Online Companies - Tesco, Ebay, Muji - Coursework Example

GOING ONLINE: STRATEGIES, COMPETENCIES AND INNOVATIONS Introduction The United Nations Conference on Trade and Development (UNCTAD) (2004), the retail and consumer industry is one of the industries exhibiting one of the highest growths today. At the same time, Murphy (2006) has said that as more companies gain online presence, there are also opportunities for businesses to market themselves with other businesses. This is an indication that the pace of internet commerce is growing rapidly but this time without the extreme speculations that caused the crash in 2000 (De Kare-Silver, 2000). Businesses are challenged not only to excel in their trade but now must be able to bring that trade to fresh waters and beyond their comfort zones (Perner, 2004). Coupled with the developments in technology, specifically the internet and aviation, and the liberalization of international commerce, globalization is now becoming a reality to many people. One of the most efficient ways to become involve in globalization is through going online, a method that has proved popular and effective for companies of varying sizes and interests. Online Objectives The primary goal of becoming online is to be able to establish presences, gain access or exposure to markets and to survey or gather information regarding prospective markets. Some companies also opt to go online because their competitors do so. Among countries that have joined the World Trade Organization (WTO), a particular development for companies going online is to be able to take advantage of the liberalization of off-shore investments that they can now attract (Tubbs and Schulz, 2006). Establishing presence online attracts attention to the brand and the products regardless of where the company is operating. Being online is a statement of a company's adaptation of technology and competency to follow trends (Murphy, 2006). The efforts can be accomplished independently by the company or by participation in third party hosting. Third party hosting can involve being listed in directories, through page links or by participating in industry profile data basing or participation in online groups and message boards. The core of the objective is to create interest for the brand and product. Gain access or exposure to markets implies that the approach targets consumers. However, this objective may or may not involve actual selling to the target markets and the core of the objective lies in informing potential markets of the product. Access to markets can also include expanding supply and distribution chains. Being online means that another company can find you as a much as you can find suppliers and costumers for one's products. This can also be achieve independently or not however, there are distinct advantage in maintaining independent methods in accessing markets since this can also be a sources of market information and a means of providing support which may not available if one utilizes third party sites (Bly, 2004). Gathering information can be made more efficient online, profile of visitors of the site can give a company an idea who is interested in their products. Most companies online provide registered user privileges in accessing their sites to be able to collect information form users and track usage. This information can be used to develop markets approaches and competitive competencies directly from individuals who already have expressed interest in the brand or product as well as provide channels for marketing and promotion efforts (Perner, 2004). For companies who are trying to find new markets, these information can provide vital information for approaches to the market so that efforts can be streamlined and be cost-effective. Online Companies For the purpose of this paper, there kinds of business that are online will be studied. One of the companies to be studies is Tesco, a large retailing supermarket company based in the UK who has recently adopted online business operation to complement its existing ones. Next is Muji, a specialty brand based in Japan whose online operations have been its main operations. The third company to be considered is eBay, an online auction company providing access to retail and exchange based in the USA Tesco Tesco, is a global leader in retailing that is based in Britain. Recent vertical and horizontal expansion of the company have now included in its portfolio agriculture, packing, merchandising and information technology (Tesco, 2006). Tesco's international expansion programs is not limited by its consumer businesses, they are aiming to launch extensive services and related markets into new markets because of two major motivations: establishing their leadership in these developing markets and maximizing existing capacities (Corporate Watch UK, 2004). Tone of the main means of accomplishing these objectives has been in expanding information and services that can be accessed online by customers. One of their biggest innovations was the introduction of online retail services. It was a pioneering effort that did not just increase market channels for the company but is one of the benchmarks of successful e-commerce. Its online services also became the foundation of its other service ventures. It has pioneered online supermarket shopping that is considered one of the reasons why e-commerce was recovered after the dot com crash (Corporate Watch UK, 2004). By the last quarter of 2006, Tesco is scheduled to launch the first home chopping catalogue as part of Tesco Direct. Its recent expansion into software has also prompted it to launch its own software packages that are aimed to utilize pricing as its main competitive edge. Software includes security systems, office suites and other software products distributed by its partners Formjet who has an exclusive