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Title: New%20eCommerce%20Trends%20and%20Technologies


1
New eCommerce Trends and Technologies
  • David Strom
  • david_at_strom.com
  • 1 (516) 944 3407
  • Centra Presentation 2/9/2000

2
Agenda
  • Build or buy your web storefront?
  • What becomes success?
  • Future trends

3
Topic 1 Build or Buy Your Web Storefront
  • Rent outsource to a CSP
  • Buy suite of software
  • Build it yourself

4
Evaluating CSPs
  • Do they offer storefront design?
  • Have in-house programmers?
  • Hosting of your own web server machine?
  • How many payment systems do they support?
  • What kinds of accounting reports do they offer?

5
Some CSP Examples
  • www.psi.net/web/ecommerce.shtml
  • www.Best.com/bizcomm.html
  • www.Brainlink.com/html/saleslink.htm
  • www.Earthlink.net
  • IBM mypage.ihost.com
  • www.Netcom.com
  • business.Mindspring.com/prod-svc/smbiz/
  • www.outer.net/ONCommerce (OuterNet)

6
Earthlink pricing explained
Program Monthly fee Setup fee
Starter Site 20 25
Total Access Acct. 20 (waived)
SSL cert. 20 10
Domain fee 75
Ecommerce 40 175
TOTAL 100 210
7
CSP Approaches
  • GeoShop/Yahoo
  • ViaWeb/Yahoo
  • iCat/Intel
  • Encanto
  • iTool
  • Others entering a very crowded field

8
GeoShop/Yahoo
  • Builds on GeoCities communities but for
    merchants (www.geocities.com/join/geoshops)
  • 25/month for just commercial listings
  • 180/month (or more!) for actual transactions
  • working with Internet Commerce Services Corp. who
    uses Open Market Transact servers
    (www.icoms.com/pp.htm)

9
ViaWeb/Yahoo
  • 100/month (lt50 items) or 300/month options
  • CyberCash processing 500 setup
  • Solid reporting and admin options

10
iCat/Intel Commerce Online Hosting Solution
  • Free for lt10 items, 99/mo. for 100 items
  • No per-transaction fees
  • Email and browser-based notifications of purchase
    completion
  • Advanced items like upsell, featured products,
    cybercash gateways

11
iTool Demo
  • www.itool.com/admin/controlpanel.cfm
  • 25-100/mo.

12
Sitematic
  • Flat rate for 40/mo
  • Staging/production site concept
  • More templates and controls

13
Encanto
  • Turnkey server/software for free!
  • Payment gateway included (50 initial, 70/month)
  • Web storefront, shopping cart, catalog system
  • Also need secure cert, merchant bank account
  • All managed via browser, steps are clearly
    documented

14
The Suite Approach
  • Leading contenders
  • What is part of the suite and what isnt
  • Prices and platforms

15
Popular eCommerce Suites
16
Popular eCommerce Suites (cont)
17
Four Typical Elements
  • Catalog
  • Storefront designer
  • Ordering/inventory system
  • Shopping cart/check out system

18
The Cold Hard Reality of Suites
  • Suites are nothing more than collection of
    products
  • Lack integration among various elements
  • Difficult to setup, customize, and use
  • Require you to live inside their structure
  • Limited payment options
  • Sounds like early MS Office

19
Payment Systems Included in Each Suite
  • Microsoft Verifone, Buy Now
  • IBM (Net.Commerce) Verifone, SET/eTill
  • OpenMarket Verifone
  • WebSite Pro IC Verify, PC Authorize, CyberCash,
    others
  • Intershop CyberCash, ICVerify, others

20
Sample Stores Included in Each Suite
  • Microsoft 4 stores
  • IBM eMall, simple and advanced sample stores
  • OpenMarket none
  • WebSite Pro 1 bookstore
  • Intershop 3 stores

21
Database Support
22
Dealing With ODBC
  • Have to understand how to set up data sources
  • Intimate knowledge of your data structure
  • Re-install ODBC drivers at least once!
  • Best to start with built-in database

23
Store Wizards Included in Each Suite
  • Net.Commerce (the best)
  • WebSite Pro (but doesnt do much)
  • Intershop (various wizards)
  • MS Commerce (although youll really need to know
    COM!)

