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Electronic Commerce Ninth Edition Chapter 3 Selling on the

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Title: Electronic Commerce Ninth Edition Chapter 3 Selling on the


1
Electronic Commerce Ninth Edition
  • Chapter 3 Selling on the Web Revenue Models and
    Building a Web Presence

2
Learning Objectives
  • In this chapter, you will learn about
  • Revenue models
  • How some companies move from one revenue model to
    another to achieve success
  • Revenue strategy issues that companies face when
    selling on the Web
  • Creating an effective business presence on the
    Web
  • Web site usability
  • Communicating effectively with customers on the
    Web

3
Revenue Models
  • Web business revenue-generating models
  • Web catalog
  • Digital content
  • Advertising-supported
  • Advertising-subscription mixed
  • Fee-based
  • Can work for both sale types
  • Business-to-consumer (B2C)
  • Business-to-business (B2B)
  • Can use same revenue model for both types of sales

4
Web Catalog Revenue Models
  • Adapted from mail-order (catalog) model
  • Seller establishes brand image
  • Printed information mailed to prospective buyers
  • Orders placed by mail or toll-free telephone
    number
  • Expands traditional model
  • Replaces or supplements print catalogs
  • Offers flexibility
  • Orders placed through Web site or telephone
  • Payments made though Web site, telephone, or mail
  • Creates additional sales outlet for existing
    companies

5
Web Catalog Revenue Models (contd.)
  • Computers and consumer electronics
  • Leading computer manufacturers
  • Sell a full range of products on the Web
  • Dell allows product configuration flexibility
  • Creates value
  • Crutchfield
  • Expanded successful mail-order catalog operations
    to include Web sites
  • Best Buy, JR Music World, Radio Shack
  • Web sites sell same products as in stores

6
Web Catalog Revenue Models (contd.)
  • Computers and consumer electronics (contd.)
  • Marketing channel
  • Pathway to customers
  • Advantage of having several marketing channels
  • Reach more customers at less cost
  • Can combine marketing channels
  • Example in-store online ordering
  • Example mail catalogs with reference to
    retailers Web site

Electronic Commerce, Ninth Edition
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7
FIGURE 3-1 Combining marketing channels Two
retailer examples
Electronic Commerce, Ninth Edition
7
8
Web Catalog Revenue Models (contd.)
  • Books, music, and videos
  • Most visible electronic commerce examples
  • Amazon.com Web-only retailer originally sold
    books
  • Evolved into general retailer
  • Barnes Noble, Blackwells, Books-A-Million,
    Powells Books
  • All adopted Web catalog revenue model
  • CDnow Web-only online music store
  • CD Universe copied CDnow approach
  • Tower Records, Sam Goody retail stores
  • Created Web sites to compete with CDnow

9
Web Catalog Revenue Models (contd.)
  • Luxury goods
  • Difficult to sell online
  • Customers want to see product in person or touch
  • Vera Wang and Versace
  • Web sites provide information
  • Shopper purchases at physical store
  • Heavy use of graphics and animation
  • Evian Web site
  • Presents information in a visually stunning way

10
Web Catalog Revenue Models (contd.)
  • Clothing retailers
  • Many adapted catalog sales model to Web
  • Display clothing photos categorized by type
  • Prices, sizes, colors, tailoring details
  • Want customers to examine clothing online
  • Place orders through Web site
  • Lands End online Web shopping assistance
  • Lands End Live (1999)
  • Online text chat and call-back feature
  • Ability to push Web pages to customers browser

11
Web Catalog Revenue Models (contd.)
  • Clothing retailers (contd.)
  • Lands End personal shopper agent (more recent)
  • Learns preferences and makes suggestions
  • My Virtual Model (customers try clothes)
  • Graphic image built from customer measurements
  • Another feature allows
  • Two shoppers using different computers to
    simultaneously browse Web site together
  • Only one of the shoppers can purchase items
  • Either shopper can select items to view
  • Selected items appear in both Web browsers

