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Internet Commerce: Enabling Web Storefronts

Learn how to successfully use the Internet for commerce, including understanding how it works and why it works. This tutorial covers topics such as choosing the right eCommerce path, installing and operating your own storefront, and examples of various products.

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Internet Commerce: Enabling Web Storefronts

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  1. Internet Commerce: Enabling Web Storefronts presented by: David Strom David Strom, Inc. USA david@strom.com (c)David Strom Inc. 1998

  2. Why This Tutorial • The Internet is moving from a collection of technologies to a set of commercial services • To use the Internet successfully: • you need to know how it works; but, • you must also understand why it works… • A fun topic, things changing quickly! (c)David Strom Inc. 1998

  3. Course Topics • What Becomes Success? • Choosing the Right eCommerce Path • Installing and Operating Your Own Storefront • Examples of various products (c)David Strom Inc. 1998

  4. Course Approach • Discuss technology • Provide pointers • Give examples • Provide insight into various approaches and technology choices (c)David Strom Inc. 1998

  5. What This Course is Not About • Nuts and bolts of payment systems • In-depth on security (c)David Strom Inc. 1998

  6. Some Disclaimers • I’ve lived in the Internet for a long time • Fundamental aspects of Internet dynamics are unavoidable • I have consulted to some of the vendors mentioned (c)David Strom Inc. 1998

  7. Today’s Topics • I: What Becomes Success • II: Choosing the Right eCommerce Path • III: Installing and Operating Your Own Storefront (c)David Strom Inc. 1998

  8. Topic I: What Becomes Success? • Overview of eCommerce market • Review physical storefront success factors • Propose some definitions • Define success for the web • Draw up five eCommerce principles (c)David Strom Inc. 1998

  9. Overview of eCommerce Market • Predictions • Success factors • Five principles (c)David Strom Inc. 1998

  10. eCommerce Revenue Predictions are Wide-Ranging

  11. IDC says the web will become a mass market in the US by 12/98! With 100 million users! Let’s not confuse web users with eCommerce BUYERS! And Not Very Believable (c)David Strom Inc. 1998

  12. US$5 million/month via the web in sales Started 11/96 Generating lots of new buyers, who wouldn’t ordinarily use their service Ticketmaster (c)David Strom Inc. 1998

  13. Then there is Disney.com • Web site Daily Blast signing up 15k members/month • Sales via web are equal to 3x-5x of physical Disney store! (c)David Strom Inc. 1998

  14. And of Course, There is the Porn Industry • “However, extensive interviews with adult site owners yield a picture of a highly charged market of approximately 10,000 sites generating about $1 billion in revenue per year, most through electronic credit card transactions.” • from Interactive Week (c)David Strom Inc. 1998

  15. 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 (c)David Strom Inc. 1998

  16. 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 (c)David Strom Inc. 1998

  17. Let’s Learn From the “Real World” • Compare what works for physical stores • Try to extend to the web (c)David Strom Inc. 1998

  18. Critical Success Factors for Physical Storefronts • Location • Branding • Good service • Good product selection • Proper pricing and margins • Traffic (c)David Strom Inc. 1998

  19. First Problem: • None of these translate on the ‘net! (c)David Strom Inc. 1998

  20. 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 (c)David Strom Inc. 1998

  21. An Example of bad location: Montana Meats • www.imt.net/~lingerie/buffalo/buffalo.html • Can’t they afford their own domain name? • www.company.com/~anything is BAD NEWS! (c)David Strom Inc. 1998

  22. Another Case: Buying Toner and Batteries • www.cartridgesusa.com, www.batterybarn.com • Catalog shows pictures of parts • Easy to find relevant item • But payment acknowledgement incomplete (c)David Strom Inc. 1998

  23. 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! (c)David Strom Inc. 1998

  24. Traditional Advertising Doesn’t Apply Anymore • Can’t measure anything • Every site has its own banner sizes • The Web is not TV (c)David Strom Inc. 1998

  25. One Working Definition of Success: • SURVIVAL! • If a site is still running after 12 months, and getting more traffic, it is a success. (c)David Strom Inc. 1998

  26. Does a site actually have to sell something? • Many actual eCommerce sites don’t do the complete transaction (Cisco) • Require faxes or telephone calls! • Some merely have catalogs • A good example: Singapore Power Authority www.spower.com.sg/readmeter.cgi?cmd=form (c)David Strom Inc. 1998

  27. Good eCommerce Examples • Easy to find merchandize • Good service • Individual customization is key • Simple navigation • Business-to-business focus (c)David Strom Inc. 1998

  28. 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! (c)David Strom Inc. 1998

  29. 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 (c)David Strom Inc. 1998

  30. AMP connect.ampincorporated.com (c)David Strom Inc. 1998

  31. 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 (c)David Strom Inc. 1998

  32. Save in Translation Costs • AMP catalog in several languages • Translation cost was US$100,000 • Versus US$1.5MM to produce separate translations of print editions (c)David Strom Inc. 1998

  33. Silicon Investor www.techstocks.com • Difficult to find anything • Incomplete database of companies • Companies are arranged poorly (c)David Strom Inc. 1998

  34. First Principle of eCommerce: • It is easy to find what you are selling! (c)David Strom Inc. 1998

  35. 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 books to choose from (c)David Strom Inc. 1998

  36. Amazon (c)David Strom Inc. 1998

  37. Update your directories! • This one is almost a year old • www.asiapage.com/alist.html#jewellery (c)David Strom Inc. 1998

  38. Non-secure servers • Many SG sites collect credit cards on them • GoodWood Florist • www.asiapage.com/goodwood (c)David Strom Inc. 1998

  39. Second Principle of eCommerce: • Deliver solid service! (c)David Strom Inc. 1998

  40. Dell • Most notable site for computer buyers • Customize the features you want via a web form • Simplifies and personalizes the shopping experience • WYSIWYB (buy) • >US$1MM/day in sales! (c)David Strom Inc. 1998

  41. Dell (c)David Strom Inc. 1998

  42. Canadiantire.com • eFlyer uses email notification along with web forms • Customize exactly what coupons and deals are sent to you (c)David Strom Inc. 1998

  43. Third Principle of eCommerce: • Individual customization is key (c)David Strom Inc. 1998

  44. BMW Motors • Example of what not to do • Use gratuitous graphics • Cheesy low-res videos • Toys, not tools (c)David Strom Inc. 1998

  45. BMW (c)David Strom Inc. 1998

  46. Compare with Subaru • Find specific information about each car • Can price options to your particular needs (c)David Strom Inc. 1998

  47. How NOT to Design a Payment Screen • www.netmar.com/~hamorder/cshorder.shtml (c)David Strom Inc. 1998

  48. How NOT to take advantage of bandwidth • www.clickdiz.com • Two different pages, one for SG ONE, one for all others • But SG ONE page has just heavy graphics -- why? (c)David Strom Inc. 1998

  49. A better example: fishing licenses • Simple, quick, and does the job with a minimum of clutter • www.permit.com (c)David Strom Inc. 1998

  50. Fourth Principle of eCommerce: • Make navigation simple! • Use small graphics, site maps, indexes • Avoid clutter, frames (c)David Strom Inc. 1998

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