Core Concept
DellAuction is an e-commerce platform that allows consumers to bid and purchase “refurbished Dell off-lease laptop and desktop computers” (Dellauction.com 2013). As stated by Shelly, Napier & Rivers (2010, p. 292), the major aim of deploying this type of website is to sell renewed and repaired dell product to its customers. DellAuction, by its nature, can be classifies into Business to Consumer (B2C) model where Dell conducts transaction between individual customers. Reichheld & Schefter’s (2000) research states that main goal of this website to strenghthen the loayalty of Dell customers.
Business Model – Electronic Auction
Dell Auction business model can be categorized to an electronic Action (e-Auction) where potential customers compete “online and real time, providing prices for goods/services that are being procured under an Auction.” However, though the core model is E-auction, it carries the fundamental customer interaction mechanisms of the Electronic Shop-front. (Electronic Catalogue, search engine, payment gateway, shipment court and customer services.” Auction funtionality)
Dell Auction Website incorporates e-catalogue module which advocates its users to browse the product with pictorial content and minute descriptions. Once the user has logged into the website, the above initial e-catalogue model is displayed. Commonly, the initial e-catalogue model segregated into “Hot Dell Detail” (Top products that are bided by the user) and “Dell Featured Products” (Commonly bided products).
Search function allows user to search for particular Dell products. However, the Dell Auction Website integrates a refined search utility allowing user to filter a particular product that adheres to user preferences. The bel...
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...ssence to developed marketing from even third-party websites. The author proposes that Dell could allow advertisement of other contemporary eminent auction websites. Thereby, this further would generate revenue to Dell. For example, Dell could invite renowned website such as EBay, ubid.com to advertise their services on Dell.
Dell Auction could provide monthly or yearly subscription to renowned auction websites. In order to attract businesses to advertise on their website Dell could provide low subscription rates. Moreover Dell could also provide low subscription rate if other websites promotes Dell products in the Dell auction sites. Hence, revenue would be generated in multiple ways. Developing these multi-revenue streams, according to Turban et al. (2010), “would optimize the chance for success.”
Difference between B2B revenue Model and B2C revenue Model
Proposed mission for eBay is to be the largest online marketplace that facilitate customer’s (1) shopping experience (2) from beginning to end, with a smart, searchable website(4), easy-to-follow instructions(7), clear and secure payment methods (5,6,8) at the same time enabling economic opportunity around the world(3) together with our associates(9).
Organizations normally reformulate their marketing strategy several times during a product’s life cycle. Economic conditions change, competitors launch new assaults and the product passes through new stages of buyer interest and requirements (Kotler, 2001, p. 484). Consequently a company must plan strategies that address any changes in the market. ebay Inc. is the world’s largest and most popular person-to-person trading community on the internet (Bradley, 2001, p. 1). From its inception eBay was unchallenged however with amazon.com’s (Amazon) entrance into the online person-to-person auction arena and other competition from Yahoo! Auctions, Auction Universe, and OnSale, eBay was faced with the issue of how to separate themselves from competitors and maintain market leadership in an increasingly crowded marketplace.
Act: improve the company website to make it more interactive with customers such as using products rating and comment on products they have used. Dell should focus on building and expanding brand advocates and use them in order to increase interaction.
Dell is one of the renowned companies in the world. If someone is asked to name the companies, which sell computers, he/she will definitely include the name of Dell (Martin 2002). In fact, it is widely accepted brand in the world. However, with the arrival of rival companies, post 2007, for Dell, it was testing to stay alive in the race in the computer industry. Dell in effect is acknowledged by some experts as one of the vulnerable brands. Hence, it would be preemptive for the corporation to continue to exist in the contest, where big companies, such as Apple and Acer have dominated the market by this
Through Dell Marketplace, suppliers and buyers can leverage Dell's e-commerce expertise along with its relationships with strategic Internet infrastructure partners to access goods and services from a wide range of companies, the majority of which are Dell customers
Consumers view Dell as a quality brand at a good price. Some consumers find that Dell's competitors may be a little more expensive but still offer a quality brand the company plans to launch a sales campaign "Dell on Ice" that will offer 15% discounts on its Blade Centre system and on its x440 top-end Intel server. (Shankland). Dell ranks high with customers because the company offers free technical support if needed. The purchasing process has changed for the consumers with Dell because all the ordering is done online which offers convenience to its customers and minimize inventory.
