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Lecture E-commerce (7/e): Chapter 9 - Kenneth C. Laudon, Carol Guercio Traver

Chapter 9 - Online retail and services. The following will be discussed in this chapter: Major trends in online retail, 2010-2011; the retail sector, the retail industry, E-commerce retail: the vision, analyzing the viability of online firms, strategic analysis factors,. | E-commerce Kenneth C. Laudon Carol Guercio Traver business. technology. society. seventh edition Copyright © 2011 Pearson Education, Inc. E-commerce: Business. Technology. Society Chapter 9: Online Retail and Services Copyright © 2010 Pearson Education, Inc. Slide 9- Chapter 9 Online Retail and Services Copyright © 2011 Pearson Education, Inc. Blue Nile Sparkles For Your Cleopatra Class Discussion Why is selling (or buying) diamonds over the Internet difficult? 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? Slide 9- Major Trends in Online Retail, 2010-2011 Growth in social shopping Online retail remained profitable during recession 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 Slide 9- The Retail Sector Most important theme in online retailing is effort to integrate online and offline operations U.S. retail market accounts for $10 trillion (70%) of total GDP Personal consumption: Services: 61 % Nondurable goods: 29 % Durable goods: 10 % “Goods” vs. “services” ambiguity Slide 9- The Retail Industry 8 segments (clothing, durable goods, etc.) For each, uses of Internet may differ Information vs. direct purchasing General merchandisers vs. specialty retailers Mail order/telephone order (MOTO) sector most similar to online retail sector Sophisticated order entry, delivery, inventory control systems Slide 9- Composition of the U.S. Retail Industry Slide 9- SOURCE: Based on data from U.S. Census Bureau, 2010 Figure 9.1, p. 579 E-commerce Retail: The Vision Reduced search and transaction costs; customers able to find lowest prices Lowered market entry costs, . | E-commerce Kenneth C. Laudon Carol Guercio Traver business. technology. society. seventh edition Copyright © 2011 Pearson Education, Inc. E-commerce: Business. Technology. Society Chapter 9: Online Retail and Services Copyright © 2010 Pearson Education, Inc. Slide 9- Chapter 9 Online Retail and Services Copyright © 2011 Pearson Education, Inc. Blue Nile Sparkles For Your Cleopatra Class Discussion Why is selling (or buying) diamonds over the Internet difficult? 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? Slide 9- Major Trends in Online Retail, 2010-2011 Growth in social shopping Online retail remained profitable during recession Online retail still fastest growing retail channel Buying online a normal, mainstream experience Selection of goods increases, includes luxury goods Informational