E-commerce Website Strategy: A Report for CIS8100 Assignment 2

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CIS8100 Assignment 2

Contents
Executive summary.........................................................................................................................3
Introduction......................................................................................................................................4
REPORT SECTION- 1 E-COMMERCE BUSINESS STRATEGY..............................................5
REPORT SECTION- 2 E-COMMERCE BUSINESS STRATEGY..............................................6
REPORT SECTION- 3 ONLINE MARKETING AND ADVERTISING TOOLS.......................8
Conclusion.......................................................................................................................................9
Recommendations..........................................................................................................................10
References......................................................................................................................................11
2

Executive summary
The E-commerce website is an online retail website of sports footwear and sports apparel. This
aim of this website is to stand among the all the market competitors by providing extraordinary
products and services to the intended customers. The retail website uses Differentiation business
strategy which will enable it to create a different product which is not made by other
competitors. This strategy has also been used by the website to provide different services, image
value etc. for the company. The revenue model used by the website is direct sales, transaction
fee and subscription model for creating profit and generating revenue so that it can always be in
demand.
3

Introduction
An online retail website sells sports footwear and apparel to the customers. The website needs
business strategy in order to stand up in the market. Hence a business strategy needs to be chosen
in order to generate and achieve long term goals for the company. The business strategy needs to
be chosen by keeping in mind the competition in sports accessories seller industry and also the
intended market place. After that a business model needs to be chosen to generated revenue for
the website. The E-commerce website needs to make it sure that customers make it their
preferable choice among the other options available. The market needs to be analysed properly
so as to know who are the competitors and how their products are affecting the direct and
indirect sales of the company. For the advertising and marketing part there are various marketing
strategies but the online marketing tools are the most helpful when It comes to attracting younger
customers.
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REPORT SECTION- 1 E-COMMERCE BUSINESS STRATEGY
There are many business strategies that make a business to stand among the crowd. The E-
commerce website sells sports apparel and footwear items all over the world. The strategy used
here is Differentiation. The reason behind choosing this strategy is that there are lots of brands
selling the same sports accessories online hence it would be a false strategy to adopt any other
method like increasing the cost or focusing on a particular area for selling the product (Chaffey
2015). The only way this E-commerce website can stand out from the crowd is by making the
selling items unique from the others. When the product will be unique, the cost can also be
increased to earn more profit, because there is no same product available in the market (Banker,
Mashruwala & Tripathy 2014). The competition is high in the sports accessories brands because
all the competitors are selling almost similar products, within the same price range. The only
difference lies between the brand name, the customer services and shopping facilities. Hence the
only way to make this E-commerce website count is to differentiate the footwear and apparel
items from the other products (Amar 2015). Using this strategy, the focus is on creating
customised footwear items and sports clothing for customers. The customers can select the
colour, prints, typographic quotes, colour block prints, size etc. For the footwear items, the
customer can select the brand, category and provide the selected footwear for customisation. The
customised products will make prevent other competitors from copying the products.
Differentiating the products along with differentiating services that E-commerce website will
provide. Such as the customers will get a try and buy option for their ordered products. This
service will make sure that customers don’t feel hesitated in buying the products online (Veit et
al. 2014). The services this E-commerce website will be providing will be more convenient by
introducing this feature. The other strategy will be to introduce special discounts and offers in the
products of the respective sport which is high in popularity at that time. For example, during the
football world cup, the E-commerce website will be offering special discounts on football related
sport clothing and footwear. The website can further differentiate their image in market by
endorsing the website collaborating with famous sports persons (Arai, Ko & Ross 2014). The
image differentiation will be created by supporting a natural cause for example by tying up with
an NGO. This will help in creating a positive image for this website. The website will perform
faster and accurately, technology wise and customer information will be safe and secure with E-
commerce website. The website will have its own brand story to establish strong connections
with its customers all across the globe. The another service that this E-commerce website will
provide its customer is to sell their old apparel and footwear items online through this website
that will be distributed to poor people by coordinating with NGO and in return the customer will
gain a coupon for their next purchase. This way differentiation will prove to effective for E-
commerce website (Euchner & Ganguly 2014).
