Topic 6 - Digital Markets

Question 1

a) What experiences have you had with shopping online?

The experiences that I have had with shopping online are that as I am a shoes addict and collector, I usually purchased my shoes through an online shoes store because they got every week "new arrivals". Furthermore, I often purchase my flight tickets online because with that I can compare the price and buy the cheapest one.

b) Describe a good experience?

First of all, I would describe a good experience as getting a product that we are looking for at a lowest price than any physical store with a quick and secure transaction and an on-time or fast delivery.

c) What did you like about the online store you used?

I generally used online store to buy shoes, electronic product and flight tickets from overseas. The advantages about the online store that I used are that I can compare a product’s price with another and deliveries were always on time. Moreover, about shoes, all the pictures are in 3D (we can see the entire shoes from different angle)

d) Describe a bad experience.

A bad experience would be where you purchased something different from what you though as the information and images were poor quality. It could involve a non respect on the delivery time imposed. In my opinion, the worst experience would be if you pay and nothing arrived in return but it never happens to me.

e) What problems did you have with the online store?

The only problem that I had was about the time of delivery. As few months ago there are strikes in France, my item didn’t arrive on time.

f) What features make an online store more appealing?

The features that make an online store more appealing are that it’s easy to use and that you can shop online from anywhere, at anytime. You can also get all the information you need such as pictures, the origin from where items will be sending, the description of the item and the specific research options.

g) What features make an online store less appealing?

The features that make an online store less appealing is that everything is virtual that is to say that we cannot view, try or touch, in few words, we cannot have a real impression of the product.

h) Should we expect to see the prices of goods and services rise or fall due to the migration of consumers online?

It is mitigates to define whether the prices of goods and services will rise or fall due to the migration of consumers online. However, all depends on businesses which have both physical and online store. Furthermore, I think the price hasn’t change because with a physical store, we have the possibility to try or touch the product in order to define the quality and this fact is an added value to the price. That is the reason why, the price of goods will not change a lot due to the migration of consumer online.

Question 2 – Discuss the following statements and indicate if you agree with them or not. 

a) The dispersion of prices (that is, the spread between the lowest and highest price for a particular product) will narrow.

I don’t believe that the dispersion of prices will narrow because while buying online, there will always be varying price and quality for a particular product, that is the reasons why the price dispersion should be low with digital markets.

b) The importance of brand names will decrease.

In digital markets I don’t think that the importance of brand names will decrease because it is still important for the customer. Regardless of whether consumers shop online or in a physical store they will choose the brands that they are satisfied.

c) Price competition will make all products cheaper.

I personally think that price competition will make all product cheaper depends on the company’s business strategy. However, world leading companies such as Apple don’t need to adopt the price competition strategy as their products answer consumer’s needs.

d) Digital markets will become dominated by a handful of mega-sites, like Amazon.com.

I do not totally agree with this statement. In my opinion, in digital market or in physical markets, if the brand name is strong, they surely dominate the market. Furthermore, all depends on customers’ way of shopping. For example, most of customer prefers to buy a book online than to buy clothes or a car online.

e) How do you think the balance of power buyer’s and sellers will change?

I think that the balance of power will be more in favor of the buyer. However, with more goods and services becoming available online people have more and more choices. In contrary to buyers, sellers have to focus on market competition and business strategies. With the expansion of the digital market we can notice that consumers have the choice to spend whenever and wherever they like.

f) Prices are clustered online.

I disagree that prices are clustered online even physically, because without that there is no objective to trade. However, the price of goods and services is still leaded by the quality, the supply and the demand of a product.

g) Online prices are elastic. (i.e. immune to change up and down with demand).

Regarding a period of time a price and an online price are always elastic because itl vary following the trends of any product, economies of scale, the demand and other external factors.

h) Online prices are generally transparent (the extent to which prices for a given product or service are known by buyers in the marketplace).

I think that online prices are generally transparent but not always because more and more online stores prefer to display duty free price in order to attract customers. In other words, online prices are still transparent to make sure that customers don’t realize the gap between the duty free price and the all taxes included price.

Question 3

a) What type of m-commerce service does your cell phone provider offer?

My cell phone provider SFR offers many online applications such entertainment, news, online top up,….

b) Which of these services for you use?

I don’t use any of these services.

c) What types of transactions do you perform through your cell phone or other wireless device?

I generally buy flight tickets and clothes through my cell phone or my laptop.

d) What types of transactions would you like to perform, but are currently unable to?

There are no transactions that I would like to perform on my cell phone that are currently unable to use.

e) What is your opinion of wireless advertising/mobile marketing?

In my opinion, as mobile phone is the digital technology which has the highest penetration rate, it is the most efficient way to advertize and to have a direct impact on the customer thanks to interactivity.