Page 107 - E-Bussiness and E-Commerce Management Strategy, Implementation, and Practice

M02_CHAF9601_04_SE_C02.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 11:07 Page 74

74 Part 1 Introduction

The amount of cashback is set by the merchants – so it varies. For example, an iPod Touch varied from 2
to 6% at launch – that’s a saving of $7–25 on a $300+ product. You can see that Microsoft’s strategy is to
take audience away from both the comparison and the cashback sites by aggregating both services!
Microsoft also adds a revenue stream since merchants will pay Microsoft for each sale as part of an affiliate
scheme and Microsoft passes on the fee to each purchaser. Microsoft needs to take care of possible
conflicts with the comparison sites which will invest a lot on advertising through the Microsoft site.

A further type of intermediary is the virtual marketplace or virtual trading community.
These are of vital importance in the B2B marketplace. From the supplier’s or manufacturer’s
perspective they provide a new channel for selling their products. If the marketplace is set up
by major players in an industry such as the Covisint marketplace originally created by Ford,
GM and DaimlerChrysler (www.covisint.com) it will probably be essential to trade with key
customers via this method, since this will be a prerequisite for trading with the customer.
From the viewpoint of the B2B customer procuring supplies, the virtual marketplace offers
the opportunity for lower prices as pricing becomes more transparent, giving rise to greater
price competition. The form of these marketplaces is considered in more detail in Focus on
electronic B2B marketplaces in Chapter 7.
Portals

Portal The concept of the portal evolved to reflect the range of services offered by some online
A web site that acts as a intermediaries. The term ‘portal’ originated with reference to sites that were the default
gateway to information
and services available home pages of users. In other words, when users started their web browser, the first page
on the Internet by they saw was their personal home page. When users use a newly installed browser it will be
providing search engines, set up so that the home page is that of the company that produces it. In the case of Microsoft
directories and other
services such as this is usually www.msn.com (the Microsoft Network) and for broadband provider Orange
personalized news or in Europe it is www.orange.com.
free e-mail.
Types of intermediaries

Intermediaries vary in scope and the services they offer, so naturally terms have evolved to
describe the different types. The main types of intermediary you will identify as part of an
online marketplace analysis are shown in Table 2.5. It is useful, in particular for marketers, to

understand these terms since they act as a checklist for how their companies can be repre-
sented on the different types of intermediaries.
Table 2.6 shows the relative importance of different types of intermediaries according to
an online audience panel measurement company. It is apparent that there is similarity in the
top search engines, portals, social networks and media owners in the different regions. Com-
score publishes data on other European, Asian and Latin American countries at
www.comscore.com/press. In the UK, US properties dominate.