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CHAPTER 6
Concept of Virtual Store for
Marketing Products and Services
Chapter Objectives
• To differentiate between the practices of
virtual retailing and traditional retailing and
relate each to EC.
• To present the advantages and
disadvantages of opening the virtual store.
• To discuss the strategies in building
awareness for the virtual store.
Virtual Vs. Tangible Retailing
Approaches
• Electronic retailing is hidden from physical
contact to the public.
• Invisible electronic merchandise or offerings
• Housed and promoted on an electronic medium such as Web
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sites, e-mails, listservs, discussion groups.
Delivered by an electronic distribution system often the
WWW.
Directed to shoppers to complement stand alone or mall store.
It is convenience to everyone in the global market place.
It helps the distribution, as well as make better use of
company’s resources with a 24 hours shopping service.
Virtual Store
• The Advantages:
• To expand market coverage and distribution to a wider market .
• A company having a web page is interested in:
• On-line sales.
• On-line advertising
• On-line customer service
• Sales and communication activities.
• Flexibility could be maintained for sales and service in any
location
• Web sites operates 24 hours a day, and it is valuable for those
firms that market overseas.
• Firm’s credentials and qualifications may be important to
dispense marketing and sales materials on the Web.
Virtual Store (cont.)
• The advantages (cont.)
• Electronic systems allows to update prices, specifications, and
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services on hourly basis.
Company-sponsored promotion are translated into Web pages.
Customer inquires can be investigated more quickly.
The Web allows the company to render fast and responsive
customer service.
Order status can be ascertained immediately.
It provides an opportunity to test a new product/service.
Experimentation with new technology is possible using Webbased testing.
Discussion/listserv environment is on which an effective
marketing program could tap selected test markets.
Virtual Store (cont.)
• The Disadvantages:
• No every product/service is appropriate to Web sales exposure.
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Perishable goods are not being sold on the Web.
Maintenance, site offerings, communication are time intensive
activities, and require the work of multiple Web masters.
Marketer’s organization is dependent upon equipment,
communication software and its Interactive Service provider
(ISP) connection.
Virtual store front continues to serve as long as the server is
running or internet provider is being paid.
Twenty-four hour service is a serious commitment by the Web
based virtual store.
Anonymity of identity of Web based company is a risk.
Consumer may not be certain who the company is, or what it
stands for.
The Value of Virtual Storefront
and the Cybermall
• The Web based virtual store should deliver:
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Reliability
Consistency
Privacy
Accessibility
Accuracy
Responsiveness
• Retailing power will be based upon:
• Demographic of connectivity:
• A match between demographic of Web user and product the
company is offering on the Web.
• Content
• Customer motivation:
• technological shoppers are surfing breath and depth within
the product category.
Value of Virtual Store front and
Cybermall (cont.)
• Several cyberstores band together to give the
merchandise in one location or address, this
gathering of Web sites is considered to be a
cybermall. Exp.ebuy.com
• Alternative to banding with a cybermall is to be
‘linked storefront’ in which the storefront address
is hyperlinked within a popular site
• The security concerns the following reasons for
not purchasing online:
• Providing credit information or credit/purchase information are
foolish attempt.
Building Cyberstore’s Awarness
• Empathy for the customer’s wants and
desires is one of the key ingredients for
storefront success:
• Customer satisfaction
• Marketer should try to match corporate strategy with
contents of site, appearance, and site security for
customer ordering and privacy.
Deciding On-Line Marketing
Objectives
• What are the appropriate goals for online
marketing.
• Competitive differences of the online
marketing compared with traditional media.
• Time for delivery
• Strategies used in direct marketing may be
used in online
• Sampling or couponing.
Sample Web Findings
• Average Web order is 12% lover than retail, but
similar to catalog.
• Average Web order doubled when a household
received a catalog.
• Previous retail & catalog interest increased
response rate by 30%
• Buyers converted from primarily female to
primarily male.
• Average age remained consistent, but generated a
shift in age ranges.
Source: Presentation at Professors’ workshop of
Direct Marketing Association in New York.
E-Commerce Image and Identity
Development
• Identify qualities that target market value in
online.
• Building image in online is the part of the
impression of the good to consumers.
• A big part of a brand name in online is to
differentiate similar products.