Chapter 3 Flashcards
What are the limitations of e-tailing? Where is e-tailing going?
In Korea, Internet retailing has become the second
most important distribution channel, exceeding the national sales volume of all department stores. In many countries,
B2C is the fastest growing form of retailing. The question is what will be the limits of e-tailing? The market concentration
has already begun, setting a high bar for new e-tailers. However, small businesses can easily start their online channel as
part of a stable e-mall service platform when they find a niche opportunity.
Because many easy sources of funding have dried up and revenue models are being scrutinized, vendor consolidation
will continue until greater stability within the e-tailing sector occurs. Ultimately, there will likely be a smaller number of
larger sellers with comprehensive general sites (e.g., Amazon.com) and many smaller, specialized niche sites (e.g., Net-
a-Porter, Blue Nile).
How should we introduce wireless shopping?
In some countries (e.g., Japan, Korea, Finland, United States), shopping
from smartphones is already very popular. In other countries, mobile shopping is not popular yet, although the platform
itself may be available. Alternative channels (multichannel marketing) and a culture of a variety of communication chan-
nels are developing in many countries, facilitating mobile strategies. In addition, because the younger generation prefers
the mobile platform, strategies for the younger generation need to be considered. Offering mobile shopping might not be
simple or appropriate to all businesses, but it certainly will be dominant in the future
Do we have ethics and privacy guidelines?
Ethical issues are extremely important online, just as they are offline. In
traditional systems, people play a significant role in ensuring the ethical behavior of buyers and sellers. Will online ethics
and the rules of etiquette be sufficient to guide behavior on the Internet? Only time will tell. For example, as job applicant
information travels over the Internet, security and privacy become even more important. It is the management’s job to
make sure that information from applicants is secure. Moreover, e-tailers need to establish guidelines for protecting the
privacy of customers who visit their websites. Security and privacy must be priorities
How will intermediaries act in cyberspace?
The role of online intermediaries has become more and more important. In
the banking, stock trading, job market, travel industry, and book sales sectors, the Internet has become an essential service
channel. These intermediary services create new business opportunities for sellers and intermediaries.
Should we try to capitalize on social networks?
Many organizations and individuals began advertising or selling prod-
ucts and services on Facebook and other social networks. Although large companies currently are concentrating on adver-
tising, some are experimenting with B2C sales. Social commerce may become an extremely important marketing channel
and should be at least experimented with by retailers.
How should we manage multichannel marketing to avoid channel and/or price conflicts?
Managing multichannels
requires a strategy on handling different types of transactions in the most appropriate and cost-effective way. Changing
channels needs to be done together with appropriate conflict management.
What are the major potential limitations of the growth of B2C EC?
First, the limitations depend on market demands
for online products. The saturation effect may be strong. Second, the cost and availability of Internet access may influence
growth. Third, cultural differences and habits may deter or slow down e-shopping. Fourth, the ease of B2C shopping is
important, and fifth, the availability of payments and order fulfillment infrastructure are critical success factors.
How to deal with “big data”?
A large amount of data is collected in B2C and is growing rapidly. It is necessary to extract
valuable information and knowledge from this data. The technologies that are used belong mostly to the category of busi-
ness intelligence (BI); they range from data and Web mining to several other analytical tools.
