Slide 2.

Chapter 2
Marketplace Analysis for
E-Commerce

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.2

Learning Outcomes

• Complete an online marketplace analysis to

assess competitor, customer and intermediary
and competitor use of the Internet as part of
strategy development

• Identify the main business and marketplace

models for electronic communications and trading

• Evaluate the effectiveness of business and

revenue models for online businesses.

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.3

Management Issues

• What are the implications of changes in

marketplace structures for how we trade with
customers and other partners?

• Which business models and revenue models

should we consider in order to exploit the
Internet?

• What will be the importance of online

intermediaries and marketplace hubs to our
business and what actions should we take to
partner these intermediaries?
David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.4

Figure 2.1 The environment in which e-business services are provided

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.5

Activity – The E-Commerce Environment

• For each of the environment influences shown in

Figure 2.1, give examples of why it is important
to monitor and respond in an e-business
context. For example, the personalization
mentioned in the text is part of why it is
important to respond to technological innovation.

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.6

Environment Constraints and

Opportunities
• Customers – which services are they offering via
their web site that your organization could
support them in?

• Competitors – need to be benchmarked in order

to review the online services they are offering –
do they have a competitive advantage?

• Intermediaries – are new or existing

intermediaries offering products or services from
your competitors while you are not represented?

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.7

Environment Constraints and Opportunities

(Continued)
• Suppliers – are suppliers offering different
methods of procurement to competitors that give
them a competitive advantage?

• Macro-environment

• Society – what is the ethical and moral

consensus on holding personal information?

• Country specific, international legal – what are

the local and global legal constraints, for
example, on holding personal information, or
taxation rules on sale of goods?
David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.8

Environment Constraints and Opportunities

(Continued)
• Country specific, international economic – what
are the economic constraints of operating within
a country or global constraints?

• Technology – what new technologies are

emerging by which to deliver online services
such as interactive digital TV and mobile
phone-based access?

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.9

Figure 2.2 Professor Donald Sull of London Business School talks about strategic
agility
Source: www.ft.com

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.10

Figure 2.3 An online marketplace map

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.11

Figure 2.4 Google Trends -- useful for consumer interest in products

Source: http://trends.google.com/websites

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.12

Figure 2.10 Number of searches through the Google Keyword Tool

Source: Google https://adwords.google.com/select/KeywordTool

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.13

B2B and B2C interactions between an organization, its suppliers and its
Figure 2.5
customers
David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.14

B2B and B2C Characteristics

Characteristic B2C B2B

Complexity of buying Relatively simple – More complex – buying
decisions individual and influencers process involves users,
specifiers, buyers, etc.

Channel Relatively simple – direct or More complex, direct or via

from retailer wholesaler, agent or
distributor

Purchasing characteristics Low value, high volume or Similar volume/value. May

high value, low volume. be high involvement.
May be high involvement Repeat orders (rebuys)
more common

Product characteristic Often standardized items Standardized items or

bespoke for sale

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.15

Disintermediation of a consumer distribution channel showing (a) the

Figure 2.6
original situation, (b) disintermediation omitting the wholesaler, and
(c) disintermediation omitting both wholesaler and retailer
David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.16

Figure 2.7 From original situation (a) to disintermediation (b) and reintermediation (c)

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.17

Counter-Mediation

• Creation of a new intermediary

• Example:
– B&Q www.diy.com
– Opodo www.opodo.com
– Boots www.wellbeing.com www.handbag.com
– Ford, Daimler (www.covisint.com)
• Partnering with existing intermediary – Mortgage
broker Charcol and Freeserve.

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.18

Example channel chain map for consumers selecting an estate agent to

Figure 2.8
sell their property
David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.19

Interactive Activity – Portals

Q1. Define portal

Q2. Is a search engine the same as a

portal? Yes, No
Q3. Is a search engine the same as a
directory? Yes, No

Q4. List search engines/portals you use

and explain why.

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.20

Search engines
Portal
Directories
‘A gateway to
information resources News aggregators
and services’
Comparers

Exchanges

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.22

Business Model

Timmers (1999) defines a ‘business model’ as:

An architecture for product, service and information

flows, including a description of the various
business actors and their roles; and a description of
the potential benefits for the various business
actors; and a description of the sources of revenue.

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.23

Figure 2.10 Business Model Canvas example

Source: Smart Insights. With permission.

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.24

Figure 2.11 Alternative perspectives on business models

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.25

Revenue Models – Publisher Example

• Subscription access to content

• Pay per view content access
• CPM display advertising
• CPC advertising on site
• Sponsorship of sections, content or widgets
• Affiliate revenue (CPA or CPC)
• Subscriber data for e-mail marketing
• Transaction fee revenue.

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.26

Figure 2.12 Example spreadsheet for calculating a site revenue model

Note: Available for download at www.smartinsights.com/conversion-model-spreadsheets/

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.27

Figure 2.12 Example spreadsheet for calculating a site revenue model (Continued)
Note: Available for download at www.smartinsights.com/conversion-model-spreadsheets/

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.28

Figure 2.13 E-consultancy

Source: www.econsultancy.com

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.29

Figure 2.14 Firebox

Source: www.firebox.com

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012
Slide 2.30

Figure 2.15 Zopa

Source: www.zopa.com.

David Chaffey, E-Business & E-Commerce Management, 5th Edition, © Marketing Insights Limited 2012