Sem1 Material Flashcards
customer value
customer is getting something back more valuable than the sacrifice they made (benefits received / sacrifices made)
costs of selling online
requires outside contractors and transporation, not every product can be sold online, higher rate of returned items, packaging costs
collaborative filtering
process that automatically groups people with similar buying intentions, preferences and behaviors to predict future purchases
basic internet economics
smaller number of locations and distribution centers, constantly rated supply chain, collaborative filtering, reducing time to deliver customer value
micro-payments
viable for electronic content to collect small charges for profit (not for tangible goods or paying over time)
micro-payment problems
high processing fees and consumer reluctance
micro-payment opportunities
monetizing free services and enabling access to premium content in too small increments
online firms with lower selling costs
profit from scalability of digitizing and lower operating expenses, BUT has high price competition with other firms
determine scalability of online sale
product characteristics, market characteristics, competition, customer behavior and cost structure
online sale: product characteristics
digital or easily shippable physical products
online sale: market characteristic
online markets for tech-savvy customer base with sufficient global reach
online sale: competition
intense online competition may reduce profitability
online sale: customer behavior
products that are frequently researched or compared online
online sale: cost structure
lower overhead costs online may improve profit margins