contract for Panda Software and Ability Plus Software (Snowden, 2006). Internet operation began in 1994 and home shopping services began in 1996. Because internet services were not as reliable as we know them today in the 1990's, Tesco launched CD catalogues to support actual internet operations. However, by year 2000 the CD catalogues were discontinued primarily because of the great improvement of internet services by that time (Tesco, 2006). Muji Muji or Ryohin Keikaku Co., Ltd. is one of the most successful fashion brands today in its segment. The company is characterized by its no brand or logo policy and its focus on recycling. It also is characterized by a Zen style in product design emphasizing minimalism and the environment. Though these features were designed to be simply unique product features, they have since become the brand's main selling point establishing its niches in the market (Muji, 2007). Considering that the were marketing very specific products, the company has had to conduct extensive and relevant market research not only with regards to their product but also with regard to the philosophy of their products. In some ways, the products can be considered a counter cultural movement in the fashion industry which traditionally centred on branding merchandise. Though the market is still overwhelmingly still brand focused, Muji provides an alternative and philosophical statement in contrast to the trend. The products are supported by a significant number in the market that demands quality over brand (Cox & Brittain, 1996). At the same time, the number of suppliers that it ahs been able to gather that support its product ideology have been developed to meet the growing demand and popularity of the products which have even become a preference of characters in fiction and literature (Gibson, 2001). Thus, Muji has also been able to show that it is responsive and sensitive marketing strategies. In an international environment, a company's concerns will have to consider more external factors. International trade laws, liberalization and globalization are the obvious concerns that emerging brands and products should be able to handle (Varley R & Rafiq, 2003). eBay Ebay, Inc., owner of the eBay online auction website Marketplace and services states that their goal is "to pioneer new communities around the world built on commerce, sustained by trust, and inspired by opportunity". The company's eBay Marketplace serves to fulfill this objective by providing the a marketplace for the all internet users. Furthermore, they say that the eBay Marketplace "exists as an online trading platform that enables a global community of buyers and sellers to interact and trade" where the company has the objective to "create, maintain, and expand the functionality, safety, ease-of-use, and reliability of our trading platform while, at the same time, supporting the growth and success of our community of users". Cohen (2003) believes that online auctions are a good example of the objectives of globalization and the internet. The most popular website offering online auction services is undoubtedly Ebay. It is not just a pioneer of the market but it can also be considered as a model of e-business. Together with he payment system Paypal, it has revolutionized commerce and has paved the way for other business, particularly retail and trading. However, together with the success that Ebay has been able to achieve is the realization that it needs to stay competitive and anticipate developments. In the last few years, there has been an abundance of other similar services on the internet, some even being sponsored by industry leaders such as MSN and Yahoo!. Conclusion Craig and Douglas (2005) describe today's market that has to be dealt with proactively with businesses taking initiative from developments instead of simply going with their flow. For business to establish themselves in today's markets they have to be able to understand and accept their position in the market and that of their competitors carefully (Levy & Weitz, 2004). A company's development of its website should be focused on the development of an appropriate platform, whether it is to be for trading or information. At the same time, it should cater to its community for users and developing a competitive format that states its status against competitors and withing its industry. Developing support market services and providing customer service are also essential in developing a positive perception of the brand and economy and the overall effots to go online. Globalization allows great opportunities but increase competition just as much. The challenge is not in holding on who you are or what your company is, the challenge will becoming what you can be (Varley & Rafiq, 2003). By being online, you gain the same information as you would from other companies that are online. There are risks but Companies should maximize the internet and the channel it provides as marketplace unbound by geography and time zones. Regardless of business size, it can become the key for positioning in the industry since the internet reduces the costs of communication and promotion. References Bly, Robert W. (2004). The Key 6 Differences Between Business-to-Business and Consumer Marketing. [Online]. Available from [Accessed on March 10, 2007] Cohen, Adam (2003). The Perfect Store. Boston : Back Bay Books Corporate Watch UK (2004). TESCO: A Corporate Profile. [Online]. Available from [Accessed on March 10, 2007] Cox, R. and Brittain, T. (1996). Retail Management Pittman, Second Edition. London: M&E Handbooks Craig, S. and Douglas, S. P. (2005). International Marketing Research. London: John Wiley & Sons De Kare-Silver, Michael (2000). E-Shock 2000. McMillan Business eBay (2004). eBay Annual Report 2004. [Online]. San Jose, CA: eBay. Available from Read More