Spring 20 0 - Internet Business Strategy CIS-686-KY

Name: _+- (please print your name)

~

eview of:

igital Darwinism: 7 Breakthrough Business Strategies forSurviving in the Cutthroat Web Economy (by Evan Schwartz)

and

~ow or Never: How Companies Must Change Today to Win the~attle for Internet Consumers (by Mary Modahl)

Each section (question group) is worth ten points. Some questions ask you to selecttie best answer, others ask you to select the appropriate answer. Good luck!

For Questions 1-7, and in no particular order, please name the 7 breakthrough strategies discussed by Schwartz in his book,one per line (I have provided "hints" along the way). For each one, please point to a Web brand or company that typifies thestrategic aProach

STRATEGT 1

1. "Build a Brand that Stands for ------ "

1a. According to Schwartz, this online portal site "seems to reinvent its brand every 90 days. The site may have startedas a Web site directory, but it quickly moved to add a keyword search engine, then a personalized news service,then a virtual community with bulletin boards and chat, then a free e-rnail service, then a series of city guides formajor U.S., European, and Asian destinations, then a travel guide, then a personal fmance center, then a completee-shopping guide sponsored by Visa ... as it keeps shifting its market, it has managed to maintain the single largestda1Y audience of any website, attract the largest share of advertising and sponsorship revenue, while incidentallytUl(ng a respectable profit at a time when profitable e-comrnerce companies were scarce."

What online brand is Schwartz describing? _

2.

STRATEGY 2

"Allow Your to Fluctuate Freely with ------- &2a. Schwartz describes an example of this Strategy at work by describing a Web brand that was created in "spring of

19f8, when it began offering airline tickets over the Web. Travelers log onto the site and start using it the sameway they would any online reservation system, entering their destination, their departure and return dates, and thenwpber of people in their party. But then this company asks for something unusual: how much the customer iswilling to pay for each round-trip ticket."

What online brand is Schwartz describing? _

STRATEG I 3

3. "lAffiliate Partners Do You, for You."----------

ACfording to Schwartz, this online retailer "was the first company to offer an Associates Program, in 1996, andoffered commissions of 5% to 15%. At the time, the original goals of the program were threefold: acquire new,10 I customers through these referrals, enable others to participate in online selling without having to fill productthemselves, and extend this brand's editorial expertise into unique areas or spheres of influence that would beimpossible for the affiliate to develop on its own."

Jat online brand is Schwartz describing? _

SmATE+4. "C eate Valuable Bundles of and "

4a.

3a.

SCl,wartz describes the economic effects of bundling information-based products and services. He cites Dr. ErikBrynjolfsson ofMIT, who has a main thesis that selling bundles of information goods in large aggregates at asinkle price will earn higher profits than selling those items separately at separate prices. As one example toillustrate this theory, Schwartz points out a very prominent and well-known company (in the news a great deal overthelpast 4 months) that has achieved a "winner-take-all bundling" success in combining different products thatWOrkbetter together than apart.

Wliat very prominent company is Schwartz describing? _

STRATEGY 5

5. "Sell Custom-Made Products Online, Then Manufacture Them."

Schwartz illustrates this concept by citing the example of an extremely successful and well-known technologycompany that:

o Developed an easy-to-use ordering system that lets customers build their own unique products onlineo Doesn't let expensive inventory sit around and depreciate in valueo Decided early on what it could do best, and made sure no one else performed their core competencies

better than themo Parceled out the remaining functions over a network to factories all over the world that specialize in

assembling specific components or some other tasko Maintains the extensive data that customers send in for future referenceo Today, does more than $33 million a day in online e-commerceo This company is based in Texas

Wliat very prominent company is Schwartz describing? _

6.

STRATEGY 6

"Add New Value to Transactions Between and _

STRATEGY 7

7. "Integrate Digital Commerce With _

7a. Briefly describe Charles Darwin's Theory of Evolution (you may only use one sentence; hint: the word "survival"should be used; in other words, how might you also hear the Theory of Evolution explained?):

QUESTION 8:

This questi n deals with Mary Modahl's theory on why consumers buy online.

Name 2 of e 3 main motives why consumer go online in the first-place:{hint: these re one-word answers that group persons as to why they try the Internet:

&

QUESTI019:

Mary Mod;tl states in her book: "The early Internet is overrun with nearly identical companies. Exactly what is thedifference 1)Ietweennew superstores like Buy.com and ValueAmerica.com? Most consumers couldn't say ... the goal, then,for a compapy that intends to win in the long run is to head in a direction that may seem counterintuitive but that reallyallows it to build a uniqueness that is hard to copy. There are three paths to creating sustainable value in electroniccommerce: I

A. Develop a _

B. Control physical distribution

C. Leverage _

QUESTIO 110:

Please rank the following:

Textbooks:

Now orNe er

Digital Da inism

(1-10)

The E-Bus' ess (R)evolution (by Amor)

MORE ....

Speakers:

Tim Harris'lcEO - TeeTimes.com

Declan Boland, IBM

Troy Renshlw, Intel

(1-10) Didn't attend

Ned Elliott, EquiCo Capital Markets

Michael Greenberg, Usite.net

Bryon Thot"'. Lucent

Steve KUnkr" AT&T

Dan Head, Sportsline.com

Liz samch1k. Sta,Med;a Networks

Yupi.com presenter

Tonight's guest speakers

Tom Eggleston, AutoNation.com

Please rank and comment on the eGroups.com site

Have you downloaded files from the site? __ (yes/no)

Will you stay as a member after fmishing the course? __ (yes/no)

THANKS - Please provide a mailing address for me to mail this graded exam andyour finkl paper to you (J will also include a personalized letter of recommendation.Contact me by phone if you need it immediately).

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