PRESENTED BY

SATHEESH.D SARAVANAN.B VAISHNAVI.M KALAIVANI.M

Selling to a final customer through a physical outlet or through direct communication e.g.: collection of individual stores, individually managed. Mall management provides physical location where a retailer can create an outlet; Generalised stores have a unified management but carry different product lines; Specialised stores sell a specific product line;
Malls

Franchise stores a single marketing and brand, but individual store may

be run by a different management, with a fee paid back to franchisee.

OTHER FORMS (NON STORE RETAILING):

Direct mailing catalogue is sent to customer, who then send a mail order. telemarketing;

door-to-door sales;
vending machines;

have moved away from physical outlet to virtual retailing.

3

Forms of Non-store Retailing

High
Direct selling Telemarketing

Active customer involvement

On-line retailing

Direct mail and catalogs

Television home shopping

Automatic vending

Low Low Active retailer involvement High

Categories of Electronic Commerce Business-to-customer (B2C): Retailing of

products and services directly to individual customers

Business-to-business (B2B): Sales of goods

and services among businesses

Consumer-to-consumer (C2C): Individuals

use Web for private sales or exchange

Nature of Retail Industry is Changing

To Todays Retailer

Mom and Pop Store

Internet Marketing and Electronic Retailing

Overview of Electronic Retailing electronic retailing (e-tailing)

Retailing conducted online, over the Internet

e-tailers
Retailers who sell over the Internet

 Online

retailing is the process consumers go through to purchase products or services over the internet. E-Retailing is the use of technology such as computers and the internet to sell a range of products and services online to the world.

E-retailing results from mapping traditional retailing to the new medium of the internet:
Specialised

stores -> specialised e-stores; Generalised stores -> generalised e-stores; Malls -> E-malls; Franchise stores -> ?

What Sells Well on the Internet?

Computer hardware and software Consumer electronics Office supplies Sporting goods Books and music

Toys Health and beauty Apparel and clothing Jewelry Cars Services Others : Electronic goods

Characteristics of Successful E-Tailing

High brand recognition A guarantee provided by highly reliable or well-known vendors Digitized format Relatively inexpensive items Frequently purchased items Commodities with standard specifications Well-known packaged items that cannot be opened even in a traditional store

Retailing vs. E-Tailing

DISINTERMEDIATION The removal of organizations or business process layers responsible for certain intermediary steps in a given supply chain.
REINTERMEDIATION The process whereby intermediaries (either new ones or those that had been disinter mediated) take on new intermediary roles.

DISINTERMEDIATION & REINTERMEDIATION

CostSweater
Manufacturer Distributor Retailer Customer

$48.50

Manufacturer

Retailer

Customer

$40.34

Manufacturer

Customer

$20.45

PRIMARY E-TAILING BUSINESS MODELS

Classification

by Distribution Channel

1. Mail-order retailers that go online

Retailers leveraging on existing infrastructures by using direct online marketing as their main distribution channel

2. Direct marketing from manufacturers

Manufacturers market directly online to customers

3. Pure-play e-tailers
No physical stores, only online presence

4. Click-and-mortar retailers
Traditional retailers with supplementary Web sites

5. Internet (online) malls

Many independent online merchants in one location.

Cont.
Direct

marketing by mail order companies

Broadly, marketing that takes place without

intermediaries between manufacturers and buyers; In our context, marketing done online between any seller and buyer For a successful Mail-Order company to have a distinct advantage in online sales, it must have good payment processing, inventory management and order-fulfillment operations as shown in the following Lands End case study.

Cont.
Direct

sales by manufacturers

Sellers understand their markets better because of the direct

connection to consumers Consumers gain greater information about the products through direct connection to the manufacturers Example: Dell Computers: build-to-order customization.
Virtual

(pure-play) e-tailers

Firms that sell directly to customers over the Internet without

maintaining a physical sales channel. Example: [Link].

Cont.
Click-and-mortar

retailers

Brick-and-mortar retailers with a transactional Web site from

which to conduct business.

