Page 78 - Electronic Commerce

Introduction to Electronic Commerce

2. In 2004, Toys“R”Us sued Amazon.com for violating terms of the agreement between the
companies; specifically, Toys“R”Us objected to Amazon.com’s permitting Amazon Market- 53
place retailers to sell toys. (Note: When the lawsuit was filed, Amazon Marketplace was
called “zShops.”) Amazon.com responded by filing a countersuit. After more than two years
of litigation, a New Jersey Superior Court judge ruled that the agreement had been violated
by both parties. The judge ordered that the agreement be terminated and denied both
companies’ claims for monetary damages. Amazon.com appealed the ruling. In 2009, an
appellate court affirmed the lower court ruling but reversed the ruling on damages, which
had awarded Toys“R”Us $93 million plus interest. In June 2009, the two companies finally
agreed in an out-of-court settlement that Amazon.com would pay damages of $51 million.
Use your favorite search engine and the Web Links for Case C1 to review the courts’ find-
ings and rulings. Prepare a report of about 200 words in which you summarize the advan-
tages and disadvantages that Amazon.com should have considered before it entered into
the agreement with Toys“R”Us.
3. In 2009, Amazon.com purchased Zappos, a highly successful shoe retailer that was started
in 1999. Since the purchase, Amazon.com has kept Zappos operating under its own brand
as a separate Web site. In a report of about 200 words, outline a rationale for
Amazon.com’s decision not to subsume Zappos operations into the Amazon.com Web site.
4. In 1998, Amazon.com purchased the Internet Movie Database for a substantial, but undis-
closed, sum. The site offers reviews of movies and information about movies, actors, directors,
and others involved in the filmmaking business. The site does not charge membership fees
(except for a small area of the site reserved for people who work in the film industry, called
IMDbPro, which does not generate a substantial amount of revenue for Amazon.com). In
about 100 words, speculate on why Amazon.com might have purchased this Web site and
explain how it benefits from owning the site today.
Note: Your instructor might assign you to a group to complete this case and might ask you
to prepare a formal presentation of your results to your class.
C2. Hal’s Woodworking
Hal Donovan started an ordinary hardware store, named Hal’s Hardware in Sandusky, Ohio, in
1978. He had been working during his summer vacations from college for a long-established
hardware store and decided he liked the business. Hal’s Hardware developed an excellent rep-
utation as a friendly neighborhood store. The store managers are all active in the community
and the store regularly sponsors youth sports teams and supports local charities. When hired,
salespeople go through a comprehensive training program that includes skill training in the
areas of the store in which they will work (plumbing, electrical, power tools, flooring, garden, and
so on), and they are trained in customer service skills. As a result of this focus on service, Hal’s
Hardware became a community gathering place.
Hal offers classes and workshops for the homeowner and hobbyist three evenings each
month and regularly schedules seminars for professional customers on weekday mornings.
Many of these workshops and seminars are underwritten and taught by manufacturers to
promote their products, but an increasing number are being created by Hal’s Hardware staff
members.

Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.