Lecture 4

Lecture 4 - Conclusion of Online Retailing: Introduction to Online Markets - Slides

  • Online Retailing - a new(ish) business model
    • Succesful internet retailer: Amazon.com
    • Unsuccessful internet retailer: Pets.com, CDnow.com
    • Framework for analyzing any internet retailing business
      • Explain all the costs of retailing, using DUB pies example
        • Explain how customer acquisition costs and shipping/fulfillment costs are a vital consideration
          • Customer acquisition costs
          • How it's affected by marketing strategy
          • PR is often cost effective
        • Customer search cost
          • Risk
          • Customer feedback helps search
        • Cost of delay to the customer
        • Cost of designing and operating the web site and transactions
          • Small cost
      • Importance of profit: any fool can set up an internet business (and many did) - the question is, can you make a profit?
        • When does online retailing make sense?
        • What kinds of products?
          • Gasoline? Clothing?
          • Products versus service industries like Starbucks?
  • Data on online retailing
    • Overall impact on the retail industry
      • Music retailing e.g. (will look at overall music and other information industries too)
  • Existing businesses selling online: disintermediation, channel conflict
    • Agent business models: travel agents, realtors etc.
  • Direct sales models
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