Week 3: Retailing in Electronic Commerce: Products and Services
Objectives:
Explore the various models of online retailing.
Understand the characteristics and strategies of online retail businesses.
Learn about the impact of e-commerce on traditional retail and the integration
of online and offline retail channels
Discussion Questions:
1. What are the key differences between B2C and B2B online retail models?
Provide examples of each.
Criteria B2C (Business-to-Consumer) B2B (Business-to-Business)
Businesses, organizations,
Customers Individuals, end consumers
wholesalers
Order Size Small, single or few items Large, bulk purchases
Buying Quick, simple (add to cart → pay Complex, involves negotiation,
Process → delivered) contracts, approvals
Fixed, standardized, with Flexible, negotiable, volume
Pricing
discounts/promotions discounts
Relationship-driven, rational, ROI-
Emotion-driven, mass marketing
Marketing focused (trade shows, LinkedIn,
(ads, social media, influencers)
direct sales)
Amazon, Shopee, Zara, Nike Alibaba, Salesforce, SAP, medical
Examples
selling to consumers suppliers selling to hospitals
2. Many companies encourage their customers to buy products and services
online, sometimes “pushing” them to do so. Why?
Lower operating costs – reduces expenses for physical stores (rent, staff,
utilities).
Wider market reach – can sell globally, 24/7 without geographic limits.
Customer data collection – track buying habits to personalize offers and ads.
Convenience for customers – easy, fast, anytime access increases satisfaction.
Boost sales opportunities – cross-selling, upselling, product bundles online.
Faster, automated transactions – quick payments, fewer errors, less
paperwork.
3. Compare the advantages and disadvantages of online stock trading with off-line
trading
Type Pros Cons
- Convenient: trade anytime, - Higher risk of impulsive decisions -
Online anywhere - Lower costs Technical issues (platform crash,
Stock (brokerage fees) - Real-time internet outage) - Security risks
Trading market information - Direct (hacking, phishing) - Limited
control over trades professional guidance
- Personalized advice from - Higher costs (brokerage and service
Offline
brokers - Less technical fees) - Slower trade execution -
Stock
dependency - More structured, Limited accessibility (office hours) -
Trading
thoughtful decisions Less transparency, depends on broker
4. Debate: Should online sales be an independent division in a click-and-mortar
firm?
Multiple choice
Which of the following best describes omnichannel retailing?
A. Selling products only through physical stores.
B. Using a single channel to sell products.
C. Integrating online and offline channels to provide a seamless shopping
experience.
D. Selling products through direct mail only.
What is a key advantage of dynamic pricing in online retailing?
A. Fixed pricing strategy.
B. Ability to adjust prices based on demand and competition.
C. Keeping prices constant over time.
D. Ignoring market trends.
Which of the following is a characteristic of B2C online retailing?
A. Large transaction sizes.
B. Simplified purchasing process.
C. Long sales cycles.
D. Negotiated prices.
What is one of the main challenges of implementing an omnichannel retail
strategy?
A. Higher shipping costs.
B. Integrating multiple sales channels.
C. Limited product selection.
D. Lower customer engagement.
Which company is known for its innovative approach to eyewear retailing
through online platforms?
A. Amazon.
B. Zappos.
C. Warby Parker.
D. Alibaba.
What is the primary focus of B2B online retailing?
A. Individual consumers.
B. Small transaction sizes.
C. Business customers.
D. Direct-to-consumer sales.
Which of the following is a benefit of offering excellent customer service in
online retailing?
A. Increased product returns.
B. Lower shipping costs.
C. Enhanced customer loyalty.
D. Reduced marketing efforts.
What is an example of a C2C online platform?
A. Amazon.
B. eBay.
C. Walmart.
D. Alibaba.
Which pricing strategy involves adjusting prices based on market demand
and competitor prices?
A. Fixed pricing.
B. Dynamic pricing.
C. Cost-plus pricing.
D. Discount pricing.
Which of the following best describes inventory management in online retail?
A. Keeping minimal stock to reduce costs.
B. Ensuring product availability and timely delivery.
C. Relying solely on drop shipping.
D. Ignoring seasonal demand fluctuations.
.Internet Exercise.
1. Watch the video “Internet Marketing and E-Commerce with Tom Antion Part One”
(9:06 min) at [Link]/watch?v=tc1u9eqpf68 (Part Two at [Link]/watch?
v=7jmK0_QTguk is optional) and answer the following questions:
(a) What revenue sources are cited?
Affiliate marketing, digital products, physical products, services,
advertising.
(b) What B2C revenue sources that you are aware of are not cited?
Subscriptions, freemium, crowdfunding, online courses/webinars.
(c) What are the two “affiliate” models? Compare these two models.
Pay-Per-Click (PPC): Earn per click.
Pay-Per-Sale (PPS): Earn per sale.
Comparison: PPC = faster, lower earnings; PPS = slower, higher earnings.
(d) Why is eBay so great for selling?
Low cost, large audience, easy to use, global reach.
(e) Comment on the suggestions for products/services you can sell from your home.
Digital products, handmade goods, consulting, affiliate marketing, freelance
services.
(f) What problems and limitations do you see for conducting business from your
home?
Distractions, isolation, time management, limited space.
2. What is advantages of established click-and-mortar companies such as Walmart
over pure-play e-tailers such as [Link]. What are the disadvantages of click-
and-brick retailers as compared with pure-play e-tailers?
Advantages of Click-and-Mortar (e.g., Walmart):
Established brand, physical presence, omnichannel, logistics infrastructure.
Disadvantages of Click-and-Mortar:
Higher costs, slower to adapt online, less digital focus.
Advantages of Pure-Play E-Tailers (e.g., Amazon):
Lower costs, global reach, scalable.
Disadvantages of Pure-Play E-Tailers:
No physical interaction, shipping dependence, intense competition.