Summary of the experience

It is already the last class! It has been a lot of fun writing those blog entries everyday and I might even continue with the blog after the class is over.

            Firstly, having to write a blog entry every week made me more aware of tech news in general. Every week, I would try to find the latest trend in e-business and would read all the recent tech articles to find the topic I wanted to discuss and that is by itself a great takeaway from this course.

            Secondly, I tried blogging a few times before but always posted a couple articles and never opened the blog again. This time, having it as a class requirement and writing more and more articles made me realize the true value and potential for blogs. Also, having the ability to check the number of sites views, the encouraging comments (even though the blog’s name was so specific that I didn’t really expect anyone to see it besides the professor) made me aware of the impact a blog designed to be read by everyone could have.

            Obviously, I also learned a lot about the topics I discussed every week. My blog was centred around e-business’s influence on shopping with a few exceptions dedicated to cloud computing.

The main takeaways that I will remember after this class is that e-business is targeting three very important trends in consumer behaviour:

·      The search for cheaper products and services: because pure-click businesses do not have high labour costs or rental costs, they offer better deals to consumers. Other business models such as group buying or penny auctions contribute to this trend.

·      The search for discovery: more and more people are looking for new products to try or see what products their friends are using and e-business tends to facilitate that for consumers through social media integration and new business models such as subscription boxes.

·      The search for convenience: people with busy lives need technology to make the most difficult tasks easier and less time-consuming. As a result, we’ve seen the growth of mobile payments, the increase in popularity of shopping walls or the introduction of the Google glass. Cloud-based software and applications are also part of this trend by making data available anywhere and anytime.

To conclude, I believe this class was very useful and taught me what the most important trends in the industry were.

Online pure-play enter the offline market?

The growth of e-business has allowed the development of a number of business models including a large number of online pure-play models.

However in the past year, we’ve noticed a number of originally “online only” players starting to enter the offline market. We’ll try to understand the origins of this trend and give some examples of how online pure-play businesses can use offline channels.

While online shops have caused a lot of brick-and-mortar businesses to close shop, they still lack a few characteristics that customer’s value such as:

•        Tactility
•        Instant delivery
•        Social interaction

By investing in the offline market, online sellers are looking for innovative ways to bridge the gap and make up for these flaws. Some of the most innovative ways to do so include:

•         E-bay opened a temporary pop-up shop in London during the holiday season where it featured images with QR codes and recommendations driven by social networks.

•         Similarly, Etsy opened a pop-up shop in New York with laptops to show their entire shop catalogs and mobile devices serving as POS terminals via Square and PayPal.

•         Another big trend is the shopping walls developed by Tesco for instance with their giant poster in Korean subways where people could take out their mobiles, scan the products they need and have them delivered to their houses, saving a significant amount of time. Now, its virtual stores are also found in bus shelters and have produced 130% increase in online sales and 76% new registrations for Tesco online.

This innovation was further developed using a similar technology and the XBOX kinect to allow customers to literally reach out and grab the products they want from their TV

Using pop-up shops and other offline channels allow online sellers to:

•         Make efficient use of retail space, with lower inventory

•         Measure engagement and conversion rates

•         Attract new customers

•         Support real-time social electronic shopping 

Subscription boxes

In the last couple years, the concept of subscription boxes has grown exponentially.

How does it work?

You subscribe to one the subscription boxes’ websites, enter your personal information (including skin type for beauty boxes, shoe size for shoe boxes….) and answer a few survey questions to help assess your taste. Then, every month, the merchant chooses a few sample size products, puts them in a box and mails it to you.

Why does it work?

For the customer, it is a great and cheap way to discover and try new products or to send a nice care package to a loved one.

It also taps into an important trend that runs parallel to social media: trying new things. So many consumers today use their favorite social network to ask for suggestions on what to eat for dinner, what show to see, what nail polish to use, which outfit to buy, and so forth, making many decisions based on input from friends and even strangers, which has caused countless people to expand their horizons.

For the retailers, it is an easy and convenient way to make consumers try new products and increase brand awareness.

Additionally, retailers get valuable information about their consumers and can therefore reach out and promote other products and services to them.

Some of the most popular boxes in Canada include: Glossybox, Glymm, Luxebox, JustFab, BarkBox, gourmet spotting, LePetitBallon's ….

The Google Glass revolution and g-commerce

What we currently know about the new device is that it will allow hands free access to information such as weather, stock prices, GPS, e-mail, video calls…It will also allow taking pictures and videos and all that though natural language voice recognition.

With the launch of the Google Glass explorer program, and the approaching public launch of the device, we decided to dedicate this post to the impact the device will have on e-commerce or as some early-birds started calling it G-commerce.