12
Web Catalog Revenue Models (contd.)
  • Clothing retailers (contd.)
  • Online overstocks stores
  • Reach more people than physical outlet stores
  • Problem varying computer monitor color settings
  • Solution send fabric swatch on request
  • Solution offer generous return policies

Electronic Commerce, Ninth Edition
12
13
Web Catalog Revenue Models (contd.)
  • Flowers and gifts (gift retailers)
  • 1-800-Flowers
  • Online extension to successful telephone business
  • Competes with online-only florists
  • Godiva offers business gift plans
  • Hickory Farms and Mrs. Fields Cookies
  • Offer familiar name brands on the Web
  • Harry and David
  • Original Web site for informational purposes
  • Promoted catalog business and added online
    ordering feature

14
Web Catalog Revenue Models (contd.)
  • General discounters
  • Buy.com and Overstock.com
  • Borrowed Wal-Mart and discount club sales model
  • Sell merchandise at extremely low prices
  • Traditional discount retailers (Costco, Kmart,
    Target, Wal-Mart)
  • Slow to implement online sales on their Web sites
  • Had huge investments in physical stores
  • Did not understand online retailing world
  • Now use the Web catalog revenue model in their
    successful online sales operations

15
Digital Content Subscription Revenue Models
  • Firms owning written information or information
    rights
  • Embrace the Web as a highly efficient
    distribution mechanism
  • Use the digital content revenue model
  • Sell subscriptions for access to information they
    own
  • Legal content
  • LexisNexis offers variety of information
    services
  • Lexis.com offers original legal information
    product

16
Digital Content Subscription Revenue Models
(contd.)
  • Academic research content
  • ProQuest digital copies of academic publications
  • Business content
  • Dow Jones newspaper publisher subscriptions
  • Sold digitized newspaper, magazine, and journal
    content subscriptions
  • Factiva online content management and
    integration service
  • Technical content
  • Association for Computer Machinery (ACM) digital
    library

Electronic Commerce, Ninth Edition
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17
Advertising-Supported Revenue Models
  • Used by United States broadcast network
    television
  • Provides free programming and advertising
    messages
  • Supports network operations sufficiently
  • Problem measuring and charging site visitor
    views
  • Stickiness
  • Keeping visitors at site and attracting repeat
    visitors
  • Exposed to more advertising in a sticky site
  • Problem obtaining large advertiser interest
  • Requires demographic information collection
  • Characteristics set used to group visitors

18
Advertising-Supported Revenue Models (contd.)
  • Can obtain large advertiser interest by
  • Using a specialized information Web site
  • Draw a specialized audience certain advertisers
    want to reach
  • Examples
  • The Huffington Post and the Drudge Report
  • HowStuffWorks

19
FIGURE 3-2 Three strategies for an
advertising-supported revenue model
Electronic Commerce, Ninth Edition
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20
Advertising-Supported Revenue Models (contd.)
  • Web portals (portal)
  • Site used as a launching point to enter the Web
  • Almost always includes a Web directory or search
    engine
  • Often includes other features
  • Web directories
  • Listing of hyperlinks to Web pages
  • Yahoo! one of the first
  • Presents search term triggered advertising on
    each page

Electronic Commerce, Ninth Edition
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21
Advertising-Supported Revenue Models (contd.)
  • Web portals (contd.)
  • Portal sites using general interest strategy
  • AOL, Excite, Google, Bing
  • Portal sites not using general interest strategy
  • Help visitors find information within a specific
    knowledge domain
  • Advertisers pay more
  • Example C-NET
  • Travel sites
  • Successful as advertising-supported online
    businesses
  • Example Kayak

Electronic Commerce, Ninth Edition
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22
Advertising-Supported Revenue Models (contd.)
  • Newspaper and magazine publishers
  • Sell advertising to cover Web site costs
  • Internet Public Library Online Newspapers page
  • Provides links to worldwide newspaper sites
  • Local shopping news, alternative press newspapers
  • Easier transition to advertising-supported Web
    revenue model
  • Newspapers Web presence
  • Provides greater exposure and advertising
    audience
  • Diverts sales from the print edition (difficult
    to measure)
  • Operating costs not covered by advertising revenue

