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eCommerce - Dave Yakar - IDC Herzliya

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Guest Lecture at Arison School Of Business
IDC Herzliya
Guest Lecturer: Dave Yakar
Founder @ Go Global | eCommerce Agency

Published in: Internet
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eCommerce - Dave Yakar - IDC Herzliya

  1. 1. eCommerce Guest Lecture at Arison School Of Business IDC Herzliya Guest Lecturer: Dave Yakar Founder @ Go Global | eCommerce Agency
  2. 2. Today’s Subjects 1. The Rise Of eCommerce 2. The opportunities in eCommerce for Israeli Retailers 3. eCommerce Models
  3. 3. 1. The Rise Of eCommerce 1. Israeli Entrepreneurship in eCommerce Channel 2. Trends In The World Of eCommerce 3. The Israeli Consumer and Online Shopping
  4. 4. (Israeli) Diamonds are a girl’s best friend Israeli Entrepreneurship in eCommerce Channel
  5. 5. (Israeli) Diamonds are a girl’s best friend Flourishing trade in The Diamonds Exchange Center Israeli Entrepreneurship in eCommerce Channel
  6. 6. Jewish Jewelry and Judaica Israeli Entrepreneurship in eCommerce Channel
  7. 7. From Bnei Brak With Love Prescription Glasses Online Israeli Entrepreneurship in eCommerce Channel
  8. 8. Namefully - Name Jewelry It started as a small business, today there is an arrangement with the Israeli Post, a truck comes specially every day to pick up the packages Israeli Entrepreneurship in eCommerce Channel
  9. 9. Tactical Gear Israeli Entrepreneurship in eCommerce Channel
  10. 10. Gas Masks On ebay Family Deals Available Israeli Entrepreneurship in eCommerce Channel
  11. 11. Rising demand for workers in the field Israeli Entrepreneurship in eCommerce Channel
  12. 12. Small businesses succeed in their eCommerce ventures Israeli Entrepreneurship in eCommerce Channel
  13. 13. For the first time - eCommerce School Israeli Entrepreneurship in eCommerce Channel
  14. 14. 1. The Rise Of eCommerce 1. Israeli Entrepreneurship in eCommerce Channel 2. Trends In The World Of eCommerce 3. The Israeli Consumer and Online Shopping
  15. 15. Creativity In Product Illustration How many cards are in your wallet? http://bellroy.com/slim-your-wallet Trends In The World Of eCommerce
  16. 16. Creativity In Product Illustration 360 degrees product illustration https://www.magictoolbox.com/magic360/examples/ Trends In The World Of eCommerce
  17. 17. Creativity In Product Illustration Virtual Try On http://www.trylive.com/demos/trylive-eyewear/player-fitting-room Trends In The World Of eCommerce
  18. 18. Mobile vs. In-Store Mobile phone becomes an integral part of In-Store shopping Trends In The World Of eCommerce
  19. 19. Mobile vs. In-Store Threat for retailers: a quarter of mall shoppers in the US on Christmas 2014 say they made purchases with mobile phones while waiting in lines Trends In The World Of eCommerce
  20. 20. It’s all about the customer "We believe that customer service shouldn't be just a department; it should be the entire company.“ Tony Hsieh (CEO Zappos.com) Trends In The World Of eCommerce
  21. 21. Israel Post fails to adapt Trends In The World Of eCommerce
  22. 22. Operation Save Santa http://kdvr.com/2015/12/23/usps-deliveries-arriving-late-check-your-porch-before-bed/ Trends In The World Of eCommerce
  23. 23. But who needs Christmas?? Trends In The World Of eCommerce
  24. 24. 1. The Rise Of eCommerce 1. Israeli Entrepreneurship in eCommerce Channel 2. Trends In The World Of eCommerce 3. The Israeli Consumer and Online Shopping
  25. 25. Traditional retail is transforming “By 2022, brick and mortar retail spaces will be little more than showrooms.” Eddie Machaalani & Mitchell Harper (Co-CEOs of Bigcommerce) The Israeli Consumer and Online Shopping
  26. 26. Or maybe brick and mortar retail spaces are a little more than showrooms today -An article explaining how Israeli shoppers use retail store for size measurement and than buy the product online from abroad The Israeli Consumer and Online Shopping
  27. 27. Offline / Online – Is there any difference? Macy’s Goes Omnichannel https://www.youtube.com/watch?v=L62N0XOsmgU The Israeli Consumer and Online Shopping
  28. 28. Threat for local retailers: 60% of the Israelis’ online shopping are Cross Border. A large share of the online retail market The Israeli Consumer and Online Shopping
  29. 29. Top sites in Israel Right after Facebook and News – Shopping Online The Israeli Consumer and Online Shopping
  30. 30. Big spenders in global scale The Israeli Consumer and Online Shopping
  31. 31. The Israeli Consumer and Online Shopping
  32. 32. A threat to Israeli retailers The Chinese are coming!! The Israeli Consumer and Online Shopping
  33. 33. And it looks like they have secret weapon The Israeli Consumer and Online Shopping
  34. 34. Wait one moment! There is high Demand: The Israeli consumer shops online and would prefer buying from local retailers There is enough Supply: Local retailers offer more than enough goods tailored to the Israeli taste There’s an Economic Vacuum, the local consumer’s choice to shop Cross Border when all the goods are available in the local market is an Economic Distortion The Israeli Consumer and Online Shopping
