Tam Pham Bang Le

ITS 380

Shin-Ping Tucker

October 4, 2019

CH4 Building an E-Commerce Presence: Websites, Mobile Sites, and Apps

Case Study – Dick’s Sporting Goods:

1.      Why did Dick’s decide to leave eBay and take over its own e-commerce operations?

Dick’s decided to leave eBay and take over its own e-commerce operations because Dick’s had grown to a size where its agreement with eBay was costing the company significant revenue. eBay collected a fixed commission on all items Dick’s sold online, no matter how big, despite the fact that expensive items cost no more for eBay to process than cheaper ones. As Dick’s e-commerce sales continued to grow, its deal with eBay was costing it more and more money. Therefore, Dick’s have moved its e-commerce operations away from external vendors and back within the control of the company to avoid these types of expenses.  

2.      What is Dick’s omnichannel strategy?

      Having control of its e-commerce operations allows Dick's to provide better support for unique omnichannel features, such as shipping online orders from physical Dick's stores. To that end, Dick's has also begun to convert its stores into distribution centers as well as traditional retail showrooms. This will increase efficiency and improve delivery times, turning its perceived weakness of excessive bricks-and-mortar infrastructure into a strength. Approximately 80% of Dicks' e-commerce orders are shipped within the geographical area of a physical store. In addition, customers can order online and pickup orders at local stores.

3.      What are the three steps in Dick’s migration to its new website?

      Firstly, Dick's began development of its proprietary e-commerce platform and integrating its existing systems in 2014. Secondly, in 2015, Dick's began moving two of its lesser brands, Field & Stream and Golf Galaxy, onto the platform to ensure that there were no major issues with it, and continued development work. Thirdly, in 2017, the company completed the launch of the new platform, which it credited with strong online sales during the year-ending holiday season, despite some isolated glitches. Overall, the company considers the new platform to be a major success.

4.   What are the primary benefits of Dick’s new system?

Specific features of the new e-commerce platform that Dick's has prioritized include the ability to buy online and pick up items at a store, the ability to ship from or to a store, and its associate ordering system. The platform also features the ability to break down and test different pricing and marketing approaches by region, an improved search function, and better analytics capabilities. Dick's has also used the mobile platform to drive brand loyalty. Dick's uses piloting beacons, or physical sensors in stores that respond to incoming customers' smartphones, to produce customers' company rewards cards as they approach the store, offering promotions and other customized deals.

 

Projects

1.      Imagine that you are in charge of developing a fast-growing startup's e-commerce presence. Consider your options for building the company's e-commerce presence in-house with existing staff, or outsourcing the entire operation. Decide which strategy you believe is in your company's best interest and create a brief presentation outlining your position. Why choose that approach? And what are the estimated associated costs, compared with the alternative?

  I would develop the start-up with existing staff instead of outsourcing the entire operation. If my company is in charge of that operation, I want to prove the quality and value of my company, and I do not want to leave in someone else’s hands the reputation of my company. If I had a company of this kind, I would make sure I am surrounded of professional that can perform a great job and solve our customer’s necessities. Outsourcing should be done for simple operation, for example, it does make sense that companies outsource the production of the components that they need to build a computer, but they do not outsource the complete operation.  If my staff does the work we would have control of the entire operation, direct contact with the customer, and have a better outcome. On the other hand, if an outsourced company does the work, they will work fast to have it done as soon as possible to get pay, and you do not want your company to be known as a company that does not care about the customer. Maybe we can save some money if you outsource the operation, realize more websites to other companies, and make more money but the image of the company, in the long run, would be damaged and no one will contract our services.

2.      Visit several e-commerce sites, not including those mentioned in this chapter, and evaluate the effectiveness of the sites according to the eight basic criteria/functionalities listed in Table 4.11. Choose one site you feel does an excellent job on all the aspects of an effective site and create a Power Point or similar presentation, including screen shots, to support your choice.

Criteria

Walmart

Nike

Dick’s

Functionality

Good

Good

Good

Informational

Good

Good

Good

Easy to use

Good

Good

Good

Redundant navigation

Good

Moderate

Moderate

Easy of purchase

Good

Moderate

Moderate

Multi-browser functionality

Good

Good

Good

Simple graphics

Good

Good

Good

Legible text

Good

Good

Good

 

In my opinion, Walmart does an excellent job on all the aspects of an effective site.