ISORG Group Project
Research on any 2 competitive e-Commerce websites
http://cdrproject.blogspot.com/

By: Chen Chin Fee, Tan Youwei Doralynn, Rathi Kunaratnam


Introduction

What is e-commerce?
Electronic commerce, commonly known as e-commerce or eCommerce, consists of the buying and selling of products or services over electronic systems such as the Internet and other computer networks. The amount of trade conducted electronically has grown dramatically since the wide introduction of the Internet. A wide variety of commerce is conducted in this way, including things such as electronic funds transfer, supply chain management (SCM), e-marketing, online marketing, online transaction processing, electronic data interchange (EDI), automated inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at some point in the transaction's lifecycle, although it can encompass a wider range of technologies such as the best connection tool ever invented, the e-mail. (source: wikipedia)

We will be comparing 2 competitive e-commerce websites: http://www.macys.com/ and http://www.shop.com/. Our scope of comparison lies predominantly within the objectives, features and characteristics of the site.

Both websites are shopping based sites that are adequately structured with both credit-card based shopping transactions, as well as information to consumers organised into the sites. The key difference between them is that one takes on the business model that encompasses a web presence with fully functional e-commerce facilities, that is complementary to their large chain of brick-&-mortar stores. The other aims to offer extreme convenience to customers in the form of an entirely virtual marketplace of many stores and products. The objective of shop.com is that it “allows shoppers to shop across millions of products, hundreds of stores & thousands of name brands with the ‘OneCart convenience’; just once click away from the world”.

From an early 2007 article written by Ian Davis for theretailbulletin.com he mentioned that retailers need to be more creative in persuading customers to shop with them rather than competitors. A good e-commerce website should have or be the following:
Encompass the transaction function on top of the research function; otherwise crucial sales could be lost.
Have a website architecture that is robust enough to support any unforeseen problems such as server crashes because it can result in sales losses and harm brand value and customer loyalty
Retailers should give control of websites back to the business user, merchandisers and marketing managers; they should be able to manipulate and control the site content without needing the constant support of the IT department. It is empowering its employees and setting up an organisation of sufficient alertness and agility to respond quickly to any changes in the economic, socio and physical environment. Such an arrangement would reduce the pressure on the IT department, and the e-business as a whole can leverage on the synergy of its managers and thus be more efficient and effective in making quick or over-night changes to offers/ displays.
It also mentioned that businesses should diverge into multi-channels, where inter-connectivity and synergy of these channels can better improve on recognising individual consumer’s online profiles. This will enable retailers to target consumers with more relevant marketing campaigns and ensure that their customers have the flexibility to research, buy and receive goods in the way that works best for them.
And a step into the future of e-business will be e-tailers being able to track their customers so as to obtain in-depth profiles for better business decision-making. In-depth profiles not only aid business managers with their yearly campaigns, but also allows the business to offer more in-depth assistance or advice should customers require it. The Click-to-Call technology that enables customers to click a button on a website to initiate a conversation with a sales or customer care agent is set to be more prevalent in the e-commerce industry. It provides an increasingly vital new channel to help consumers go from browsing to buying, boosting conversion rates and profits for the company. However, in order for Click to Call to be a success, a company must be able to identify web behaviour that indicates a customer is indecisive about purchasing and recognise at which stage the business should intervene and offer support. Carefully selecting the point at which Click to Call should be offered not only makes the technology more effective, but ensures call centre agents do not have to deal with an onslaught of calls from every customer curious about what Click to Call can offer.

We have found some of these qualities in both macys.com and shop.com. We will discuss how these 2 websites can compare to what the article generally states as a ‘good e-commerce website’.


Analysis

Our 2 websites in this research analysis show many similarities in terms of how they have managed to incorporate the essence of e-Commerce even thou our subject matter has been continuously evolving over the years. There are, however, some differences that make either website stand out competitively.

After general comparison of the feel and outlook of the websites, we deduce that both websites are attractive in their own ways. Macy's website looks more professional and focused to be a retailer - it is clear and concise and aimed to be a resourceful site where individuals can surf and shop with no qualms. Whereas Shop.com feels a bit more haphazard/ market place like. It features some very different e-tailing techniques from macys.com such as the presence of an online contest, an informative blog-site, and widgets to make the shopping more fun. Like any marketing gimmick, this could be the ploy to portray the individual site qualities since Macy's is an old business and Shop.com is an e-marketplace that brings together various shops and brands, but with the same level of service quality one expects from a top-notch e-tailer.

They share similar objectives such as providing a fun e-shopping experience with added qualities of site features such as “Wishlists”, ‘Favourites’, “Gift Registry”, and a sale or clearance ‘department’ on the online store.

