World Wide Web and E-commerce Winter

groundwork to E-Commerce tax Models Objectives In this chapter, you will envision approximately Revenue sits How some companies move from one revenue modeling to a nonher to achieve advantage Revenue strategy issues that companies face when selling on the meshing An foot to E-Commerce wintertime 85, 2 1 Objectives (continued) Creating an effective work presence on the meshwork meshwork send usability Communicating effectively with customers on the Web An excogitation to E-Commerce winter 85, 3 Revenue Models Mail order or catalog model Proven to be successful for a wide variety of consumer items Web catalog revenue model Taking the catalog model to the WebAn mental hospital to E-Commerce spend 85, 4 2 Computers and Consumer Electronics Apple, Dell, Gateway, and Sun Microsystems wee-wee had huge success selling on the Web Dell created value by roleing its entire business around offering a high degree of configuration flexibility to its customers An display to E- Commerce pass 85, 5 Books, Music, and Videos Retailers use the Web catalog model to sell books, music, and videos Among the most visible examples of electronic commerce Jeff Bezos organise Amazon. com Jason and Matthew Olim Formed an on greenback music store they called CDnow Used the Web catalog revenue model An incoming to E-Commerce spend 85, 6 3 Luxury near(a)s People are still reluctant to buy luxury goods through a Web come in Web state of affairss of Vera Wang and Versace Constructed to translate info to shoppers, not to generate revenue Web localize of Evian Designed for a select, affluent group of customers An Introduction to E-Commerce overwinter 85, 7 Clothing Retailers Lands End Pioneered the subject of online Web shopping assistance with its Lands End Live feature in 1999 Personal shopper Intelligent factor program that learns customers preferences and makes suggestions Virtual model Graphic image built from customer measurements An Introduction to E-Commerc eWinter 85, 8 4 Flowers and Gifts 1-800-Flowers Created an online extension to its telephone order business Chocolatier Godiva Offers business gift plans on its site An Introduction to E-Commerce Winter 85, 9 Digital Content Revenue Models Firms that own intellectual property have embraced the Web as a new and highly efficient distribution mechanism Lexis. com Provides full-text search of judicatory cases, laws, patent databases, and tax regulations ProQuest Sells digital copies of published documents An Introduction to E-Commerce Winter 85, 10 5 Advertising-Supported Revenue Models Broadcasters provide free programming to an udience along with advertising messages Success of Web advertising is hampered by No consensus on how to measure and charge for site visitor views Stickiness of a Web site the ability to keep visitors and perpetrate repeat visitors Very few Web sites have sufficient visitors to interest large advertisers An Introduction to E-Commerce Winter 85, 11 Web Portal s Web directory A listing of hyper associate to Web pages Portal or Web approach lay apply as a launching point to enter the Web Almost ceaselessly includes a Web directory and search engine Examples Yahoo , AOL, AltaVista An Introduction to E-Commerce Winter 85, 12 6 Advertising-SubscriptionMixed Revenue Models Subscribers Pay a fee and accept some level of advertising Typically are subjected to such(prenominal) less advertising Used by The New York Times and The Wall Street Journal An Introduction to E-Commerce Winter 85, 13 Advertising-Subscription Mixed Revenue Models (continued) Business Week Offers some free content at its Business Week online site Requires visitors to buy a subscription to the Business Week print magazine An Introduction to E-Commerce Winter 85, 14 7 Fee-for-Transaction Revenue Models Businesses offer serve and charge a fee establish on the consequence or size of transactions processed DisintermediationRemoval of an intermediary from a value cooking stove Reintermediation Introduction of a new intermediary An Introduction to E-Commerce Winter 85, 15 Fee-for-Service Revenue Models Fee base on the value of a service provided Services range from games and entertainment to financial advice Online games Growing number of sites include premium games in their offerings Site visitors mustiness pay to play these premium games An Introduction to E-Commerce Winter 85, 16 8 Fee-for-Service Revenue Models (continued) Concerts and films As more households let broadband door to the Internet, companies are providing drift video of concerts and films to paying ubscribers Professional Services State laws are one of the main forces preventing U. S. professionals from extending their practices to the Web An Introduction to E-Commerce Winter 85, 17 Revenue Models in Transition Subscription to advertising-supported model Microsoft founded its Slate magazine Web site An upscale news and current events publication Charged an annual subscription f ee after a bound free introductory period Was ineffective to draw sufficient number of paid subscribers Now operated as an advertising-supported site An Introduction to E-Commerce Winter 85, 18 9 Advertising-Supported to AdvertisingSubscription Mixed Model Salon. om Operated for several years as an advertisingsupported site Now offers an optional subscription version of its site Subscription offering was motivated by the gilds inability to raise additional money from investors An Introduction to E-Commerce Winter 85, 19 Advertising-Supported to Feefor-Services Model Xdrive Technologies Opened its authoritative advertising-supported Web site in 1999 Offered free disk storage space online to users After two years, it was unable to pay the costs of providing the service with the advertising revenue generated Later switched to a subscription-supported model An Introduction to E-CommerceWinter 85, 20 10 Advertising-Supported to Subscription Model Northern Light Founded in August 1997 as a search engine with a twist Revenue model Combination of advertising-supported model plus a fee-based teaching access service January 2002 Converted to a new revenue model that was primarily subscription supported An Introduction to E-Commerce Winter 85, 21 Multiple Transitions Encyclop? dia Britannica Original offerings The Britannica Internet Guide Free Web navigation aid Encyclop? dia Britannica Online accessible for a subscription fee or as part of a CD package 1999 Converted to a free, advertiser-supported site 001 Returned to a mixed model An Introduction to E-Commerce Winter 85, 22 11 Revenue outline Issues Channel conflict Occurs whenever sales activities on a companys Web site interpose with existing sales outlets Also