24
Tips
  • Dont install anything before making sure you
    have everything!
  • Downloads for free, but they expire
  • Can you export existing files to these systems?

25
Prices of DIY Products
26
Putting Together Your Own Solution
  • SQL Server database
  • CyberCash payment system
  • WebCatalog 3.0 (supports CCash)
  • IIS web server
  • Total price ltUS10,000

27
Topic 2 What Becomes Success?
  • Overview of eCommerce market
  • Review physical storefront success factors
  • Propose some definitions
  • Define success for the web
  • Draw up eCommerce principles

28
Sad State of Todays eCommerce Marketplace
  • Poor quality tools
  • Hard-to-find stores
  • Limited payment methods
  • Credit card snooping perceptions
  • Older browser versions cant view latest sites

29
Case in Point Buying a Bike Rack
  • Item not carried outdated catalog
  • Telesales not familiar with web
  • No cross-sell or substitutions online
  • Needed three phone calls to complete purchase

30
Another Case Buying Theater Tickets
  • Web site doesnt carry event information in real
    time
  • Orders are fulfilled weeks later
  • No indication on web site of sold-out or nearly
    so events

31
Lets Learn From the Real World
  • Compare what works for physical stores
  • Try to extend to the web

32
Critical Success Factors for Physical Storefronts
  • Location
  • Branding
  • Good service
  • Good product selection
  • Proper pricing and margins
  • Traffic

33
First Problem
  • None of these translate on the net!

34
Now Try to Agree on Definitions for Web Stores
  • What determines a good location?
  • Position on a search page
  • Nearness to popular destination
  • Ad on a popular server
  • What determines branding?
  • Memorable domain name
  • Popular search category destination

35
An Example of bad location Montana Meats
  • Link
  • Cant they afford their own domain name?
  • www.company.com/anything is BAD NEWS!

36
Determining Traffic
  • Hard to do -- is it hits, page views, registered
    users?
  • HITS How Idiots Track Success
  • Hard to measure -- do you count gifs? Use log
    files?
  • No general agreement on any metrics!

37
One Working Definition of Success
  • SURVIVAL!
  • If a site is still running after 12 months, and
    getting more traffic, it is a success.

38
Does a site actually have to sell something?
  • Many actual eCommerce sites dont do the complete
    transaction
  • Require faxes or telephone calls!
  • Some merely have catalogs
  • Examples Singapore Power Authority
  • Cisco Connection Online

39
Principles of Good eCommerce
  • Easy to find merchandize
  • Good service
  • Individual customization is key
  • Simple navigation
  • Make payments easy
  • Make buyer feel transaction is secure
  • Communicate effectively and frequently

40
AMP Connect
  • Have customers in 100 countries
  • Speak many languages
  • Produce 400 catalogs covering 135,000 items
  • Mailings cost US7MM/yr
  • Fax back cost US800,000/yr
  • But you cant buy anything directly!

41
Solution Step Searching
  • Saqqara.com software to enhance Oracle database
  • Provide user feedback as they type in the query
  • Show how many matches in the database
  • Different mechanisms for searching
  • by part number
  • by alphabetical names
  • by part family
  • by picture even

42
AMP Old Screen
43
AMP Connect (cont)
  • And can set to list parts that are available in
    specific countries!
  • Updated daily with over 200 item changes
  • Detailed drawings saves time for customers to
    pick the right item
  • Saved AMP over US5MM in production costs
  • Saved US1MM in translation costs

44
First Principle of eCommerce
  • Make it easy to buy!

45
Amazon.com
  • Services frequent readers with a variety of
    programs
  • Editorial comments
  • If you liked this book, youll like...
  • Notification of new books by author, topic
  • Simplified 1-Click ordering
  • Uses simple pages and email
  • Associates program for commission kickbacks
  • Gift certificates via email
  • And ... lots of stuff to choose from

46
Use Affiliates Programs Wisely
  • They bring traffic to your doorstep
  • Nice revenue sharing model
  • Lots of them to choose from to model your own on
  • AssociatePrograms.com
  • Refer-it.com
  • Shopnow.com (payment processing)