23
Advertising-Supported Revenue Models (contd.)
  • Targeted classified advertising sites
  • Can command higher rates than general advertising
  • Original version
  • Newspaper classified advertising
  • Growth of classified advertising Web sites
  • Very bad for newspapers
  • Example craigslist
  • Web employment advertising
  • Most successful targeted classified advertising
    category
  • Examples CareerBuilder.com, The Ladders and
    Guru.com, Monster.com

24
Advertising-Supported Revenue Models (contd.)
  • Targeted classified advertising sites (contd.)
  • Used vehicle sites
  • AutoTrader.com, CycleTrader.com, BoatTrader.com
  • Accept paid advertising to sell cars,
    motorcycles, boats
  • Product sites with dedicated following
    (VetteFinders)
  • Successful by catering to small audiences
  • Potential classified advertising sites
  • Any site selling products useful to buyer after
    initial use
  • Musicians Buy-Line, ComicLink.com, The Golf
    Classifieds

25
Advertising-Subscription Mixed Revenue Models
  • Subscribers pay fee and accept advertising
  • Typically less advertising compared to
    advertising-supported sites
  • Web sites offer different degrees of success
  • The New York Times (today)
  • Bulk of revenue derived from advertising
  • The Wall Street Journal (mixed model)
  • Subscription revenue weighted more heavily

26
FIGURE 3-3 Revenue models used by online editions
of newspapers and magazines
Electronic Commerce, Ninth Edition
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27
Advertising-Subscription Mixed Revenue Models
(contd.)
  • ESPN
  • Leverages brand name from cable television
    business
  • Sells advertising, offers free information
  • Mixed model includes advertising and subscription
    revenue (collects Insider subscriber revenue)
  • Consumers Union (ConsumerReports.org)
  • Purely a subscription-supported site
  • Not-for-profit organization with no advertising
  • Free information
  • Attracts subscribers and fulfills mission

28
Fee-for-Transaction Revenue Models
  • Service fee charged
  • Based on transaction number or size
  • Web site offers visitor transaction information
  • Personal service formerly provided by a human
    agent
  • Value chain
  • Disintermediation
  • Intermediary (human agent) removed
  • Reintermediation
  • New intermediary (fee-for-transaction Web site)
    introduced

29
Fee-for-Transaction Revenue Models (contd.)
  • Travel
  • Travel agency revenue model receive fee for
    facilitating a transaction
  • Travel agent adds information consolidation and
    filtering value
  • Computers also good at information consolidation
    and filtering
  • Travel agents have long used networked computers
    Sabre Travel Network
  • Internet provided a new way to do business online

30
Fee-for-Transaction Revenue Models (contd.)
  • Travel (contd.)
  • Web-based travel agencies were new entrants
  • Examples Travelocity, Expedia, Hotels.com, Hotel
    Discount Reservations, Orbitz
  • Generate advertising revenue from ads placed on
    travel information pages
  • Traditional travel agents squeezed out
  • Surviving agencies charge a flat fee
  • Smaller travel agents specialize (cruises,
    hotels)
  • May use a reintermediation strategy
    (WaveHunters.com)

Electronic Commerce, Ninth Edition
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31
FIGURE 3-4 Orbitz home page
32
Fee-for-Transaction Revenue Models (contd.)
  • Automobile sales
  • Web sites implement the fee-for-transaction
    revenue model differently
  • CarsDirect.com model
  • Customers select specific car, site determines
    price and finds local dealer
  • Autoweb.com and Autobytel model
  • Locate local dealers, car sells at small premium
    over dealers nominal cost
  • Car salesperson disintermediated
  • Web site new intermediary (reintermediation)

33
Fee-for-Transaction Revenue Models (contd.)
  • Stockbrokers
  • Original full-line brokers charged relatively
    high commissions
  • Provided advice
  • 1970s deregulation resulted in discount brokers
  • Web-based brokerage firms ETRADE and Datek
  • Web allowed investment advice, fast trade
    execution online

