Competitive Threats in E-Business - Assignment Example

? of affiliation Question 2 According to Chaffey, there are two categories of competitive threats that acton the e-business. These threats emerge from both the buyers’ side and the sellers’ side. The competitive threats can act to either enhance business performance or greatly lower its performance depending on the organizational approaches that are put in place. In the case of glam Media Company, there are a number of competitive threats that can greatly affect the company performance in case effective strategies and measures are not put in place. Some of the competitive threats include the following: on the buy threats, there are issues such as supplier threats, intermediary threats, threat of new digital products and the threat of new entrants into the market. On the sell side threats, the company is faced with the issues of customer threats and entry of new business models (Chaffey 2011). Below is a brief discussion of these competitive threats and their respective levels on business performance. 1. Suppler threats To the glam media company, supplier threat is low and is not likely to influence the company’s performance in any way. Since most of the company has established a long term relationship with its suppliers around the globe. As the company largely deals on fashions, women styles and beauty, there are many willing and potential suppliers around the globe that are capable of giving them their demanded products (Plunkett 2009). Therefore since the company is fast growing and incorporating more and more products into their system, the issue of suppliers is a little threat and can only influence the company’s performance positively , helping it to rise to higher levels and seek new markets (Plunkett 2008). Similarly, the company has invested on agile and adaptable suppliers who are willing to change and transform with every bit of market change. Such companies can withstand technological advancements and can have long term effects on business performance. 2. New digital products threat New digital products is equal a low level treat to the glam media company. The company management has engaged in a series of innovative ideas that largely help the company advance with the technological changes and transformations in the market. The management of the company has ensured that they stay ahead of the market competition through the introduction of new products. Similarly, the company has engaged in a series of market research that enables it to discover the various customer need (Chaffey & Wood 2010). This technique has enabled them to stay firm and effective in the market. As well, the company has extended its services to many countries, and the website is already getting clicks from various parts of the world. This is a sign that they have conquered the market and effectively penetrated deeper markets. To this extent the company enjoys a large global market share hence ensuring that they stay on top of the market in terms of quality and the most latest products in the market. 3. Threat of new entrants in the market This is a medium competitive threat. The glam media company has largely captured the market and is currently among the leading company in terms of women products and styles. One of the greatest tool that the company initially relied upon was proper market survey and bringing in exactly what people demand (Smith & Zook 2011). New entrants into the market are however a threat since a company may learn of their weaknesses and then use it against them. In addition, entry of new companies in the market may lead to emergence of new and more superior products that will out do theirs. This factor makes new entrants into the company a little threat. Relatively, new entrants into the market may come up with similar products but different and more lucrative means of advertisement as well as distribution channels. Advertisements play a very major role in company development, thus it sets the basic threshold for competition. Therefore if a company comes up with a more effective advertisement strategy then there is a likelihood of this being a competitive threat. 4. Customer threats Customer reactions in the market can at times be predictable and in other times quite unpredictable. Customer competitive threat is a high one since the existence of a business all relies on the customers (Smith & Zook 2011). The buying pattern of customers often change with seasons and times, thus a company must maintain a constant vigilance in the market to ensure that they fully understand the customer demands and tastes at any particular time. Most things like women styles and fashions often go with time and each every new day new products are unveiled into the market. In case the company does not perform a good market research, then there are possibilities of them not satisfactorily bringing the customers what they exactly need. In return, the customers will change their purchasing patterns and start getting products from other sources. A shift in customer purchasing pattern often has a great impact on business since there is always a mass turn out of customers at a given time. The glam Media Company is therefore obliged t constantly engage in market research in different parts of the globe to ensure that