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Chapter 16

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Chapter 16

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  1. Chapter 16 Launching a Successful Online Business

  2. Learning Objectives • Understand the fundamental requirements for initiating an online business. • Describe the funding options available to startup businesses. • Evaluate the options for hosting Web sites.

  3. Learning Objectives (cont.) • Understand the processes and business decisions associated with managing Web site development. • Understand the importance of providing content that meets the needs and expectations of the intended audience.

  4. Learning Objectives (cont.) • Evaluate Web sites on design criteria such as appearance, navigation, consistency, and performance. • Know the techniques of search engine optimization to obtain high placement in search engines.

  5. Learning Objectives (cont.) • Understand the benefits of customer relationship management through customer self-service, listening to customers, and increasing trust.

  6. OBO Sets Its Goals for Success • The Problem • OBO sells protective gear for field hockey goalkeepers • OBO’s unique three-dimensional thermo-bonding manufacturing process produces equipment that is shaped to reflect the way the body moves

  7. OBO Sets Its Goals for Success (cont.) • By manufacturing a quality product and listening to the customer, OBO has become the market leader • OBO is based in a small provincial town in New Zealand that is a very long way from its principal markets

  8. OBO Sets Its Goals for Success (cont.) • OBO sells a niche product that is best sold thorough agents or stores to ensure a proper fit • How does OBO use its Web site to market an experiential product to a global market from New Zealand?

  9. OBO Sets Its Goals for Success (cont.) • The Solution • The goals of the Web site are: • community building • product sales • research and development

  10. OBO Sets Its Goals for Success (cont.) • Community building happens through: • online discussion forums • sponsored players • an image gallery • The principal marketing and sales goal of the Web site is to: • convince the visitor of the value of the product • direct the customer to a store or agent to make the purchase

  11. OBO Sets Its Goals for Success (cont.) • The Web site is a support mechanism for the brand and the sale of equipment through the agents • Research and development goal is met through: • online surveys • solicitation of players’ opinions of the products • focus groups

  12. OBO Sets Its Goals for Success (cont.) • The Results • The OBO Web site is most successful at community building • The site also builds community by promoting a goalie-friendly approach to OBO’s customers • Online product sales are modest because the Web site supports, not competes, with OBO’s agent network

  13. OBO Sets Its Goals for Success (cont.) • Online sales are expected to grow because OBO has introduced a new line of clothes designed to be sold exclusively through the Web site • The focus groups deliver high-value feedback at almost no cost • The discussion forums contribute to both community building and feedback about OBO’s product

  14. OBO Sets Its Goals for Success (cont.) • What we can learn… • A small company with a great product is using its Web site to reach its target markets in distant countries • OBO is using the site to support business goals, as well as to meet the needs and expectations of its target audience

  15. OBO Sets Its Goals for Success (cont.) • The Web site is simple and well designed, includes: • “attractors” that encourage customer interaction and keep customers coming back • content that promotes cross selling • effectively promotes sustainable customer relationships

  16. Doing Business Online:Getting Started • Business formation process: • Identify a consumer or business need in the marketplace • Investigate the opportunity • Determine the business owner’s ability to meet the need

  17. Doing Business Online:Getting Started (cont.) • Requirements that reflect the online nature of a business: • Need to understand Internet culture Customers are active in how they absorb and use information, and the Internet is a personal, helping, and sharing place for most users • Consider the nature of appropriate products and services

  18. Doing Business Online:Getting Started (cont.) • E-business planning Business plan: A written document that identifies a company’s goals and outlines how the company intends to achieve the goals

  19. Doing Business Online:Getting Started (cont.) • Biggest difference in e-business planning is for the ontrepreneur to recognize that the Internet is unlike any other sales channel; companies can: • interact with consumers with both reach and richness • introduce new and innovative business models • distribute information at the speed of light at almost zero cost

  20. Doing Business Online:Getting Started (cont.) • An existing brick-and-mortar business looking to move online also needs a: Business case: A document that is used to justify the investment of internal, organizational resources in a specific application or project

  21. Doing Business Online:Getting Started (cont.) • Business case template includes: • Goals • Cost savings • New revenue • Extra benefits • Cost of the solution • Net benefits • Recommendation

  22. Doing Business Online:Getting Started (cont.) • Funding the online business • Venture capital (VC): Money invested in a business by an individual or a group of individuals (venture capitalists) in exchange for equity in the business

  23. Doing Business Online:Getting Started (cont.) • Angel investor: A wealthy individual who contributes personal funds and expertise at the earliest stage of business development

  24. Doing Business Online:Getting Started (cont.) • Incubator: A company, university, or not-for-profit organization that supports businesses in their initial stages of development

  25. Doing Business Online:Building the Web Site • Classifications of Web sites • Informational Web site: A Web site that does little more than provide information about the business and its products and services • Interactive Web site: A Web site that provides opportunities for the customers and the business to communicate and share information