Multichannel

business model

A business model where a company sells in multiple

marketing channels simultaneously Example: A company conducting its business using both physical stores and online stores.

Cont.
Retailing

in online malls or e-mall

Referring directories
Directory organized by product type Catalog listings or banner ads at the mall site advertise the products or stores.

Malls with shared services

Consumer can find the product, order and pay for it, and arrange for shipment Hosting mall provides these services, but they are executed by each store independently. Ideally, the customer would like to go to different stores in the emall, use one shopping cart, and pay only once. This integrated services (with a single checkout for many merchants) is possible in Yahoo! Store ([Link]/merchant).

 Specialised

e-store Generalised e-store E-mall Direct Selling by the manufacturer E-broker E-services E-auction

[Link];
Wal-Mart; Yahoo!

Store;

[Link]; [Link];

[Link]
E

bay
21

e-Auctions are negotiations conducted via an online platform. Suppliers get the possibility of improving their proposals based on market feedback (e.g. rank in negotiation) and are considered to be the most transparent way of conducting negotiations. e-Auctions include both price and non-price (service level, quality, etc.) parameters to ensure the result of the auction reflect the overall best total value .

 Transparent

process It will be clear to participants why they won/lost the e-Auction. Participants will receive real-time market information. Contracts can be awarded faster. Time saving compared to face-to-face negotiations.

1 Consumer finds

something he or she wants to buy at a shop on the Net Shop

6
Verification and remittance of actual funds

2 Consumer sends on
enciphered request for payment to his or her bank

The electronic bank sends back a 3 secure packet of ecash Merchant Server Consumer sends the ecash to the shop

Consumers Bank

Consumer Public Key

The shop sends the packet of cash to its bank

Shop

Merchant Bank

Payment Systems in E-Retailing

SYSTEM CREDIT CARDS

DESCRIPTION SECURE SITE PRESERVES INFORMATION

ELECTRONIC CASH

DIGITAL CURRENCY USED FOR MICROPAYMENTS

PERSON-TO-PERSON

SEND MONEY TO SITES UNABLE TO USE CREDIT CARDS

DIGITAL WALLET

SOFTWARE STORES CREDIT CARD INFORMATION

ELECTRONIC CHECK

CHECK WITH ENCRIPTED DIGITAL SIGNATURE

SMART CARD

MICROCHIP STORES ELECTRONIC CASH

ELECTRONIC BILL PAYMENT

ELECTRONIC FUNDS TRANSFER

THE INFORMATIONS THAT ARE ESSENTIAL IN AN E-TAILING WEBSITE :

How can products and service be made available to the global market?
There are range of ways to make your web site be well know by

people. This includes:

Using banners on others sites to advertise Using word of mouth

Using social networking sites to advertise such as twitter to alert

people when a new product is available

Use of existing contacts with customers to alert them either by

putting pallets out thought the physical store and through email.

If the funds are available use television advertisement and radio advertisement.

1. 2. 3. 4. 5. 6. 7. 8.

9.
10.

[Link] [Link] Alibaba Corporation [Link] Wal-Mart Hewlett-Packard John Lewis House of Fraser MercadoLibre Otto Gruppe

India has an internet user base of over 100 million users. The penetration of e-commerce is low compared to markets like the United States and the United Kingdom but is growing at a much faster rate with a large number of new entrants.

The India retail market is estimated at $470 Bn in 2011 It is expected to grow to $675 Bn by 2016 and $850 Bn by 2020, estimated CAGR of 7%.

According to Forrester, the e-commerce market in India is set to grow the fastest within the Asia-Pacific Region at a CAGR of over 57% between

2012-16.

India e-tailing market in 2011 was about $600 Mn and expected to touch $9 Bn by 2016 and $70 Bn by 2020

Estimated CAGR of 61%. E-tailing in India is currently a $0.7 bn industry, providing employment to near 11,000 people.

[Link] is the largest B2B Ecommerce portal in India.

