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ECT 455 E-Commerce Web Site Engineering.


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ECT 455 E-Commerce Web Site Engineering Lecture #2 Consumer Internet Commerce Agenda Market News Types of Consumers and Purchases Business Models and Value Propositions e-Commerce Value Chain Assignments – Website Analysis Project Deliverable B A Quick Poll:
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ECT 455 E-Commerce Web Site Engineering Lecture #2 Consumer Internet Commerce ECT 455 Susy Chan Ph.D.

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Agenda Market News Types of Consumers and Purchases Business Models and Value Propositions e-Commerce Value Chain Assignments – Website Analysis Project Deliverable B ECT 455 Susy Chan Ph.D.

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A Quick Poll: What sorts of customers would you say you are? How would you shop online? ECT 455 Susy Chan Ph.D.

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Types of Consumers Types of Buyers Impulsive Buyers: speedy buying Patient Buyers: value correlation Analytical Buyers: look into first Shopping Experiences Utilitarian: undertaking finish and discerning Hedonic: association and diversion ECT 455 Susy Chan Ph.D.

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Types of Online Purchases Specifically Planned Purchases Generally Planned Purchases Reminder Purchases Unplanned Purchases Implications for Strategies and Design? ECT 455 Susy Chan Ph.D.

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Amazon How does Amazon site bolster diverse sorts of customers, buys, and shopping practices? ECT 455 Susy Chan Ph.D.

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The Multichannel Consumer Embraces The Net ECT 455 Susy Chan Ph.D.

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Customer Expectations Merchandize collection About the same number of items accessible as the retail location (21%) About the same number of items in addition to specials (51%) More online SKUs than store or index (39%) (Global Online Retailing Report) ECT 455 Susy Chan Ph.D.

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A Technographics View of New shopper Internet Adoption Mainstream Number of new online customers Early adopters Laggards Time Forrester: Now or Never ECT 455 Susy Chan Ph.D.

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Meeting Customer Expectations Top 3 Reasons for Shopping Online Good choice of things Competitive evaluating Convenience Shopping trucks are much of the time deserted Placed items in the truck yet did not finish the buy (78%) on the grounds that: Shipping cost too high (45%) Price check (37%) Changed personality (34%) Price to high (24%) Check out procedure was long/misty (18%) E&Y Global Retailing ECT 455 Susy Chan Ph.D.

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User Profile: Information GVU Web User Survey ECT 455 Susy Chan Ph.D.

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ECT 455 Susy Chan Ph.D.

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The e-Commerce Value Cycle Attract React Interact Act ECT 455 Susy Chan Ph.D.

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The e-Commerce Value Chain Get and keep client premium Turn enthusiasm into requests Service clients Manage requests Attract Interact Act React Catalog Sales static element Advertising Marketing channels media Order catch - Shopping Cart Payment Fulfillment merchandise Customer administration Order following ECT 455 Susy Chan Ph.D.

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Attract Customers (Marketing) Purpose Build brand mindfulness, pull in clients, and lure them to purchase Merchandizing Methods Advertising Coupons Sales and Promotions Frequent purchaser programs 1:1 showcasing ECT 455 Susy Chan Ph.D.

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Beyond Price, Research and Brand Fast Search – value Long inquiry – marking, conveyance time, and other item qualities Brynjolfssor: Search and item separation at an Internet Shopbot. MIT Sloan School of Management, Dec 2004. ECT 455 Susy Chan Ph.D.

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Interact with Customers (Sales) Purpose Turn enthusiasm into requests Catalog, Product and Service Techniques Registration with Internet web crawlers Hyperlinks Onsite item look Product and value correlation Dynamic versus static substance Pricing ECT 455 Susy Chan Ph.D.

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Act on Customer Instructions (Order Management) Purpose: Manage request and shopping knowledge Order Processing: Shopping truck and request conglomeration Order acceptance; Application of coupons or rebates Cross offering Calculation of offers, assessments, transportation and conveyance charges, moved up request Payment: handle different installment routines (money, credit, Mastercards, platinum cards) Act – Fulfillment Delivering the products requested to their destination Transmission of request data to distribution center, pressing or request gathering for transportation, delivery and conveyance ECT 455 Susy Chan Ph.D.

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React to Inquiries (Service) Purpose: consumer loyalty, experience, and rehash visits Methods 24X7 administration limit Proactive and Immediate criticism – voice and email Access to status data Self-help (FAQ) Multi-dialect bolster ECT 455 Susy Chan Ph.D.

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ECT 455 Susy Chan Ph.D.

