Weather.com. PayPal. EBay. Match.com. B2C Trends Since 2000 - PowerPoint PPT Presentation

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Weather.com. PayPal. EBay. Match.com. B2C Trends Since 2000

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Weather.com. PayPal. EBay. Match.com. B2C Trends Since 2000. Consolidation and niche growth ... weekly on E-Commerce Times http://www.ecommercetimes.com/ectpi ... – PowerPoint PPT presentation

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Title: Weather.com. PayPal. EBay. Match.com. B2C Trends Since 2000


1
Framework for E-Commerce Analysis
  • B2C (and C2C/P2P)
  • Interactive marketing and customization
  • Online sales and distribution
  • Online service and support
  • B2B
  • Supply chains
  • Distributed transparent and dynamic virtual
    and transformed
  • Extranets
  • E-marketplaces
  • B2E
  • Knowledge management and decentralization
  • Employee training, tracking and productivity
    support
  • Virtual companies and subsidiaries

2
B2C Business Models
Model Examples Revenues
Yahoo, Google
Amazon WalMart
CNN, WSJ Weather.com
PayPal
EBay
Match.com
3
B2C Trends Since 2000
  • Consolidation and niche growth
  • The largest and the smallest ends of the spectrum
    are the most robust
  • Hybrid models for leadership
  • Multiple businesses, services and revenue sources
    through integration, acquisition, and strategic
    partnerships
  • Amazons new search engine
  • Yahoos wireless and media businesses
  • Googles enterprise services
  • More acceptance of fee-based models
  • The Internet is no longer a free for all zone
  • Music, mobile and gaming set the pace (and
    always, sex)
  • Business services and personal gratification are
    core drivers
  • Continued expansion in online sales
  • BUT still seeing dismal browser conversion and
    transaction completion data across all B2C sites
    what are the barriers to growth of E-Commerce?

4
Consumer Drivers
  • Convenience
  • Comparison shopping
  • Product research before purchase decision
  • Greater selection
  • Lower prices
  • And..

5
Critical Role of Trust
  • Security is a prerequisite but not a substitute
    for online trust
  • Security prevents bad things from happening.
  • Trust enables good things to happen.
  • Online trust is an unnatural act
  • Internet lacks traditional trust markers
  • Personal acquaintance, geographical proximity,
    physical presence are how we once instinctively
    decided who to trust
  • Therefore B2C trust must be carefully built and
    maintained in every online interaction to
    maximize the value of the investment in E-Commerce

6
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7
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8
Building Online Trust
  • Excellent and consistent performance at the
    Internet and Web presence technical and security
    level
  • Metrics Web site speed and reliability
    security best practices and policies
  • Excellent Web site design and functionality
  • Metrics Web site best practices implementation
  • Business Reputation
  • Metrics Perception and value of brand
    responsiveness (answer your e-mail!)
  • Providing Tangible Value to the Customer along
    with Protection of Privacy and Personal
    Information
  • Metrics Privacy policies valued online
    services and features

9
Digital Trust Hierarchy of Needs
Shared Value
Relationship
Online Performance
Reputation and Responsiveness
Security and Privacy
Consumer Needs
Typical B2C Approach
10
Web Features That Build Trust(From 1999
E-Commerce Trust Study by Sapient)
  • Brand Recognition
  • Navigational Consistency and Search Function
  • Reliable Fulfillment
  • Starting with ease of ordering, clear fulfillment
    process (explicit information about what happens
    once order is placed online, visible and
    easy-to-use customer support contacts
  • Professional Presentation of Content
  • Accurate, current information and links (no error
    messages)
  • Up to Date Technology Especially for Security
  • Seals of Approval--External Trust Insignia
  • But only if insignia group is recognized by user

11
What Features Do Consumers Value Most?
November 2003
12
Quantifying What Matters Web Performance and
Transaction Success
The Keynote E-Commerce Transaction Performance
Index shows the total (automated) web execution
time and success rate for logging into an
account, searching for an item, adding it to the
shopping cart, and proceeding to check out on
selected Internet retail sites. Success rate is
aggregate ratio of attempts to successful
completion of all steps. Available weekly on
E-Commerce Times http//www.ecommercetimes.com/ect
pi/  
13
10/11/04
Execution Time Rankings
Success Rate in Transactions
Seconds

Rank ( last week)
14
Who Do We Really Trust?
  • Survey (2004) by Ponemon Institute and TRUSTe
    asked 6,300 consumers to name 5 companies across
    all industries that they trusted the most to
    protect their privacy and the personal
    information provided online
  • Top 5 companies in order of rank
  • eBay
  • American Express
  • Proctor Gamble (all brands)
  • Amazon
  • Hewlett Packard
  • Also in top 10
  • US Post Office, IBM, Earthlink, Citibank, Dell

15
What Do We Worry About Most?
  • The same survey asked respondents what worried
    them the most when buying or interacting online
    (including e-mail, web browsing and general
    Internet activities)
  • Majority worried about
  • Identity theft (76)
  • SPAM (58 -- twice as high as in 2003 survey)
  • Some minority worries
  • Legal problems, surveillance, loss of civil
    liberties
  • Financial problems, stolen credit card or loss of
    payment made
  • Public embarrassment
  • Stalking or spying activities

