Why do they enjoy the working at Zappos ?

I konw Zappos for a long time because they are insanely successful. As a leader of selling shoes in the E-commerce industry, zappos is also known for a genuinely happy workplace, judging from the employees and medias.

The way Zappos treat its employees is surprised me. For sure, most of new hiring need to be trained before they do the real job. But can you believe after completing the training courses,   , the company offers $2000 if a new employee decide to quit right away? If you are a critical thinker, you shouldn't be shocked because of the money, but admire the self-confidence that most people are loved to stay to the company and committed the culture.

We all know the fact that people are happy at work which also ensure that they give incredibly working results and good customer service. And often that service goes above and beyond. Zappos gets this internal strategy, as more and more companies consider letting employees feel more happy are essential for the successful development. When bosses reserve the priority to their employees (not the clients, not the stakeholders, but the people get pays).They increase happiness, creativity, productivity and profits.

This is not a complicate case, but a common sense. Companies like Google, Southwest Airlines, , Disney, Pixar and many many others will verify the fact that it works. Actually, we already can see some.

What is the Search Engine Optimization ?

From the internet savvy result as we have it today, consumer's demand to the online search engine marketing for all the E-commerce companies turns more and more essential. What I mean by that is the application or operational system which pushes the websites rank higher in the Google's search result page. Therefore, a new business model company, rely on E-commerce, was created. They are called Search Engine Optimization (SEO) Companies. Basically, the marketing strategy for E-commerce industry is getting high percentage of web presence. However, paying to a web searching engine for presence in such competitive market is not enough. The critical way is to be the top portion of website in the search engine result pages.

Base on my understanding, In order to improve the level of exposure the online, the E-commerce companies try so hard to popularize their web-sties in different ways, as much as they can, to increase the page-views and sale volume. These are the ways to reach out to maximum number of people at a time. But most important job has to be completed at this point is that the companies have to acquire potential customers who are in fact very valuable to them. That is what the SEO Companies are there for. They help the websites in all possible ways to get to the top position in the Search Engine Result pages with its various tools, the "Search Engine Marketing" being one of them.

By providing the Engine Marketing Tool package from SEO companies,  their clients' websites will increase the frequency of appearance on major Search websites ( such as Google and Bing). The popularity is supposed to be enhanced with more and people visiting their web pages or clicking its link. In fact, when the a people enters keywords related to the specific s/he is interested in, the Search Engines will automatically displayed many results related to the search topics. But on the vary top portion, Google and Bing charge this space, in the other words, the advertisement.  The webpage containing the most appropriate and relevant answer to the query of the visitor is always placed on the top of the search engine result pages. As more and more visitors click on the page, it gets higher ranking in the Search engine result pages.

US top 10 E-Retailer ranking

Smartphone apps

          Here is a situation: I believe many of us have experienced before. So when you shopping at a store, you suddenly get some questions regarding to a product you are interested. Now you have two options,  go asking a store associate or using the online apps by your smart phone, which will be pick? Recently study found that 73% of shoppers with smart phone favor using the phone on hand to handle simple tasks in stores compared with 15% who favor interaction with an employee, the survey says.  Similarly, 71% favor using their smart phone to identify a store with a desired item in stock, while 17% would prefer to get that information by speaking to an employee.

          This a pretty good news for those retailers who have already developed the online app for smart phone users, and one more "glad thing" for owners is that they can save some by firing those hour-bases-salary employees. Survey also indicates that 48% of these users have downloaded at least one retail app, with 90% reported apps useful. This data is a reminder for retailers who haven't considered the mobile apps function yet, hey! It’s not too late to do so from now!

Satisfaction level increase for online stores

              Overall, during this Thanksgiving sales season, E-commerce sales increased about 17% compare with the same period in last year, but the increase of traditional retailer's sale remain on flat. Meanwhile, Amercian shoppers' satisfaction levels with e-commerce companies and their websites have improved in the last 12 months. This is according to the latest research from Foresee Results Inc, which indicates that retail sites reached a higher satisfaction score of 73.7 for Thanksgiving holiday week this year.

