Online Book Retailing Essay

1746 words - 7 pages

1. Introduction:In the past few years, the world saw lots of changes in online retailing. In this B2C e-commerce model, the combination of screen-to-customer interfaces, network effects, real-time competitive responses, and one-to-one customization leads to "value increases" for both the customer and the firm. In general, more and more customers can use online shopping with confidence, while more and more companies recognized that online retailing is no longer an option but a business requirement.The United States is by far the global leader in the B2C e-commerce arena. Up to now, books are still the top-selling products online. So we will look at U.S. online bookselling market, in ...view middle of the document...

Not having a credit card or distrust of using a credit card online are the leading obstacles to greater online purchasing. Shipping costs are cited as the primary factor discouraging online purchases.To the both sides of the e-retailing, there are some pros and cons. To consumers, the main advantages include good selection of items, competitive prices, and convenience. But lack of consistently high levels of service and access to customer service representatives might be the two major disadvantages. To companies, the main advantages of selling online are as follows: a worldwide-audience, two-way communication with customers and no time limit-can be available 24/7. However, difficulty in targeting particular group, limited accessibility of many consumers, and limited capability of distribution are the key disadvantages.3. Books selling online:As the typical products selling online, books are widely accepted by online shoppers, and the trend is going to increase with a greater selection, more convenience and better customer service. In this market, Amazon.com and Barnes & Noble are the two major players. According to a survey conducted by Ernst & Young's in October and November 2000, they are the first two most-frequented sites, with 28% and 15% of U.S. online buyers respectively. (Chart 2)Chart 2: Favorite sites for purchasing in U.S.Source: Global online retailing: an Ernst & Young special report (2001)Amazon.com began selling books online in July 1995. By the end of 1999, it had completed its first steps toward transforming itself into becoming an online retail superstore. Now books are one of biggest categories of its broad range offers. Barnes & Noble is the largest book retailer in the United States. When it established its web-based subsidiary BarnesandNoble.com in May of 1997, it had 483 superstores located throughout the United States.Books are the top online purchase category in U.S. (Chart 3). In this market, competition is still intensive. The online book-selling environment will be discussed along the following dimensions: selection, price, customer acquisition, associates/affiliates programs, personalization, customer service, and user navigation.Chart 3: Top 10 purchase categories:Source: Global online retailing: an Ernst & Young special report (2001).3.1 Selection:For online book shoppers, they have a wide range of selection. For example, BarnesandNoble.com have 8 million titles in its database and 750,000 titles in its inventory, which included books from thousands of small independent publishers and university presses. Amazon.com reportedly had 4.7 million titles in its database and 300,000 titles in its inventory.3.2 Price:Usually, the books selling online are cheaper than in conventional outlets. Both Barnes & Noble and Amazon.com remained the pricing policies largely unchanged-30% off of most hardbacks and 40% off of selected titles.3.3 Customer Acquisition:Customer acquisition is one of the areas in...

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