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Exploiting eCommerce to your advantage. David Strom CW Post May 2001 Seminar david@strom.com. Critical Success Factors for Physical Storefronts. Location Branding Good service Good product selection Proper pricing and margins Traffic. First Problem:.

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exploiting ecommerce to your advantage

Exploiting eCommerce to your advantage

David Strom

CW Post May 2001 Seminar


critical success factors for physical storefronts
Critical Success Factors for Physical Storefronts
  • Location
  • Branding
  • Good service
  • Good product selection
  • Proper pricing and margins
  • Traffic
first problem
First Problem:
  • None of these translate on the ‘net!
now try to agree on definitions for web stores
Now Try to Agree on Definitions for Web Stores
  • What determines a good location?
    • Position on a search page
    • Nearness to popular destination
    • Ad on a popular server
  • What determines branding?
    • Memorable domain name
    • Popular search category destination
an example of bad location montana meats
An Example of bad location: Montana Meats
  • Link
  • Can’t they afford their own domain name?
  • www.company.com/~anything is BAD NEWS!
determining traffic
Determining Traffic
  • Hard to do -- is it hits, page views, registered users?
  • [HITS = How Idiots Track Success]
  • Hard to measure -- do you count gifs? Use log files?
  • No general agreement on any metrics!
traditional advertising doesn t apply anymore
Traditional Advertising Doesn’t Apply Anymore
  • Can’t measure anything
  • Every site has its own banner sizes
  • The Web is not TV
one working definition of success
One Working Definition of Success:
  • If a site is still running after 12 months, and getting more traffic, it is a success.
does a site actually have to sell something
Does a site actually have to sell something?
  • Many actual eCommerce sites don’t do the complete transaction
  • Require faxes or telephone calls!
  • Some merely have catalogs
  • Examples: Singapore Power Authority
principles of good ecommerce
Principles of Good eCommerce
  • Easy to find merchandize
  • Good service
  • Individual customization is key
  • Simple navigation
  • Make payments easy
  • Make buyer feel transaction is secure
  • Communicate effectively and frequently
amp connect
AMP Connect
  • Have customers in 100 countries
  • Speak many languages
  • Produce 400 catalogs covering 135,000 items
  • Mailings cost US$7MM/yr
  • Fax back cost US$800,000/yr
  • But you can’t buy anything directly!
solution step searching
Solution: “Step Searching”
  • Saqqara.com software to enhance Oracle database
  • Provide user feedback as they type in the query
  • Show how many matches in the database
  • Different mechanisms for searching:
    • by part number
    • by alphabetical names
    • by part family
    • by picture even
amp connect con t
AMP Connect (con’t)
  • And can set to list parts that are available in specific countries!
  • Updated daily with over 200 item changes
  • Detailed drawings saves time for customers to pick the right item
  • Saved AMP over US$5MM in production costs
  • Saved US$1MM in translation costs
first principle of ecommerce
First Principle of eCommerce:
  • Make it easy to buy!
amazon com
  • Services frequent readers with a variety of programs
    • Editorial comments
    • If you liked this book, you’ll like...
    • Notification of new books by author, topic
    • Simplified “1-Click” ordering
  • Uses simple pages and email
  • Associates program for commission kickbacks
  • Gift certificates via email
  • And ... lots of books, toys, electronics, etc. to choose from
use affiliates programs wisely
Use Affiliates Programs Wisely
  • They bring traffic to your doorstep
  • Nice revenue sharing model
  • Lots of them to choose from to model your own on:
    • AssociatePrograms.com
    • Refer-it.com
  • Shopnow.com(payment processing)
amazon vs borders
Amazon vs Borders
  • Borders link
  • Cookies vs logins
  • Who makes it easier to buy books?
update your directories
Update your directories!
  • This one is almost a year old
another side of service repeat business
Another Side of Service: Repeat Business
  • Make the shopper feel part of the family
  • Shopping as entertainment (online auctions)
  • “Do what I mean” search function (Amazon again looks at common misspellings made in the previous 24 hours for book searches)
  • Periodic targeted email updates and reminders
second principle of ecommerce
Second Principle of eCommerce:
  • Deliver solid service!
dell positives
Dell positives
  • Most notable site for computer buyers
  • Customize the features you want via a web form
  • Simplifies and personalizes the shopping experience
  • WYSIWYB (buy)
dell problems
Dell problems
  • Site is now very complex
  • Print ads contain “eValue” codes
  • Too many pages to get to actual PC configuration
now compare with other pc makers
Now Compare with Other PC Makers
  • Gateway
  • IBM
  • Compaq
  • Micron
  • … which is easiest to customize your PC?
third principle of ecommerce
Third Principle of eCommerce:
  • Individual customization is key
bmw motors
BMW Motors
  • Example of what not to do
  • Use gratuitous graphics
  • Cheesy low-res videos
  • Toys, not tools
compare with subaru
Compare with Subaru
  • Find specific information about each car
  • Can price options to your particular needs
a better example fishing licenses
A better example: fishing licenses
  • Simple, quick, and does the job with a minimum of clutter
common mistakes with payments
Common mistakes with payments
  • Provide too few or too many order confirmation pages
  • Confusing methods and misplaced buttons on order page
  • Make it hard for customers to buy things
  • Don’t make your customers read error screens
making the buyer feel secure the six components of ecommerce trust
Making the Buyer Feel Secure: the Six Components of eCommerce Trust
  • Seals of approval, logos of credit card co’s
  • Identifiable brand name
  • Ease of navigation
  • Order fulfillment easy to understand
  • Clear purpose and site presentation
  • Fast and simple technology

(Cheskin Research)

perceptions of credit card snooping still exist
Perceptions of Credit Card Snooping Still Exist
  • But are largely popularized by media, not consumers!
  • Internet fraud stories are still common from both buyer and seller sides
  • Just starting to see authentication services (such as Cybersource) ramp up
  • Trust will take a long time
sixth principle of ecommerce
Sixth Principle of eCommerce:
  • Make the buyer feel secure!
how should you use email
How Should You Use Email?
  • When to communicate?
  • What to communicate?
  • When is email helpful and when is it spam and annoying?
email uses in ecommerce
Email Uses in eCommerce
  • Sending order acknowledgement
  • Sending shipping notification
  • Purchase receipt
  • Telling customer when item is in stock or on sale
  • Responding to specific queries about service issues
email receipts should contain the following items
Email Receipts Should Contain the Following Items
  • Total price, including shipping
  • Your address and the store’s
  • Items ordered
  • Whether they are in stock or not
  • When they shipped
  • Bonus: order number and URL to view this info online, link to UPS/Fedex tracking system
when to send a customer email
When to Send a Customer Email?
  • To acknowledge the order was placed
  • To say items shipped (or not ) and money changes hands
seventh principle of ecommerce
Seventh Principle of eCommerce:
  • Communicate effectively and frequently!
communicate effectively and frequently
Communicate Effectively and Frequently
  • Get your response systems in place
  • Tie in your storefront with any existing customer relationship management tools and call centers
  • Send replies within an hour of initial order, within 24 hours of any query