Chapter Five

Understanding eCommerce product design

strategy

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Learning objectives
 Benefits of internet based marketing
 E-commerce considerations
 When a product can be marketed over internet
 Design criteria for selecting web enabled supply channels

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Introduction
 channels used for marketing is quite important
 Channels are different conduits to reach end users
 correct fitment of products and channels
 lower selling costs
 availability of products at the right time
 fewer customer problems
 technology is changing the shape of the channel
 enhancing capability of existing channels
 creating new ones
 fitment of products, technology and channel is becoming
critical
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Introduction..contd..
 Product marketing strategy - enabled by technology
 nature and mix of channels
 packaging and designing of their offerings
 enabling internet with correct design can take advantage
of the web enabled
 products that easily fit are digital music, news, financial
services, and computer software
 creates easy brand awareness among consumers

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Benefits of Web Enabled Channels
 Dell pioneered the concept of redesigning the product
 Technology enhances existing selling channels and creates new
ones
 “digitize” product catalogues and available to all
 to re-architect product specifications
 customer configured information can be pushed to potential
customers
 Internet stores (virtual) and online marketplaces that sell
products directly online
 products are displayed on electronic shelves
 customers can customize and try out different combinations

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Benefits of Web Enabled Channels..contd..
 Can help rapid-fire bidding during online auctions
 Not only products but channels need to be web ready
 Professional services such as executive search, tax
consulting
 Enabling product configuration and assembly that is
fast and transparent to the customer
 Designing products and services that can be sold
through any channel or mix of channels

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E-commerce considerations
 capability of the channel
 distribution requirements need to be understood
 Features in an interactive mode
 How the products can be stacked in logistics (if ordered
through online)
 personalized products, personalised services, and fast
delivery
 package, distribute, and configure products
 Compare prices and products
 adjusting product pricing on the fly

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E-commerce considerations..contd..
 wider selection of products and services
 self-service electronic channels
 online marketing assistance
 Benchmark customer offerings
 lower transaction costs, more self-service
 building services into structured pricing
 accessorize mature products with desirable services
 automatic replenishment ordering, free returns and free
delivery
 Technical capabilities of the channels

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E-commerce considerations..contd..
 packaging, price, placement, and promotion need to be
applied
 Be able to digitally represent the products
 Be able to distribute products through electronic order
fulfilment
 publishing and the music industry modify their offerings
for digital distribution
 pricing by considering time, medium, and context
 Web’s unique ability to sell contents in small quantities
 Shelf life of perishable products

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E-commerce considerations..contd..
 several material changes to the product are necessary for
web enabling
 search engine keywords and interactive links to make
information available to potential buyers
 Graphics bring life to contents and make them look
better online
 Mechanism for impartial, open-source reviews and
referrals from actual customers
 re-segmenting and repackaging product based on
feedback – making products easier to sell buy online

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E-commerce considerations..contd..
 customers should be able to select, configure, and buy
products over internet
 3G/4G technologies will increase the capability of
ecommerce
 customers can feel the product online
 take decisions without going to retail stores
 gain competitive advantage
 Standardization and availability of catalogues over internet
 Local language
 Search and artificial intelligence
 Mass customization - products to be readily configured and
assembled as per customer specifications
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E-commerce considerations..contd..
 design products that can be more easily configured
 facilities to request the ingredients, textures, packaging,
and chose delivery schedule
 Factor in large amounts of customer information into the
design of the product, including health, diet, portion size,
allergies, and demographics
 Dynamic pricing
 fast and accurate market pricing
 calculate product profitability
 as per the configuration demanded by the customer
 flexible pricing

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E-commerce considerations..contd..
 market-based pricing structures
 data mining/segmentation software will provide data analysis
tools
 bundle products with other features and provide a package
 optimally align the value to the customer
 Customers are more demanding and innovate new ‘values’ for
customers
 hybrid distribution channel needs to be defined
 Online billing for rapid decision and delivery and returns
 mail response management
 Service and support integrated with e-commerce

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
Summary
The chapter talks about different parameters that need to
be considered before getting ready for ecommerce
 designing product features,
 hybrid channels for distributions,
 differential pricing for products meant for different
channels and
 mass customization
 product channel readiness

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