called cannibalization Channel cooperation Giving customers access to the companys products through a coordinated presence in all distribution channels An Introduction to E-Commerce Winter 85, 23 strategic Alliances and Channel Distribution Manageme nt Strategic alliance When two or more companies join forces to tackle an activity over a long period of time Account aggregation servicesIncrease the propensity of customers to unsay to the site Channel distribution managers Companies that take over the responsibility for a particular product line within a retail store An Introduction to E-Commerce Winter 85, 24 12 Creating an Effective Web Presence An ecesiss presence The public image it conveys to its stakeholders Stakeholders of a family Include its customers, suppliers, employees, stockholders, neighbors, and the command public An Introduction to E-Commerce Winter 85, 25 Achieving Web Presence Goals Objectives of the business Attracting visitors to the Web site fashioning the site interesting enough that visitors tay and explore Convincing visitors to follow the sites cerebrate to obtain information An Introduction to E-Commerce Winter 85, 26 13 Achieving Web Presence Goals (continued) Objectives of the business Creating an impression consonant with the organizations desired image Building a trusting relationship with visitors Reinforcing positive images that the visitor might already have about the organization Encouraging visitors to return to the site An Introduction to E-Commerce Winter 85, 27 Profit-Driven Organizations Toyota site A good example of an effective Web presence Provides links to tiny information about each vehicle modelA dealer locator page Information about the company and the financing services it offers An Introduction to E-Commerce Winter 85, 28 14 Toyota U. S. Home page An Introduction to E-Commerce Winter 85, 29 Profit-Driven Organizations (continued) Quaker Oats Web site does not offer a particularly strong reek of corporate presence Site is a straightforward presentation of links to information about the firm Redesigned site is essentially the same as the previous version An Introduction to E-Commerce Winter 85, 30 15 Quaker Oats Old Home varlet An Introduction to E-Co mmerce Winter 85, 31 Quaker Oats Home Page 1999 RedesignAn Introduction to E-Commerce Winter 85, 32 16 Not-for-Profit Organizations gravestone goal for the Web sites Information dissemination Key element on any successful electronic commerce Web site Combination of information dissemination and a two-way ghost channel An Introduction to E-Commerce Winter 85, 33 Web Site Usability Motivations of Web site visitors Learning about products or services that the company offers Buying products or services that the company offers Obtaining information about warranty, service, or repair policies for products they purchased Obtaining general information about the company or organizationAn Introduction to E-Commerce Winter 85, 34 17 Web Site Usability (continued) Motivations of Web site visitors Obtaining financial information for making an investment or credit granting decision Identifying the people who manage the company or organization Obtaining contact information for a person or depart ment in the organization An Introduction to E-Commerce Winter 85, 35 Making Web Sites Accessible One of the best ways to accommodate a broad range of visitor needs is to build flexibility into the Web sites interface Good site design lets visitors choose among information attributes Web sites can offer visitors multiple nformation formats by including links to files in those formats An Introduction to E-Commerce Winter 85, 36 18 Making Web Sites Accessible (continued) Goals that should be met when constructing Web sites Offer substantially accessible facts about the organization Allow visitors to experience the site in different ways and at different levels Sustain visitor attention and encourage return visits Offer easily accessible information An Introduction to E-Commerce Winter 85, 37 Trust and Loyalty A 5 portion increase in customer loyalty can yield profit increases between 25% and 80% Repetition of satisfactory service can build ustomer loyalty Customer service is a line for many electronic commerce sites An Introduction to E-Commerce Winter 85, 38 19 Usability Testing Companies that have make usability tests Conduct focus groups Watch how different customers navigate through a series of Web site test designs Cost of usability testing is low compared to the total cost of a Web site design or overhaul to E-Commerce An Introduction Winter 85, 39 Customer-Centric Web Site Design Putting the customer at the center of all site designs Guidelines Design the site around how visitors will navigate the links Allow visitors to access information quicklyAvoid using inflated marketing statements An Introduction to E-Commerce Winter 85, 40 20 Customer-Centric Web Site Design (continued) Guidelines Avoid using business jargon and terms that visitors might not understand Be consistent in use of design features and colors Make sure navigation controls are clearly labeled Test text visibility on smaller monitors Conduct usability tests An Introduction to E-Commerc e Winter 85, 41 Connecting With Customers Personal contact model Firms employees individually search for, qualify, and contact potential customers Prospecting Personal contact approach to identifying and reaching customersMass media approach Firms prepare advertising and promotional materials about the firm and its products An Introduction to E-Commerce Winter 85, 42 21 Connecting With Customers (continued) Addressable media Advertising efforts directed to a know addressee Also called mass media One-to-many communication model Communication flows from one advertiser to many potential buyers matched communication model Both buyer and seller participate in information exchange An Introduction to E-Commerce Winter 85, 43 Business Communication Modes An Introduction to E-Commerce Winter 85, 44 22 Summary Models used to generate revenue on the WebWeb catalog Digital content sales Advertising-supported Advertising-subscription mixed Fee-for-transaction and fee-for-service Companies under taking electronic commerce initiatives sometimes Form strategic alliances Contract with channel distribution managers An Introduction to E-Commerce Winter 85, 45 Summary (continued) Firms must understand how the Web differs from other media Enlisting the help of users when building test versions of the Web site is a good way to create a site that represents the organization well Firms must also understand the nature of communication on the Web An Introduction to E-Commerce Winter 85, 46 23