Group Buying Sites

A fast growing Internet shopping trend of group buying sites is proving to be highly beneficial for both consumers and businesses. Based on a very simple model, the sites offer customers great online-deals on any product from a cup of coffee to a cosmetic lotion. So how does it work? Suppose the retail price at the shop is $500, the site offers to sell it for $480 if at least three units are demanded, price will drop to $450 if five units are demanded, $400 for eight units and so on.  The sales' status is updated and displayed on the Web, this way the buyers can follow the deal and jump in whenever they like.

The sites negotiate these deals with the retailers, in exchange for delivering a large number of customers, with no advertising fee. They make their money by taking a portion of the revenue from these deals, and also some advertising. This trend, first caught on US market, is now gaining steam in China. More than 300 Chinese sites are competing with each other, some small sites which focus on a specific geographic area or product-category. Other big and successful give different offers to a larger geographical range. Low entry barriers and extremely low costs lead to this competition.

This is another example of the massive bargaining force the Internet allows to consumers and also a great example of another win-win situation in the B2C/B2B processes you can create online.  

References: 

1. China Group Buying Sites Gain Steam

2. Krishnan & Ravi (2003), Group Buying On The Web: A Comparison of Price-Discovery Mechanisms, University of Pennsylvania.

CRM for Isracard

In class we were discussing different CRM systems and their contribution to business processes. A month ago Isracard (Israeli Master-Card Company) launched their new CRM system, which started working in less than six months - a very short period of time in relation to such complex project. The system now operates in all 600 calling centers of the credit card company. Financial scope of the project was about one million dollars.

This CRM system is based on an innovative concept developed by IBM, of a virtual desktop for the user, which is basically a shell. This concept enables the organization to establish a CRM system built on different components that exist in the organization, and create the connection between them - without having to rewrite existing applications.

The solution is called "Expeditor", and it allows the service representative to activate various components of existing systems under the new shell. Within the same umbrella were implemented a few different Microsoft CRM modules. All The systems were connected together; allowing users – i.e. representatives of service – a transparent extraction of data.

Oren Cohen, director of Isracard service centers, said: "Thanks to this system, along with other information systems… we've optimized and improved customer service, and service representatives' access to information. Response time decreased, and also the incoming requests quantity decreased by 19%".

As an Isracard customer, I believe this is great news not only for Isracard, but for us customers too, especially when you have no choice but to wait on the phone while the service representative puts you on hold…

Reference: article by Yehuda Konportz Sept. 16, 2010 from: www.pc.co.il

INSTANT

For my first blog I decided to pick a topic from the news, something that was recently introduced to us, another small but significant change in our everyday life.

This week Google launched the "Google Instant", a new feature that gives search results as you type. The results change as you keep typing and the search box gives you a prediction of what you're looking for, in grey letters. The idea came from the fact that people type slowly but read fast, and Google wants to help us find the info we're looking for as fast as possible. By using "Google Instant" the search time decreases by 2-4 seconds per search. Seems like a pretty small and insignificant change, but just think for a moment how much time of your day you spend searching the internet, working, studying, playing, etc.

Many people found this search method rather distracting, for they know what they are looking for when typing it. Furthermore, inappropriate content, such as pornography or violence that can easily pop up inadvertently while typing, was a disturbing fact. These concerns were predicted by Google beforehand. For the distraction issue, the user can delete the instant search application. In addition, the old search method remains the same, and so do the results. For the second argument, Google users can add the "Safe-Search" set in order to filter the content. On this matter they announced that auto-complete text will exclude those words automatically.    

I find it amazing that still there are more holes to fill, more needs we have that we didn’t even know about. Again, technology proves us that our lives can be better, faster and easier. Internet has become, whether we like it or not, the center of our business and social life. In that sense, we need the best tool in order to find our way through the web spending as little time as possible.