              In today's struggling economy, retailers were still trying the best to provided a outstanding shopping experience to customers, such as deeper discounts, abundant merchandises, and smooth check-out processes. Many smart online retailer utilized this opportunity to gain more reputation because they had prepared enough prior to this high sales season, that helped a lot to capture available market share when other retailers and competitors fail to meet consumers' increasingly high standards and expectations.

What makes Amazon so competitive ?

          Right after Thanksgiving this year, Amazon’s shares hit an all-time high in early trading Monday as analysts predicted this online retailer would gain more market share in nearly future. So why my favorite One-stop shopping site, Amazon.com, could hold a position firmly at the top of the online retail realm, and ranking as the number one of America’s largest online retailer, as well as the UK’s top retailer for PC and home entertainment?  I believe Amazon’s biggest strength is its competitive advantages.  I am pretty sure many of you have shopped at Amazon.com, or at least visited the website once.  So you probably can find Amazon as a one-stop shopping site, which sells everything under your needs, such as: books, music, home, video games and computer software, consumer electronics, appliances, garden items, baby products, sporting goods, jewelry, watches, health and beauty products, musical instruments, clothing, and groceries, among other things.  The range of products under these categories is equally as vast; if it exists, it is likely to be found on Amazon, either from the company’s own stock, from a third party retailer(partner e-commerce companies), or from an individual user(Amazon marketplace).

          Bill Gates pointed it out in a magazine interview. He said: “I buy all my books at Amazon.com because I’m busy and it’s convenient.  They have a big selection, and they’ve been reliable”.  What Bill mentioned are some core value propositions that Amazon makes.  I made purchases at Amazon because its convenience, huge selections, excellent service, but one more thing Bill left out － of course, he don’t care about it at all － the price. Not only Moms, but also all consumers, including me are concern more about pricing benefits Amazon offers to us.  If you try to input a product name and clicking the price search icon on Nextag or Pricegrabber.com, the results most likely include Amazon’s products with competitively priced, and they are often significantly lower than the suggested retail list price.  Another pricing completive advantage Amazon owns is that it does not charge sales tax, for example, in California, since here does not have its distribution center, making its bargains even greater for me and those lucky enough to live in one of the other states without an Amazon warehouse. 

          Amazon also assists customers in making an informed decision before making a purchase.  One web technology made popular by Amazon is user reviews. Now you have experience with Amazon, and you know for each product, it provides a press review, features user reviews, and rated on a 5-star basis.  Amazon allows users to submit reviews of products sold on Amazon, which are attached to the web pages of each product. If you roll down the web-page by mouse, users' typically comments will be displayed which are about their experiences using the product and whether or not the product met expectations. So when we are considering buying a product, we definitely would love to visit the site just like Amazon, to read the abundant user reviews regardless of where we intend to make final purchase. By acting this way, Amazon encourages consumers to consider the alternatives at Amazon.com. Also, I personally admire the CEO of Amazon, Jeff Bezos’s idea about promoting negative users’ review. He chose to take a radically different approach to reviews because as he said: "we want to make every book available – the good, the bad, and the ugly...not to let truth loose”.  I’ll bet his purpose by allowing negative reviews on site is not just like what he said in front of us.  But Amazon is able to create a community for its reviewers. Much like a social network, Amazon’s customers share their opinions amongst one another.  So this community reinforces Amazon’s commitment to transparency and buyer empowerment while increasing customer loyalty.

          If you just don’t like shop at Amazon.com, I know you must like to shop at those traditional retail stores. This preference is leading an obvious disadvantage for Amazon:  Amazon.com’s main competitive disadvantage is that it is an online exclusive retailer.  Because of this, impatient consumers, like my dad, can’t achieve the instant gratification of utilizing something the second they buy it. I am pretty sure that they really don’t want for orders to be processed and shipped.  Likewise, without brick-and-mortar locations, how could a grandma buy stuff at amazon if they even don’t know how to use the internet?  Poor credit people also need a card in order to make purchases, as Amazon has no way of accepting cash.  Other complications I heard from traditional shoppers are associated with a lack of physical retail locations include the difficulty and inconveniences of returning or exchanging an item, the risk of damage during shipping, and the inability to inspect an item, verify that it is listed correctly, and try it on before purchasing it.

