Electif 621 EBusiness and mBusiness Antoine Harfouche The

Electif 621 E-Business and m-Business Antoine Harfouche

The New Economy The Putting-out Economy Industrial Economy Services Economy Digital Economy

‘Bricks and Clicks’ - A Hybrid Model Traditional Pure Web - Dot. com “Bricks and Mortar” “Clicks” Combines strengths from traditional and pure Web approaches

Brick & Mortar A face-to-face service delivery system or traditional physical CSD : Customer 1 Customer 2 Customer 3 Adapted from: Eiglier, P. and Langeard, E. (1987) Servuction - Le marketing des services, Stratégie et Management, Paris,

Pure-Players or the Pure-Click A virtual channel of service delivery system Customer 1 Customer 2 Help Desk Customer 3 Adapted from: Sousa, R. , Voss, C. (2006), Service Quality in Multichannel Services Employing Virtual Channels, Journal of

E-Services • People – Automate – use web self-service, offer customer choice • Process – Change process for service – contact strategies • Physical evidence – Site design – differentiate or support brand – Fulfillment quality.

Physical backoffice Virtual back-office Click-and-Mortar Antoine Harfouche, Université Paris-Dauphine Sous la direction de M. KALIKA Face to face service delivery system Integrated Back-office employee Invisible organization & systems Customer support provided by human agent IT Systems Front-office 1: Contact personnel (Service Inanimate encounters, environment Human (Servicescape Interface) or physical support) Virtual Interface (Web site, Front-office 2: interactive rtual channel of service delivery kiosk. . ) system service 1 service 2 Custom er 1 Customer 2 ICT 1 Customer 3

Pillars of Business Model

Key Resources The most important assets required to deliver our value proposition, distribution channel, and customer relationships § Physical § Intellectual § Human § Financial § Production § Platform

Key Activities [Capabilities] The most important activities a company must do, in order to deliver its value proposition, and makes its business model work. § Marketing § Engineering § Managing § Selling § Logistics § Problem solving § Managing

Key Partners Who are key partners in terms of suppliers and intermediaries between the firm and its end-users? Which key resources are we acquiring from partners? Which key activities do partners perform? § Motivations for Partnerships § Optimization and economy § Reduction of risk and uncertainty § Acquisition of particular resources and activities Partnerships can be motivated by needs to acquire knowledge, licenses, or access to customers. Example: Mobile phone companies that license Android, or insurance companies that rely on independent brokers.

Crowdsourcing • The recruitment and coordination of piecemeal work across the internet to achieve a goal. 1. Speeds up content creation 2. Gets clients and collaborators involved 3. Gets target audience involved 4. Offers diversity and creative choice 5. Drives development of scalable processes (Bratvold, 2012)

Crowdfunding

Co-opetition

Co-opetition = Value Creation • Co-opetition does not simply • emerge from coupling competition and cooperation issues Co-opetition implies that cooperation and competition merge together to form a new kind of strategic interdependence between firms, giving rise to a co-opetitive system of reciprocal value creation. Source: D. Meyer, 15 th March 2011, and reubenmiller. typepad. com 15

Value Propositions describes what creates value for a targeted Customer Segment. § § § Newness Performance Customization “Getting the job done” Brand / Status Design § § § Cost reduction Risk reduction Accessibility Convenience Usability

Augmented Product

Customization • • • Pure standardization Segmented standardization Customized standardization Tailored customization Pure customization

Co-creation Traditional Relationship Focus on expanding the pie Value to Customer Focus on splitting the pie Extended Enterprise Value to Supplier Source: J. H. Dyer, Collaborative Advantages 21

Customer Segments & targets For whom are we creating value? § Who are the most important customers? § § § Mass Market Niche Market Segmented Diversified Multi-sided platform

Channels of communication and Information strategy Value Propositions are delivered to customers through communication, distribution and sales channels. § How a company communicates with and reaches its customer segments to deliver a value proposition. § Which Channels do our Customer Segments want to be reached? How are we reaching them now? Which are working best (or not working)? § Enabling customers to evaluate a firm’s products § Allowing customers to purchase § Providing post-purchase customer support

Channels Direct Own Channel Types Sales force Web sales Indirect Own stores Partner Channel Phases Partner stores Partner web sales Wholesaler 1. Awareness 2. Evaluation 3. Purchase How to raise awareness about the product? How to help customers evaluate the product's value proposition. How do we allow customers to purchase specific products and services? 4. Delivery 5. After Sales How do we How to provide deliver a Value post-purchase Proposition to customer support? Customers?

Social Media Strategies Strategy #3 – “Appealing to Influencers”: Target Influencers Who Can Move the Masses Engaging the Advocates User Reviews Social Media Wildfire “Pro-sumer” collaboration Influencer-Led Development Strategy #1 – “Accessing social Consumers”: Use Social Media as a New Channel to Individuals Social Media Community Creating Urgency/ Spontaneous Selling Policies Customers as “Community Organizers” “Pass it along” promptions Recruiting others/ Group Seles Strategy #2 – “Engaging the Hive”: Get Customers to Mobilize Their Personal Networks Source: Robert Wollan, Nick Smith, Catherine Zhou, The Social Media Management Handbook, John Wiley, 2011. 26

Revenue Streams Pricing Mechanism Fixed Menu Pricing Predefined prices are based on static variables List Price Product Feature Customer Segment Volume dependent Price set by product, service, or other Value Propositions Price depends on the number and quality of Value Proposition features Price depends on the type and characteristic of a Customer Segment Price as a function of quantity purchased Dynamic Pricing Prices change based on market conditions Negotiation Price determined by bargaining skills and leverage Yield Price depends on inventory and time of Management purchase Price is determined dynamically based on Real-time-market supply and demand Auctions Price determined by outcome of competitive bidding

Cost Structure What are the most important costs inherent in delivering the value proposition? Which key resources are most expensive? Which key activities are most expensive? § Is our business model more Cost driven or Value driven? § Types of costs § Fixed § Variable § Economies of scale § Economies of scope Some business models, are more cost-driven than others. “No frills” airlines, for instance, have built business models entirely around Low Cost Structures.

Revenue Management • Set of techniques use to manage – Constrained, perishable inventory (time) • When customer willingness to pay increases towards departure • Applications: – Airlines, Hotels, Car Rentals, News Vendors • Main techniques: Open and close certain rate categories (rate fences) based on historical probabilities and forecasts of future demand

Mobile Application

Advantages for mobile web apps • Convenience: Always on, always near the owner. – 60% of mobile users keep their phones bedside at night (Ahonen, 2008) • Ubiquitous, omnipresent information streams: Don’t need to return to a desk to input data • Location aware: GPS, accelerometers widely available • Media input: Most smartphones have built-in camera, microphone, and speaker in addition to keyboard input

• Key Entry Features – Virtual or physical keyboard – Numeric or alphanumeric entry – External keyboard attachment • Interacting with applications – Touch or multi-touch – Handwriting and/or voice recognition • Geo-location • Facial and gesture recognition • Connections: Phone, web, texting, email

Best Practices • • • Handle unavailable or lost network connection Limit permissions requested as much as possible Optimal use of storage. Use the SD card if possible Use standard GUI layouts Efficient, fast, responsive Multi thread slow time consuming operations Save application data when state changes occur Share data with apps by implementing content providers Implement activities launchable from other apps Utilize notification facilities, progress bars, flash screens

• • • Design Considerations Orientation changes Varied screen sizes and resolutions Operating system choice to reach a wide audience Intuitive operation Reason for continued use Well-defined purpose Multi user support Upgrades/new features (without feature creep) Multiple language and color support Varied font sizes