  35. 35. Why are the Israeli retailers sleeping while on duty? The Israeli Consumer and Online Shopping
  36. 36. Summary - The Rise Of eCommerce:  Small Israeli businesses are thriving in eCommerce sales channel to the global market  The Israeli consumer shops online... and a lot!  With the rise of eCommerce comes a critical threat on a significant share of the online (and offline) market
  37. 37. 2. The opportunities in eCommerce for Israeli Retailers 1. The Opportunities in the local market 2. The Opportunities in the global market
  38. 38. Bricks and Clicks Synergy: Integration between the store chain to the online shop Opportunities in the local market
  39. 39. A completing channel for the store chain channel For customers in areas where there is no store Opportunities in the local market
  40. 40. Online catalog, new arrivals updates Anything that would bring the customers to the stores Opportunities in the local market
  41. 41. “Innovation distinguishes between a leader and a follower” Steve Jobs (1955-2011)
  42. 42. Rare opportunity to lead the market and differentiate the brand Opportunities in the local market
  43. 43. Opportunity to take a bite of the Cross Border competitor’s market share, 60% of total online spending Opportunities in the local market
  44. 44. 2. The opportunities in eCommerce for Israeli Retailers 1. The Opportunities in the local market 2. The Opportunities in the global market
  45. 45. A new Marketing Channel Endless markets in the global arena Opportunities in the global market
  46. 46. Global traders benefit of 17% Sales Tax exemptions for export shipments Opportunities in the global market
  47. 47. Taxes benefit for exporters of Israeli goods Opportunities in the global market
  48. 48. Taking advantage of free trade agreements such as Mercosur Agreement Opportunities in the global market
  49. 49. Argentina USA Usage of different brand name in other markets for many reasons Opportunities in the global market
  50. 50. Bargaining power as a buyer Opportunities in the global market
  51. 51. Forward integration – expand activities to include control of the direct distribution of the market Becoming a retailer instead of wholesaler Opportunities in the global market
  52. 52. The perfect solution for seasonal product categories Australia and New Zealand: Coats in the summer, swimwear in the winter Opportunities in the global market
  53. 53. So why retailers are not doing anything about it?? Opportunities in the global market
  54. 54. 3. eCommerce and organizations 1. The organizational challenge 2. Awakening demand for consultation 3. Business models
  55. 55. “It is not the strongest or the most intelligent who will survive but those who can best manage change.” Charles Robert Darwin (1809-1882)
  56. 56. The venture is treated as branch # 155, another store eCommerce activity has completely different set of needs and requires focus as a separate independent channel The organizational challenge
  57. 57. Today’s Status: many companies in recent years got burnt in an attempt to set up eCommerce activity by suppliers without sufficient knowledge I will build you a website... For only $100,000 The organizational challenge
  58. 58. A website is not a solution, without formulating clear vision and strategy funds will be invested on an online venture and the project will fail The organizational challenge
  59. 59. Many retailers are afraid of losing the current physical advantage in a new channel (and beginning) The organizational challenge
  60. 60. Inflexibility of organizations in containing new ventures Formal organization built many complex processes and may act as a barrier to effective entrepreneurial activity The organizational challenge
  61. 61. eCommerce venture - a new realm of high technology marketing and is not a part of the core activity of the firm The organizational challenge
  62. 62. Technology Implementation of knowledge and many processes along with a shortage of qualified suppliers in the domestic market The organizational challenge
  63. 63. Lack of knowledge in product management in international markets Conversion of thousands of products to different languages The organizational challenge
  64. 64. Lack of global marketing experience / strategy Loss of brand value in a foreign environment The organizational challenge
  65. 65. Cannibalization Competing with the company's physical stores The organizational challenge
  66. 66. Low customer service awareness in Israel comparing to the world The heart of eCommerce activity is customer experience The organizational challenge
  67. 67. eCommerce project is a cross-organizational The challenge is cooperation of senior management in favor of changing the perception of the organization from top to bottom The organizational challenge
  68. 68. At first no manager in the organization would want to adopt the new kid The organizational challenge