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REPORT SECTION- 2 E-COMMERCE BUSINESS STRATEGY
Value proposition- value proposition generally means why the customer should choose
shopping from your website when multiple other options are present out there (Smith 2015). The
value proposition of the E-COMMERCE website comes from the fact that the footwear and
apparel items that this website will provide are hard to find anywhere else because the products
are directly manufactured from the customer's point of view or in other words it can be said that
the products are totally customizable. Not only the products are branded but also customizable.
The items also come up with try and buy option which will make this website highly popular
among the customers. Although the products are customizable, they will get dispatched in 2-3
working days making it highly likely to attract the customers. The products are easily trackable
including the information regarding the customisation process. When coming to return policies
the shipped items can be returned instantly with the delivery person in a try and buy option or if
the customer doesn't like the product it can be returned within twenty days after the purchase was
made. The value proposition of this online retail website will make the customers their own boss
by helping them to create their own clothing and footwear items. Each product will come with a
story about its manufacturing making it more approachable to the buyer (Gandy 2015). The
products returned by the customers will be available for others to purchase. It will automatically
create a market for both the type of customer, one who know what they want to wear and other
one's who doesn't know exactly but need options for choosing (Osterwalder et al. 2014). The
concept of selling the old products on the same platform for more coupons and discount and that
too to support a cause will engage more customers thereby increasing the value proposition. The
other websites are selling the similar products in the same price range but E-commerce website is
selling different products that are not available anywhere else.
Revenue model- Revenue models are used by the E-commerce websites to ensure that not only
profit is earned but also revenue is generated so that the business continues to grow. Because
profit only cannot be sufficient and the company might get vanished over a period of time. The
revenue model used by this E-commerce website are:
1. Direct sales model – The revenue generated by the company will be through providing
direct sales to its customers by establishing warehouses at different location all over the
globe. The services will be provided to all the customers irrespective of their locations.
The revenue will be generated through shipping services as well as the direct revenue
from the goods sold out. The customers will be paying for the international shipping
charges, although the charges will be less as compared to the shipping charges of other
websites. This will be done by contacting the courier services who supply all over the
globe in minimum charges. The charges being less will also be a benefit to the company
because the customers never want to pay high amount of shipping charges.
2. Subscription model- the website will also enable the customer to tie up with the website
for creating the customizable goods for selling online using this website only. This will
give a platform to all of those designers of apparel and footwear to showcase their talent.
But to make use of this service, the willing customers will have to pay the subscription
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amount. The subscription charges will not be high enough to make the willing customer
avoid the subscriptions but it will enable more people to collaborate and high revenue
will be generated. This model will generate the revenue at greater extent further it will be
connected with another revenue model which is transaction fee model (Rudolph et al.
2017).
3. Transaction fee model- This model will work together with the subscription model as
the customers who are willing to tie up with the website to create their own customisable
collection for other customers, will be paying for the subscription and as the created
product by the subscriber gets a purchase, the retailer gets a profit. More the customers
will build the trust with the company, more the trust will be generated among the
customers. It will also create healthy advertising automatically for the company. This
will create more customers to engage with the website and all will open the doors of
revenue generation for the retailer (Lund & Marinova 2014).
Competitive market- The competition for E-commerce website is very high. Several brands and
websites are selling sports accessories, footwear and sports apparel. Therefore, the market of this
E-commerce website will be highly influenced by various direct and indirect market. For
example, the companies which are old and selling similar products already are the direct
competitors and those retailers who are not the direct seller of the same products but their
products directly influence the sports goods and apparel can influence it also (Green 2015).
Some of the brand names are quite popular because of the image they have created in the market
through years. Some special occasions like a sports match or world cup also encourages
customers to buy sports apparel and footwear but at the same time the brand gets a high chance
of endorsement, there are several brands that have advertisement tie-ups with sports stars.
Therefore, increasing the market competition for E-commerce website (Lindner 2014). The
companies producing leather etc. which can be supplier for E-commerce website, if starts selling
these products to the direct competitors, will increase the production cost of the products. It will
be considered as the indirect competitor for the E-commerce website. For example, the states
where football is popular, respective sports clothing and footwear needs to be sold. The
companies which are taking advantage of sport specific business can be the competition. Hence
the market for E-commerce website is huge and the smart strategies has to be applied in order to
eliminate the competition and stand in the market (Bocken et al. 2016).