While the true impact and use of Google glass will only be known after the public launch, a lot of people have started predicting potential uses of the Glass. One of the main impacts of the Glass will definitely be the ability to search on the go and as we know the Google mobile search app already allows image capture search. We can therefore imagine walking into a bookstore and looking at/scanning a barcode would bring up information about the book, Google shopping would allow price comparison with other vendors and combined with google maps show the best location to get the book in question. Even more impressive, imagine entering a clothing shop, finding a nice shirt, scanning it and have google shopping find it online, automatically suggest the cheapest vendor including shipping costs and allows you to add it to you shopping cart and buy it online without having to take out your wallet or share your financial information with a third party.

Google Glass could truly revolution the way we shop!

Cloud Gaming

Last week, we spoke about the business applications of cloud computing, this week we will see how the cloud is changing the world of video gaming.

Cloud gaming is the new big trend in video games.

Cloud gaming refers to a game that resides on a company server rather than on the gamer’s computer or device. The gamer enters the game by installing a client program that can access the server where the games are running. The main advantage of cloud gaming is that the company can upgrade the games without having to worry as much about the capabilities of users’ computers.

The idea of cloud gaming was first introduced by G-cluster on Electronic Entertainment Expo, E3. Initially, the idea was to offer cloud gaming service over WiFi to handheld devices. In the 2009 Game Developers conference, OnLive demonstrated cloud gaming by streaming the game Crysis over the Internet from a remote server. It officially turned on its service in the US on June 17, 2010, at an initial monthly service fee of $4.95 but later canceled this subscription fee. A year later, Gaikai, which allows game publishers and others to embed free streaming game trials on their web sites, launched its open beta with games from Electronic Arts including Dead Space 2, Mass Effect 2, and Sims 3. Gaikai’s main strength was that it allowed its games to be embedded directly inside websites, on Facebook, or on mobile devices.  The company grew in popularity over the years until Sony eventually bought it in July 2012 for US$ 380 million. This acquisition allowed Sony to use the cloud gaming technology for the PS4, the company’s newest console introduced about two weeks ago.

http://news.bbc.co.uk/2/hi/programmes/click_online/8085937.stm

http://cloud-gaming-the-new-gen-gaming-trend.blogspot.ca/

http://www.hongkiat.com/blog/cloud-gaming/

Cloud computing applications

Last week, we defined cloud computing and the different technologies behind it. This week we will discuss the most popular applications of cloud computing for small to medium businesses. In fact, smaller businesses are the first to benefit from the new cloud-computing trend. It decreases the barriers to entry by eliminating the hassle of having to deploy physical infrastructure like storage systems and e-mail servers, facilitates collaboration between business partners and gives access to sophisticated technology at a low cost.

Some of the most useful applications of cloud computing include:

·      Productivity: a number of software targets the improvement of productivity. Examples include SageOne which offers invoicing, project tracking and expense management or Adobe FormsCentral which provides a good and easy way to create some fairly user-interactive forms for your business website or social media pages and analyze the data gathered through this forms. Gliffy is another service on the cloud that allows drawing diagrams such as databases or organizational charts in collaboration with other members of the organization, improving productivity.

·      Project management: Software such as Mindomo 5 enables you to easily visualize projects through mind maps, embed media, hyperlinks, and attachments, and begin planning projects by assigning priorities, completion statuses, and resources. 

·      CRM: Salesforce.com can track contacts, customer interactions, tasks, and hook into Outlook and Google Apps, while also offering document sharing and mobile access. Depending on the edition, it can also allow tracking sales opportunities and offer full reporting and analytics, custom dashboards, e-mail marketing, sales forecasts, granular permissions, real-time data sharing, and basic customer service tools.

·      File syncing: Dropbox, Box, Google Drive are all cloud-based services that allow you to access and edit the most updated version of a document online.

·      Finance: Bookkeeping software such as FreshBooks and and QuickBooks are all moving on the cloud to facilitate usage…

·      IT management: software such as PureCloud provides small and mid-sized businesses with a risk management tool that gives administrators an easy-to-use and comprehensive list of security issues in the network as well as detailed steps to proactively remediate the problems. 

Cloud computing

Everyone has stored a document on dropbox or google doc, streamed movies from Netflix or used social networking sites.

In a few years, “cloud computing” has moved from being a crazy idea that tech geeks talk about to a tangible reality that is now indispensable.

Cloud computing refers to the delivery of computing resources over the Internet. Instead of keeping data on your own hard drive or updating applications for your needs, you use a service over the Internet to store your information or use its applications.

Cloud computing can be used by companies following different business models:

·      Software as a Service (SaaS) is model where the consumer buys the ability to access and use an application or service that is hosted in the cloud. The best examples for this service model are salesforce.com and google apps.