47
A Different Take on Affiliates ClickRewards
  • Pays you in airline miles for your patronage
  • Accrue miles on many sites
  • You redeem benefits on their site

48
Amazon vs Borders
  • Borders link
  • Cookies vs logins
  • Who makes it easier to buy books?

49
Update your directories!
  • This one is more than a year old!

50
Another Side of Service Repeat Business
  • Make the shopper feel part of the family
  • Shopping as entertainment (online auctions)
  • Do what I mean search function (Amazon again
    looks at common misspellings made in the previous
    24 hours for book searches)
  • Periodic targeted email updates and reminders

51
Second Principle of eCommerce
  • Deliver solid service!

52
Dell positives
  • Most notable site for computer buyers
  • Customize the features you want via a web form
  • Simplifies and personalizes the shopping
    experience
  • WYSIWYB (buy)

53
Dell problems
  • Site is now very complex
  • Print ads contain eValue codes
  • Too many pages to get to actual PC configuration

54
Now Compare with Other PC Makers
  • Gateway
  • IBM
  • Compaq
  • Micron
  • which is easiest to customize your PC?

55
Third Principle of eCommerce
  • Individual customization is key

56
BMW Motors
  • Example of what not to do
  • Use gratuitous graphics
  • Cheesy low-res videos
  • Toys, not tools

57
You Never Want To See This Screen!
58
Compare with Subaru
  • Find specific information about each car
  • Can price options to your particular needs

59
A better example fishing licenses
  • Simple, quick, and does the job with a minimum of
    clutter

60
How NOT to Design a Payment Screen
  • http//www.netmar.com/new/norderform.shtml

61
Common mistakes with payments
  • Provide too few or too many order confirmation
    pages
  • Confusing methods and misplaced buttons on order
    page
  • Make it hard for customers to buy things
  • Dont make your customers read error screens

62
Fifth Principle of eCommerce
  • Make payments easy!

63
Perceptions of Credit Card Snooping Still Exist
  • But are largely popularized by media, not
    consumers!
  • Internet fraud stories are still common from both
    buyer and seller sides
  • Just starting to see authentication services
    (such as Cybersource) ramp up
  • Trust will take a long time

64
Sixth Principle of eCommerce
  • Make the buyer feel secure!

65
How Should You Use Email?
  • When to communicate?
  • What to communicate?
  • When is email helpful and when is it spam and
    annoying?

66
Email Uses in eCommerce
  • Sending order acknowledgement
  • Sending shipping notification
  • Purchase receipt
  • Telling customer when item is in stock or on sale
  • Responding to specific queries about service
    issues

67
Email Receipts Should Contain the Following Items
  • Total price, including shipping
  • Your address and the stores
  • Items ordered
  • Whether they are in stock or not
  • When they shipped
  • Bonus order number and URL to view this info
    online, link to UPS/Fedex tracking system

68
When to Send a Customer Email?
  • To acknowledge the order was placed
  • To say items shipped (or not ) and money changes
    hands

69
Seventh Principle of eCommerce
  • Communicate effectively and frequently!

70
Communicate Effectively and Frequently
  • Get your response systems in place
  • Tie in your storefront with any existing customer
    relationship management tools and call centers
  • Send replies within an hour of initial order,
    within 24 hours of any query

71
Topic 3 Future Trends
  • eWallets and secure transactions
  • Caching technologies
  • Internet Appliances

72
eWallet Trends
  • eWallets will eventually go away
  • SET becomes a server-side issue
  • SSL still dominates eCommerce transactions for
    many years

73
Caching Trends
  • More caching appliances as time goes on
  • Better and cheaper caching devices appear
  • Most ISPs will use them within a few years if
    they want to retain customers

74
Internet Appliance Trends
  • More of them and cheaper too
  • Still for SO/HO environments mainly, although
    that is changing
  • Already some vendor consolidation

75
Conclusions
  • eCommerce crosses many different skill sets
  • Software is still too dicey in many areas
  • Standards arent much use right now
  • Suites dont offer much in the way of integration
  • DIY may be the best solution

76
Thanks!
  • David Strom
  • 1 516 944 3407
  • david_at_strom.com
  • Copies of this presentation and other eCommerce
    resouces can be found at http//strom.com/pubwork/
    ecommerce
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