  69. 69. After the first 100K all managers will seize the opportunity The organizational challenge
  70. 70. This will be the CIO’s reaction after understanding the necessary integration with the ERP system The organizational challenge
  71. 71. And this is the CMO after hearing the extreme change in the marketing strategy The organizational challenge
  72. 72. And the CFO when he found out about the need for bank accounts in Japan and the US The organizational challenge
  73. 73. And the COO’s response to the need of a dedicated warehouse and shipping within 24 hours The organizational challenge
  74. 74. And the this is how the consultant will feel The organizational challenge
  75. 75. And all this with the difficulty of proving the ROI When the venture didn’t show a first shekel in sales The organizational challenge
  76. 76. 3. eCommerce and organizations 1. The organizational challenge 2. Awakening demand for consultation 3. Business models
  77. 77. Today’s status: re-awakaning of demand for consultation Many companies assigned budgets for eCommerce and it looks like organizations are willing to invest on ‘Round Two’ Awakening demand for consultation
  78. 78. Golf acquires Adika for 40 Million Shekels Awakening demand for consultation
  79. 79. Organizations understand and feel the threat from cross border competitors and the need to align to today’s market requirements Awakening demand for consultation
  80. 80. There is an understanding that the nature of eCommerce is not a site, it is a vision and strategy and these activities require professional consultancy in setting up the project Awakening demand for consultation
  81. 81. 3. eCommerce and organizations 1. The organizational challenge 2. Awakening demand for consultation 3. Business models
  82. 82. In-House model Establishment of eCommerce SBU within the organization Business models
  83. 83. In-House model Starting points of the organizations who choose this model:  Refresh the existing online presence strategy of the organization  An organization that wants the ability to manage the brand presence across all channels  Improving and refreshing an existing eCommerce business unit  An organization with a vision and strategy for the online channel  An organization with a centralized nature Business models
  84. 84. In-House model Abilities and functions involved in this model:  Cross organizational project  Needs to be sponsored by one of the senior ranks or by the CEO  Support most or all of the functions in the organization (as noted in previous chapters)  Online marketing vision and strategy development  Implementation of technological knowledge in the organization  Rewriting of many processes  Recruitment and building the eCommerce unit in the organization Business models
  85. 85. “An important re-engineering principle is that companies should focus on their core competence and outsource everything else.” Bill Gates Outsource model Cooperation with a company that specializes in eCommerce Business models
  86. 86. Outsource model Reasons for choosing this model:  Professionalism  Quick launch and GTM  Each party is measurable and maximizes its capabilities  Different needs in moving the project away of the organization  Minimum investment  Strategy: First step is outsource and the next step will be implementation of capabilities within the organization Business models
  87. 87.  In this model there is a minimal dependence on the organization’s capabilities  IT level: There is a need for integration to the corporate’s ERP  Product and service level: SLA development for the online channel, inventory availability, quality control, deliveries within 24 hours of orders and implementation of many other processes Outsource model Abilities and functions involved in this model: Business models
  88. 88. Back to Back Wholesaler model Selling to online retailers The organization as a wholesaler Online retailerOnline retailerOnline retailer Consumers Business models
  89. 89. Wholesaler model Reasons for choosing this model: The lack of eCommerce strategy Minimal investment and risk A decision to stay as a retailer in the local market and operate on a B2B model in other markets Strategy: Learning the market at the expense of other retailers Business models
  90. 90.  IT level: Integration to the corporate’s ERP  Product and service level: SLA development for the online channel, inventory availability, quality control, deliveries within 24 hours of orders and implementation of many other processes  Sales and marketing level: development of a sales unit specializing in acquisition of retailers as clients  On development level: Website, lead generation system and other technological solutions Wholesaler model Abilities and functions involved in this model: Business models
  91. 91. Dave Yakar Linkedin: linkedin.com/in/daveyakar Facebook: facebook.com/dave.yakar email :dave@goglobal.co.il Phone: 052-5744444

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