Download ppt - Turban Ec2010 Ch03

Retailing in Electronic Commerce: Products and Services

Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

1. Describe electronic retailing (e-tailing) and its characteristics.

2. Define and describe the primary e-tailing business models.

3. Describe how online travel and tourism services operate and their impact on the industry.

4. Discuss the online employment market, including its participants, benefits, and limitations.

5. Describe online real estate services.6. Discuss online stock-trading services.

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7. Discuss cyberbanking and online personal finance.

8. Describe on-demand delivery of groceries and similar products/services.

9. Describe the delivery of digital products and online entertainment.

10.Discuss various online consumer aids, including comparison-shopping aids.

11.Describe disintermediation and other B2C strategic issues.

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• OVERVIEW OF ELECTRONIC RETAILING– electronic retailing (e-tailing)

Retailing conducted online, over the Internet– e-tailers

Retailers who sell over the Internet• SIZE AND GROWTH OF THE B2C MARKET• WHAT SELLS WELL ON THE INTERNET• CHARACTERISTICS AND ADVANTAGES OF

SUCCESSFUL E-TAILING

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• Travel• Computer hardware

and software• Consumer electronics• Office supplies• Sport and fitness goods• Books and music• Toys and hobbies

• Health and beauty• Entertainment• Apparel and clothing• Jewelry• Cars• Services• Food and drugs• Pet supplies• Others

WHAT SELLS WELL ON THE INTERNET

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• CLASSIFICATION BY DISTRIBUTION CHANNEL1. Direct marketing by mail-order retailers that go

online2. Direct marketing by manufacturers3. Pure-play e-tailers4. Click-and-mortar retailers5. Internet (online) malls

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• Direct Marketing by Mail-Order Companies– direct marketing

Broadly, marketing that takes place without intermediaries between manufacturers and buyers; in the context of this book, marketing done online between any seller and buyer

• Direct Sales by Manufacturers

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• Pure-Play E-Tailers– virtual (pure-play) e-tailers

Firms that sell directly to consumers over the Internet without maintaining a physical sales channel

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• click-and-mortar retailersBrick-and-mortar retailers that offer a transactional Web site from which to conduct business

• brick-and-mortar retailersRetailers who do business in the non-Internet, physical world in traditional brick-and-mortar stores

• multichannel business modelA business model where a company sells in multiple marketing channels simultaneously (e.g., both physical and online stores)

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• OTHER B2C MODELS AND SPECIAL RETAILING– Transaction brokers– Information portals– Community portal and social networks– Content creators or disseminators– Viral marketing– Market makers– Make (build)-to-order– B2B2C– Service providers

• B2C IN SOCIAL NETWORKS

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• Online travel bookings and associated travel services are one of the most successful e-commerce implementations

• SPECIAL SERVICES ONLINE– Wireless services– Direct marketing– Alliances and consortia– Travel-Oriented Social Networks

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• BENEFITS AND LIMITATIONS OF ONLINE TRAVEL SERVICES– Benefits

• The amount of free information is tremendous• Information is accessible at any time from any place• Substantial discounts

– Limitations• Many people do not use the Internet• The amount of time and the difficulty of using virtual travel agencies

can be significant• Complex trips or those that require stopovers might not be available

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• IMPACT OF EC ON THE TRAVEL INDUSTRY– Direct impacts because customers increasingly

using the Internet to make bookings– Indirect impacts because airlines and hotel chains

encouraging customers to book direct or through online wholesalers, bypassing travel agents

– Investing in content (information, travel advice, and the like) is a requirement for success in this competitive market

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• CORPORATE TRAVEL– Many large corporations receive additional

services from large travel agencies– To reduce corporate travel costs, companies can

make arrangements that enable employees to plan and book their own trips

– Travel authorization software that checks availability of funds and compliance with corporate guidelines is usually provided by travel companies

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• THE INTERNET JOB MARKET– The following parties use the Internet job market:

• Job seekers• Employers seeking employees• Classified ads• Job agencies• Government agencies and institutions

– A Consortium of Large Employers and College Career Advisors

– Online Job Markets on Social Networking– Global Online Portals

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• BENEFITS AND LIMITATIONS OF THE ELECTRONIC JOB MARKET

• Probably the biggest limitation of the online job market is the fact that some people do not use and do not have access to the Internet, although this problem has declined substantially

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• REAL ESTATE ONLINE– Zillow, Craigslist, and Other Web 2.0 Real Estate

Services

• INSURANCE ONLINE– Companies use Internet to offer standard

insurance policies, such as auto, home, etc. often at a substantial discount to individuals

• ONLINE STOCK TRADING– The Risk of Trading in an Online Stock Account

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• electronic (online) banking or e-bankingVarious banking activities conducted from home or the road using an Internet connection; also known as cyberbanking, virtual banking, online banking, and home banking

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• HOME BANKING CAPABILITIES– Informational, administrative, transactional,

portal, and others

• VIRTUAL BANKS– Have no physical location; only conduct online

transactions

• INTERNATIONAL AND MULTIPLE-CURRENCY BANKING– Support global transactions

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• ONLINE FINANCIAL TRANSACTION IMPLEMENTATION ISSUES– Securing Financial Transactions– Access to Banks’ Intranets by Outsiders– Imaging Systems– Fees Online Versus Fees for Offline Services– Risks

• PERSONAL FINANCE ONLINE– Online Billing and Bill Paying– Taxes

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• ON-DEMAND DELIVERY OF PRODUCTS– e-grocer

A grocer that takes orders online and provides deliveries on a daily or other regular schedule or within a very short period of time

– on-demand delivery serviceExpress delivery made fairly quickly after an online order is received

– The Case of E-Grocers• FRESHDIRECT

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ONLINE DELIVERY OF DIGITAL PRODUCTS, ENTERTAINMENT, AND MEDIA

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• ONLINE ENTERTAINMENT– Adult Entertainment– Internet Gambling– Online Dating Services

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• shopping portalsGateways to e-storefronts and e-malls; may be comprehensive or niche oriented

• shopping robots (shopping agents or shopbots)Tools that scout the Web on behalf of consumers who specify search criteria

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• “SPY” SERVICES– Wireless Shopping Comparisons

• BUSINESS RATINGS SITES• TRUST VERIFICATION SITES• OTHER SHOPPING TOOLS

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• A traditional brick-and-mortar store with a mature Web site that uses a click-and mortar strategy is able to do the following:– Speak with one voice– Leverage the multichannels– Empower the customer

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• disintermediationThe removal of organizations or business process layers responsible for certain intermediary steps in a given supply chain

• reintermediationThe process whereby intermediaries (either new ones or those that had been disintermediated) take on new intermediary roles

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• cybermediation (electronic intermediation)The use of software (intelligent) agents to facilitate intermediation

• channel conflictSituation in which an online marketing channel upsets the traditional channels due to real or perceived damage from competition

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• DETERMINING THE RIGHT PRICE• PRODUCT AND SERVICE CUSTOMIZATION

AND PERSONALIZATION• FRAUD AND OTHER ILLEGAL ACTIVITIES• HOW TO MAKE CUSTOMERS HAPPY

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1. What should our strategic position be?2. What are the limitations of e-tailing?3. How should we introduce wireless shopping?4. Do we have ethics and privacy guidelines?5. How will intermediaries act in cyberspace?

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