Chapter 3:Selling on the Web: Revenue Models and Building a Web Presence2ObjectivesIn this chapter !ou "ill learn about:# Revenue $odels# %o" so$e co$panies $ove &ro$ one revenue $odel to another to achieve success# Revenue strateg! issues that co$panies &ace "hen selling on the Web# Creating an e&&ective business presence on the Web# Web site usabilit!# Co$$unicating e&&ectivel! "ith custo$ers on the Web3E-BUSINESS MODELS Weill and 'itale proposition:(he value propositions o& eight business $odels di&&er according to the degree to "hich the &ollo"ing e)business assets are captured online:*Custo$er transaction * to capture revenue*Custo$er data * to capture data about custo$er+s purchasing needs*Custo$er relationship * abilit! to in&luence custo$er+s behaviors Atomic Business Models,E-BUSINESS MODELSBusiness Models and Their E-Business AssetsAtomic Business Models-Based on Weill and 'itale 2../ Straub 2..,01Business Models and their E-Business AssetsAtomic Business Models-Based on Weill and 'itale 2../ Straub 2..,0E-BUSINESS MODELS2Typical Business Models in EC# Online direct $ar3eting# 4lectronic tendering s!ste$s -e5g5 reverse auction0# 6a$e !our o"n price# 7&&iliate $ar3eting# 'iral $ar3eting# 8roup purchasing# Online auctions# Product and service custo$i9ation customization# 4lectronic $ar3etplaces and e:changes# 'alue)chain integrators# 'alue)chain service providers# In&or$ation bro3ers# Bartering # ;eep discounting# Me$bership# Suppl! chain i$proversWeb Site Isabilit!# Motivations o& Web site visitors include:* @earning about products or services that the co$pan! o&&ers* Bu!ing products or services that the co$pan! o&&ers* Obtaining in&or$ation about "arrant! service or repair policies &or products the! purchased* Obtaining general in&or$ation about the co$pan! or organi9ation* Obtaining &inancial in&or$ation &or $a3ing an invest$ent or credit granting decision* Identi&!ing the people "ho $anage the co$pan! or organi9ation* Obtaining contact in&or$ation &or a person or depart$ent in the organi9ation,.Ma3ing Web Sites 7ccessible#One o& the best "a!s to acco$$odate a broad range o& visitor needs is to build &le:ibilit! into the Web site+s inter&ace#8ood site design lets visitors choose a$ong in&or$ation attributes#Web sites can o&&er visitors $ultiple in&or$ation &or$ats b! including lin3s to &iles in those &or$ats,/Ma3ing Web Sites 7ccessible#8oals that should be $et "hen constructing Web sites:*O&&er easil! accessible &acts about the organi9ation*7llo" visitors to e:perience the site in di&&erent "a!s and at di&&erent levels*Sustain visitor attention and encourage return visits*O&&er easil! accessible in&or$ation about products and services,2Ma3ing Web Sites 7ccessible#What does accessibilit! reall! $eanE%o" do people "ith disabilities access "ebpagesE* I"a!es # ani"ations$ Ise the alt attribute to describe the &unction o& each visual5 * I"a!e "aps% Ise the client)side "ap and te:t &or hotspots5 * Multi"edia% Provide captioning and transcripts o& audio and descriptions o& video5 * &yperte't lin(s% Ise te:t that $a3es sense "hen read out o& conte:t5 Aor e:a$ple avoid Jclic3 here5J * )a!e or!ani*ation% Ise headings lists and consistent structure5 Ise CSS &or la!out and st!le "here possible5 * +raphs # charts% Su$$ari9e or use the lon!desc attribute5 * Scripts, applets, # plu!-ins% Provide alternative content in case active &eatures are inaccessible or unsupported5 * -ra"es% Ise the no.ra"es ele$ent and $eaning&ul titles5 * Tales% Ma3e line)b!)line reading sensible5 Su$$ari9e5 * Chec( your /or(% 'alidate5 Ise tools chec3list and guidelines at http:KK"""5"35orgK(RKWC78 ,3%o" do !ou retain custo$ersE#One o& the $ost co$$on &actors that in&luences a site+s success is the trust custo$ers have in the &ir$ and the increased loyalty that this brings*What leads to trustE# 7 1 percent increase in custo$er lo!alt! can !ield pro&it increases bet"een 21L and =.L# Repetition o& satis&actor! service can build trust and custo$er lo!alt!