          But in order to ensure its competitive advantages sustainable, Amazon is constantly seeking new business opportunities. After staying within the company's basic business model, “business to customer”, for decades, Amazon  realized that there are more potential markets to gain advantages. Blogger Scott Macaulay argues that “Amazon Studios”, the new open-source studio from the online retail behemoth, is challenging other film production firms significantly in the market; moreover, I was a little bit surprised when I place an order on Target.com because its platform looks so familiar to me.  By expanding its business model to include “business to business”, Amazon was able to sell its web services (platform) to other e-commerce companies, such as Target.com, that lacked competitive web technology and infrastructure, creating a new source of revenue for the company.

          Now that Amazon sells its web services to other e-commerce companies, you probably have some doubt that Amazon will be able to maintain its position as the absolute leader in the highly competitive e-commerce industry, especially now that competitors have access to Amazon’s technology and infrastructure.  However, think about this: Amazon’s core competitive advantage is not merely the company’s outstanding backend, but rather and more importantly, the strong customer loyalty that Amazon enjoys.  Even though other e-commerce companies are using the same IT backend as Amazon, they lack the same strong relationship with Amazon that has been built upon years of trust and outstanding service.  Because of this, Amazon made a very smart choice to diversify its corporate business, as its e-commerce model will inevitably be duplicated. Amazon will remain relevant and sustainable because its core competitive advantage transcends its innovations.

Monster.com, not only for job searching

Most University seniors visit Monster.com at least once a week. Of course, this is a E-commerce companies, but I'd rather don't want to call it "an on-line retailer" because there is no thing for customers to buy. However, this company do make a lot of money: the market cap of nearly $7 billion in 2007 and generates over $1 billion per year in revenue. All that revenue is largely generated on paid job listings, starting off at $475 for a single listing. In early November this year, Monster.com launched its Facebook page to each job seeker who wants to ask questions about job market in the US. Basically, the hottest questions were be presented to Austan Goolsbee, chair of the White House Council of Economic Advisors (CEA). And then he would answer those popular questions in recorded videos.The Monster.com YouTube page now has all of Goolsbee’s answers online, including unemployment rate and small business.

Social media Vs. E-commerce

Online sales is playing an increasingly important role in total holiday sales. But how much of that growth can be attributed to social media, like a link on website such as facebook?

Blogger Paul Chaney asked Hitwise, the competitive intelligence service, how is the situation (Internet traffic) e-commerce sites was affected by social media. A spokesman for Hitwise responded via Twitter that the number was 4.39 percent for the "top 500" ecommerce sites on Black Friday. That is, according to Hitwise, social networks referred 4.39 percent of traffic to the top 500 retail sites on Black Friday 2010.

In today's informational society, not only companies are using social media to promote merchandises and deals during the sales high season, but consumers get benefits from their own purposes also. For instance, I would like to share information about some favorite products and purchases I experienced on facebook; I may also follow the recommendations from friends about products they like on twitter, and even hang out to go shopping or purchase online together with friends and family.

Cyber Monday Hit Biggest Sales Record Ever : $1B

Cyber Monday reached a record-breaking level this year with more than $1 billion dollars spent online, making it the heaviest U.S. online shopping day ever recorded. I would expect the huge E-commerce business opportunity in the future, as you can see the sales during last five years are keeping increase even though during the recession period. 

eHarmony is moving to Asia

           eHarmony.com, a leader of online dating service provider, will launch its first Asia branch in Japan recently. Blogger David Evens Worried about the differences in culture between the US and Japan, and he wonders what changes eHarmony will make in their matching systems based on 29 dimensions of compatibility for Japanese. I remember I had a presentation about the eHarmony for my Marketing class at USC. So basically, customers need to answer more than 400 questions before s/he becomes an official member, and paying 60 bucks monthly. But one of the coolest things is that eHarmony rejects 20% of its potential customers in order to guarantee their outstanding services to existing users. Expending internationally seems a necessary path for companies to be more profitable, but bases on eHarmony currently business model, I would doubt could this company survive in Japan, a country is still keeping many traditional rules toward men and women, and also a country has the lowest divorce rare in the world?

