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E-Business Distribution
    Systems
    The E-channel vs Traditional Channels




Module 4                Krooman.com
The nature of Distribution
  Simple-you made a product or
   provide a service. That product or
   service has to reach the customer
  Depending on the type of good or
   service, different distribution
   channels are used.
  In some cases you distribute via own
   channel direct to the customer; other
   via an intermediary or
   intermediaries.
  Intermediaries were necessary
   because company did not have the
   knowledge or territorial reach to the
   customer. In some cases, product
   was too bulky to sell directly to
   customer; product needed to be
   bundled.
Module 4                     Krooman.com
How has the Internet affected distribution
   Possible to reach directly your customers
    faster and cheaply
   Made it possible to create products
    specific for an online distribution
    channel.
   Made it possible to extend territorial
    reach.
   Has dispensed with time.
   Now possible to combine your
    distribution and service under one
    package
   Has made it possible to support
    traditional distributor more effectively.
   In somes cases has resulted in lower than
    average costs for distributing products. In
     fact in some cases, the MC is almost
    zero.


Module 4                       Krooman.com
E-Channel
   E-Channel is the chain
    of relationships
    between companies
    and customers and
    between companies
    and their
    partners/resellers.



Module 4          Krooman.com
Issues
   Technology is used to
    alter the
    distribution/marketing
    channel.
   Links are either been
    removed or new links
    added
   New ways of linking
    businesses and
    customers
Module 4           Krooman.com
E-Business Distribution
    Systems
    Which e-Channel



Module 4          Krooman.com
What Channel Strategy?
   Transaction enhancement
   E-Channel Compression
   E-Channel Expansion
   E-Channel Innovation




Module 4        Krooman.com
Transaction Enhancement
   Use the current
    distribution channel,
    but add enhanced
    functionality through
    technology
   Providing marketing
    information



Module 4           Krooman.com
E-Channel Compression
   Eliminates redundant
    steps in the channel.
   Shortening of the
    legacy channel. This
    can result in a closed,
    more direct
    relationship between
    customer and supplier.


Module 4           Krooman.com
E-Channel Expansion
   This actually lengthens
    the process. Why?
   Due to inefficiencies in
    the market place




Module 4           Krooman.com
E-Channel Innovation
   Attract new customers
    by pioneering new
    channels to satisfy and
    to anticipate unmet and
    potential customer
    desires.
   An example is the post
    office selling stamps
    online

Module 4           Krooman.com
E-Business Distribution
    Systems
    Compare and Contrast Traditional distribution
    systems and e-business distribution systems




Module 4                 Krooman.com
The Hotel Industry
              Hotel                      Travel
Traditional   CRO      Switch      GDS              Consumer
                                         Agent


              Hotel                       Travel
Internet      CRO
                       Switch     GDS
                                          Agent
                                                       Consumer


              Hotel
                        Switch             GDS          Consumer
              CRO

              Hotel
              CRO                          Switch        Consumer


               Hotel
                                                        Consumer
               CRO



   Module 4                Krooman.com
The Publication Industry
   Download Version
   From Publisher to
    Customer
   Online Editions




Module 4         Krooman.com

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Module4 edistribution

  • 1. E-Business Distribution Systems The E-channel vs Traditional Channels Module 4 Krooman.com
  • 2. The nature of Distribution  Simple-you made a product or provide a service. That product or service has to reach the customer  Depending on the type of good or service, different distribution channels are used.  In some cases you distribute via own channel direct to the customer; other via an intermediary or intermediaries.  Intermediaries were necessary because company did not have the knowledge or territorial reach to the customer. In some cases, product was too bulky to sell directly to customer; product needed to be bundled. Module 4 Krooman.com
  • 3. How has the Internet affected distribution  Possible to reach directly your customers faster and cheaply  Made it possible to create products specific for an online distribution channel.  Made it possible to extend territorial reach.  Has dispensed with time.  Now possible to combine your distribution and service under one package  Has made it possible to support traditional distributor more effectively.  In somes cases has resulted in lower than average costs for distributing products. In fact in some cases, the MC is almost zero. Module 4 Krooman.com
  • 4. E-Channel  E-Channel is the chain of relationships between companies and customers and between companies and their partners/resellers. Module 4 Krooman.com
  • 5. Issues  Technology is used to alter the distribution/marketing channel.  Links are either been removed or new links added  New ways of linking businesses and customers Module 4 Krooman.com
  • 6. E-Business Distribution Systems Which e-Channel Module 4 Krooman.com
  • 7. What Channel Strategy?  Transaction enhancement  E-Channel Compression  E-Channel Expansion  E-Channel Innovation Module 4 Krooman.com
  • 8. Transaction Enhancement  Use the current distribution channel, but add enhanced functionality through technology  Providing marketing information Module 4 Krooman.com
  • 9. E-Channel Compression  Eliminates redundant steps in the channel.  Shortening of the legacy channel. This can result in a closed, more direct relationship between customer and supplier. Module 4 Krooman.com
  • 10. E-Channel Expansion  This actually lengthens the process. Why?  Due to inefficiencies in the market place Module 4 Krooman.com
  • 11. E-Channel Innovation  Attract new customers by pioneering new channels to satisfy and to anticipate unmet and potential customer desires.  An example is the post office selling stamps online Module 4 Krooman.com
  • 12. E-Business Distribution Systems Compare and Contrast Traditional distribution systems and e-business distribution systems Module 4 Krooman.com
  • 13. The Hotel Industry Hotel Travel Traditional CRO Switch GDS Consumer Agent Hotel Travel Internet CRO Switch GDS Agent Consumer Hotel Switch GDS Consumer CRO Hotel CRO Switch Consumer Hotel Consumer CRO Module 4 Krooman.com
  • 14. The Publication Industry  Download Version  From Publisher to Customer  Online Editions Module 4 Krooman.com