A01 chaf6542 06 se fm indd

Online value 

proposition (OVP)

A statement of the 

benefits of online 

services reinforces the 

core proposition and 

differentiates from an 

organisation’s offline 

offering and those of 

competitors.

Figure 1.13

A simple stage model for  buy‑  side and  sell‑  side e‑commerce

Stage 1

E-mail marketing

Stage 2

Brochureware site

Stage 3

Interactive site

Stage 4

Online ordering

Stage 5

Relationship building

Stage 6

Site optimisation

Sell-side e-commerce

Stage 1

Review suppliers

Stage 2

Stock availability

Stage 3

Online catalogues

Stage 4

Online ordering

Stage 5

Integrate databases

Stage 6 Supply

chain optimisation

Buy-side e-commerce

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Part 1  Introduction

a lower  cost-  base as they have lower staff and distribution costs than a retailer that runs a 

network of  high-  street stores. A simple price differential is a key approach to encouraging 

usage of online services. In the late 1990s,  low-  cost airline easyJet encouraged the limited 

change behaviour required to move from phone booking to online booking by offering a 

£2.50 discount on online flight bookings.   

 Note that the 7Cs of Rayport and Jaworski (2003) provide a similar framework of Context, 

Content, Community, Customisation, Communication, Connection and Commerce.   

  Barriers to consumer Internet adoption 

 An indication of some of the barriers to using the Internet, in particular for consumer pur-

chases, is clear from a survey (Booz Allen Hamilton, 2002) of perceptions in different coun-

tries. It noted that consumer barriers to adoption of the Internet included: 

   

● 

  No  perceived  benefi t  

  

● 

  Lack  of  trust  

  

● 

  Security  problems  

  

● 

  Lack  of  skills  

  

● 

  Cost   

 This lack of demand for Internet services still present in every country needs to be taken into 

account when forecasting future demand. 

 To complete this chapter, read  Case study   1.2    for the background on the success factors 

which have helped build one of the world’s biggest digital businesses.        

 Case Study 1.2 

 eBay – the world’s largest online business?     

  This case summarises the strategic approach used by 

eBay to take advantage of increased consumer adoption 

of the Internet. It summarises its objectives, strategy and 

proposition and key risks that need management. You 

will see that many of its success factors are similar to 

those for smaller retailers.