Cash on Delivery as a preferred payment method. India has a vibrant cash economy as a result of which 80% of Indian ecommerce tends to be Cash On Delivery (Cash on Delivery). Direct Imports constitute a large component of online sales. Demand for international consumer products is growing much faster than in-country supply from authorized distributors and e-commerce offerings.

EMI(credit facilities) facilities is an emerging trend in etailing.

 Indian

e-tailing market leader is [Link] whose valuation is $1 Bn. Flipkarts revenues were $10 Mn in 2010-11 and $150 Mn in 2011-2012. Its 20% of Indian online retail market. Flipkart is aiming to achieve $1 Bn in next 2-3 years. Indian e-tailing is dominated by pure play internet companies with no serious play by any existing retailers. Futurebazaar is $35 Mn revenue today and Croma has recently entered e-commerce.

TO THE CUSTOMER:
convenience better

information competitive pricing customisation shopping anywhere, anytime.

40

 Enjoyment

of retail shopping lost Privacy and security issues Access to the Internet and computer necessary Product risk

TO THE E-RETAILER:
global

reach; better customer service; low capital cost; mass customisation; targeted marketing; more value added services; new forms of specialised stores and niche marketing.
42

 channel

conflict

Issues in E-Tailing

Situation in which an online marketing channel upsets the traditional

channels due to real or perceived damage from competition

Determining

the right price

Personalization

Mass customization
Fraud
How

and illegal activities

to make customers happy

Need market research

BOOKS

INTERNET MARKETING & E-COMMERCE BY WARD HANSON AND KIRTHI

KALYANAM, INDIAN EDITON. RETAILING : ENVIRONMENT & OPERATIONS BY ANDREW J NEWMAN AND PETER CULLAN, INDIAN EDITON.

WEBSITES:
[Link] [Link] [Link] [Link]

[Link]
[Link]/ technopak

Case Study-12 eBay

[Link] are the advantages and dis-advantages from the buyers and sellers perspectives of purchasing merchandise through Internet auctions like eBay?

 The

small level entrepreneurs have a chance to sell their products. The big businesses are discovered like Disney and sun Microsystems in eBay. E-auction help to sell returned merchandise, refurbished merchandise, and used products. Sellers are get more revenue because of disintermediation. 24* 7 service is available. So the sellers are selling their products at any time.

 E-bay follow C to C MODEL. Customers will get the products

at Low price

because of disintermediation. 24*7 service is available. So customer can buy the product at any time. N number of products are available. Have a chance of comparing other products . Other buyers feedback is available, its helps to know the opinion of other buyers about the product. The customers need not to pay any fee for transactions.

 Sellers

alone liable to pay the service charges to the e-auction websites. Bidder registration fee, appraisal& authentic fees are charged. the seller has to face world wide competition

 Privacy

and security issues Product risk No guarantee and warrantee for the merchandise from the e-auction websites. Tax liability Delay in receiving merchandise (ex: 14 days in eBay) low buyer interaction and involvement.

2. Will a significant amount of retail sales be made through internet auctions like eBay in the future? Why or Why not?

Yes, there is a significant scope for internet auction web sites to made retail sales through e-auction

According to a new survey conducted for eBay by ACNielsen International Research, a leading research firm. More than 724,000 Americans report that eBay is their primary or secondary source of income. In addition to these professional eBay sellers, another 1.5 million individuals say they

supplement their income by selling on eBay.

Buy anything you can think of from just about any part of the world. Unique benefits to the customers like no-deductibles, no-haggle, no third

party money-back guarantee for the purchase up to certain sum of money

(ex: $250 in [Link])

E-retailing has achieved 13% of Compounded Average growth rate. By 2020 it is expected that 60% of the merchandise retailing takes place through e-tailing. The competition online with e-commerce websites and online auction sites is huge, which means retailers are constantly slashing their prices. Obviously this represents a great deal for the consumer, who manages to get products at hugely discounted prices, without a

valid reason