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Topic 3 o2o
- 1. Omni-channel: Online toOffline Click-and-Mortar Wei-Lun Chang wlchang@mail.tku.edu.tw Professor Department of Business Administration Tamkang University
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- 3. Launching Yelp Reservation •Motivation – Yelp needs a partner (online reservation) • OpentTable (2013), RezBook, SeatMe • Background – Industry: 661 billion ， but only 20% survived – OpenTable is the most popular platform – Yelp can enhance revenue (increment of number of employee) – Mobile device integration – More investment 3
- 4. Launching Yelp Reservation •OpenTable – Own reservation system (ERB) – Installation fee: 600-700 USD – Customer ： via OpenTable (1USD) 、 via restaurant (0.25USD) – Restaurant ： 270 USD / month 4
- 5. Launching Yelp Reservation •RezBook – Urbanspoon – Online selection (seats) – Restaurant ： 200 USD / month – Customer ： 1 USD • SeatMe – Restaurant ： 99 USD /month – No fees of each transaction – Earn 1188 USD of a customer per year 5
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- 8. Failure: Webvan • TooQuick to Scale – Vans, computer systems and software, personnel costs • The company did not outsource its distribution – Webvan owned and operated warehouses – efficiently rationalize delivery routes Source: https://rctom.hbs.org/submission/webvans-demise-or-when-technology-fails-to-meet-operations/ 8
- 9. Walmart v.s Amazon •Walmart – Leading technology • Amazon – Auto-pricing robot – Amazon Mom (competitor: Diapers.com, 2009) 9
- 10. Amazon • Amazon Books –2015/11, Seattle – First online to offline bookstore • Amazon Go – Real-world grocery store – Artificial intelligence & Internet of things (cameras and sensors) • Whole Food – Amazon fresh pickup – Organic food (460 stores) – 70% of population + 1-hour deliverySource: http://finance.technews.tw/2017/01/08/retail-business-am Source: https://www.geekwire.com/2017/amazon-set-open-secon 10
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- 13. Amazon • Amazon DashButton – Amazon Prime – $ 4.99 USD – Set it, press it, and get it – 80+ brands, 100+ products (2016) Source: https://techcrunch.com/2016/03/31/amazon- expands-dash-button-line-up-top-sellers-to- date-include-tide-bounty-cottonelle/ 13
- 14. Amazon • Amazon Key –Amazon Prime – Amazon Key In-Home Kit, $250 USD – 58% prime members won’t use it – 5% prime members will use it Source: https://www.amazon.com/Introducing- Amazon-Key-In-Home-Kit/dp/B00KCYQGXE 14
- 15. Walmart • Walmart.com – Shipfrom store – Site to store • 10 AM to 10 PM • 24 hours pickup • Walmart pickup grocery (2014) – Online order, drive through pickup – 2 hours – 10,000+ items • Shipping pass v.s Amazon prime – 2 days guaranteed • Merger – Jet.com 15
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- 17. Effect of Omni-channel •Amazon is accounting for 26% of online retail sales • US Survey (2015/6-2016/8, 46,000 shoppers) – 7% online-only shoppers – 20% store-only shoppers – 73% omnichannel shoppers • The more channels customers use, the more valuable they are • Omnichannel shoppers are more loyal – 23% more repeat shopping trips, are willing to recommend • Encouraging online customers to visit a store increased profits 17
- 18. Case: Warby Parker •2010-present • Try-at-home, one-for-one business model • Offer the best experience to customers – 1st : On-the-spot eye exams, next-day and direct- to-door service – 2nd : Order online (5 frames), try at home (5 days), return the box (free shipping) 18
- 19. Logistics: IT Perspective •Software • Infrastructure • People To support process 19
- 20. Summary • How tobecome competitive? – Last mile of logistics • Location is important – Exclusive item • Channel, … – Omnichannel strategy • Online x Offline 20
- 21. Successful Strategies forOmni- channel Retailing 21