  26. Doing Business Online:Building the Web Site (cont.) • Attractors: Web site features that attract and interact with visitors in the target stakeholder group • Transactional Web site: A Web site that sells products and services

  27. Doing Business Online:Building the Web Site (cont.) • Building the Web site • Select a Web host • Register a domain name • Create and manage content • Design the Web site • Construct the Web site and test • Market and promote the Web site

  28. Web Site Hosting • Web hosting options: • Storebuilder service: A hosting service that provides disk space and services to help small and micro businesses build a Web site quickly and cheaply • ISP hosting service: A hosting service that provides an independent, standalone Web site for small- and medium-sized businesses

  29. Web Site Hosting (cont.) • Web hosting service: A dedicated Web site hosting company that offers a wide range of hosting services and functionality to businesses of all sizes • Mirror site: An exact duplicate of the original Web site, but it is physically located on a Web server on another continent

  30. Web Site Hosting (cont.) • Co-location: A Web server owned and maintained by the business is placed in a Web hosting service that manages the server’s connection to the Internet • Self-hosting: When a business acquires the hardware, software, staff, and dedicated telecommunications services necessary to set up and manage its own Web site

  31. Web Site Hosting (cont.) • Contracting the Web host • The search for an ISP host: • contacting local ISPs for information • asking others in the business community for recommendations • consulting with local telecommunications and computer user groups

  32. Web Site Hosting (cont.) • When a short list of potential ISPs has been compiled, a RFQ can be used to ensure that complete and consistent bids for provision of service are submitted

  33. Consider: service quality measures guaranteed uptime number of clients current traffic rates software support security site traffic analysis technical support services costs Web Site Hosting (cont.)

  34. Web Site Hosting (cont.) • Registering a domain name • Domain name: A name-based address that identifies an Internet-connected server • Domain name registrar: A business that assists prospective Web site owners with finding and registering a domain name of their choice

  35. Web Site Hosting (cont.) • Selecting a good domain name: • Make it memorable • Make it easy to spell • Avoid numbers and special characters • Keep it short and sensible

  36. Web Site Hosting (cont.) • Be flexible • Think about the future • Give products their own name • Investigate the competition • Avoid trademarked names

  37. Content Creation and Management • Content:The text, images, sound, and video that make up a Web page • Commodity content:Information that is widely available and generally free to access on the Web

  38. Content Creation and Management (cont.) • Premium content:Content not available elsewhere on the Web • Cross selling:Offering similar or related products and services to increase sales • Up selling:Offering an upgraded version of the product in order to boost sales and profit

  39. Content Creation and Management (cont.) • Up-selling activities usually include offering products with a different design, color, fabric, or size • Promotion secondary content that can increase sales or improve customer service • Comment further explanation about the product can be offered after introducing the product

  40. Content Creation and Management (cont.) • Creating content • collecting all the content that is currently available • value of additional content is assessed for inclusion in the Web site • consider how each bit of content will serve the site’s goals and whether customers will want it or expect it • created by customers through reviews etc.

  41. Content Creation and Management (cont.) • Buying content • Content can be purchased or licensed • Content that is acquired from outside sources should be supplemental content, not primary content • If primary content is purchased and no value is added, visitors will go to the originating site and not return

  42. Content Creation and Management (cont.) • Personalizing content Personalized content: Web content that is prepared to match the needs and expectations of the individual visitor • Delivering content by e-newsletter E-newsletter: A collection of short, informative articles sent at regular intervals by e-mail to individuals who have an interest in the newsletter’s topic

  43. Content Creation and Management (cont.) • Writing effective content • Write scannable text • Break long sections into smaller ones with clearly noted headings • Grab the reader’s attention at the beginning of every page and section • Write in a tone and with language that reflects the purpose of the material

  44. Content Creation and Management (cont.) • Consistency in site content can be achieved using a style guide • Make the material available in a .pdf file when necessary • Create compelling links that encourage a reader to click • External links can offer good content for visitors • Avoid material that is not highly valued by customers

  45. Content Creation and Management (cont.) • Content management Content management: The process of adding, revising, and removing content from a Web site to keep content fresh, accurate, compelling, and credible

  46. Content Creation and Management (cont.) • Content testing—frequent checks of material for: • Accuracy • Clarity • Typos • poor punctuation • misspelled words • inconsistencies

  47. Content Creation and Management (cont.) • Content removal Expired pages should be deleted or moved to an off-line location that can serve as an archive • Content management software Allows nontechnical staff to create, edit, and delete content on the company’s Web site

  48. Content Creation and Management (cont.) • Purchasing a content management software • Do a thorough needs analysis • Document requirements and discuss with at least two companies that have purchased a CMS • Start small with CMS that has a trial version or low entry cost • Assess the system after 30 days • Repeat the assessment process regularly

  49. Web Site Design • The goal of any Web site is to deliver quality content to its intended audience and to do so with an elegant design

  50. Web Site Design (cont.) • Information architecture Information architecture: How the site and its Web pages are organized, labeled, and navigated to support browsing and searching throughout the Web site