SEGMENTATION

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SEGMENTATION

• UNDERSTANDING THE END USER

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AGENDA

• INTRODUCTION
• END USER
• CHANNEL PREFERENCES
• SERVICE OUTPUTS
• TRENDS

3
AGENDA

• SERVICE OUTPUT DEMANDS
• SEGMENTING BY
• MEETING

4
INTRODUCTION

• Start with the end-user
• End-user
• Goods and services
• How wants to buy
• How wants to use
• When wants to buy
• How wants to benefit

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INTRODUCTION SOD TEMPLATE
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AGENDA

• END USER
• CHANNEL PREFERENCES
• SERVICE OUTPUTS
• TRENDS

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CHANNEL PREFERENCES

• Includes
• BAM
• Consumer
• Business

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CHANNEL PREFERENCES

• Includes
• CAM
• C2C
• C2B
• B2C
• B2B

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CHANNEL PREFERENCES

• End users buy
• Goods and Services
• Shopping Experience
• Shopping Process

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SERVICE OUTPUTS

• Authors to know
• Alderson (1957)
• Bucklin (1967)

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SERVICE OUTPUTS

• References to know
• Web as Distribution Channel
• SOD to LOG to SCM

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SERVICE OUTPUTS

• Bulk breaking
• Price
• Convenience
• Inventory
• Warehousing

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SERVICE OUTPUTS

• Spatial
• Accessibility
• Convenience
• Proximity
• All segments

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SERVICE OUTPUTS

• Queue
• Convenience
• Customization
• Typically, trade off against price

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SERVICE OUTPUTS

• Assortment
• Product variety
• Positively correlated with distribution costs
• Positively correlated with customer satisfaction

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SERVICE OUTPUTS

• Consider
• Sales responsiveness
• Cost
• Profit

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TRENDS B2B

• Outsourcing
• Economies of scope
• Economies of scale
• Core competencies

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TRENDS B2B

• Outsourcing
• Transaction cost economics
• Coase
• Williamson
• Effects on Electronic Markets

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TRENDS B2B

• Outsourcing
• TCE
• Dissects competitive market behavior
• If market works
• Firms will concentrate on core competencies
• Will outsource

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TRENDS B2B

• Outsource
• Versus integrate a question of tce
• Bounded rationality
• Opportunism
• Market uncertainty
• Asset specificity

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TRENDS B2B

• Outsource
• As TE increase
• Internalize
• Vertically integrate
• Shrink the value chain

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TRENDS B2B

• Outsourcing
• What does e-com do to
• Bounded rationality?
• Opportunism?
• Market uncertainty?
• Asset specificity?

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TRENDS B2B

• Outsourcing
• What does E-com do to
• Outsourcing?
• Use of value chains?
• Length of channels?
• Directness of channels?

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TRENDS B2B

• Downsizing
• Doing more with less
• Broadening lines of authority
• Broadening lines of responsibility
• Tends to reinforce outsourcing

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TRENDS B2B

• Alphabet Soup
• CRM
• CPFR
• ERP
• ECR
• More

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TRENDS CONSUMER

• Poverty of Time
• Search
• Buy
• Return

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TRENDS CONSUMER

• Increased Knowledge
• Mobility
• Connectivity
• Training
• Education

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TRENDS CONSUMER

• Increased Polarity of Income
• Willingness to buy
• Ability to buy

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TRENDS CONSUMER

• Increased Self-Employed
• SOHO
• Changes
• What
• Why
• How
• Where

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AGENDA

• SERVICE OUTPUT DEMANDS
• SEGMENTING BY
• MEETING

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SOD SEGMENT

• Produce groups
• Similar within
• Different between
• Differ on relevant dimensions

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SOD SEGMENT

• Analyze
• Dimensions
• Responsiveness
• Cost
• Profit

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SOD MEETING

• Cost
• Competitiveness
• Ease of Entry
• Other

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SUMMARY AND CONCLUSIONS