Cyber Monday Sales

            Many consumers are getting more familiar with the term "Cyber Monday" during these years. In fact, in the end of November, 2005, the term was created by "Shop.org" press which release entitled "'Cyber Monday' Quickly Becoming One of the Biggest Online Shopping Days of the Year". I believe many retailers, especially for E-commerce companies are more glad to use "Cyber Monday" as a marketing promotion to persuade people shop online after Thanksgiving "Black Friday". Now, Black Friday is not an only biggest discount event to those people waiting for a whole year. Many smart consumers know they should just be patient because more products with deeper discounts would come out after weekend. This year, Cyber Monday may have been the heaviest online spending day in history with a record-breaking $1.028 billion in online spending — a 16% jump in spending when compared against the same day last year.

New Businee opportunity

               What we usually do after turkey dinner? "Hard-working" people probably already left from home to get on line outside of shops. Many people like my family just prefer staying at home watching new-released movies. So the those movie rental companies like Netflix would be a best choice because of its fast mailing, and abundant movie resources.

               However, One market segment that Amazon has not yet penetrated is subscription video service just like Netflix. I believe Amazon should add a service where users can stream anything and everything in the Amazon catalog for a monthly or yearly fee.  Amazon already has web technology in place that allows for one time purchases or rentals of streaming movies. Currently, Amazon even offers customers the option of downloading digital copies of music and movies that they have already purchased. This service allows customers to watch films while they wait for the physical discs of movies they have ordered to be shipped. Netflix has already proven that a market exists for a subscription video service, and the Amazon name would add credibility, affordability, and value to such a service.

Black Friday - the biggest shopping day of 2010

happy thanksgiving

          Who would be happy on Thanksgiving day? Students get a long weekend holiday to hang out with friends. Employees can not wait for this day comes, so many of them leave company early on the day before thanksgiving. But the happiest groups of people could be those shoppers got big discounts on black Friday, and of course, the retailers. Amazon.com Inc. Amazon.com says that this black Friday was its biggest-ever record for sales of Kindle devices.  Company also posted on the Amazon Kindle link on Facebook page many days before that on Friday, it will sell its older, second-generation Kindle for $89, which is $10 less expensive than Best Buy. On average, online spending on Black Friday this year increased nearly 16 percent compared with last year, and The  average order value on Black Friday was $190.80, up from $170.19 last year.

E-commerce as the online dating model

The article “Take the Lid off – Secret Spending” from “Money” Magazine tells a very interesting story: some 80% of husbands and wives spent money over the past year without telling their mates. Just by guessing, we probably could figure out that women are hiding those spending for the endless fashion; men usually don’t speak out the alcohol and small appliances. However, this survey found out that husbands tend to spending more money on dating websites, and of course, they keep these secrets.

Old Navy vitual online game

             Now when youth have the uncertainty to purchase clothing from Old Navy, could use the simulated reality of a computer game to refine their dressing ideas before testing apparel in the physical stores. The retailer is very clear about their marketing strategy, and they understand what Old Navy's customers really wants. Launching this game is specifically targeting to major customers, the teenage. At the same time, Old Navy is trying to make sales by promotions and ad placements while creating impressive and enjoyable image for its merchandises offerings, especially with the thanksgiving and Christmas are coming .

             I tried the game today. As part of the game, players can lead a favorite character from movie by passing an entire Old Navy store, choosing virtual Old Navy fashion, similar to that available in-store, and socializing with other game players during the game time. The Old Navy virtual world will mirror the real world in-store experience.Users can enjoy a digital shopping spree, grabbing items for themselves and gifting virtual Old Navy fashion to their Facebook friends, if the holiday season has them feeling generous.