# Poor custo$er service results in lac3 o& trust "hich can 3ill lo!alt!,,%o" do !ou retain custo$ersE# Ma3e the site usable5 Isabilit! is de&ined b! &ive Mualit! co$ponents -7lertbo: ;r5 ?a3ob 6ielsen0: * @earnabilit!: %o" eas! is it &or users to acco$plish basic tas3s the &irst ti$e the! encounter the designE * 4&&icienc!: Once users have learned the design ho" Muic3l! can the! per&or$ tas3sE * Me$orabilit!: When users return to the design a&ter a period o& not using it ho" easil! can the! reestablish pro&icienc!E * 4rrors: %o" $an! errors do users $a3e ho" severe are these errors and ho" easil! can the! recover &ro$ the errorsE * Satis&action: %o" pleasant is it to use the designE ,1Custo$er)Centric Web Site ;esign# Custo$er)centric Web site design puts the custo$er at the center o& all site designs # 8uidelines: * ;esign the site around ho" visitors "ill navigate the lin3s * 7llo" visitors to access in&or$ation Muic3l! * 7void using in&lated $ar3eting state$ents* 7void using business jargon and ter$s that visitors $ight not understand* Be consistent in use o& design &eatures and colors* Ma3e sure navigation controls are clearl! labeled* (est te:t visibilit! on s$aller $onitors* Conduct usabilit! tests,=4ntrepreneurship and Business Models#4ntrepreneurship and creativit! is a processG*Identi&! an Opportunit!*;evelop a Concept*;eter$ine the ReMuired Resources*7cMuire the 6ecessar! Resources*I$ple$ent and Manage*%arvest the 'entureSource: Morris et al5 4ntrepreneurship N Innovation ,>4ntrepreneurship and Business Models#Ara$e"or3sSource: Morris et al5 4ntrepreneurship N Innovation 4ntrepreneurial Process(he 4nviron$ent(he 4ntrepreneur(he Resources (he Concept(he Organi9ationalConte:t1.4ntrepreneurship and Business Models#%o" to &ind opportunitiesSource: Morris et al5 4ntrepreneurship N Innovation (!pes Methods Sources ;etractorsPerennial ;eliberate Search vs5 ;iscover! (he Rules Change ;e$ographics Change 6o 6eed Present Windo" is not !et openOccasional Mar3et Pull vs5 Resource or Capacit! Push Inderserved Mar3ets Social (rends Strong @o!alties %igh S"itching CostsMultiple Causes 6e" custo$ers to the $ar3et Satis&ied custo$ersMultiple 4&&ects Increase in usage rates Shortages 4as! &or others to enter "ith alternatives Intense co$petition 6e" Ono"ledge Custo$ers hard to reach1/4ntrepreneurship and Business Models#(!pes o& Innovations*6e" to the "orld products or services*6e" to the $ar3et products or services*6e" product or service line that at least one co$petitor is o&&ering*7ddition to e:isting products or service lines*ProductKservice i$prove$ent revision including addition o& ne" &eatures or options*6e" application o& e:isting products or services including application to a ne" $ar3et seg$ent*Repositioning o& an e:isting product or serviceSource: Morris et al5 4ntrepreneurship N Innovation 124ntrepreneurship and Business Models#4ntr! WedgesSource: Morris et al5 4ntrepreneurship N Innovation Other Entry Wedges New Product or Service Parallel Competition FranchisingAcquisition Exploiting Parallel omentum !eographic "rans#er Supply Shortages "apping $tili%ed &esources ' ' ' Customer Sponsorship Customer Contract (ecoming a )nd Source ' ' Parent Co* Sponsorship +oint ,enture -icensing ar.et &elinquishment Sello## /ivision ' ' ' ' !overnmental Sponsorship Favored Purchasing &ule Changes ' ' 13What is a Business ModelE#Si: 3e! Muestions*%o" do "e create valueE*Aor "ho$ do "e create valueE*What is our source o& co$petenceK advantageE*%o" do "e di&&erentiate ourselvesE*%o" do "e $a3e $one!E*What are our ti$e scope and si9e a$bitionsE1,Porter+s Co$petitive Aorces Model: %o" the Internet In&luences Industr! Structure11Su$$ar!#Models used to generate revenue on the Web include:*Web catalog*;igital content sales*7dvertising)supported*7dvertising)subscription $i:ed*Aee)&or)transaction and &ee)&or)service#Co$panies underta3ing electronic co$$erce initiatives so$eti$es:*Aor$ strategic alliances*Contract "ith channel distribution $anagers12Su$$ar!#Air$s $ust understand ho" the Web di&&ers &ro$ other $edia#4nlisting the help o& users "hen building test versions o& the Web site is a good "a! to create a site that represents the organi9ation "ell#Air$s $ust also understand the nature o& co$$unication on the Web