Page 109 - Introduction to Electronic Commerce and Social Commerce

88 3 Retailing in Electronic Commerce: Products and Services

Another shopping tool is a wallet—in this case, an elec- Examples of self-service tools are: configuration tools, cal-
tronic wallet, which is a program that contains the shopper’s culators (e.g., for cost), FAQs, virtual online real-time assis-
information. To expedite online shopping, consumers can tants, application tools, and site searches.
use electronic wallets so that they do not need to reenter the
information each time they shop. Although sites such as
Amazon.com offer their own specialized wallets, Microsoft SECTION 3.8 REVIEW QUESTIONS
Passport has two services, “a Single Sign-On service that
allows members to use a single name and password to sign 1. Define shopping portals and provide two examples.
on to a growing number of participating websites, and a 2. What are shopbots?
Wallet service that members can use to make fast, convenient 3. Explain the role of business and website ratings, reviews,
online purchases.” recommendations, and site verification tools in the
purchase- decision process.
Example: Yelp 4. Why are escrow services useful for online purchases?
Yelp (yelp.com) is a search engine whose mission is to help Describe “spy” services in B2C EC.
people find local (in a specific city) qualified services ranging 5. How can a site motivate people to contribute their opin-
from mechanics to restaurants to hairstylists based on recom- ions on products and vendors?
mendations of fellow locals. It connects people with busi- 6. Describe digital coupons.
nesses. Community members, known as “Yelpers,” write
reviews of the businesses and then rate them. Yelpers also
find events and special offers and can connect with each other 3.9 THE NEW FACE OF RETAIL
by posting “conversations” on different topics (for example, COMPETITION: RETAILERS
to “talk” with someone from Los Angeles, see yelp.com/ VERSUS E-TAILERS
talk/la). For details, see yelp.com/faq and Chapter 7.
The introduction of B2C intensified the competition in the
retail market. As we illustrated in the Blue Nile case in
Aggregators Chapter 2, prices are declining, while companies are disap-
pearing or changing. For example, many retailers are adding
These are sites that aggregate information from many other an online channel to their off-line offerings, or adding Internet
sites and bring them to one place. Yipit (yipit.com) is a free only options. Adding an online retail channel helps, but many
“e-mail-based daily aggregator” that gathers deals (“every well-known retailers such as Best Buy, J.C. Penney, Radio
deal in your city”) on products from daily deal sites such as Shack, Sears, Staples, and Office Depot still are forced to
Groupon and Living Social. Tell Yipit what you want, and close numerous physical stores and are struggling to survive
they will alert you when there are deals that match, usually at (e.g., see usatoday.com/story/money/business/2014/03/12/
a fraction of the retail price (yipit.com/about). retailers-store-closings/6333865 and Schoon 2014). Let us
first look at an overview of the competition.
Digital Coupons

Shoppers are introduced to a new generation of coupons, The Online Versus Off-Line Competition:
which can be described as “no clip and no print.” This is how An Overview
it works. You register, for example, with the “Just-For-U”
program at Safeway. You click on the special sale items, or The Oxford Handbook of the Digital Economy from oxford-
on the coupon of a product you want. When you go into handbooks.com provides a comprehensive study by Lieber
Safeway and buy any of the products you clicked on (if they and Syverson (2012), which describes the nature of the com-
are available), you automatically receive a 10–20% discount. petition as well as the interplay of online and off-line retail
SavingStar Inc. (savingstar.com) offers a similar nationwide markets. They also look at the characteristics of online shop-
service in the USA. pers and the changes in both the demand and supply. The
major variables studied in the Oxford handbook are:
Self-Service
• Customers’ search cost. With today’s shopping search
One of the major benefits of EC is that it facilitates self- and comparison engines and the use of mobile devices,
service. By providing tools that enhance self-service, cus- the search cost to customers is very low and its impor-
tomers can improve their online shopping experience. tance in the competition is probably declining.