Amazon is not only a store

          Amazon is a very smart company, and they know how to make more money. For Amazon, revenue should not be only limited in the E-commerce model. It now wants to shift the industry back from the exclusive, private world of Hollywood, taking the movie making business to the web instead. The online retailer giant has started a film production website, in which screenwriters and filmmakers can submit scripts and movies. Amazon.com  has also partnered Warner Bros. Studios with this new venture to consider the submitted scripts for commercial feature films. Amazon.com, Inc. today launched Amazon Studios, a new online business that invites filmmakers and screenwriters around the world to submit full-length movies and scripts to make money, get discovered and get their movie made. Through the monthly and annual Amazon Studios Awards, Amazon Studios will offer a total of $2.7 million to the top submissions received by Dec. 31, 2011.

What should BlackBerry do next ?

Recently, I saw an online advertisement from AT&T, which introduced this wireless carrier is now selling a new cell phone designed by Microsoft. Looking back ten years ago, Blackberry was the absolute leader in smart phone industry. People felt so proud when they described self as a Blackberry person.  However, in nowadays, not only iphone takes big marketing shares away, but also Android from Google does so, and plus the windows phone just released recently.  In order to surpass its competitors, I think BlackBerry needs to develop applications that support enterprises and appeal to consumers.  It needs to grow quickly if it wishes to prevent Apple from capturing its current customers.  If RIM can successfully expand its applications, it can attract consumers and retain enterprises, therefore increasing its presence in the market.  BlackBerry has a reliable operating system that is more secure than Google’s Android, but consumers are not aware of it.  By drawing new buyers towards BlackBerry, consumers can experience firsthand the benefits of BlackBerry and contribute to the company’s reputation and popularity.   

BlackBerry should continue expanding to new global markets in order to increase customer base and to stay ahead of competitors such as Google’s Android and Apple’s iPhone.  BlackBerry would be successful in areas where there are limited bandwidth markets and Internet access.

Netflix: Packing DVDs at lightning speed!

That's why we got favorite movies so fast....

E-commerce sales Increase 13.7% in Q3

             According to estimates released recently by the U.S. Commerce Department, during the third quarter of this year, total sales of E-commerce industry increased nearly 13.7% compare to the same period a year ago. The total sales captured 4.2% of national retail sales, a new record for e-commerce.  "Cost conscious consumers also see online shopping as a way to spend wisely," writes Grau in an upcoming report. "They can go to coupon sites and shopping blogs and communities to learn about bargains. They can also research purchases to find cheaper alternatives."
             The 13.7% growth rate for e-commerce sales also is more than double that of total retail sales, which posted 6.0% growth during the third quarter. The U.S. Commerce Department estimates seasonally adjusted total retail sales during the third quarter were $978.73 billion. “The data underscores yet again the secular shift from offline to online spending,” says Colin Sebastian, an analyst for Lazard Capital Markets. “Despite some lingering macro-level hesitation on consumer spending, e-commerce companies should feel good about this year and the return to growth.”

Black Friday

        Black Friday, an event that many “deal diggers” would excited about, is coming. The term "Black Friday" was originated in Philadelphia, where it was used to describe the heavy and disruptive pedestrian and vehicle traffic which would occur on the day after Thanksgiving. More recently, merchants and the media have used it instead to refer to the beginning of the period in which retailers go from being in the red) to being in the black on the balance sheet. Those shoppers have limited resources consider to use that day to save money and take advantage from the biggest discounts offered during a whole year.

        In fact, stores encourage people to spend more with discounts on all merchandises from home theater to a towel, or even something with a regular price. Shoppers believe that day is to get holiday purchase completed and pretty beneficial for those who expect this day to come for a long time. However, after these brave shoppers stand in cold from midnight to early morning, and the madness that occurs inside the stores Friday morning, how many people really got nice deals or how many of them spend too many after walking out from the stores?

        For me, I rather want to just stay at home, check the online deals. Smart shoppers shouldn’t forget about online deals that are offered during the Black Friday weekend. And please do remember, we still have a Cyber Monday with a smoother online store access and check out.  

Wanna a high quality or video of the product?