16
Quantifying the Value of Trust
  • DoubleClick 2004 consumer study
  • 81 of US consumers surveyed send and receive
    e-mail daily
  • Consumers consider an e-mail as SPAM when it
    comes from an un-known sender (93) or comes too
    frequently from a known source (58)
  • Despite irritation with SPAM, consumers continue
    to respond to permission-based e-mail and offers
    (which account for less than 8 of total e-mail)
  • Permission marketing drives sales (and requires
    trust)
  • 32 of respondents have made made immediate
    online purchase in response to e-mail offer
  • 30 have clicked for more info and made online
    purchase later
  • 12 have clicked for more info and made purchase
    offline
  • 79 have redeemed e-mailed coupons for online
    purchases
  • 59 have redeemed e-mailed coupons for offline
    purchases

17
Potential B2C Trust Dividend
  • Raise browser-to-buyer conversion rate from under
    10 to 50
  • Estimated added sales revenue
  • Increase the completion rate for transactions
    already at the shopping cart check out from 47
    to 80
  • Estimated added sales revenue
  • Boost the online percentage of all US retail
    sales from under 10 to 50
  • Estimated aggregate E-Commerce dollar increase

18
Best B2C Practice Overview
  • Go to the Buyers Bring in traffic through
    effective online marketing (and affiliate
    programs)
  • Optimize Home Page Design Provide clear
    navigation, site overview, search and support
    options
  • Content Partnerships Keep content relevant and
    current
  • Supporting Images and Content Product details
  • Persistent Shopping Cart Let customers browse
    and then pick up cart as they left it when they
    come back to site
  • Promote Online and Offline Synergies Offer
    in-store pick up and returns provide store
    locator
  • Excellent Search Engine Capabilities Most
    frequently used navigation tool
  • Clear Customer Support Options
  • Strong and Relevant Cross Selling - Solid product
    recommendation logic and tight inventory
    integration is critical

19
One Persistent Worst Practice
  • 2004 study by BenchmarkPortal found that 41 of
    the largest US and Canadian companies on the Web
    are not responding promptly or personally to
    e-mails, even those that indicate a consumer
    interest in making a purchase
  • 41 did not respond
  • 39 send response within 24 hours
  • 15 sent an immediate acknowledgement
  • 17 responded with an accurate and complete
    answer
  • 6 of online companies dont even provide an
    e-mail contact address

20
Sign of Immaturity of B2CStill More Focus on
Finding Than Keeping Customers
Overall retailer digital marketing spending
Source The State Of Retailing Online 5.0
21
Tracking cross-channel customers is elusive
Do you know how many of your Web site
visitors come into your stores and make a
purchase?
Yes 2
No 98
Courtesy of Forrester Research
22
Most offline retailers have not integrated their
channels
Percent of retailers using
Process to measure revenue and cost impact across
channels
42
42
Costs allocated across channels
Offline channels get revenue credit for online
sales
26
Online channel gets revenue for offline sales
influenced by Web
9
Courtesy of Forrester Research
23
Creating an Information Gap in All Channels About
What Happens to the Dropouts
Online researchers who buy in another channel
Online buyers and researchers
Dropouts?
Courtesy of Forrester Research
24
Best Buy A basic cross channel best practice
  • What they did implemented the ability to buy
    online and pick up offline
  • What they learned the Web influences 19 of
    store purchases
  • Impact higher budgets for new developments like
    online circulars, DVD rentals, etc.

25
Sears.com A multichannel best practice
26
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27
Sears.com influences 500 million of in-store
appliance purchases a year
28
WalMart Overview
  • End to end strategy starts with online management
    of all supplier relationships
  • Dynamic sales and inventory update reports via
    the web
  • Customer facing sales and support online,
    including new digital products and services
  • Music downloads, DVD rental services
  • Innovations with RFID tagging for enhanced
    inventory control

29
Standardized Navigation Bars Detailed
Content Online Service Offerings
How does the worlds big store retail giant
rate in end-to-end e-business practice?
30
Two cross selling pitches for relevant items
31
Detailed product descriptions
Anticipating and responding to customer support
questions
Still cross-selling!
Offering alternative contact options and
multi-channel support
32
WalMart in Europe Extending the Brand With
Localization
Global branding and localized web presence
 WalMart International Web SitesCanada
www.walmartcanada.ca China www.wal-martchina.com
Germany www.walmartgermany.de
Mexicowww.walmartmexico.com.mx Korea
www.walmartkorea.com United Kingdom
www.asda.com
33
Another Web Site for Outdoor Furniture How Many
Best Practices Can You Spot?
Well-known best practices mean that start-ups
have a running start In fact, smaller companies
reap proportionately more benefits from an
exemplary web presence
34
Evolution of B2B E-Commerce
  • EDI ancestors
  • Early appearance of supplier webs
  • E-procurement software tools
  • Net exchanges and marketplaces
  • Value webs
  • Private industry and VPN platforms

35
B2B Business Models
Model Examples Revenues
Ariba
Covisent RubberNetwork
Salesforce.com Supportforce.com
Cisco
IBM
36
B2B Trends
  • Consolidation
  • Many start up business failures as well as
    acquisitions
  • E-Marketplace integration along with
    industry-specific survivors
  • Survival based on demonstrating ROI
  • Reach for higher-level management customers
  • Spend management focus by Ariba
  • Executive Dashboards from multiple vendors
  • Data integration and channel synchronization
    issues loom equally large in B2B
  • Security is relatively more robust
  • Critical component is the degree of information
    transparency
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