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70 Part 1 Introduction

of selling on the Internet. A turnover of several billion dollars has been achieved by eBay
from consumers offering items such as cars and antiques. Many airlines have successfully tri-
Debate 2.2 alled auctions to sell seats remaining on an aircraft just before a flight,
and this has led to the site www.lastminute.com which can broker or link
Innovative business models
to such offers.
‘The new business models associated
An example of a completely new commercial mechanism that has
with the dot-com era were, in fact,
existing models in an online context. been made possible through the web is provided by priceline.com
Business models and revenue models (www.priceline.com). This travel site is characterized by its unique and
have not changed.’
proprietary ‘Name Your Own Price™’ buying service. Here, users enter
the price they wish to pay for airline tickets, hotel rooms or car hire
together with their credit card details. If priceline.com can match the user’s price and other
terms with inventory available from its participating suppliers, the deal will go ahead. The
brand has also been licensed overseas. In the UK, priceline.com has three core services: air-
line tickets, hotels and car hire, and a similar service has been launched in Asia (Figure 2.9).

The importance of multi-channel marketplace models

Customer journey In the previous section we discussed new types of online channels and intermediaries, but it
A description of modern needs to be stressed that in many categories, purchasers use a combination of channels. As
multi-channel buyer
behaviour as consumers consumers follow their customer journeys as they select products and interact with brands,
use different media to they do not use the Internet in isolation – they consume other media such as print, TV,
select suppliers, make
purchases and gain direct mail and outdoor. These media are still very important for marketers to communicate
customer support. with customers who still spend the majority of their waking hours in the real world rather
than the virtual world. It follows that an effective approach to using the Internet is as part of
Multi-channel
marketing strategy a multi-channel marketing strategy. This defines how different marketing channels should
Defines how different integrate and support each other in terms of their proposition development and communi-
marketing channels cations based on their relative merits for the customer and the company. The multi-channel
should integrate and
support each other in approach is also a common theme throughout this book and we return to it in Chapter 4.
terms of their proposition
development and
communications based
on their relative merits for
the customer and the
company.

Figure 2.9 Priceline Hong Kong service (www.priceline.com.hk)