Companies That Are Using the Web to Conduct Business - Assignment Example

Companies That Are Using The Web To Conduct Business Name University Date Companies That Are Using The Web To Conduct Business The World Wide Web, apart from providing an inexpensive and popular medium for advertising and communication, has now started becoming a much preferred platform for conducting business because of it’s convenience and it’s ability to reach out to a wider audience in a shorter span of time. Following is a complete and thorough business assessment of two companies that use the web to conduct their business. A short history of the company before and after the use of web. Started in 1987 by Hemu Ramiah, Landmark is now the largest retail chain of book and lifestyle stores in India. It has three stores in Chennai, one in Bangalore, one in Mumbai, one in Vadodra, one in Gurgaon, one in Pune, one in Lucknow and one in Ahmedabad, a total of ten spanning the entire country. 1996 saw an extension of Landmark’s product category. Their product line now included music, curios, toys, movies, lifestyle products, magazines and other gift articles apart from their original product line that extended only as far as books, stationery and greeting cards. In 2001-2002 Landmark launched it’s very own website www.landmarkonthenet.com hosted by Sifymall.com thereby extending their arm from retail to e-business. Today it has come as far as having a very advanced search engine, an accurate store locator of its nationwide stores, online sale of books, music and movies with detailed, specific categories, delivery of the product within 25 days, author features and access to view the New York times bestseller list. Jeff Bezos has been the inspiration and role model for the 25crore e-business of Landmark. According to Jai Subramaniam, husband and business associate of Hemu Ramiah, “The book is a great product to put on the Net. The book is properly catalogued with a unique number, and it can be posted easily. Our role model always was Jeff Bezos”. Landmark is yet to launch and sell it’s other variety products online as they are currently encountering some sales tax glitches. Landmark is now a subsidiary of Trent Limited, which was founded in 1998. Trent Limited forms part of the giant Tata Group in India. Wal-Mart was started in 1962, by Sam Walton as the first discount store in Rogers, Ark. Five years down the line there were, in all, 24 Wal-Mart stores all over Arkansas pulling off a sales of about $12.6 million. The next two decades saw Wal-Mart opening it’s first distribution center, the Wal-Mart home office in Bentonville, operation in more that ten states, and started selling it’s shares as a publicly held company and was approved and listed in the New York stock exchange. 1983 saw Wal-Mart being listed as the number one retailer among other general retailers for the eighth year in a row by Forbes magazine. The first ever Sam’s Club was also opened in this year. Wal-Mart ventured into international arena in 1991 and the first opening was a retail unit in Mexico City. By 1995 Wal-Mart had stores across 50 states, and retail units in Argentine, Brazil and a join venture in China. As per the latest reports from Forbes magazine in year 2008 Wal-Mart is the world’s largest public corporation by revenue, and the largest private employer in the world too. In 1996, Wal-Mart took its first step into the Internet business and in January 2000 it founded www.walmart.com with its headquarters in San Francisco, near the Silicon Valley. With the name and backup of the Wal-Mart retail stores they forged ahead into the web business arena with a view to make Wal-Mart a more universally known brand. The main aim of walmart.com is to provide easy access to the various Wal-Mart products. Walmart.com provides more than one million products for sale online ranging from apparel, to electronics to movies, books and music to health and lifestyle products and more. Wal-Mart looks to combine the best of technology and retailing all under one roof. Apart from providing a wide assortment of products at low prices to its consumers at its different retail outlets all over the world, it aims to achieve the same success using the World Wide Web. B2C or B2C Landmark comes under the Business to Consumer model. Business to Consumer usually referred to, as B2C, is simply the transaction or exchange of goods and services from the company to the consumer. When a company caters to the need of the individual consumer as opposed to the needs of another business it follows the B2C model. Popular examples of companies under the B2C business models include Amazon, Barnes and Noble, E-bay etc. Wal-Mart also comes under B2C, also referred to as the Business to Consumer model since it caters directly to the need of the consumer. Wal-Mart’s main idea is to sell products to the consumer at discounted prices. Their mission is to help people save money to enable them to live better lives. Wal-Mart’s strength is also their diversity in products. Wal-Mart has got the best retailer award in Canada for 2003 and 2004. The core strength of companies following this business model is their ability to judge and infer the varying needs of the consumers and adapt their product line