Chad Nordean


ITS-380 Global E-commerce Systems


Chapter 9- Online Retail and Services



Case Study Questions:

1.     What Characteristics of the restaurant market made it difficult for a reservation system to work?

-          Some of the characteristics that made it difficult for the reservation system to work were that reserving a table over the phone was very time- consuming, inefficient, and prone to errors. The restaurant market was also very slow to implement technology. Other challenges for OpenTable included, they needed real time access to all of the restaurants, table capacity, and if the restaurant would accept a reservation.

2.     How did OpenTable change its marketing strategy to succeed?

The company originally started their strategy by targeting large chains and paying for online restaurant reviews for links to the website. They soon realized they were spending a million dollars a month and only bringing in $100,000 in revenue. OpenTable changed their strategy by focusing on four large cities. Chicago, New York, San Francisco, and Washington D.C. Next, they re-tooled their software to make it user friendly and added and ERB system and deployed a door to door sales force. With this combination OpenTable soon start to grow!


3.     Why would restaurants find SaaS model very attractive?

-         Restaurants find such SaaS models attractive because they themselves do not have to buy software and hardware and install it manually. Instead, they can focus on just buying the subscription. This often will allow the restaurant to save money and save time. The other major benefit is the ability to implement the system instantly and to go live in no time.


4.     What challenges does OpenTable face?


-          OpenTable faces many challenges, they face the threat of new competition every day. They also face challenges like updating technology, training on the technology, and also the fact that one of their employees made false reservations. Just like any technology company, you face the fear of your tech becoming old and out of date. You also face the threat of companies being more efficient and cheaper then your product. These are just some of the challenges OpenTable faces.



Project Questions:

1.     Find an example not mentioned in the text of each of the four types of online retailing business models. For each firm explain why it is an example of the specific business model.

-Business models are ways in which a company markets its products and sells its to the customers.

Types of Business models:

-          Brokerage

o   The business model brings buyers and sellers together to make a transaction. You ultimately take a fee. An example of this would be Expedia, where they bring travelers to a site in which they buy air fare from providers.

-          Advertising

o   This is extended from a traditional marketing service. It allows businesses to pay to be advertised on social media. An example of this is Destination Duluth. Where local businesses pay to be sponsored on Destination Duluth.

-          Subscription

o   This is a high volume needed model and it is a model in which it charges monthly for a service. An example of this would be Netflix or Hulu. Where the customer pays a monthly fee to have access to a service or product.

-          Merchant Model:

o   This kind of model has the wholesalers and retailers sell the goods. An example of this is Amazon. They offer other companies products and sells their products for the.


2.     Investigate the use of mobile apps in the online retail or financial services industries. Write a short briefing on your findings.

-          The use of mobile apps for online and financial services has sky rocketed in the past 5 years. With online banking and other financial services lie access to the stock market and budget apps, more and more millennials are downloading these apps. It is how roughly 50% of millennials use their financial services. The older generations are slow to catch on but are increasingly using these services. Online retail has also exploded. One of the most used online retail apps used is Amazon. This app allows users to quickly search what they need, give multiple options, and offer them at a low price. Plus, Amazon has the one click purchase to make it much more user friendly. Overall, these types of mobile apps are increasingly becoming more integrated in everyday life. In the future these apps will probably become standard on phones because they will be widely used.