they fully understand their customer demands and tastes. Doing this will enable them retain customer loyalty hence maintaining their large market share. In this digital era, market transformations occur fast since information is sent within the click of a button. The social media largely contributes to dissemination of information around the globe hence their effects can either ruin or build a business or a product (Bocij & Chaffey 2007). The glam media company should therefore capitalize on social media and ensure they leave positive impacts on it as well as use it effectively to advertise for their gains. This will make them emerge successful and more effective in their operations. To stay on top of the competition, the glam media company needs to continually invent new products a head of their competitors. Similarly, they need to engage experts in their field of production to ensure that every time they bring unique and new substances in the market (Lavine 2009). Doing this will keep customers wanting more of their products hence making them more stable. As well, they need to penetrate other unexplored markets around the globe. Such markets include other continents like Africa and other parts of the Asian continent which these products have not yet arrived at. While doing this, they should also come up with distribution strategies that will help in ensuring that the products reach customers at the right time. At the same time, there is need to ensure that customers have an easy payment option. Most customers around the world may be able to click the products on the website but may lack a viable payment option that is supported in their countries. This is an opportunity that the company can use to ensure that they capture a large number of customers in a given region by offering them flexible means of payment (Smith & Zook 2011). Applying the above mentioned strategies can help the glam media overcome the competitive threats and operate effectively in the market. Question 3 Crowd sourcing Crowd sourcing is fast becoming a common phenomenon and practice among various online communities. It is increasingly turning out to be one of the best ways to finding research and opinions over certain issues online (Howe 2009). The most common community or groups of people that often participates in crowdsourcing is the online community which performs the given task and then submits their solutions. Similarly, the crowd or the community selects among the solutions to find the best and the most suitable ones. After the finding of the solution, the company retains the answers while the community is given a reward or appreciation. The nature of such compensations may be in terms of monetary values, prizes or the individuals given recognition. Through the use of crowdsourcing, a company can find solutions through volunteers or amateurs who may be simply working during their spare times. Alternatively, the process can engage experts and other small businesses in coming up with the right solutions. In addition, you can choose to use idea scale in creating your own crowdsourcing community faster (Roebuck 2011). In simple terms, crowdsourcing may be defined as a turnkey which allows submission of a complex or simple solutions for vetting giving room for best ideas to surface. Many companies today are currently making use of crowdsourcing as a means to automatically find solutions to their problems. One of the most prospective places where this concept is applicable is in the semi automation of the financial industry (Grier 2013). One illustration of such means is finding the best payment methods or options that customers prefer around the globe. Many companies do not know their customers’ preferred means of payments and as a result, they lose huge chunks of money. In order to find the right solution, they can perform a crowd sourcing on their website. Here the company can invite their customers to submit their opinions regarding their preferred payment methods. This should run for a given period of time, lets say one week. After which the company closes the opinion sessions and then embark on the process of analyzing the opinions one by one. Here, the method with the largest opinion will carry the day. In this way, a financial task in the industry has been semi automated through the use of crowdsourcing. Other ways of doing research through crowdsourcing is by the use of social media. This is a platform where people all over the globe interact and exchange ideas (Peintner 2012). A company can come up with a financial problem like “what currency units do you prefer to be used in our website?” this question on the social media can generate lots of opinions especially with the use of like and unlike buttons. The face book like button is viral in nature and a single like can lead to all friends within your circle liking the same products. It is thus perfect way of crowdsourcing and also the fastest. Barriers to effective crowd sourcing Some of the advantages accrued to this procedure is that it is fast, less costly and gives genuine opinions of customers. It can thus be used in finding solution to a number of issues within an organization especially in cases where the organization does not have sufficient funds to hire professional services to conduct the