An E-Commerce Business Model: Questions and Answers - Assignment Example

An E-Commerce Business Model: Questions and Answers It is without question that the prospect of beginning an e-commerce sight entails a massive amount of work and a great deal of expense. Payment systems have be determined and tested, the ease of checkout must be gauged, even the color schemes and banners might need to be tested by outside entities to determine if they add to or detract from the customer experience (Abhiman, 2012). Additionally, marketing firms may be consulted to provide assessments of product offerings and how the techniques used on the website might be improved upon. Lastly, external advertising must be decided upon as a way to increase visibility and traffic on the e-commerce sight. This may be done in a number of ways. First, traditional fliers can be passed out in the store itself or posted on the reverse side of store receipts as a cheap and easy way to increase visibility of the e-commerce sight with existing customer base. Asides from this approach, web advertising can be bought and blast emails can be generated to let customers who have signed up to receive updates what the new product offerings and sales are and when they will take place. As a result of these practices, an array of infrastructure is riding on the fact that the web address, or physical location on the internet, of this e-commerce sight remains unchanged. 1) Imagine that someone has offered you $1,000 to buy your domain name shortly after you started your business online. Explain why or why not you would not sell and cite the ethical dilemmas involved. As such, the prospect of an individual or entity coming to the owner of the e-commerce sight and offering to buy it creates a host of problems. Not the least of which would be the need to start afresh on the previously listed steps engaged in. Such a transition would require a great deal of money, time, and effort on the part of all involved in the creation of the domain. At the price of $1,000 dollars, such a sale would not warrant the expense and headache caused. Indeed, even for a price of $10,000 dollars such a sale would also be inadvisable due to the fact that the business owner must not only tally the total amount of money he/she has spent in development and advertising but also consider the loss of sales that changing his/her domain might entail for the customers that are already familiar with the site. 2) The e-Commerce software you will be using must provide a catalog display, shopping cart capabilities and transaction processing. The convenience and usability for the customer are benefits of these functions. State how each of these functions could be beneficial to your business. Market research has proven time and again that a seamless shopping experience yields repeat customers. Accordingly, it is of utmost importance for an e-commerce site, whether this be an e-commerce giant like Overstock.com or a lesser known/lower traffic e-commerce sight such as bensoutlet.com, to be able to readily display its goods, provide suggestions of similar products to the user, and provide a quick 2-3 click checkout process facilitated by a well known and reputable payment processor such as PayPal or Google Shopping. By providing suggestions and combining multiple purchases with discounts and or free shipping, the e-commerce site is able to increase sales at a very low cost to the business. Additionally, a shopping cart function is useful to the business as many times customers will be shopping and for one reason or another leave the site or close the browser. Unlike in a traditional store when a customer leaves the physical store the sale is often lost. However, due to the fact that the shopping cart saves the customers selections in the cookies, the suggestion potential remains once the customer has then returned to the site. Lastly, once the selections have been made, the ability of the customer to quickly select a payment method and complete the transaction allows for a pleasant experience as well as increasing the likelihood of returning customers. 3) Your business will have created a presence in the physical world by having a store along the boardwalk. Assess how you will create an effective presence on the Web, meeting the objectives listed in Chapter 3. Be sure to include how you would improve Web presence by increasing Website usability. An important facet that any e-commerce site that is working to augment the earning power of a physical site is that it must absolutely reflect the same core principles, industry standards, and level of service that the physical site maintains. This is for a number of reasons but most importantly due to the fact that customers expect the two to behave as one and the same creature. Far too many e-commerce sites have lost money and eventually closed due to the fact that they did not espouse the same principles that allowed their physical locations to flourish in the first place. Likewise, maintaining the same sense of social responsibility, espousing the same principles of legal and economic responsibility, and generally behaving in a corporately responsible manner are all aspects that will serve to augment the presence and power of the e-commerce site. Tangentially, in a physical store, the seller wants to remove all impediments towards buyer’s spending money while within their store. Sellers will hire more cashiers to ensure that a fast and easy transaction process is maintained. Sellers will upgrade and update the store in an ongoing effort to make sure that the store has the most specific needs of the customer and his/her flow around the store will be mapped (E-commerce, 2011). It stands to reason, the same impediments should also be removed and the same customer behavior mapped from an e-commerce site’s perspective. Likewise, for an e-commerce site to succeed it requires the seller to be acutely aware of the habits of the web user and the buying habits associated with that. As such, offering goods for sale at reasonable prices is not the only requirement for success. 4) Develop a Web marketing strategy for your company including the following: identify the market segments you will target, how you will reach the segment, and explain how you advertise on the Web. As discussed briefly in question 1, the first way in which the e-commerce sight in question intends on marketing to the customer is directly via the use of fliers and advertisements printed on the reverse side of receipts. This serves a dual effect. Firstly, this is a targeted marketing that is not wasted on a larger audience which may or may not be interested in the product offered. Because the firm knows that customers have chosen to spend their money in the store, they are more likely to repeat this action as opposed to those that are unaware the store exists or the products that are offered. Additionally, this is an exceedingly low cost alternative to traditional advertising and marketing as it does not require the purchase of any particular medium in which to operate. Furthermore, another low cost alternative to increasing web presence among customers would be to offer discounts at the register for customers who are willing to sign up for store newsletters and sales blasts which could be emailed out every week or so. Again, because repeat customers espouse the greatest likelihood of revenue for the firm, these are the ones which will serve to increase web presence to the greatest extent without having to expend thousands of dollars on pricey marketing (Rogers, 2010). If the firm is fully committed to increasing its web presence and intends to do so via a marketing campaign the final and costliest approach to doing so would be to target the demographic and age group of those customers that most frequently shop at the physical store. By performing an analysis on these customers, their habits, their likes, the sites that they most often frequent, and their web habits in general, the store can then engage in a paid advertising campaign to raise awareness among the potential customer base. This has been listed last because it is the most pricey of the solutions towards raising customer awareness of the goods and products offered at the e-commerce site. However, there is a low-cost alternative to this style of marketing which would extensively use and promote itself in the form of social networking. If the target demographic extensively uses and interacts with the firm via social networking, this can be a powerful and effective way of promoting the site among the relevant demographic. Bibliography (2011). E-commerce and web technologies 12th International Conference, EC-Web 2011, Toulouse, France, August 30 - September 1, 2011, proceedings. Dordrecht New York: Springer. Abhiman, P. (2012). Plan, Design & Implementation of A Cohesive E-commerce Strategy. Golden Research Thoughts, 2(1), 1-6. Rodgers, W. (2010). E-commerce issues addressed in a throughput model. New York: Nova Science Publishers. Read More