34
Fee-for-Transaction Revenue Models (contd.)
  • Stockbrokers (contd.)
  • 1990s discount brokers faced competition from
    online firms
  • Discount brokers and full-line brokers opened new
    stock trading and information Web sites
  • Online brokers offer transaction cost reductions
  • Traditional stockbrokers disintermediated

Electronic Commerce, Ninth Edition
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35
Fee-for-Transaction Revenue Models (contd.)
  • Insurance brokers
  • Quotesmith offered Internet policy price quotes
    directly to public (1996)
  • Independent insurance agents disintermediated
  • Insurance policy information, comparisons, sales
    sites
  • InsWeb, Answer Financial, Insurance.com
  • Progressive Web site
  • Provides quotes for competitors products too
  • The General (General Automobile Insurance
    Services) Web site
  • Offers comfortable, anonymous experience

36
Fee-for-Transaction Revenue Models (contd.)
  • Event tickets
  • Web allows event promoters to sell tickets from
    one virtual location to customers worldwide
  • Online agencies earn a fee on every ticket sold
  • Ticketmaster, Tickets.com, TicketWeb
  • Web created secondary ticket market (StubHub,
    TicketsNow)
  • Brokers connecting ticket owners with buyers
  • Earn fees on tickets resold for others, buy
    ticket blocks
  • Web created easy-to-find central marketplace,
    facilitating buyer-seller negotiations

37
Fee-for-Transaction Revenue Models (contd.)
  • Real estate and mortgage loans
  • Web sites provide all traditional broker services
  • Coldwell Banker, Prudential
  • National Association of Realtors Web site
  • Realtor.com
  • 2008 financial crisis
  • Dramatically reduced number of mortgage brokers
    in business
  • Successful online mortgage brokers
  • Ditech and E-LOAN

38
Fee-for-Transaction Revenue Models (contd.)
  • Online banking and financial services
  • No physical product
  • Easy to offer on Web
  • Web financial transactions concerns
  • Trust and reliability of financial institution
  • Solutions
  • Use existing banks identification and reputation
  • Start online bank not affiliated with existing
    bank (First Internet Bank of Indiana)
  • Use different name (Bank One used Wingspan)
  • Approach was not successful

39
Fee-for-Transaction Revenue Models (contd.)
  • Online banking and financial services (contd.)
  • Additional barriers preventing a more rapid rate
    of growth
  • Lack of bill presentment features
  • Lack of account aggregation tools
  • By 2012
  • Industry analysts expect most banks (online and
    traditional) will offer aggregation services

Electronic Commerce, Ninth Edition
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40
Fee-for-Transaction Revenue Models (contd.)
  • Online music
  • Recording industry slow to embrace online
    distribution
  • Feared digital copying
  • Large online music stores
  • Revenue from fee-for-transaction model
  • Some sites offer subscription plans
  • Complicating issues
  • Stores offer limited number of digital music
    files
  • Stores promote their own music file format
  • Artists and recording companies invoke limits

41
Fee-for-Transaction Revenue Models (contd.)
  • Online music (contd.)
  • Complicating issues (contd.)
  • Buyers required to download and install Digital
    Rights Management (DRM) software
  • Varying restrictions confusing to consumers
  • Online music market industry failed to embrace
    the network effect gained by adopting one
    standard file format

Electronic Commerce, Ninth Edition
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42
Fee-for-Transaction Revenue Models (contd.)
  • Online music (contd.)
  • Some stores sold audio in a generally compatible
    file format with no copying restrictions
  • Mondomix MP3 and Smithsonian Folkways
  • Music not produced by major recording companies
  • Solutions
  • Adopt one standard file format, no copying
    restrictions, DRM-free MP3 format (Amazon in
    2007)
  • By 2012 80 percent of all music will be sold
    online

Electronic Commerce, Ninth Edition
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43
Fee-for-Transaction Revenue Models (contd.)
  • Online video
  • Issues hampering prior sales
  • Large file size
  • Fear of online sales impairing other sales types
  • Inability to play on variety of devices
  • Overcoming the issues
  • New technologies improving delivery
  • Companies incorporating online distribution into
    revenue strategy
  • Delivery allowed on multiple devices
  • Through standard Web browser