research. Despite these benefits, the use of crowdsourcing faces a number of challenges that greatly demean its performance and efficiency in finding solutions to a given problem. One of the major challenges to crowdsourcing is lack of sufficient money to initiate the process. Prior to setting up a crowdsourcing community, one needs to develop a website, and in other cases especially for newbie they have to reward participants so as to encourage their participation (Brabham 2013). All these require money to initiate, a factor that many people or small businesses do not have. As a result, most crowdsourcing projects do not get sufficient attention hence poor solution in terms of public opinions. In addition, crowdsourcing require people to browse online and the website. Gaining topmost rank in the social media is very difficult and in most cases, websites with the crowdsourcing projects may us taper on the third page of the major search engines (Shankar & Levy 2011). Such pages seldom get any visitors and therefore no one may click on the links provided for the crowdsourcing. This is a major challenge since it can lead to wastage of time and resources. Consequently, many people online often perceive such surveys as scam and people out to deceive them of their hard earned cash. As a result, many refuse to participants even if the case is genuine and out to reward the participants. For such a page even if the correct Search Engine Optimization measures are effectively applied, it may take another milestone convincing people that it is a viable and genuine project. Website interface plays a very major role in attracting visitors to click the page. Most businesses lack the capability to give their sites the correct interfaces. As a result, people do not get attracted to it or the products therein. In such a situation, a business may take long to get their desired results hence making the crowdsourcing unfruitful. Apart from the above, the wrong topic or product choice used can lead to people not liking or giving their opinions on the page. Company marketers need to know the correct approaches to give to such crowdsourcing so as to make it catchy and attractive to many people (Sloane 2011). People love things that are interesting and sweet to read, thus, using a catchy topic and introductory words will make it appealing and result to many clicks. The above mentioned are the main barriers that need to be tacked to ensure that the semi automation with the financial industry is fully achieved. Despite the simplicity that crowdsourcing may take, there are many it is worth noting that salient measures need to be put in place to ensure it is successful. The ability of the survey to produce the targeted results largely dwells on the strategies that have been put in place to make it compete effectively among others. The web is also full of scam and such are out to deceive people of their hard earned cash. You must work hard therefore to ensure that there is a clear distinction between your crowdsourcing and the online scams. In this way, the crowdsourcing campaign will be effective and successful in achieving the desired results. References Bell, D, 2010, The crowdsourcing handbook: the how to on crowdsourcing, complete expert's hints and tips guide by the leading experts, everything you need to know about crowdsourcing. Brisbane, Emereo Pty Ltd.]. Bocij, P, & Chaffey, D, 2007, Business information systems: technology, development and management for the e-business. Harlow [u.a.], Financial Times/Prentice Hall. Brabham, D,C, 2013, Crowdsourcing. Sloane, P,2011, A guide to open innovation and crowdsourcing: expert tips and advice. London, Kogan Page. Chaffey, D, & Wood, S, 2010, Business information management: improving performance using information systems. Harlow, Pearson Education. Chaffey, D, 2011, E-business & e-commerce management: strategy, implementation and practice. Harlow, England, Pearson/Financial Times Prentice Hall. Grier, D, A, 2013, Crowdsourcing for dummies. New York, Wiley. Howe, J, 2009, Crowdsourcing: why the power of the crowd is driving the future of business. New York, Three Rivers Press. Lavine, K, 2009, The mommy manifesto how to use our power to think big, break limitations, and achieve success. Hoboken, N.J., John Wiley. Peintner, S, 2012, Crowdsourcing platforms in two-sided markets how to engage with a heterogeneous user base in order to win competition? : an empirical study of three design crowdsourcing platforms. Rotterdam, Erasmus Universiteit. Plunkett, J, W, 2008, Plunkett's apparel & textiles industry almanac 2008: the only comprehensive guide to apparel companies and trends. Houston, Tex, Plunkett Research. Plunkett, J, W, 2009, Plunkett's e-commerce & Internet business almanac 2009 the only comprehensive guide to the e-commerce & Internet industry. Houston, Tex, Plunkett Research Ltd. Roebuck, K, 2011, Crowdsourcing: high-impact strategies, what you need to know : definitions, adoptions, impact, benefits, maturity, vendors. Newstead, Australia, Tebbo/Emereo Pty. Shankar, K, & Levy, M, 2011, Crowdsourcing tweet book01 140 bite-sized ideas to leverage the wisdom of the crowd. Cupertino, CA, Thinkaha Smith, P, R, & Zook, Z 2011, Marketing communications: integrating offline and online with social media. London, Kogan Page. Read More