Ritchey Design - E-Commerce - Lecture Slides, Slides of Fundamentals of E-Commerce

E-Commerce is taking over the traditional commerce practices. It is of special concern for the IT students. Following are the key points of these Lecture Slides : Ritchey Design, Internet Consumer, Research, Market, Consumer Behavior, Internet Surfers, Consumer Purchasing, Building Relationships, Implementation, Consumer Market Research

Typology: Slides

2012/2013

Uploaded on 07/30/2013

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E-Commerce
Internet Consumer & Market
Research
Learning Objectives
Describe the essentials of consumer behavior
Describe the characteristics of Internet surfers and EC purchasers
Understand the process of consumer purchasing decision making
Describe the way companies are building relationships with
customers
Explain the implementation of customer service
Describe the consumer market research in EC
Experience the role of intelligent agents in consumer applications
Describe the organizational buyer behavior model
The Importance of Customers
Competition
“fighting” on customers
to succeed : control the 3Cs
Customers
customers becomes a King/Queen
to succeed : finding and retaining customers
Change
EC is a new distribution channel
to succeed : convince customers to go online and then to choose
your company over the online competitors
The idea is to understand the needs and requirements of the
customer and the changes in his behavior
The major pressures are labeled the 3Cs
Ritchey Design Learns
about Customers
The Problem
Ritchey Design, Inc. is a relatively small designer
and manufacturer of mountain bike components
Sells its products to distributors and/or retailers,
who then sell them to individual consumers
Its 1995 Web site was more a status symbol than a
business tool
Ritchey Design Learns
about Customers (cont.)
Visitors could get information on Team Ritchey or
find out where Ritchey products were sold
It did not give customers all the information they
wanted
It did not enable the company to gain insight into
its customers’ wants and needs
Ritchey Design Learns
about Customers (cont.)
The Solution
In late 1995, Ritchey reworked the Web site so
that the company could hear from its customers
directly
set up customer surveys on the site
offered visitors who answer the surveys a chance to
win free Ritchey products
vsitors enter their names and addresses and then
answer questions about the company’s products
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E-Commerce

Internet Consumer & Market

Research

Learning Objectives

  • Describe the essentials of consumer behavior
  • Describe the characteristics of Internet surfers and EC purchasers
  • Understand the process of consumer purchasing decision making
  • Describe the way companies are building relationships with customers
  • Explain the implementation of customer service
  • Describe the consumer market research in EC
  • Experience the role of intelligent agents in consumer applications
  • Describe the organizational buyer behavior model

The Importance of Customers

  • Competition
    • “fighting” on customers
    • to succeed : control the 3Cs
  • Customers
    • customers becomes a King/Queen
    • to succeed : finding and retaining customers
  • Change
    • EC is a new distribution channel
    • to succeed : convince customers to go online and then to choose your company over the online competitors
  • The idea is to understand the needs and requirements of the customer and the changes in his behavior

The major pressures are labeled the 3Cs

Ritchey Design Learns

about Customers

  • The Problem
    • Ritchey Design, Inc. is a relatively small designer and manufacturer of mountain bike components
    • Sells its products to distributors and/or retailers, who then sell them to individual consumers
    • Its 1995 Web site was more a status symbol than a business tool

Ritchey Design Learns

about Customers (cont.)

  • Visitors could get information on Team Ritchey or find out where Ritchey products were sold
  • It did not give customers all the information they wanted
  • It did not enable the company to gain insight into its customers’ wants and needs

Ritchey Design Learns

about Customers (cont.)

  • The Solution
    • In late 1995, Ritchey reworked the Web site so that the company could hear from its customers directly - set up customer surveys on the site - offered visitors who answer the surveys a chance to win free Ritchey products - vsitors enter their names and addresses and then answer questions about the company’s products

2

Ritchey Design Learns about Customers (cont.)

  • Web Trader software automatically organizes and saves the answers in a database and is used to help make marketing and advertising decisions
  • Questions are changed to learn customers’ opinions about any new products Ritchey develops
  • Saves $100,000 on product development per year

Ritchey Design Learns about Customers (cont.)

  • An online catalog educates retailers and consumers about the technological advantages of Ritchey’s high-end components over competitors’ parts
  • Visitors browse the product catalog that includes detailed descriptions and graphics of Ritchey’s products

Ritchey Design Learns about Customers (cont.)

  • The Results
    • ritcheylogic.com sells only team items such as t- shirts, bags, water bottles, and other gear directly to individuals online
    • The company does not sell bike parts to individuals directly online because it wants to maintain its existing distribution system
    • Dealers can place orders on the site

4

Variables Influencing Decision Making Process

  • Environmental Variables

Social variables people influenced by family members, friends, co-workers, “what’s in fashion this year”, Internet communities and discussion groups Cultural variables Other environmental variables available information, government regulations, legal constraints, and situational factors (^6)

Looking at a online Consumer (Average)

The statistics are US based

Variables Influencing Decision Making Process (cont.)

  • Consumer Demographics (2006)

Age (mostly 20-30 year-old)

Marital status (41% married & 39% single)

Educational level (82% with at least some college education & 50% obtained at least baccalaureate degree)

Ethnicity (87% white in America)

Occupation (26% educational-related field, 22% computers & 22% other professionals)

Consumer Demographics

  • Gender (61% male user & 39% female user)

Purchases Category

% of Total Category Purchases (299)

% of Total Respondents Buying (166) Computer Software 15% 39% Books 14% 35% Music 11% 28% Magazines 11% 28% Flowers 11% 28% Women’s Clothing 7% 19% Computer Hardware 5% 12% Games 5% 11% Videos 4% 10% Crafts & Craft SupplierToys 4%3% 10%9% Home Furnishings 2% 6% Children’s Clothing 2% 4% Men’s ClothingArt 2%2% 4%4% JewelryFurniture 1%1% 3%2% TOTAL 100%

Variables Influencing Decision Making Process (cont.)

  • Consumer Demographics Household income (46% at least $50,000/year) Internet usage profile (Internet access option, length and frequency of web use & access cost) Internet access option (63% primarily form home & 58% primarily from work or school) Length and frequency of use (88% access daily & 33% access 10-20 hours a week) Access cost (67% pay for their own Internet access & 31% paid for by their employers) 9

Some figures from 2007

  • comScore Networks has announced the results

of the first complete review of consumer e-

commerce for the year 2007, reporting that

sales at domestic online retailers surged to

$153 billion for the year. Excluding online

Travel, comScore reports sales totaled $73.

billion, reflecting a growth rate of

approximately 30% vs. the year 2006.

Source: http://www.sellitontheweb.com/ezine/news0556.shtml

Shop.org Statistics

Consumer Decision-

Making Essentials

Consumer Purchasing Decision-Making: Roles

  • Roles that people play in the decision making process Initiator : the person who first suggests or thinks of the idea of buying a particular product or service Influencer : a person whose advice or views carry some weight in making a final buying decision Decider : the person who ultimately makes a buying decision or any part of it - whether to buy, what to buy, how to buy, or where to buy Buyer : the person who makes an actual purchase User : the person who consumes or uses a product or service