44
Fee-for-Transaction Revenue Models (contd.)
  • Electronic books
  • Forms of digital audio books
  • CDs (originally) and various types of digital
    files
  • Audible sells subscriptions
  • Allows monthly download of a certain number of
    books
  • Pricing is per book
  • Amazon.com
  • Offers books, newspapers, magazines, other
    digital format items
  • Delivered directly to its line of Kindle readers

Electronic Commerce, Ninth Edition
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45
Fee-for-Service Revenue Models
  • Companies offer Web service
  • Fee based on service value
  • Not a broker service
  • Not based on transactions-processed number or
    size
  • Online games
  • Sales revenue source
  • Advertising (older concept), pay-to-play for
    premium games, subscription fees
  • Average game player is 35 years old, playing
    computer or video games for 12 years

46
Fee-for-Service Revenue Models (contd.)
  • Professional services
  • Limited Web use
  • State laws prohibit extension of practice
  • Patients may set appointments, receive online
    consultation
  • Major concern
  • Patient privacy
  • Law on the Web site
  • Legal consultations to United Kingdom residents
  • Martindale.com
  • Online version of Martindale-Hubbell lawyer
    directory

47
Fee-for-Service Revenue Models (contd.)
  • Professional services (contd.)
  • CPA Directory
  • United States accounting professionals site
  • General health information
  • RealAge, Dr. Andrew Weils Self Healing, WebMD
  • Significant barrier
  • Patient diagnosis difficult without physical
    examination
  • Some physicians beginning to offer online
    consultations
  • For ongoing, established relationship patients

48
Free for Many, Fee for a Few
  • Economics of manufacturing
  • Different for physical and digital products
  • Unit cost high percentage of physical products
  • Unit cost very small for digital products
  • Leads to a different revenue model
  • Offer basic product to many for free
  • Charge a fee to some for differentiated products
  • Examples Yahoo e-mail accounts, bakery free
    cookies

49
Revenue Models in Transition
  • Companies must change revenue model
  • To meet needs of new and changing Web users
  • Some companies created e-commerce Web sites
  • Needed many years to grow large enough to become
    profitable (CNN and ESPN)
  • Some companies changed model or went out of
    business
  • Due to lengthy unprofitable growth phases

50
Subscription to Advertising-Supported Model
  • Slate magazine
  • Upscale news and current events
  • Success expectations were high
  • Experienced writers and editors
  • Acclaim for incisive reporting and excellent
    writing
  • Initial revenue source
  • Annual subscription did not cover operating costs
  • Now an advertising-supported site
  • Part of the Bing portal
  • Value to Microsoft increase the portals
    stickiness

51
Advertising-Supported to Advertising-Subscription
Mixed Model
  • Salon.com
  • Acclaimed for innovative content
  • Initial revenue source
  • Advertising-supported site
  • Needed additional money to continue operations
  • Now offers optional subscription version
  • Annual fee for Salon premium
  • Free of advertising
  • Additional content
  • Downloadable content

52
Advertising-Supported to Fee-for-Services Model
  • Xdrive Technologies offered free disk storage
  • Initial revenue source (1999) advertising-support
    ed
  • Targeted e-mail advertising
  • Did not cover operating costs
  • 2005 bought by AOL
  • Switched to a subscription-supported model
  • Xdrive frequently adjusted its monthly fee
    downward
  • AOL closed the service in 2009
  • Successful companies fee based on storage amount
    used

53
Advertising-Supported to Subscription Model
  • Northern Light search engine includes own
    database
  • Results include Web site links and abstracts of
    its owned content
  • Initial revenue source
  • Combination of the advertising-supported model
    plus a fee-based information access service
  • Advertising revenue insufficient to cover
    service
  • Converted to a new subscription-supported revenue
    model
  • Mainly large corporate clients
  • Individual monthly billing option for articles
    accessed

