Ecommerce

Jasmine Theragood

February 20, 2015

CINS 5303

Dr. Frizell

Assignment 1

Chapters 1 & 2

1. Discuss 3 reasons for the dot com failures of the late 1990s. What can be learned from those failures?

There are a lot of reasons to why the dot com failed in the late 1990s. Three common reasons to why they no longer exist are because

• They failed to develop an adequate infrastructure to deliver customer satisfaction and repeat buying.
• They assume business idea that works in the real world will work online without understanding why it works anywhere. (Ideas such as people with feet like buying shoes.)
• They believed that building a database is more important than building sales.

If a person wants to have a successful business with market dominance they will have to know where they are going. Look at the opportunities and define the market that will need to be dominated. Analyze what plan that is set aside and use it before it is lost. Sort problems before they arise and know the company’s customers and competition.

1. In what ways (if any) has the company PayPal contributed to the growth in ecommerce?

PayPal has contributed tremendously in the growth of ecommerce. PayPal has become a valuable marketing partner to tons of companies through the internet, that develops the relationship between the brand and its existing, loyal customers, and also fosters new relationships. PayPal revenue has grown five-and-a-half times faster than credit card revenue. PayPal is quickly becoming just as vital to several ecommerce businesses as Visa and MasterCards. For instance, in 2007 GUESS, Inc. launched its new casual apparel retail concept for young adults, G by GUESS, PayPal quickly spread the word. G by GUESS reached more than 20 million customers through PayPal’s Back-to-School campaign. PayPal aided G by GUESS in reaching young adults; a key initiative for GUESS, Inc. PayPal now has a double-digit share of checkout on GbyGUESS.com.

1. Discuss what is meant by e-commerce localization. What benefits (if any) are companies like Groupon having on the growth of ecommerce?

Ecommerce localization helps companies with a range of requirements enabling the ecommerce website to fully function for global markets. A few of the benefits that companies have on the growth of ecommerce are:

• Growing the revenue with website localization - The economic potential of online communication is $45 trillion, according to a recent study by Common Sense Advisory.
• Increasing buyer confidence with localized user-generated content

1. 71 % of customers agree that online consumer reviews make them more comfortable that they’re buying the right product or service.
2. 70 %of people consult reviews and ratings before purchasing.
3. 63 % of people are more likely to purchase a product from a website if it has positive product ratings and reviews.

1. What is value chain? Who are the major players in an industry value chain and how are they impacted by e-commerce technology?

Value chain is a string of companies working together to satisfy market demands. The major players in an industry value chain are the suppliers, manufacturers, distributors, transporters, retailers, and customers. E-commerce technology has helped manufacturers to reduce the costs they pay for goods through the use of Web-based B2B exchanges. Some manufacturers have also developed direct relationships with their customers online thereby eliminating the distributors and the retailers from the value chain. Distributors can develop highly efficient inventory management systems to reduce their costs, and retailers can develop highly efficient, customer relationship management systems to strengthen their services to customers. Customers can use the Web to search for the best quality, delivery, and prices, thereby lowering their overall transaction costs and reducing the final price they pay for goods.