A more in-depth comparison reveals that both websites adopted many of the points stated in Ian Davis’s article - How to compete in 2007's competitive e-commerce environment:

1. They are sufficiently structured websites for consumers to be able to browse through with understanding. Both websites are “departmentalized”, much like a shopping mall is, without the walking, so customers can easily navigate to departments for household items to baby clothes, cosmetics and sale/clearance items. It allows customers to “help themselves” on a self-serve site, easy to use without assistance. This implies that all information is available; cross-sell information, advice for product alternatives and supplies & accessory selectors are available.
Macys.com has an extensive range of in-store product details and special macys.com-only merchandise for sale, and information about the company, including things like career opportunities, FAQs, store locator, and Macy's credit card info and signup. Macy’s also has an added information portion on its physical stores;
Shop.com, over the expected “view cart”, “gift”, “e-mail to friend” links and such, it goes as far as to have shipping cost calculation and store ratings on every product page to better inform customers.

2. The product search functions allow consumers to search with keywords to get a shortlist of what is available on the site. Furthermore, the search results are categories should the resulting data be large in quantity.

3. Individual product details are available on a page by page basis so as not to clutter the minds of customers as they browse the mass of data available. For example, price, colour, sizing etc are available to the customer to make a purchase decision. Other information such as cross-sell information, advice for product alternatives, supplies and accessory selectors are on every other page to aid shoppers as well as surreptitiously increase overall sales. Most definitely, various promotion strategies like “free shipping for selected products” have eye-catching graphics to attract and entice.

4. There is evidence that retailers are tracking customer demands and preferences, be it by individual accounts, or by product page because of links titled “Customer Favourites” and such. We can also generalise that with the day and age of ICT, these heavyweight e-commerce sites have empowered their business managers to be able to manipulate the website content without the help of the IT department. This reduces the time lag in putting to motion new business campaigns, or emergency response to market changes, which allows the business to go with the market flow smoothly.

5. There are supporting resources such as shipping information, return policies, payment information etc. These have come to be standards of an e-commerce website that consumers can easily navigate to should they be interested in purchasing from the site.

6. Easy and secured way for customers to effect transactions from password protected accounts, to Secure Sockets layer (SSL technology), firewalls and extra protection against credit card fraud. This is to ensure that sensitive data and information is not tapped when data is passing through the site servers and consumer. This will give consumers peace of mind when shopping, whereby online credit card transaction is the preferred mode (accounting for 90% of general online purchases) of payment on both macys.com and shop.com. Shop.com being a hybrid B2C company that takes a purely online presence has to rely heavily on security measures to protect its only means of business – the website. It has incorporated the following security fence around its business:



OneCartTM is the trademark of shop.com to mean that it is a “one secure password account” that will give access to a large base of merchants. Trusted Merchants being its in-house security process to ensure that all merchant partners are thoroughly checked and verified reliable and secure for monetary transactions to take place. TRUSTe Certified Privacy and VeriSign Secured are examples of companies whose main concern is to create and maintain the easy and secure transaction methods for businesses and its consumers.

7. Shopping tools to aid shoppers with their purchase decisions, though the details of each tool function defers for both websites.

8. Although we have been unable to verify, we are quite certain that both websites have competent staff and systems to keep these heavy duty e-commerce sites running continuously. It is to an extent, expected of either site to provide reliability and security to their consumers by using IT such as Parallel servers, hardware redundancy, fail-safe technology, information encryption and firewalls. A breakdown in the workflow will result in huge losses, not just monetary but also in terms of general customer perception and satisfaction. Such a virtual catastrophe will have detrimental effects, especially for Macys as they have a long standing reputation to maintain, along with their brick-&-mortar outlets sales figures that will also be affected.



Special Features

The next part of our research analysis will focus on the special features of each e–commerce site. These can be loosely categorised as shopping tools to aid the customers in making a purchase decision, and also increase customer satisfaction and sales. Our e-commerce sites have, what has come to be the standard shopping aids – Gift, Wishlist, or “Sale items spotlight” functions. These ubiquitous shopping tools enable rigours marketing of products and, at the same time, variety and personalised help to consumers.

The more common features are quick links on most pages to create account, change shipping/billing addresses, preferred mode of payment, order via telephone which is some form of human interaction through a call centre and step-by-step guides to e-shopping.

Shop.com features a couple more “radical” shopping aids.
One is in the form of a http://www.facebook.com/ link for friends to access each one’s shop.com wishlist.
Another is called “My Planner” whereby one can access favourite stores, set up date reminders, send egifts and create registries.
“My Shop” is a feature that allows account holders to create customized shopping – a virtual shop that organises favourite stores and gives personalized product suggestions.
“My Favourites Link” also enables customers to save info on products that they really like; much like a book mark to be reviewed later and can be further edited to be under a ‘friends & favourites’ section.
There is a “SHOP.COMpanion” widget to make shopping easier by downloading the widget to the desktop – i.e. bringing the site to the descktop with an updated, at-a-glance view of the site.
An interactive game with prize money to be won will ensure a steady stream of new and repeat customers. This game is titled “Cart Me Away”, and at last check is being re-designed for a ‘hip fusion between The Price Is Right & Sex and the City”. It will be returning in November. The game provides one with an excursion into a virtual retail experience without actually burning the bank account. There are fabulous offers for winners, and all participants have a chance at the weekly drawing and the grand prize that are both cash benefits.
The site features a blog titled http://www.theshoppingvine.com/ that gives a less hard-sell feeling. It also provides useful updates and information to the general person.
Lastly, between both sites, shop.com probably has the more comprehensive gift service among the 2. This will be discussed later.

