce market,"
Swan told IBD. "For retailers and brands, Web-enabled commerce is an area of focus as they're looking
for ways to expand and provide better omnichannel solutions to customers. At eBay Inc., it's our job to
help connect retailers with technology solutions that will allow them to better compete and win for
customers."

QUESTION NO. 3

What Is Business-to-Consumer (B2C)?

The term business-to-consumer (B2C) refers to the process of selling products and services directly
between a business and consumers who are the end-users of its products or services. Most companies
that sell directly to consumers can be referred to as B2C companies.

B2C became immensely popular during the dotcom boom of the late 1990s when it was mainly used to
refer to online retailers who sold products and services to consumers through the Internet.

As a business model, business-to-consumer differs significantly from the business-to-business model,

which refers to commerce between two or more businesses.

KEY TAKEAWAYS

Business-to-consumer refers to the process of businesses selling products and services directly to
consumers, with no middleman.

B2C is typically used to refer to online retailers who sell products and services to consumers through the
Internet.Online B2C became a threat to traditional retailers, who profited from adding a markup to the
price.However, companies like Amazon, eBay, and Priceline have thrived, ultimately becoming industry
disruptors.
Understanding Business-to-Consumer

Business-to-consumer (B2C) is among the most popular and widely known of sales models. The idea of
B2C was first utilized by Michael Aldrich in 1979, who used television as the prmiary medium to reach
out to consumers.

B2C traditionally referred to mall shopping, eating out at restaurants, pay-per-view movies, and
infomercials. However, the rise of the Internet created a whole new B2C business channel in the form of
e-commerce, or selling goods and services over the Internet.

Although many B2C companies fell victim to the subsequent dot-com bust as investor interest in the
sector dwindled and venture capital funding dried up, B2C leaders such as Amazon and Priceline
survived the shakeout and have since seen great success.

Any business that relies on B2C sales must maintain good relations with their customers to ensure they
return. Unlike business-to-business (B2B), whose marketing campaigns are geared to demonstrate the
value of a product or service, companies that rely on B2C must elicit an emotional response to their
marketing in their customers.

Business-to-Consumer

B2C Storefronts Vs. Internet Retailers

Traditionally, many manufacturers sold their products to retailers with physical locations. Retailers made
profits on the markup they added to the price paid to the manufacturer. But that changed once the
Internet came. New businesses arose that promised to sell directly to the consumer, thus cutting out the
middleman—the retailer—and lowering prices. During the bust of the dotcom boom in the 1990s,
businesses fought to secure a web presence. Many reteilers were forced to shutter their doors and went
out of business.

Decades after the dotcom revolution, B2C companies with a web presence are continuing to dominate
over their traditional brick-and-mortar competitors. Companies such as Amazon, Priceline, and eBay are
survivors of the early dot com boom. They have gone on to expand upon Their early success to become
industry disruptors.

Online B2C can be broken down into 5 categories: direct sellers, online intermediaries, advertising-based
B2C, community-based, and fee-based.

B2C in the Digital World

There are typically five types of online B2C business models that most companies use online to target
consumers.

1. Direct sellers. This is the most common model, in which people buy goods from online retailers. These
may include manufacturers or small businesses, or simply online versions of department stores that sell
products from different manufacturers.
2. Online intermediaries. These are liaisons or go-betweens who don’t actually own products or services
that put buyers and sellers together. Sites like Expedia, Trivago, and Etsy fall into this category.

3. Advertising-based B2C. This model uses free content to get visitors to a website. Those visitors, in
turn, come across digital or online ads. Basically, large volumes of web traffic are used to sell advertising,
which sells goods and services. Media sites like the Huffington Post, a high-traffic site that mixes in
advertising with its native content is one example.

4. Community-based. Sites like Facebook, which builds online communities based on shared interests,
help marketers and advertisers promote their products directly to consumers. Websites will target ads
based on users’ demographics and geographical location.

5. Fee-based. Direct-to-consumer sites like Netflix charge a fee so consumers can access their content.
The site may also offer free, but limited, content while charging for most of it. The New York Times and
other large newspapers often use a fee-based B2C business model.

B2C Companies and Mobile

Decades after the e-commerce boom, B2C companies are continuing to eye a growing market: mobile
purchasing. With smartphone apps and traffic growing year-over-year, B2C companies have been shifting
attention to mobile users and capitalizing on this popular technology

Throughout the early 2010s, B2C companies were rushing to develop mobile apps, just as they were with
websites decades earlier. In short, success in a B2C model is predicated on amazon

Amazon,
on the other hand, is an example of a 100% e-commerce B2C model. E-commerce means doing business
online.

The online giant works as an intermediary. It offers all kinds of products from different places at any time
to anybody with access to the internet.ontinuously evolving with the appetites, opinions, trends, and the
desires of consumers.