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Online Retail –2004 Holiday Seasons Revenue development solid .  91% of retailers reported income development for the 2004 online Christmas season; 17% encountering incomes multiplied. Case: PearlParadise.com: 113% development $888m - >$1.9b Customer fulfillment expands .  95% purchasers were fulfilled by internet shopping background; 89% in 2003, 84% in 2002 Free sending remains the lord of web showcasing advancements (60%), Recommendations: 56% present focus, proposed things page (32%), leeway page (32%), included deal thing (31%) Search motors and subsidiary promoting assist retailers with discovering clients, remained the second (58%) and third (half) best advertising vehicle for retailers.â  â€œ Multi-channel procedures – 45% exploration on index  purchase online; 21% examination online  purchase from inventory Shop.org/BizRate 2004 eHoliday Mood study .– January 2005 ECT 455 Susy Chan Ph.D.

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Amazon How does Amazon site execute the e-business quality chain? Draw in Interact Act React ECT 455 Susy Chan Ph.D.

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Value Propositions For Consumers/Customers/Users For the Firm/Organization ECT 455 Susy Chan Ph.D.

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Value Proposition for Customers Transform client relationship from supplier-focused to client focused qualities self administration, 1:1; decisions; conveyance to client area; client needs; decision of administration hours Displace conventional wellspring of qualities Physical versus advanced worth (data) Economies of scale versus economy of extension Mass created versus mass altered Information versus learning worth Distribution as requirements versus empowering influence Local versus worldwide ECT 455 Susy Chan Ph.D.

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Value Proposition for Firms Ability to achieve a worldwide business sector Reduced showcasing and offering cost Increased proficiency of operation Ability to target purchasers all the more absolutely Ability to pass on more exact item and accessibility data ECT 455 Susy Chan Ph.D.

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Four Strategies Channel Master (Cisco; Amazon) Customer Magnet (Yahoo) Value Chain Pirate (Autobytel.com; e*trade) Digital Distributor (Monster.com) Disintermediation and reintermediation ECT 455 Susy Chan Ph.D.

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Merchant Model virtual dealers Click & Brick Multi-Channel Shopping Malls Advertising Model Horizontal entrance Vertical gateway Personalized entry Intermediary (Brokerage) Buy/offer satisfaction Buyer/request aggregator Virtual shopping center Hypermediary (money related settlement) Auction representative Reverse closeout B2C Business Models: Generating Revenues ECT 455 Susy Chan Ph.D.

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Merchant Models (virtual, C&B, MC, shopping centers) Advantages: Enables dealers to offer items on the Web Conduct business 24-by-7 , overall An e-trade storefront ought to include: Online inventory of items Order handling (powerful shopping basket) Secure online installment Timely request satisfaction C&B or MC – physical area, brand acknowledgment, built up client base, cannibalization, channel reconciliation Virtual Merchant: stay away from the expense of physical stores ECT 455 Susy Chan Ph.D.

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Portal Model Portal destinations : Give guests the opportunity to discover practically all that they are searching for in one spot Horizontal entries: Portals that total data on an expansive scope of themes Yahoo! , AltaVista , Google Vertical entryways : Portals that offer more particular data inside of a solitary region of interest WebMD , IMDB , FirstGov Requires crisp and inexhaustible substance, and hearty web index to draw movement Heavy dependence on publicizing income, decrease in adequacy of internet promoting ECT 455 Susy Chan Ph.D.

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Auction Model Online closeout destinations Act as gatherings through which Internet clients can sign on and expect the part of either bidder or dealer Collect a commission on each effective closeout Sellers post things they wish to offer and sit tight for purchasers to offer Reserve value The base value a vender will acknowledge in a given closeout Reverse barters Allow the purchaser to set a cost as merchants contend to match or even beat it ECT 455 Susy Chan Ph.D.

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Dynamic Pricing Models The Web has changed the way items are estimated and obtained Comparison valuing model Web locales utilizing shopping bot innovation to locate the most reduced cost for a given thing e.g. NextTag.com Demand-touchy evaluating model Group purchasing diminishes cost as volume of offers expand Name-your-value model Name-your-cost for items and administrations ECT 455 Susy Chan Ph.D.

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Amazon What are their client worth recommendations? What are their business worth recommendations? What are their plans of action? Who are their rivals? ECT 455 Susy Chan Ph.D.

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The State of Retailing Online 7.0* *Profitable online operations, 43 % (2000)  56% (2001) - > 70% (2002)  79% (2003) Overall Operating edges  21%; catalogers 28%; online retailer  - 1% (from - 16% in 2002) **Shoppers burned through $51.3 b online in 2001, up 21% from 2000. $76 b in 2002, up 58% from 2001; anticipated that would grow 26% in 2003 to $96 b. Most well known item classifications: PC HW/SW (40%), tickets (17%), books (12%) **Marketing expenses: Web based retailers ($10/per request), store-based (