·      Platform as a Service (PaaS) is a model where consumers buy access to the platforms, allowing them to use their own software and applications in the cloud. Examples include Amazon Simple Storage Service (S3)

·      Infrastructure as a Service (IaaS) is a model where consumers control and manage the systems in terms of the operating systems, applications, storage, and network connectivity, but rent the underlying infrastructure, as a service.  An example is Amazon Elastic Cloud Compute (EC2).

The main benefits of cloud computing include cost savings as companies can reduce their capital expenditures, lowering barriers to entry. Another major advantage is scalability and flexibility as companies can increase their deployment rapidly and adjust their resources to satisfy consumer demands. Also, cloud computing allow workers to access applications from anywhere increasing productivity. However cloud computing has also raised many concerns mainly with regards to security and data protection.

In the next few posts, we will discuss the impact that cloud computing has had on business models and take a closer look at the major players in the field.

Price discrimination

In the past few years, the increasing popularity of online shopping has allowed customers to better compare prices between competitors but has also allowed companies to collect a large amount of data on its customers through click-through rates, IP geo-localisation and cookies.

This important quantity of data is sometimes used to better target ads or customize a search but can also be used for price discrimination purposes.

A few years ago, Amazon.com started using information collected on different buyers to charge individual customers different prices for the same DVD titles. One buyer reportedly deleted the cookies on his computer that identified him as a regular Amazon customer and watched the price of a DVD offered to him for sale drop from $26.24 to $22.74. The strategy, as soon as revealed, was the source of strong customer outrage that forced the company to stop this pricing discrimination.

First, it is interesting to know that the practice is not exclusively reserved for the online market. The same product often costs more in a store located in a fancy area than in a store located in poorer one…

Secondly, a recent study revealed that two-thirds of adult Internet users believed that it was illegal for online retailers to charge different people different prices. It might surprise a lot but charging different customers different prices for the same product is actually legal unless the discrimination is based on a "suspect category" such as race, religion, national origin or gender.

Now if you’re wondering how to protect yourself or even take advantage from this discrimination, the answer is pretty simple: the same way you wouldn’t wear your fanciest outfit to a flea market, you should "hide that you have money to spend" by often checking bargain hunter websites, following a few online tips such as booking airline tickets on weekends when big corporations aren’t and finally you should delete the cookies installed on you computer to limit the amount of information accessible about you.

http://www.isr.uci.edu/pep06/papers/PEP06_Spiekermann.pdf

http://www.cnn.com/2005/LAW/06/24/ramasastry.website.prices/

http://vulkan.worc.ox.ac.uk/wp-content/images/combined-paper.pdf

Mobile payments

It is the new big thing in e-commerce!

With the launch of Passbook compatible apps on IPhones and the introduction of Google and Paypal’s virtual wallets, mobile payment is really starting to take off.

Now, you can pay for your Starbucks coffee by simply scanning a barcode on your phone, you can have a virtual movie ticket that you can just scan at the theatre entrance, avoiding all the lines… Even more revolutionary, Google wallet can store all your debit and credit cards on highly secure Google servers and allows you to pay in any store using Paypass or  GoogleWallet terminals by tapping the back of your phone to an NFC point of sale terminal at checkout.

On February 2011, the mobile payment market was estimated at 300 billion dollars and this number is expected to double by the end of 2013 as more banks, credit card companies, mobile network operators and big firms like Google and PayPal expand their offering and more merchants adopt them.

There are four basic technology models that allow mobile payment:

•     Premium SMS based transactional payments was one of the first mobile payment technologies used and allows a consumer to pay for a service by sending a payment request via text or USSD to a short code. The consumer is then charged through his phone bill or his online wallet.
•        Direct Mobile Billing: The consumer uses a PIN and a one-time password and is charged for the purchase on his mobile account. This was a very popular payment method, particularly in Asia but is now being replaced by WAP and NFC
•     Mobile web payments: the consumer can use the web pages or apps combined with a payment service such as paypal or a credit card to make the purchase. The WAP technology is used to purchase an item the same way it would be on a desktop.
•     Contactless near field communication technology or NFC: the consumer stores credit card and/or debit card information on his phone and make a payment by just waving his phone over the card reader. Some virtual wallets will even allow you to pre-load coupons and customer reward points on your smartphone and will apply them to your total automatically when you check out. This is the technology used by Google Wallet for instance.

http://www.theglobeandmail.com/report-on-business/canadian-banks-rushing-to-offer-virtual-wallets/article4404561/

http://www.google.ca/wallet/

http://en.wikipedia.org/wiki/Mobile_payment

Online bidding and penny auctions

Read till the end

A couple weeks ago, a friend of mine came to me bragging about her brand new IPad and assuring me she got it for $50! I could only believe her after I saw her receipt, it was just incredible!

