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Decision 1: Digital business channel priorities

The digital business strategy must be directed according to the priority of different strategic 

objectives such as those in Table 5.6. If the priorities are for the  sell-  side  downstream  chan-

nel, as are objectives 1 to 3 in Table 5.6, then the strategy must be to direct resources at 

these objectives. For a B2B company that is well known in its marketplace worldwide and 

cannot offer products to new markets, an initial investment on  buy-  side upstream channel 

e- commerce and value chain management may be more appropriate.

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Chapter 5  Digital business strategy

For multichannel businesses with a physical and online sales presence, digital busi-

ness channel strategy priorities can be summarised in the words of Gulati and Garino 

(2000): ‘Getting the right mix of bricks and clicks’. This expression usually refers to  sell-  side 

e- commerce. The general options for the mix of ‘bricks and clicks’ are shown in Figure 5.19. 

This summarises an organisation’s commitment to e-commerce and its implication for tra-

ditional channels. The other strategy elements that follow define the strategies for how the 

target online revenue contribution will be achieved.

A similar figure was produced by de  Kare-  Silver (2000) who suggests that strategic 

e- commerce alternatives for companies should be selected according to the percentage of the 

target market who can be persuaded to migrate to use the e-channel and the benefits to the 

company of encouraging migration in terms of anticipated sales volume and costs for initial 

customer acquisition and retention.

Although being  Internet-  only is impractical for many businesses, companies are mov-

ing along the curve in this direction. In the UK, the Automobile Association and British 

Airways have closed the majority of their retail outlets since orders are predominately 

placed via the Internet or by phone. But both of these companies still make extensive use 

of the phone channel since its interactivity is needed for many situations. Essentially they 

have followed a ‘bricks and clicks’ approach; indeed, most businesses require some human 

element of service.

The transition to a service that is  clicks-  only is unlikely for the majority of companies. 

Where a retailer is selling a product such as a mobile phone or electronic equipment, many 

consumers naturally want to compare the physical attributes of products or gain advice from 

the sales person. Even  dot-  coms such as lastminute.com have set up a call centre and experi-

mented with a physical presence in airports or train stations since this helps them to reach a 

key audience and has benefits in promoting the brand. Another example of the importance 

Figure 5.18

Matrix for evaluating digital business strategy alternatives

Source: E‑consultancy (2008a).