INMA_A01.QXD

STRATEGIC GOAL SETTING

Activity 4.3 Assessing the significance of digital channels

Purpose

To illustrate the issues involved with assessing the suitability of the Internet for e-commerce.

Activity

For each of the products and services in Table 4.3, assess the suitability of the Internet for

delivery of the product or service and position it on the grid in Figure 4.8 with justification. Make

estimates in Table 4.3 for the direct and indirect online revenue contribution in 5 and 10 years’

time for different products in your country. Choose specific products within each category.

Table 4.3Vision of online revenue contribution for different types of company

Products/services Now 2 years’ time 5 years’ time 10 years’ time

Example: Cars, US

Direct online sales 5% 10% 25% 50%

Indirect online sales 50% 70% 90% 95%

Financial services

Direct online sales

Indirect online sales

Clothing

Direct online sales

Indirect online sales

Business office supplies

Direct online sales

Indirect online sales

Figure 4.8Grid of product suitability against market adoption for transactional

e-commerce (online purchases)

Market adoption/propensity for online purchase

Information services

Chemical manufacturer

Professional services

(consultancy)

Engineering company

(high cost, low volume)

Traditional books / CDs

Digibooks

Air tickets

Grocery retailer

Magazine publisher

Engineering company

(low cost, high volume)

Drug retailer

Low

Low

High

High

Product suitability = opportunity = risk