54
Multiple Transitions
  • Encyclopedia Britannica
  • Initial Web offerings (1994)
  • Britannica Internet Guide
  • Encyclopedia Britannica Online
  • Initial revenue source
  • Paid subscription site had low subscription sales
  • Converted to free advertiser-supported site
    (1999)
  • Advertising revenues declined
  • 2001 returned to mixed model with subscription
    plan and free content
  • Value added sells reputation and the expertise

55
Revenue Strategy Issues
  • Topics
  • Web revenue models implementation issues
  • Dealing with the issues

56
Channel Conflict and Cannibalization
  • Channel conflict (cannibalization)
  • Company Web site sales activities interfere with
    existing sales outlets
  • Levis Web site and Maytag
  • Web sites no longer sell products
  • Sites now provide product, retail distributor
    information
  • Eddie Bauer
  • Online purchases returnable at retail stores
  • Required compensation and bonus plans adjustments
    to support Web site
  • Channel Cooperation made it successful

57
Strategic Alliances
  • Strategic alliance
  • Two or more companies join forces
  • Undertake activity over long time period
  • Yodlee account aggregation services provider
  • Yodlee concentrates on developing the technology
    and services
  • Banks provide the customers
  • Amazon.com
  • Joined with Target, CDnow, ToysRUs
  • ToysRUs and Amazon suing each other

58
Creating an Effective Web Presence
  • Organizations presence
  • Public image conveyed to stakeholders
  • Usually not important
  • Until growth reaches significant size
  • Stakeholders
  • Customers, suppliers, employees, stockholders,
    neighbors, general public
  • Effective Web presence
  • Critical even for smallest and newest Web
    operating firms

59
Identifying Web Presence Goals
  • Business physical space
  • Focus very specific objectives
  • Not image driven
  • Must satisfy many business needs
  • Often fails to convey a good presence
  • Web business site
  • Intentionally creates distinctive presences
  • Good Web site design provides
  • Effective image-creation features
  • Effective image-enhancing features

60
Identifying Web Presence Goals (contd.)
  • Web business site objectives
  • Attracting Web site visitors
  • Keeping visitors to stay and explore
  • Convincing visitors to follow sites links to
    obtain information
  • Creating an impression consistent with the
    organizations desired image
  • Building a trusting relationship with visitors
  • Reinforcing positive images about the
    organization
  • Encouraging visitors to return to the site

61
Identifying Web Presence Goals (contd.)
  • Making Web presence consistent with brand image
  • Different firms establish different Web presence
    goals
  • Coca Cola Web site pages
  • Usually include trusted corporate image (Coke
    bottle)
  • Image traditional position as a trusted classic
  • Pepsi Web site pages
  • Usually filled with hyperlinks to activities and
    product-related promotions
  • Image upstart product favored by younger
    generation

Electronic Commerce, Ninth Edition
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62
Identifying Web Presence Goals (contd.)
  • Matching site design to function
  • Volkswagen of America site
  • Accomplishes important functions for the company
  • Provides links to detailed Volkswagen model
    information, links to a dealer locator page,
    links to information about the company, a link to
    a set of shopping tools
  • Volkswagens home page
  • Meets the needs of most visitors quickly and
    effectively
  • Volkswagen site enhances company image by
    providing useful information to customers online

Electronic Commerce, Ninth Edition
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63
FIGURE 3-5 Volkswagen of America home page
64
Identifying Web Presence Goals (contd.)
  • Not-for-profit organizations
  • Web presence effort key goals
  • Image enhancement and information dissemination
  • Successful site key elements
  • Integrate information dissemination with
    fund-raising
  • Provide two-way contact channel
  • American Civil Liberties Union (ACLU)
  • Serves many different constituencies
  • Web sites used to stay in touch with existing
    stakeholders, identify new opportunities for
    serving them

65
FIGURE 3-6 ACLU home page
66
Web Site Usability
  • Current Web presences
  • Few businesses accomplish all goals
  • Most fail to provide visitors sufficient
    interactive contact opportunities
  • Improving Web presence
  • Make site accessible to more people
  • Make site easier to use
  • Make site encourage visitors trust
  • Make site develop feelings of loyalty toward the
    organization

