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New eCommerce Trends and Technologies

New eCommerce Trends and Technologies. David Strom david@strom.com +1 (516) 944 3407 Centra Presentation 2/9/2000. Agenda. Build or buy your web storefront? What becomes success? Future trends . Topic 1: Build or Buy Your Web Storefront. Rent : outsource to a CSP Buy suite of software

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New eCommerce Trends and Technologies

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  1. New eCommerce Trends and Technologies David Strom david@strom.com +1 (516) 944 3407 Centra Presentation 2/9/2000 Centra presentation (c) David Strom Inc. 2000

  2. Agenda • Build or buy your web storefront? • What becomes success? • Future trends Centra presentation (c) David Strom Inc. 2000

  3. Topic 1: Build or Buy Your Web Storefront • Rent: outsource to a CSP • Buy suite of software • Build it yourself Centra presentation (c) David Strom Inc. 2000

  4. Evaluating CSPs • Do they offer storefront design? • Have in-house programmers? • Hosting of your own web server machine? • How many payment systems do they support? • What kinds of accounting reports do they offer? Centra presentation (c) David Strom Inc. 2000

  5. www.psi.net/web/ecommerce.shtml www.Best.com/bizcomm.html www.Brainlink.com/html/saleslink.htm www.Earthlink.net IBM: mypage.ihost.com www.Netcom.com business.Mindspring.com/prod-svc/smbiz/ www.outer.net/ONCommerce (OuterNet) Some CSP Examples Centra presentation (c) David Strom Inc. 2000

  6. Earthlink pricing explained Centra presentation (c) David Strom Inc. 2000

  7. CSP Approaches • GeoShop/Yahoo • ViaWeb/Yahoo • iCat/Intel • Encanto • iTool • Others entering a very crowded field Centra presentation (c) David Strom Inc. 2000

  8. GeoShop/Yahoo Builds on GeoCities “communities” but for merchants (www.geocities.com/join/geoshops) $25/month for just commercial listings $180/month (or more!) for actual transactions working with Internet Commerce Services Corp. who uses Open Market Transact servers (www.icoms.com/pp.htm) Centra presentation (c) David Strom Inc. 2000

  9. $100/month (<50 items) or $300/month options CyberCash processing $500 setup Solid reporting and admin options ViaWeb/Yahoo Centra presentation (c) David Strom Inc. 2000

  10. Free for <10 items, $99/mo. for 100 items No per-transaction fees Email and browser-based notifications of purchase completion Advanced items like upsell, featured products, cybercash gateways iCat/Intel Commerce Online Hosting Solution Centra presentation (c) David Strom Inc. 2000

  11. iTool Demo • www.itool.com/admin/controlpanel.cfm • $25-$100/mo. Centra presentation (c) David Strom Inc. 2000

  12. Sitematic • Flat rate for $40/mo • Staging/production site concept • More templates and controls Centra presentation (c) David Strom Inc. 2000

  13. Turnkey server/software for free! Payment gateway included ($50 initial, $70/month) Web storefront, shopping cart, catalog system Also need secure cert, merchant bank account All managed via browser, steps are clearly documented Encanto Centra presentation (c) David Strom Inc. 2000

  14. The Suite Approach • Leading contenders • What is part of the suite and what isn’t • Prices and platforms Centra presentation (c) David Strom Inc. 2000

  15. Popular eCommerce Suites Centra presentation (c) David Strom Inc. 2000

  16. Popular eCommerce Suites (con’t) Centra presentation (c) David Strom Inc. 2000

  17. Four Typical Elements • Catalog • Storefront designer • Ordering/inventory system • Shopping cart/check out system Centra presentation (c) David Strom Inc. 2000

  18. The Cold Hard Reality of Suites • Suites are nothing more than collection of products • Lack integration among various elements • Difficult to setup, customize, and use • Require you to live “inside” their structure • Limited payment options • Sounds like early MS Office Centra presentation (c) David Strom Inc. 2000

  19. Payment Systems Included in Each Suite • Microsoft: Verifone, Buy Now • IBM (Net.Commerce): Verifone, SET/eTill • OpenMarket: Verifone • WebSite Pro: IC Verify, PC Authorize, CyberCash, others • Intershop: CyberCash, ICVerify, others Centra presentation (c) David Strom Inc. 2000

  20. Sample Stores Included in Each Suite • Microsoft: 4 stores • IBM: eMall, simple and advanced sample stores • OpenMarket: none • WebSite Pro: 1 bookstore • Intershop: 3 stores Centra presentation (c) David Strom Inc. 2000

  21. Database Support Centra presentation (c) David Strom Inc. 2000

  22. Dealing With ODBC • Have to understand how to set up data sources • Intimate knowledge of your data structure • Re-install ODBC drivers at least once! • Best to start with built-in database Centra presentation (c) David Strom Inc. 2000

  23. Store Wizards Included in Each Suite • Net.Commerce (the best) • WebSite Pro (but doesn’t do much) • Intershop (various wizards) • MS Commerce (although you’ll really need to know COM!) Centra presentation (c) David Strom Inc. 2000

  24. Tips • Don’t install anything before making sure you have everything! • Downloads for free, but they expire • Can you export existing files to these systems? Centra presentation (c) David Strom Inc. 2000

