Notes and Study Materials

B2C Model

 

 

The B2C model basically involves business houses and consumers. B2C Websites display product and service information in an on-line catalogue and store it in a database. The B2C model generally refers to on-line trading and auctions such as on-line stock trading markets and on-line auctions' for any product. The B2C model basically involves business houses and consumers.

 

B2C Websites display product and service information in an on-line catalogue and store it in a database. The B2C model generally refers to on-line trading and auctions such as on-line stock trading markets and on-line auctions' for any product. The following Figure  shows the flow of information between consumers and business organizations.


The B2C model offers a variety of services, which are as follows:

 

• Auctions

• On-line stores

• On-line services

 

1. Auctions:

Electronic auctions offer an electronic implementation of the bidding mechanism accompanied by the multimedia presentation of goods. It also integrates the bidding  process with contracting, payments and delivery.

 

 

Some of the advantages of Internet auctions are as follows:

 

Convenience: A participant can participate in the bidding process from any place and conveniently find more details about the goods.

Flexibility: Internet auctions allow asynchronous bidding lasting for  weekend. The participants are not constrained to participate in the bidding at the same time.

Increased reach: Internet auctions have a global reach that provides a large market for the auctioned goods.

Economical operation: Internet auctions are very cheap as they do not require the infrastructure as is required in a conventional system.

 

Disadvantages:

 

• Inspection of goods: Physical inspection of goods is impossible in Internet auctions. Bidders can only rely on the information provided or the electronic images of the goods.

• Potential for fraud: An Internet bidder has no guarantee of receiving the goods even after paying for it.

 

2. On-line stores:

 

It refers to the marketing of a product of a specific company on the Web. Web marketing is done either to promote a company and its products and services or to actually sell its products and services. Some of the advantages gained by companies through on-line stores are increased demands,  lower cost  path to global reach and cost reduction for promotion and sales of products and services. Also, the customers have the benefits of lower prices, a much wider choice, better information and convenience.

 

A major bottleneck on-line stores face is the lack of an efficient revenue model. Therefore, there is a need to devise new ways of generating revenues such as charging membership fees from customers or charging some fees for a transaction and decreasing the fees per transaction with the increase in  the number of transactions.

 

3. On-line services:

 

The number of companies using the Internet to provide customer services, such as service sector banking and stock trading, is on the rise. makethemove.com founded by Mike McCabe is an important example of on-line services. Its goal is to make Internet usage easy by creating functional and interactive services. MaketheMove.com helps the users to set up, transfer or cancel their utilities such as local phone, wireless phone, gas, cable television, Internet Service  providers (ISP), paging, newspapers, magazines and many more when the customer shifts from one place to another.

 

Capabilities of B2C model:

 

The capability and the power of the B2C model depend upon the advancement of the Internet. Some of the capabilities of the B2C model are as follows:

 

Instantaneous communication:

 

The B2C model allows instantaneous communication between business parties and customers and helps in reducing the marketing time for new products.

 

Global access:

 

The products and services offered through the B2C model have a global presence that gives access to larger and newer markets.

 

Customization:

 

The B2C model provides products and services in real time, thus enhancing the probability of customizing the products and the services in accordance with the customer's need.

 

Round-the-clock availability: The B2C model allows round-the-clock availability of products and services.

 

De-intermediation:

 

The B2C model helps in eliminating the middleman, thereby offering products based on the customer's choice and at a lower price.

 

Consolidation and convergence:

 

The B2C model helps in increasing consolidation and convergence, thereby facilitating the placing of orders and fulfilling them.

 

Collaboration:

 

The B2C model facilitates transactions between the communicating parties and enables real-time information exchange, thereby allowing collaborative processing.

 

Challenges in B2C implementation:

 

Although B2C has numerous advantages, there are a number of challenges in implementing it. Some of these challenges are as follows:

 

Organizational change:

 

Transformation from traditional to a B2C company requires a radical organizational change that is strongly opposed by the employees.

 

Business process redesign:

Transformation to a B2C company requires a complete re-design of the existing processes.

 

System integration hurdles:

 

Transformation to a B2C model requires system integration of both the business organization 'and its partners as compatibility between the various systems is a pre-requisite for the B2C model.

 

 

Difficulty in matching technology needs to business needs:

 

With the technology taking giant leaps and a range of products coming in a progressive fashion, it becomes very difficult to match technology and business.

 

Getting browsers to purchase things: Many users usually visit the sites but whether they buy the products or not is what determines the success of the B2C model.

Building customer loyalty: Customer relationship management is the toughest challenge that can be met by personalization and by making an easy-to-use site.

 

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