        Last week, I was trying to buy a watch on a website called World Of Watches. Overall, the Pictures of the watches were good, but the one I like it, its picture was so blurred. Although the picture could be zoom in, this image became worse. So I switched to another website, my favorite: Amazon. I like go shopping at Amazon not only for the competitive price, but also the advanced product viewing capabilities. When you ready to buy a product online, how do you like the 360-degree views ; different colors on the product image; zoom-in/out; and the ability to customize your products online? Beside, online shoppers also like to view more carefully about products reviews from other customers before they make any purchase, and sites that not only show an individual shopper information, but also retain the particular product was bought and the prices.

How efficiency are the online advertisements?

        A new research released today indicates online advertisements and search results can be impressive —even if the web page viewers don’t click it.

        

        Interactive agency iProspect and conducted by web measurement firm comScore Inc., examined how consumers' behavior and react when they check  searching engine results, online display advertising, as well as the business paid searching results. This study shows how reading such advertisements or results impacts customer's brand favorability, likelihood to make a decision to buy, to visit a web site, and brand trust. 

        

        Paid search impressions reflects brand favorability by 28% across all search result categories, and it is  highest impact overall to consumers, study found. Paid search impressions are particularly adept at influencing buying behavior, whether they are used alone or in conjunction with other digital media, the study finds. Overall, for E-commerce companies, they should pay attention now since shoppers could be more likely to buy from a company that they have seen in a paid search advertisements, around 44%.

Wal-Mart posts deals link on Facebook

        

            The biggest social net work, Facebook, I believe its major revenue come from the online advertise. And now, the largest retail supermarkets, Wal-Mart made a new cooperative relationship with Facebook. The new promotion program is called CrowdSaver.  Basically, Wal-Mart began offering a product and a proposed discount for that item on the the Wal-Mart Facebook page. If enough consumers clicked the "Like" button below the product description, the retailer promised to honor that discount until supplies run out. The first item offered under the CrowdSaver program this week is a 42-inch plasma TV from Element Electronics that Wal-Mart said it would sell for $398—which the retailer said was 18% off the regular price—if 5,000 consumers pressed the Like button.  Consumers who pressed the button first had to become a Facebook follower of Wal-Mart.

Apple onile store in China

         Apple Inc, originally came from California, has launched an online official store in China for Apple’s royal fans in there. Meanwhile, Apple states that company already finished the mobile application, the especially design for the Chinese language.

         

         This is a very smart strategy since many Apply products that Chinese consumers use are grey market products, mainly imported from Hong Kong illegally. Due to the unavailability of online official store before, Chinese Apply fans forced to purchase Apply products –Iphone, Itouch, Ipad-  through grey maktet because of the  adequate inventory outside of mainland China, and the

         Apple’s expansion into China follows other foreign retailers’ efforts to market to China’s 400 million online consumers. Recently, for instance, Goldman Sachs Inc. projected that Amazon.com Inc., No. 1 in the Top 500 Guide, could generate annual web sales from China of $1 billion in 2011, up from $750 million this year.

         However, I am still doubtful of the efficiency of the Apple online store in China. Regardless of the adequate inventory now, but consumers are more concern about how much they have to pay. Comparing the price of iphone from Taobao.com, the biggest Chinese online auction and shopping website operated in China by Alibaba Group, I do not see the price competitive edge listed in Apply online store. These iphone and ipad sold at Taobao are most the gray products. They are cheaper due to the Hong Kong’s Tax policy advantage.

The new partnership between Groupon and Ebay

          I am a frequent visitor of Groupon.com, and I do not if there is anyone familiar with this website. But I strongly recommend this site to you, especially to the “deals digger” you. According to the description of the web site itself, Groupon negotiates huge discounts on popular local goods, services and cultural events. Then it offers the deals to thousands of subscribers in a free daily email. The deals are activated only when a minimum number of people agree to buy. More exciting to me is that there is only one deal post every day.

          Now, Ebay aims on Groupon. Maybe Ebay considers this new style of group-buying discount business offer a big potential from market.  So, they made an agreement, which is about EBay shoppers who have signed up for the company’s loyalty program receive 5% of the purchase price back as eBay Bucks, which members can use toward purchases on eBay.

