Based on a number of e-channel case studies and strategic management theories, this short article presents (1) an overview of a triangular strategic analysis and (2) an example application of the triangular strategic analysis with an Office Depot case study. Data on the Office Depot’s e-channel strategy and implementation were collected through secondary sources such as trade journals and Office Depot’s official publications. The triangular strategic analysis consists of (1) competitive forces analysis, (2) resource base analysis, and (3) critical success factor analysis
To capture the ever-increasing B2C population, retailers have experimented with a variety of B2C business models (Gulati & Garino, 2000). Some of the widely used e-commerce models include auction models (e.g., eBay.com), reverse auction models (e.g., Priceline.com), portal models (e.g., Yahoo.com), stand-alone e-retailer models (e.g., Amazon.com), and hybrid e-retailer models (e.g., Walmart.com). While B2B e-commerce applications such as e-procurement systems and the Internet-based supply chain management have brought significant benefits to business organizations, many B2C business models have failed to generate sustainable long-term profits.
In the late 1990s, most stand-alone e-retailers of commodity type products suffered the hardest hits due to low margin, rising customer acquisition cost, and the lack of financial support of investors (Stockport, Kunnath, & Sedick, 2001). Numerous stand-alone e-retailers such as Garden.com, Boo.com, and Petopia.com were consolidated with traditional retailers or liquidated (Kujubu & Martin, 2001). These failures were attributed to the poor business plan, weak complementary resources in distribution network and customer services, lack of brand name recognition, and low entry barriers.
Key Terms in this Chapter
Channel Conflict: Situation in which an e-channel creates a conflict with existing channels because of real or perceived damage from inter-channel competition.
Reverse Auction: A fixed-duration auction hosted by a single buyer in which multiple sellers compete for business.
On-Demand Delivery Services: Express delivery of products made with highly efficient transportation systems after an online order is received.
Complementarities: Products or services that provide more value together than individually. For example, hybrid e-retailers can leverage complementarities by providing offline services to online shoppers.