Dell Inc. has realized that the most efficient path to the customer is through a direct relationship, with no intermediaries to add confusion and cost. With the power of their direct model and their team of talented people, they are able to provide to their customers high-quality, relevant technology, customized systems, superior service and support and products and services that are easy to buy and use.
eBay needs to transfer its competitive advantage in the online auction industry into the area of
Dell made the bold decision in 1994 to eliminate their products from retail stores and focused on mail order customers. In 1996 Dell began selling through their website as well. By eliminating the retail store presence Dell was able to reduce costs, reduce inventory, and maximize profit. Dell utilized a built to order system that allowed customers to specify exactly what they did and did not want on their Dell computer. Dell's just in time inventory system lowered inventory to 6 days and storage costs were saved.
New online manufacturer brand e.g. Dell.com - Entrepreneurs saw opportunities for developing online manufacturers' brands that took advantage of online technologies that enabled innovative new products to be adapted to customer preferences, and by using IT to enable efficient and effective operations such as assembly and logistics.
Dell combines direct customer model which is our initial goal, with relevant technologies and solutions, efficient manufacturing and logistics, and strive to find new distribution channels amongst businesses and individuals around the world. Within the customer experience, superior value, high quality, relevant technology, and customized systems set us apart from our competitors. Also, product differentiation, and new acquisitions are a part of the widening of the business. (1)
Historically, personal computer companies produced most of the components for a computer which they assembled into their final products and distributed to resellers. The manufacturing of these components was vertically integrated into the organisation. Dell, as a small start-up, could not build this infrastructure. Instead, they developed a model where they developed relationships with organisations that could provide these components, allowing Dell to focus on selling and delivering computers. By selling directly to customers, initially through mail orders and later by using the internet, Dell avoided reseller mark-up. Dell also enabled customers to order customised computers, which Dell then assembled after receiving the order (Magretta, 1998, p.73-74). “Customers got exactly the computer they wanted and Dell saved money making the computers only when they were ordered” (Hill & Seggewiss, 2008)....
and is especially popular among eBay customers. Fig.1 briefly illustrates Company’s business. The system enables its
A business is feasible when it is able to generate profits, standstill despite of risks and achieve the founders’ goals (Hofstrand, 2009). In order to meet all of these achievements, the researcher need to investigate investment, technical market and commercial feasibility (How to conduct a feasibility study, 2015). In terms of Business model Canvas, the ‘customer segments’ component presents the market feasibility. Dell has targeted four main segments which allow the company to design, produce, promote and deliver different products with different features. In comparisons, the ‘value propositions’ contribute to the technical feasibility when the product is formed and advertised, ready to deliver. Dell has used different strategies to maintain and developed the brand including remain the same brand name for different products. This strategy is promised to stimulate customers’ awareness of the company, thus, attract numerous number of clients and increase annual profits. Finally, ‘channels’ characteristic focuses on accessing technical feasibility. Dell disposes different channels in order to reduce the transportation and warehouse costs as well as guarantee customers with aggressive on-time delivery. Consequently, as the cost has been lowered and the reputation has been improved, Dell is expected to maximize their revenues
This strategy was carried out by selling via phone, fax and direct sales, instead of selling through retail stores. Not only this approach differentiated Dell from other competitors at the time, it also reduced its operating costs as it did not have to rent expensive retail space. In addition, Dell’s strategy of selling customised computers allowed it to hold only a small amount of inventory, which reduce...