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REPORT SECTION- 3 ONLINE MARKETING AND ADVERTISING TOOLS
The online marketing tool that will be used for the marketing and advertising of E-commerce
website will be Mobile-local social network marketing and Location-based messaging app.
Social media advertising is the fastest and easiest way to reach the customers. Social media
networking sites like Facebook, YouTube, Instagram etc. (Habibi, Laroche & Richard 2014) can
be used to post advertisements and polling to see the costumer’s interest and to know what is
their impression about the website (Piercy 2014). The intent marketing can be used to know the
consumer’s interest at particular period of time during any sport match etc. to know at the real
time what type of footwear and apparel, people are showing interest into. With the help of AI,
the E-commerce website can know the customer’s interest depending upon the number of clicks
on the website. The company thus can target the specific customers who are showing interest
into their products (Tiago & Veríssimo 2014). This marketing tool will help to analyse the mode
through which the retailers will reach the customers in most effective way. Location based
marketing will help the website to advertise the content on the basis of customer’s geolocation.
Everyone in today’s world uses smartphones with geolocation feature which after granting user’s
permission can be enabled. The geolocation will help in marketing the right product for specific
customer (Nguyen et al. 2014). For example, depending upon the geolocation the customer’s
country and state can be identified and according to the sport popular in that area, selected
products can be advertised (Armstrong et al. 2015).
The challenges that location based marketing faces is that most of the customers tends to turn off
the geolocation tracker keeping in mind their privacy concerns (Feng & Xie 2014). There might
be chances that the location tracking can be wrong. The challenge social media networking
marketing tool faces is that strategy needs to keep on changing. The marketing directly depends
upon the number of followers even if the brand is good but there are less followers in social
media, it can be a disadvantage for the retailer (Gao & Liu 2014). New customers may get the
idea that this brand is not good enough. The biggest challenge is to analyse the customer
behaviour accurately (Leeflang et al. 2014). However, the results can be measured with the help
of intent marketing in mobile-local social networking marketing strategies (Jain 2015). Intent
marketing can be used to analyse the customer’s behaviour and accordingly advertising the
products. Several charts and tools can be used to collect and analyse the data. Traffic can be
checked on the website. Coupons can be shown on the advertisement. The followers on social
networking sites, number of views, traffic can be used as effective tool for measuring the interest
of customers and accordingly applying strategies to ensure attracting the customers (Popa 2015).
The percent increase in the revenue generated with the help of advertising tools can be measured.
Thus using online marketing tools can give E-commerce website a way to interact with its
customers directly (McCarthy 2018). Creating contacts with customers in today’s world is the
most beneficial way of creating popularity among the customers.
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Conclusion
The online retail website E-commerce website is a retailer of Sports footwear and apparel. The
website aims to sell the products all across the globe. The business model used by the website is
differentiation because the competition is very high and the other retailers are also selling same
products in similar range. Hence in order to stand out on the competition, the E-commerce
website has come up with idea of customizable products and services like try and buy. Further it
enables the customers to collaborate with the website in order to sell their customizable products.
This way E-commerce website will ensure revenue generation using Subscription model,
transaction fee model and direct sales model. The products and services being different from the
other products makes it differentiable and provides value proposition as why the customers will
shop from this website when there are several similar products sellers out there. For
advertisement and marketing the website uses location based app messaging technique so that it
can attract the customers according to the location where they are living. Also the mobile social
network marketing strategy will enable the online advertisements and posts etc. to create
customer traffic and advertise their products on social networking platform.
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Recommendations
The E-commerce website should use the strategies to create its image in the competitive market
and establishing its market with the already established companies. The way to achieve it can be
using brand stories to bond the customers. Also the website should have a slogan close to the
brand story. The main focus should be on advertising the website on social platforms as well as
in the local market by doing campaigns. One effective strategy could be analysing the current
customer’s behaviour and accordingly build advertising strategies to gain more customers.
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