28-07-2012, 03:05 PM
Online Retail and Services
Online Retail and Services.ppt (Size: 1.7 MB / Downloads: 77)
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How has Blue Nile built its supply chain to keep costs low?
How has Blue Nile reduced consumer anxiety over online diamond purchases?
What are some vulnerabilities facing Blue Nile?
Would you buy a $5,000 engagement ring at Blue Nile?
Major Trends in Online Retail, 2011–2012
Growth in social shopping
Online retail still fastest growing retail channel
Buying online a normal, mainstream experience
Selection of goods increases, includes luxury goods
Informational shopping for big-ticket items expands
Specialty retail sites show most rapid growth
Increased use of interactive, Web 2.0 marketing
The Retail Sector
Most important theme in online retailing is effort to integrate online and offline operations
U.S. retail market accounts for $10.7 trillion (70%) of total GDP
Personal consumption:
Services: 65%
Nondurable goods: 25%
Durable goods: 10%
“Goods” vs. “services” ambiguity
E-commerce Retail: The Vision
Reduced search and transaction costs; customers able to find lowest prices
Lowered market entry costs, lower operating costs, higher efficiency
Traditional physical store merchants forced out of business
Some industries would be disintermediated
Few of these assumptions were correct—structure of retail marketplace has not been revolutionized
Internet has created new venues for multi-channel firms and supported a few pure-play merchants
The Online Retail Sector Today
Smallest segment of retail industry (5%–6%)
Growing at faster rate than offline segments
Revenues have resumed growth
Around 72% of Internet users bought online in 2011
Primary beneficiaries:
Established offline retailers with online presence (e.g., Staples)
First mover dot-com companies (e.g., Amazon)
Multi-channel Integration
Integrating Web operations with traditional physical store operations
Provide integrated shopping experience
Leverage value of physical store
Types of integration
Online order, in-store pickup
In-store kiosk or clerk Web order, home delivery
Web promotions to drive customers to stores
Gift cards usable in any channel
Increasing importance of mobile devices