          EBay visitors who click on an advertised Groupon offer which directly connect to Groupon’s eBay store. And than they can select “buy now,” leading them to the Groupon .com to complete the transaction. Alternatively, Ebay’s royal customers could to “sign in” to earn eBay Bucks. That consumer then is sent to Groupon’s site to complete the coupon purchase. Just like other internet retailers, Groupon declines to disclose the financial terms of the arrangement. When working with small retailers, Groupon typically takes 50% of the purchase price of the Groupon offer.

 

E-commerce is not limited in computer internet base

        Adobe Mobile Experience Survey found 43% cell phone owners have purchased series of product such as movie, music, ring-tone and games to get more fun for their phones. This survey is made between March and August this year. And one third of the sample size states no purchase at all. But those owners who made purchase through mobile phone internet are also bought  for clothing, shoes or jewelry in 30%; 28%, electronics; 26%, books, magazines or newspapers; 20%, grocery, health or beauty; 20%, computers or office; 16%, sports or outdoors; 16%, toys, babies or kids; and 13% home, garden or pets.
        More importantly, two third of sample size expressed that they would like make purchase by mobile applications if they use cell phone to shopping. This is definitely a good news for those retailers already set applications for cell phone, but an another big alert for the retailers do not take this fact in account or completely ignore it.

        “As cell phones get smarter, people are using them less to make calls and more to text, shop, read news, play games, engage with social networks and perform routine tasks,” Adobe writes in the survey report. “As the pace of smart-phone adoption quickens globally, businesses have to be invested in the channel and move beyond the planning stages to start executing and gain some learnings on how users are interacting with the mobile channel.”

CVS new online application for iphone users

CVS is moving forward to the new field of E-commerce, the mobile phone online shopping. The existence of iphone should be one miracle for cell-phone industry, but its power affect deeply to other business industries. For example, Wall-Street journal designed cell phone reading function for iphone users long time ago; Amazon, of course, cannot ignore this business opportunity to catch their royal customers. Now, CVS joined in, it launched new application for iphone fans. The app, which complements the merchant’s m-commerce site and another iPhone app dedicated solely to prescription refills, offers a variety of features and functions, enabling customers to:

• Find nearby CVS/pharmacy locations using the GPS-based store locator with integrated driving directions and maps.
• Refill prescriptions from a personalized prescription history for pickup at any CVS/pharmacy.
• Access the CVS.com Drug Information Center to retrieve details about medication management including instructions for use, dosing information, side effects and safety warnings.
• View and manage the sales circular to create a custom shopping list and identify weekly deals.
• Schedule a flu shot at any CVS/pharmacy location.

Is E-commerce an ideal business to start ?

          One forecasting for the retailer industry caught my eyes: e-commerce sales will represent 8 percent of all retail sales in the U.S. by 2014; and 154 million people in the U.S. bought something online, or 67 percent of the online population. Every day, more and more consumers in the world are switching over to e-commerce to fulfill their shopping needs. For me, online stores and marketplaces are a convenient, and often cheaper, option for anyone with an internet connection and a credit card.  With everything from cars to groceries to clothes and electronics being sold for reasonable prices online (often tax-free and with free shipping), there is little reason for consumers to ever leave the house to go shopping anymore. 

         "It's the fact that you can research the products that are available," said Barbara Staib, president of Safe Home Products, "survey indicates 89% of consumers prefer online shopping." What a surprising data it is! Online retail does not appeal to one demographic or region in particular, it has expanded in scope to encompass the entire world, as everyone desires to find the best bargain possible, something that online retail often provides.  Neilsen reported in 2005 that 1 out of 10 people around the world now shops online, and cites a desire for better pay options as a barrier from more entering the online marketplace.  And I believe, this number is keeping growing.

           Large multi-national e-commerce companies such as Amazon.com compete for the same customers. For sure, consumers would like shop at Large e-commerce companies because it offer the lowest prices due to the fact that they benefit the most from economies of scale. In additional, because they carry so many different merchandises, they offer more product choice to all customers in different marketing segments. For example, let me give you a number first:  including the Amazon “market place”, Amazon's total SKU reaches to million. As the online sales keep growing year after year, nobody want to reject the statement that on-line retailer will replicate the leading retailer position held by Wal-Mart today, giving leaders in the E-commerce industry more ability to dictate rules and pricing to its suppliers simply because of their enormous market share.