How did she manage to get such a good deal?

The answer might be surprising to some of you but she bought it by bidding on one of the many rising penny auction websites.

Quibids, Happy Bidday or ZBiddy are all part of this new trend of e-business: penny auctions.

Penny auctions are a type of pay-to-play auction format. Potential buyers must register with the penny auction site and purchase a number of bids that they can then use in the auctions. Bids commonly cost around $0.60 and most penny auction sites offer packages in which users can save money by purchasing larger quantities at one time.

What is particularly interesting is that those websites offer products varying from small gift cards to higher ticket items such as computers, tablets or TVs, however they always tend to start at very low values (often 1$) and each new bid adds one penny ($0.01) to the price.

Other than that, it's just like any other auction, people bid on items they’re interested in, and when the auction clock runs out, the final bidder wins the item for its closing price.

Another interesting fact is that some of those websites such as Quibids offer the option to buy the item for the full price if the bidder loses. That way, the bids count towards the full price, limiting the amount of money wasted on bids.

You still think it’s a scam? Well you’re not wrong!

In order to get her Ipad, my friend bided exact 453 times, at a price of 0.60$ a bid, my friend actually paid $271,8 in fees!

Considering the regular price of her IPad is around $400, it could still be considered a deal, just clearly not as appealing as the website lets it sound like.

The Washington post article linked below has a very interesting psychological view of how such websites exploit our mind.

http://www.onlineauctionreviews.org/strategies/auctions-101/

http://www.washingtonpost.com/wp-dyn/content/article/2009/07/11/AR2009071100684.html

Group buying trend

Groupon, Tuango, Linving social, Dealfinder, Dailydeal.com, all those sites are part of the big social media marketing trend that’s group buying. The trend originated in China where tuángòu or team buying allowed to get discount prices from retailer when a large group of people were willing to buy the same item. Nowadays, the whole world had adopted the trend and some of those group buying sites have had a triple digit growth rate in the past couple years.

How does it work?

The concept is fairly simple: group-buying sites contact local businesses willing to offer big discounts online. Each site sends its subscribers a daily e-mail with the deal and a description of the business offering the deal, the minimum number of purchasers required for the deal and the time remaining. If enough people buy, the deal is "on" and purchasers can use their coupons to get the service they paid for.

Why does it work?

For customers, group buying gives access to exceptional discounts that allow the coupon buyer to experience services that would be otherwise inaccessible or too expensive, it allows the customer to discover new restaurants, new spas, new shops and new activities. For the seller, it is a “free” marketing and promotional tool that allows businesses to get their business known by all the subscribers of the deal’s website and getting them to try the service or product offered for a cheap price, hoping those customer will return in the future. It also works for luxury businesses such as spas or fancy restaurants by providing them with the opportunity to fill their tables. Finally, it is a great way to get rid off excess inventory especially when the holding cost is higher than the loss from selling at a discount.

A lot of new websites are appearing everyday and a lot of people are now questioning whether the business has a future but what is certain is that group buying has definitely changed the way Canadians buy and customers now think twice before paying full price.

http://www.canadaone.com/ezine/apr11/group_on.html
http://www.theglobeandmail.com/globe-investor/personal-finance/home-cents/im-not-yet-buying-the-group-buy-trend/article4327638/
http://www.wazua.co.ke/inner.aspx?sec=groups&aid=74

Online shopping Intro

There was a time, shopping implied struggling to find a parking spot, wasting time going from shop to shop trying to find that perfect dress, waiting in line at the cash, carrying all those heavy bags and even with all that, the choice was limited and you might end your shopping trip without what you were looking for.

Nowadays, a significant number of people go online and after a few clicks, have browsed more dresses than what any brick and mortar shop could ever hold and have their order delivered to their own door.

Online shopping has been growing exponentially: in the U.S., Forrester Research shows that $248.7 billion online sales are expected by 2014. A compounded growth of 10% is forecast for the next five years. Even more impressive, online sales have increased by over 25% in China in 2012. A number of technological innovations including new security measures to protect credit card’s information as well as the improvement of shipping procedures and the increase in online deals and coupon offerings are some of the main innovations that have helped online shopping.

In this blog, I will discuss the main innovations that encourage shoppers to shop online, the main trends in online shopping, how websites like Amazon, Beyond the rack or Zappos are revolutionizing the retailing sector and how more traditional companies are trying to catch up with the trend. I will also discuss the new business models that have emerged after the introduction of online shopping and the main disadvantages of this mode of shopping.

Sources: Forrester Researh, Global times China, WWWMetrics