accordingly, as they are constantly in direct contact with their consumers.. Position in the supply chain. A supply chain includes all the various parties involved in the manufacture, sale and delivery of a particular product. It includes the manufacturers, wholesalers, distributors, transporters and retailers. According to a paper by Ram Ganeshan and Terry P. Harrison (1995): “A supply chain is a network of facilities and distribution options that performs the functions of procurement of materials, transformation of these materials into intermediate and finished products, and the distribution of these finished products to customers. Supply chains exist in both service and manufacturing organizations, although the complexity of the chain may vary greatly from industry to industry and firm to firm.” Following is a simple pictorial representation of the supply chain for a book business to depict Landmark’s position in the same. Landmark assumes the role of a Chain Bookstore in the above given supply chain as they directly supply the goods and services to the consumer either through their website or through their retail stores located in various parts of the country. They also play the role of the Online Retailer Warehouse as they supply their goods online directly to the consumer. All the consumer has to do is to sign into Landmark’s website, login to their account and start adding the items they want in his or her shopping cart. The consumer browses the list of various categories, which enables him or her to pick the book or music CD or movie that is required. Once the items are added to the shopping cart, the consumer pays Landmark directly by means of either a debit card or credit card. Once the payment has been made the goods are delivered within 25 days. Landmark takes up the retailer’s role also because they buy their various products from the wholesaler or distributor and books from many national and international book houses. They also import various products from manufacturers and wholesalers abroad and sell it directly to the consumer. Landmark Limited has recently entered into the arena of publishing with the Chicken Soup series. They also take up the role of distributors in the supply chain because of their tie up with various leading book houses in India and other retailers who buy their products for further distribution to consumers. Following is a pictorial representation of a supply chain for a consumer goods unit. Wal-Mart occupies the position of a retailer and e-tailer in the supply chain. According to the above pictorial representation, it takes up the second place from the top just before the consumers. They are the point of contact between the manufacturer and the consumer. Apart from having retail spaces and outlets all over the world, they provide online shopping facility to consumers to enable them to buy the products they want from their homes. One has to just login to their site and register to get their very own login account. Once this is done he or she may shop at leisure, choose and pick the products they want from a variety of categories and pay online through a very safe payment system. Wal-Mart has distribution centers all over the country and a well planned networking system to enable them to deliver the very best. The effects of the use of web for business. Landmarkonthenet.com has had a rather slow growth ever since its inception. After a good take off in 2001-2002 and a reasonable amount of success for the next two years, sales online took quite a dip in the year 2004. This was hugely because of poor Internet facilities, less accessibility to the Internet for a large number of people, order cancellations and delivery problems. The trend, however, is slowly changing. Says Himanshu Chakrawarthi, chief operating officer of Landmark Limited, “We are seeing a huge growth in online selling with large number of orders pouring in from small towns in India.” Apart from other aspects e-business gives consumers the convenience of browsing titles and other products available in the comfort of their own home and in their own time. It avoids the hassles of commuting and going through never ending racks of books or music or other products, trying to locate the one he or she wants. Walmart.com did not achieve immediate success after its establishment in 2000 according to reports from a case study by James Maguire (2002). Though Wal-Mart was a huge success and the most successful retailer chain in the real world, virtually it did not reach the same heights. According to analysts, Wal-Mart did not do very well in terms of online sales. This has been attributed to not having their customer base online and to the basic difference between a regular Wal-Mart shopper and online shoppers. Online shoppers tend to have less time and more income. Whereas Wal-Mart shoppers are more oriented towards saving money. But post this period; in late 2003 and early 2004 walmart.com saw a fair amount of success. Online traffic to walmart.com saw a good increase as the website started showcasing products like the Canon digital camera, diamond and platinum rings and quite a few other high flying products. The combination of diverse products and specialized services has helped in the increase of online