         

           So, it looks like E-commerce is a pretty ideal business to start. Really? I want to say that the barrier to entry in the e-commerce industry can be either low or high. Do you believe for only a few thousand dollars, new entrants can establish their own website and begin selling products immediately? Yes, this can be true. However, new entrants are very unlikely to be successful outside of small niche markets. To compete with industry leaders such as Amazon.com, Yahoo.com, and Ebay.com, new entrants must be willing to commit hundreds of millions of dollars to investments in distribution, technology development, and relationships.

            

            Let's take an observation about running an E-commerce company. First of all, we all agree a competitive e-commerce company successfully establish the advantage in distribution by operating multiple fulfillment centers across the United States (or whatever country they are doing business in). Fulfillment centers are located hundreds of miles apart from one another and are frequently located near airports to ease transportation.  Large volumes allow industry leaders to benefit from economies of scale.

         

           Secondly, operating a successful e-commerce website requires a huge investment into web development and technology – millions of dollar. For example, Amazon.com has a competitive advantage due to its patented "one click buying" technology. I like make an online purchase through a single click by using previously entered billing and shipping information. This creates a more enjoyable buying experience for me and customers and encourages repeat business. At the same time, legal protections prevent competitors from copying this technology. "Amazon Windowshop is a top-to-bottom rewrite of Amazon.com – designed and built without compromise ," said Jeff Bezos, founder and CEO of Amazon.com. "Try it. I think you'll find it’s an amazing way to shop Amazon's millions of items. Same selection, same low prices, same fast delivery, same benefits of your Amazon Prime membership – just a completely new, fluid interface designed specifically for lean-back, touch screen tablets.”

             

           Moreover, new e-commerce companies have an especially tough time with relationship building due to the fact that the e-commerce industry is still dominated by the original “first movers.” Established e-commerce companies have relationships with industry and channel players that date back to the birth of the industry. As we can image, a new entrant could not expect to have enough time nor money to build closer relationships with these players before facing stiff competition from the first movers.  The new entrant will constantly be judged based upon a performance benchmark set by the first movers.

            

           One the other hand, the rivalry in the e-commerce industry is pretty high. This is due to the tremendous amount of power that we all have in the e-commerce industry. Because there are very low switching costs on the internet, we-the buyers- definitely want to find a cheaper competitor that offers the same product. This has led many e-commerce companies to target niche markets where they can avoid purely competing on price. Often niche markets will only have one or two direct competitors.

            

           Furthermore, the threat of substitutes in the e-commerce industry is a big concern for most E-commerce companies.  Large e-commerce companies like Overstock.com or Amazon are able to offer customers a wide range of products and services, however they are not without many competitors and thus substitutes. Within the e-commerce industry, there are many different retailers that sell the same product. The largest substitutes for the industry overall are the brick-and-mortar stores such as Costco, Target, Ralph’s Macy’s or Barnes & Noble.  These traditional stores offer customers a lot of tangible benefits that online stores cannot.  For instance, reading a book with a cup of aroma coffee at a Barnes & Noble offers its customers a relaxed atmosphere and environment where they can spend time browsing books, listening to music, and drinking coffee without feeling pressure to make a purchase.

           Traditional brick-and-mortar stores also provide customers instant gratification because they can use their product immediately, whereas online customers have to wait for their product to be shipped.  Also, customers at brick-and-mortar stores can physically touch a product before buying it, which allows them to verify that they have the right size. Physically touching the product may also cause the customer to become emotionally attached to the product, creating an impulse buy. Because they can see what they are purchasing, it is easier for customers to trust brick-and-mortar stores.

           

           Regardless of type, it is very easy for shoppers to switch between substitutes.  There is relatively no switching costs and it is difficult for online retail stores to build strong customer loyalty—although some companies like Amazon are rare exceptions.