Nathan Magnuson

Chapter 9

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Case Study

OpenTable changed is market strategy by: Changing CEOs, cutting staff, and shrinking its reach to only a few large US cities. They incorporated door to door tactics, new hardware/software applications, and interface. With a combination of all aspects, they succeeded and began to grow. As computers and internet connections began to be more a part of restaurants, OpenTable grew even more.

Questions

1.) Many are drawn to online retail because it can be very profitable early one due to the potentially low startup costs and not as extensive knowledge needed.

5.) The initial thought that by paying online reviewers to create links to its Web site could generate revenue. Also, the targeting of national chains was another approach in the hopes that they could expand very quickly, however the cost greatly outweighed the profit.

10.) Revenues are good to see how much money can be made with its product, but it isnít profit yet because there could be lots of bills to pay. The Net Margin would be better since it would display a closer representation of its profit by showing it as: revenue minus operating costs/taxes/etc.

15.) Real Estate websites allow customers to view houses/apartments that the company has up for sale. They could see how the real estate agents are rated and see their portfolios.

20.) For the very fact that they are on-demand is the reason that they can be disruptive. If the customer doesnít need to use the service all the time they donít have to, but can easily rejoin the service when the need arises. It beats being locked into a contract, especially if the customer is paying for a service that is not being used for a certain period of time.

Projects

Online retailers do have some issues that they must be wary of such as social and legal problems that they may face or others may think that the retailer has neglected. Social issues are not as problematic as legal, but social issues can greatly affect how well the company is viewed by the customers for multiple reasons: not having good service, keeping up with trends, and bad e-commerce setup. Legal issues can arise due to data collection/security, improper sales, and broken contracts.