Whereas for Macys.com, as we have noticed, the site is quite focused to be the online supplement to their physical stores, and thus has an image to upkeep. Here are some of the unique features, against shop.com.
The site is much like an interactive catalogue. It has links to particular feature pages such as “Have to have items” For The Home Department, or Weekly Beauty Product Picks and Special Offers via menus that would sort products by coulr, skin care range, and fragrance brands.
A “Site Tour” keeps the customer informed about updates on the website and brings to attention new features.

New pages such as Fashion finds & Beauty
There is a “My Wallet” feature for account holders to store and manipulate up to 10 personal credit card information.
The “My address book” feature is similar, but stores address information for quick selection upon purchase of products.
They have a warranty information page whereby customers can request for detailed warranty information online.
They also have a page that informs customers on what products are on recall, and gives particular details of each product.
The “Wishlist” function allows the customer to choose the product, make adjustments to colour/ size/ quantity on the item description page, and then click “update” to his wishlist. Any account holder can create one’s own wishlist, and shop from a friend’s.
Macys.com has a few gift functions that provide the standard e-commerce service that savvy consumers have come to expect. We will be discussing them, in comparison to shop.com in the next section.
There is also one very thoughtful function which is the “User Assistance Tool” that can be downloaded to aid the visually impaired customer.

We have introduced both sites to have gift functions. What is interesting to note is that what was once a simple “Gift” function has diversified into sub-categories after listening to consumer feedback. The site in the spotlight is shop.com. Their gift services are
“Gift recommendation service” that recommends the most appropriate gifts for that special someone/ occasion.
“eGifts” & “eCards” is their unique virtual gifting service that allows one to send gifts and appropriate greeting to anyone.
The “Date reminder service” aids account holders in remembering all those special dates.
They also value add the process by including the ability to find gift certificates for most of the member merchants via the “Gift Certificate Centre”.
Macys.com has structured their gift functions in a different manner
There is a “Gift box and Personal message” function of the site that prides itself as a one-stop shop that combines great gift ideas, always-perfect gift cards and a powerful wishlist in one place. It can show gifts by recipient or occasion, and get quick access to the assortment of gift cards.
Being a reputable departmental store, macys.com features the “Wedding Gift Registry” that combines the ease of online registry with the shopping convenience of over 800 stores nationwide (USA) at macysweddingchannel.com.
Either way, each company has a reason for the different structure of the Gift function to suit their business model.


Business Model

To look at the similarities with regards to the business aspect of the either e-tailers models
E-tailing is very much sales and marketing via hard selling products. It is basically attractive pictures of products, and splashing all information available to customers for them to pick and choose.
Promotion strategies like strategically placed promo-graphics and slogans are continuously updated. It gives consumers “refreshing change” and entice consumers to buy
It is always good to aim for the level of customer service that exceeds expectations. It is prudent to ensure that customers are kept happy in all aspects of the site, be it the products that are offered, the information provided to ensure that it is by far a “self-help” website, yet still offer any assistance along the way. These steps would greatly improve the whole e-shopping experience and the customer will have positive perceptions of the business.

Shop.com provides a more interesting twist to conventional business models, such as macys.com follows. Since shop.com is a purely e-commerce website, to survive, sales is the key to success. To achieve that, they focus on a number of core competencies and have successfully engineered an electronic value chain that flows through hundreds of merchants and consumers. This cross-linking f websites and advertising affiliate programs do help with the site sales. The failure to coordinate with various points on the value chain will signal demise of the e-business applies to both web-businesses.

For e-commerce websites to constantly be on the cutting edge of technology as well as market trends, like all businesses, they have to strive to keep reinventing themselves in all aspects of business. However, some key factors will make or break the e-business such as
structure of the organisation, empowering employees and trimming the fat;
sales and promotion techniques, for example web coupons and contests;
structure and design of the website, because this is what makes the first impressions;
availability of functions and utilities to create more fun and enjoyment as well as helpful service to the customer
the range of products itself to attract potential customers at competitive price
It is crucial that an e-commerce organisation must provide an enjoyable and rewarding experience to itscustomers.


Suggestions for future improvements

We noticed that although either site have included a link for customers to send feedback, they have not adopted the “Click-to-Call technology” mentioned in the reference article. This technology enables customers to click a link and it directly connects him to a customer service officer. The officer will be thoroughly informed of the customer’s account history such as previous orders, orders in transit, shopping pattern, favourite products etc, to the ability of the program.

Other features or improvements that either websites can include are chat rooms, and discussion boards. These solicit customer input and gives a sense of community. They of course, however must ensure that such additions are aligned to their business strategy.

A loyalty program can be put in place once there are sufficient active customers in the ‘shop’.


Conclusion

E-commerce has changed the scope of businesses. Macys.com best exemplifies a business that reinvents itself to move with the changes of time and technology. While Shop.com provides a 1 stop service on their website that allow us to shop from varies departmental stores. Both Shop.com and Macys.com allows consumers and even business partners to have a more convenient way of shopping at the comfort of one’s home, and even in a remote destination. With the help of information technology connection to all parts of the world is just a click of the mouse away.