The shipping costs are a good example. Amazon just need to transfer products from manufactures to its warehouse, after order online, products will ship to customers directly. While traditional shopping style may be need to pay more fees for transportation management system. Therefore, Amazon has shown more competitive advantages in providing cheaper product. Easier for vertical comparison Amazon never loses passion on
The advantage they bank on is their competitive prices and better customer service against their internet competition. One notable report stated that the practice of showrooming will be less of a concern this year in part because retail companies have gotten much better at allowing customers to price shop on their phones while they browse in their stores. This article can be related to several concepts in the Economics textbook. What caught my eye was in transaction costs. This is defined as the costs of time and information required to carry out market exchange.
In a service company like Peapod quality play's the role of better service to make happy consumers by being faster and cheaper. The role that productivity plays is that since it is an Internet grocer the product will be unlimited for all buyer. The stores will have more time to start making more products if they think is needed and would not over produce products that won’t be obtain by buyers. The difference between the quality and productivity from Peapod and a manufacturing company is that in Peapod the quality and service for the customers is easier because it is via Internet and it provides reliable performance. The productivity is better to be by Peapod because you won't have the problem of over producing products and then loosing extra money; which would bring to a bad economic decision.
My suggestion: In order to attract more customers and improve their financial performance, Calyx Flowers (“Calyx”) should increase internet advertising. Argument in support: • The internet advertising requires less capital than other options do • Internet advertising allows a more targeted market segmenting and higher target reach. • Online advertising avoids expensive long-term contracts, can be placed in a short amount of time, and can be launched on demand. i.e. Calyx can run a mass of online ads in a short period of time such as before busy holidays like Valentine’s Day and Christmas even on a relatively tight budget.
The rules of marketing may have changed but it definitely does not mean that IM is the only answer for marketers. For a company like HubSpot, whose products appeal to a certain type of customer, specifically people who are familiar with 2.0 and know what product they are looking for, IM is effective because potential customers are already familiar with the platform and are shopping around. IM is also good because it is cheaper and provides very informative details on the company’s products. However, if a business only offers products which appeal to older or specific customers who are not familiar with web 2.0, IM will not work. One example of a business where IM will not work is a business that that sells electric wheelchair.
"We save people money so they can live better." This all too popular mission statement is not to be taken lightly. The retail industry is dominated by few retail giants, with Wal-Mart competing in several retail categories. Wal-Mart competes against Kmart and Target in the general merchandise retailing; against Costco in the warehouse club segment; and against Giant and Safeway in the supermarket retailing realm. The core feature of Wal-Mart’s strategy is overall low-cost leadership.
It is also more cost effective as it is relatively cheaper to advertise online than it is to print an ad. Internet marketing is a business imperative because the Internet is an irrevocable and unstoppable trend. Even if you have a traditional "brick-and-mortar" business, you'll lose valuable customers without an online presence. People routinely search for goods and services with their computers in lieu of the yellow pages. If your business isn't on the Web, customers will likely choose another company with whom to do business.
It makes since, instead of always wasting the sales person time. If everyone is going to be going into stores just to check barcodes and see where they find the product cheaper or even shop online all the time it doesn’t make sense for a company to be paying employees for unnecessary work. Or work their not able to do at all. It will save the company money instead of paying for such big space that not a lot of consumers are going to. The only downfall I see or disadvantage I see is depending on where those lower rent locations are because some uppity people don’t feel secure in lower rent locations.