COMPUTER 1

ROMEO FERNON C. STO. DOMINGO

BABS, IRREG

MAM. JOY NATURALES

A CASE STUDY ANALYSIS OF E-COMMERCE STRATEGIES FOR RETAIL
BUSINESSES
INSIGHT
E Commerce is growing day by day in both B-to-B and B-to-C context. Retailing industry
including Fashion Retail and Grocery retailing have caught on to the bandwagon and
have begun to offer E trading or Online Shopping. In the early 1990s we saw
Companies setting up websites with very little understanding of E Commerce and
Consumer behaviour. E commerce as a model is totally different from the traditional
shopping in all respect. All Companies have fast realised the need to have E commerce
strategy separately but as a part of overall Retail Strategy.

Retail Strategy involves planning for the business growth keeping in view the current
market trends, opportunities as well as threats and building a strategic plan that helps
the Company deal with all these external factors and stay on course to reach its goals.
Further the Retail business strategy is concerned with identifying the markets to be in,
building the product portfolio and band width coupled with brand positioning and the
various elements of brand visibility and in store promotions etc. Business operations are
more or less standard and proven models that are adapted as best practices.
However when it comes to defining an E Commerce strategy for the business, the
dynamics of the various elements contributing to the business are totally different. The
one factor that remains common is the focus on Customer. While in the physical|
traditional selling method, there exists a physical experience from the Customer’s end
and hence it is easier to build Customer relationship and engage the Customer.

E-Commerce platform has got to devise methods to reach out to the virtual Customer
on One to One basis and build the relationship. The E-commerce generally provides
more product information and technical details to the Customers than provided through
the Traditional Sales channel. E-Commerce has got to define the sales transaction, third
party payment and financial transaction as well as Customer service processes. As
compared to traditional physical channel sales, all these processes are new and have to
be well defined and proven.
One important question that the Companies have got to answer is to figure out ‘How Do
We Differ from Competition’ or have an edge over Competition in the E commerce
market. One of the key differentiators has been the system security and the third party
billing desk partners used by the Companies. Wherever Companies have partnered with
well-known and reputed bankers and billing desk service companies providing safe and
secure transactions, the customer confidence in dealing with such Company is
enhanced.

Secondly companies that provide clear processes outlining the delivery commitments,
Online Customer service coupled with publicized policy of customer returns and
warranty management are successful in building loyal customer base. Loyalty programs
and product promotion offers.

Pricing of products is another area that is required to be addressed through the E-

Commerce strategy. While the Selling and operational costs are higher in traditional
sales model, the E-commerce or Virtual Sales costs are negligible. There exists a
potential to price products attractively and engage the Customer to buy in bulk.
E commerce strategies and plans would be different in case of Retail Companies
engaged purely in internet selling to the already established Retail Companies offering
Online shopping along with traditional shopping. Similarly it is also seen that selling
intangibles and technical products is easier through the E-Commerce platform than
other products that needs some interaction with salesman as well as product sampling
etc. Accordingly the product offering on the E-Commerce platform may have to be
decided by the Company as a part of its strategy plan.

The fact that traditional shopping experience as well as back end operations are totally
different from the virtual and instantaneous Online shopping, the Companies have got to
come up with separate sales strategy for both traditional sales channel as well as
electronic commerce trading channel.