traffic to walmart.com. According to John Fleming (2004), President and CEO of Wal-Mart, "From the customers' perspective, what we do is offer easy access to more Wal-Mart.” Mr. Fleming argues that the percentage of Wal-Mart’s online customers has gone up from 50% to 70% since its inception in 2000. With the gradual but sure increase in the number of people who have accessibility to the Internet, business through the web is slowly gaining popularity. Internet hubs are increasing in number and awareness of the Internet among the growing population has contributed to the success of business through the web. With more and more road traffic and extremely busy lifestyles of people, e-business is continuing to achieve high levels of success. E-business also gives the people of other towns and cities, that don’t have specific retail outlets; an opportunity to get what would otherwise not be available in their own towns. Waves of innovation. Landmark has devised numerous innovative ways for consumer interaction and satisfaction. Landmark conducts various Quiz programs and sponsors many other programs that pertain to their line of business in order to aid consumer interaction and participation. It also has a Loyalty program and provides discounts to their various consumers. Landmark continually has book readings and releases by famous authors among whom Jeffrey Archer was a recent visitor to the Chennai store. They have introduced innovative Gift Cards for consumers that can be swiped at any time for specific amounts on the purchase of varied gift articles. They can be loaded and recharged with cash at anytime. The website has a unique store locator. The website also lists upcoming and past events as a source of information to its customers. It also has a special hotline for consumer queries and complaints. It provides the online customers with a special feature for tracking their orders so as to keep a tab on them. In addition to all this they have added new feature called Diaries 2009 that sells exclusive diaries online at special discounted prices. Wal-Mart over the years has also come up with unique and innovative methods for increased customer gratification and interaction. Apart from their unique feature of discounted rates at their stores, their website has provided easy access to their products to consumers who may not have a Wal-Mart store in their state or city. The website has easy navigation with each product section in a separate link to enable quick buying. The site is supported by an advanced search engine and equipped with a store locator. It has a What’s New column that features everything that’s new in their stores and site. It has special feature called Connect and Share that provides various tips and helps people share their experiences and connect to different people. Wal-Mart also went into online renting of DVDs although they got out of this business in late 2005. The website also has the facility of downloading music and movies and runs a feature called 1-Hour Photos. Wal-Mart also gives consumers the convenience of ordering the products online and then picking them up at the local Wal-Mart store in their city. It also runs a program called Wal-Mart Affiliate, which allows customers to earn a commission when they refer other customers to Wal-Mart. It also gives access to weekly Wal-Mart newsletters to know what is happening at the stores. Wal-Mart has also implemented a number of measures towards the increase of energy efficiency. These measures aim to reduce the emission of greenhouse gases from their trucks, reduce the energy used up by their stores and also to reduce environmental waste. Wal-Mart is considered to be the biggest seller of organic milk and largest buyer of organic cotton in the world. It also has stores in Texas, Colorado, Las Vegas, Nevada, Aurora etc, run by wind turbines, photovoltaic solar panels, bio fuel boilers, water-cooled refrigerators and xeriscaped gardens. Business through the web for both the above given companies has had a share of successful times and a share of unsuccessful times since their inception and establishment. The emerging trends show a reasonable amount of increase in the scope of online business due to various reasons. But only time and the reach of these websites will tell how successful or otherwise they will be. References De, Aditi (2004, December 25). Canvas – Shopping. The Hindu Businessline Deshmukh, Ashutosh (2005, May 1). Issues and advances in B2C Research. Journal of Electronic Commerce Research. Maguire, James (2002, November 15). Case Study: Walmart.com. Retrieved February 16, 2008, from the e-commerce-guide website: http://www.ecommerce-guide.com/news/trends/article.php/1501651 Troy, Mike (2004, January 26). Cyber hurdle suddenly seems less high - Wal-Mart – Online. DSN Retailing Today Tata Review (2008, November). In search of maturity, 72 -73. Landmarkonthenet.com. Retrieved February 16, 2008 from the Landmark Limited website: http://www.landmarkonthenet.com/Business/Aboutus.aspx Walmartstores.com . Retrieved February 16, 2008 from the Wal-Mart website: http://walmartstores.com/AboutUs/7603.aspx Walmart.com. Retrieved February 16, 2008 from the Wal-Mart website http://www.walmart.com/catalog/catalog.gsp?cat=542413 Read More