  25. Prices of DIY Products Centra presentation (c) David Strom Inc. 2000

  26. Putting Together Your Own Solution • SQL Server database • CyberCash payment system • WebCatalog 3.0 (supports CCash) • IIS web server • Total price: <US$10,000 Centra presentation (c) David Strom Inc. 2000

  27. Topic 2: What Becomes Success? • Overview of eCommerce market • Review physical storefront success factors • Propose some definitions • Define success for the web • Draw up eCommerce principles Centra presentation (c) David Strom Inc. 2000

  28. Sad State of Today’s eCommerce Marketplace • Poor quality tools • Hard-to-find stores • Limited payment methods • Credit card snooping perceptions • Older browser versions can’t view latest sites Centra presentation (c) David Strom Inc. 2000

  29. Case in Point: Buying a Bike Rack • Item not carried: outdated catalog • Telesales not familiar with web • No cross-sell or substitutions online • Needed three phone calls to complete purchase Centra presentation (c) David Strom Inc. 2000

  30. Another Case: Buying Theater Tickets • Web site doesn’t carry event information in real time • Orders are fulfilled weeks later • No indication on web site of sold-out or nearly so events Centra presentation (c) David Strom Inc. 2000

  31. Let’s Learn From the “Real World” • Compare what works for physical stores • Try to extend to the web Centra presentation (c) David Strom Inc. 2000

  32. Critical Success Factors for Physical Storefronts • Location • Branding • Good service • Good product selection • Proper pricing and margins • Traffic Centra presentation (c) David Strom Inc. 2000

  33. First Problem: • None of these translate on the ‘net! Centra presentation (c) David Strom Inc. 2000

  34. Now Try to Agree on Definitions for Web Stores • What determines a good location? • Position on a search page • Nearness to popular destination • Ad on a popular server • What determines branding? • Memorable domain name • Popular search category destination Centra presentation (c) David Strom Inc. 2000

  35. An Example of bad location: Montana Meats • Link • Can’t they afford their own domain name? • www.company.com/~anything is BAD NEWS! Centra presentation (c) David Strom Inc. 2000

  36. Determining Traffic • Hard to do -- is it hits, page views, registered users? • [HITS = How Idiots Track Success] • Hard to measure -- do you count gifs? Use log files? • No general agreement on any metrics! Centra presentation (c) David Strom Inc. 2000

  37. One Working Definition of Success: • SURVIVAL! • If a site is still running after 12 months, and getting more traffic, it is a success. Centra presentation (c) David Strom Inc. 2000

  38. Does a site actually have to sell something? • Many actual eCommerce sites don’t do the complete transaction • Require faxes or telephone calls! • Some merely have catalogs • Examples: Singapore Power Authority • Cisco Connection Online Centra presentation (c) David Strom Inc. 2000

  39. Principles of Good eCommerce • Easy to find merchandize • Good service • Individual customization is key • Simple navigation • Make payments easy • Make buyer feel transaction is secure • Communicate effectively and frequently Centra presentation (c) David Strom Inc. 2000

  40. AMP Connect • Have customers in 100 countries • Speak many languages • Produce 400 catalogs covering 135,000 items • Mailings cost US$7MM/yr • Fax back cost US$800,000/yr • But you can’t buy anything directly! Centra presentation (c) David Strom Inc. 2000

  41. Solution: “Step Searching” • Saqqara.com software to enhance Oracle database • Provide user feedback as they type in the query • Show how many matches in the database • Different mechanisms for searching: • by part number • by alphabetical names • by part family • by picture even Centra presentation (c) David Strom Inc. 2000

  42. AMP Old Screen Centra presentation (c) David Strom Inc. 2000

  43. AMP Connect (con’t) • And can set to list parts that are available in specific countries! • Updated daily with over 200 item changes • Detailed drawings saves time for customers to pick the right item • Saved AMP over US$5MM in production costs • Saved US$1MM in translation costs Centra presentation (c) David Strom Inc. 2000

  44. First Principle of eCommerce: • Make it easy to buy! Centra presentation (c) David Strom Inc. 2000

  45. Amazon.com • Services frequent readers with a variety of programs • Editorial comments • If you liked this book, you’ll like... • Notification of new books by author, topic • Simplified “1-Click” ordering • Uses simple pages and email • Associates program for commission kickbacks • Gift certificates via email • And ... lots of stuff to choose from Centra presentation (c) David Strom Inc. 2000

  46. Use Affiliates Programs Wisely • They bring traffic to your doorstep • Nice revenue sharing model • Lots of them to choose from to model your own on: • AssociatePrograms.com • Refer-it.com • Shopnow.com(payment processing) Centra presentation (c) David Strom Inc. 2000

  47. A Different Take on Affiliates: ClickRewards • Pays you in airline miles for your patronage • Accrue miles on many sites • You redeem benefits on their site Centra presentation (c) David Strom Inc. 2000

  48. Amazon vs Borders • Borders link • Cookies vs logins • Who makes it easier to buy books? Centra presentation (c) David Strom Inc. 2000

  49. Update your directories! • This one is more than a year old! Centra presentation (c) David Strom Inc. 2000

  50. Another Side of Service: Repeat Business • Make the shopper feel part of the family • Shopping as entertainment (online auctions) • “Do what I mean” search function (Amazon again looks at common misspellings made in the previous 24 hours for book searches) • Periodic targeted email updates and reminders Centra presentation (c) David Strom Inc. 2000

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