67
How the Web Is Different
  • Simple mid-1990s Web sites
  • Conveyed basic business information
  • No market research conducted
  • Web objectives achievement
  • Failed due to no understanding for Web
    presence-building media
  • Web sites designed to create an organizations
    presence
  • Contain links to standard information set
  • Success dependent on how this information offered

68
Meeting the Needs of Web Site Visitors
  • Successful Web businesses
  • Realize every visitor is a potential customer
    (partner)
  • Web presence is an important concern
  • Know visitor characteristic variations
  • Understand that the visitor is at the site for a
    reason
  • Varied motivations of Web site visitors
  • Why visitors arrive at Web sites
  • Learning about company products or services
  • Buying products or services
  • Obtaining warranty, service, repair policy
    information

69
Meeting the Needs of Web Site Visitors (contd.)
  • Varied motivations of Web site visitors (contd.)
  • Why visitors arrive at Web sites (contd.)
  • Obtaining general company information
  • Obtaining financial information
  • Identifying people
  • Obtaining contact information
  • Following a link into the site while searching
    for information about a related product, service,
    or topic
  • Challenge to meet all motivations
  • Visitors arrive with different needs, experience,
    and expectation levels

70
Meeting the Needs of Web Site Visitors (contd.)
  • Making Web sites accessible
  • Build interface flexibility options
  • Frame use
  • Text-only version
  • Selection of smaller graphic images
  • Specification of streaming media connection type
  • Choice among information attributes
  • Controversial Web site design issues
  • Adobe Flash software use
  • Some tasks lend themselves to animated Web pages

71
FIGURE 3-7 Lee Jeans FitFinder Flash animation
72
Meeting the Needs of Web Site Visitors (contd.)
  • Making Web sites accessible (contd.)
  • Offer multiple information formats
  • Consider goals in Web site construction

FIGURE 3-8 Goals for business Web sites
73
Trust and Loyalty
  • Creates relationship value
  • Good service leads to seller trust
  • Delivery, order handling, help selecting product,
    after-sale support
  • Satisfactory service builds customer loyalty
  • Customer service in electronic commerce sites
  • Problem
  • Lack integration between call centers and Web
    sites
  • Poor e-mail responsiveness

74
Rating Electronic Commerce Web Sites
  • Companies routinely review electronic commerce
    Web sites for
  • Usability, customer service, other factors
  • Sell the gathered information directly to the
    companies operating the Web sites
  • Include suggestions for improvements
  • BizRate.com posts ratings
  • Provides comparison shopping service
  • Compiles ratings by conducting surveys of sites
    customers

75
Usability Testing
  • Importance
  • Helps meet Web site goals
  • Avoids Web site frustration
  • Customers leave site without buying anything
  • Simple site usability changes
  • Include telephone contact information
  • Staff a call center
  • Learn about visitor needs by conducting focus
    groups
  • Usability testing cost
  • Low compared to Web site design costs

76
Customer-Centric Web Site Design
  • Important part of successful electronic business
    operation
  • Focus on meeting all site visitors needs
  • Customer-centric approach
  • Putting customer at center of all site designs
  • Follow guidelines and recommendations
  • Make visitors Web experiences more efficient,
    effective, memorable
  • Webby Awards site
  • Examples of good Web site design

77
Connecting with Customers
  • Important element of a corporate Web presence
  • Identify and reach out to customers

78
The Nature of Communication on the Web
  • Communication modes
  • Personal contact (prospecting) model
  • Employees individually search for, qualify,
    contact potential customers
  • Mass media
  • Deliver messages by broadcasting
  • Addressable media
  • Advertising efforts directed to known addressee
  • Internet medium
  • Occupies central space in medium choice
    continuum

79
FIGURE 3-9 Business communication modes
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Summary
  • Six main Web revenue models
  • Models work differently
  • Different business types use different models
  • Companies change models as they learn more about
  • Customers, business environment
  • Channel conflict and cannibalization challenges
  • One approach channel cooperation
  • Effective Web presence delivers customer value
  • Web site visitors arrive with a variety of
    expectations, prior knowledge, skill levels,
    technology
  • Web communication fits in between personal
    contact and mass media
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