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Course |
Internet Business Models MKT 6322-501, #12258 |
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Professor |
Ernan Haruvy |
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Term |
Fall 2008 |
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Meetings |
T, 7:00pm-9:45pm, SOM 2.804 |
Professor’s Contact Information
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Office Phone |
972-883-4865 |
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Office Location |
SM 3.434 |
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Email Address |
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Office Hours |
Tuesday 6-7 or by appointment |
General Course Information
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Pre-requisites, Co-requisites, & other restrictions |
MKT 6301 |
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Course Description |
The Internet in recent years has radically altered the face of business. The objective of this course is to introduce students to key concepts that are pervasive in today’s e-business practices as well as to the perils and opportunities in e-commerce. In particular, we focus on e-business strategy, the construction and implications of different e-business models, interaction with customers—including web interface, customer relationship management, and consumer behavior online—in an online environment, e-marketplaces and business-to-business commerce, data analysis, electronic auctions, market communications, online communities, and branding. We will also touch on various other e-commerce topics, depending on class interest, individual student experiences, and current events.
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Learning Outcomes |
Upon completion of this course, students are expected to: Be able to construct a complete business model with value proposition, marketspace offering, resource model, and financial model Be able to take advantage of Internet capabilities in this business model, including the two I’s (Interactivity and Individualization), Customer Relationship Management, Internet customization capabilities, Internet communities, and Internet communication Be able to implement in this business model each of the seven C’s of Internet Marketing: Context, Content, Community, Customization, Communication, Connection, Commerce Understand Porter’s strategic forces in Internet context Be able to evaluate clickstream data Understand key topics in e-commerce, including procurement, auctions, exchanges, and open source
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Required Texts & Materials |
1. Textbook: Internet Marketing – Mohammed, Fisher, Jaworski and Paddison, McGraw-Hill, 2004 2. Case Packet for Professor Haruvy -- MKT 6322* |
*Changes from last semester:
Added Google Advertising. 9-507-038. Replaced Dell Online 9-598-116 with Dell
New Horizons 9-502-022
Assignments & Academic Calendar
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Cases are to be found in your case packet. Articles are downloadable on the class web site.
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Course Policies
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Grading (credit) Criteria |
Class Participation: 5% Assignment 1: Topic 1% Assignment 2: Survey 1% Assignment 3: Data 3% Written group project—Part I 5% (p-weighted) Written group project—Part II 5% (p-weighted) Final written group project (Parts I, II, and III) 25% (p-weighted) Presentation grade 15% (p-weighted) Quizzes 10% Exam 1: 15% Exam 2: 15% ‘p-weighted’ stands for peer-weighted which means this grade is multiplied by the weight group members assign to each individual’s contribution |
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Student Conduct and Discipline |
The University of Texas System and The University of Texas at Dallas have rules and regulations for the orderly and efficient conduct of their business. It is the responsibility of each student and each student organization to be knowledgeable about the rules and regulations which govern student conduct and activities. General information on student conduct and discipline is contained in the UTD publication, A to Z Guide, which is provided to all registered students each academic year.
The University of Texas at Dallas administers student discipline within the procedures of recognized and established due process. Procedures are defined and described in the Rules and Regulations, Board of Regents, The University of Texas System, Part 1, Chapter VI, Section 3, and in Title V, Rules on Student Services and Activities of the university’s Handbook of Operating Procedures. Copies of these rules and regulations are available to students in the Office of the Dean of Students, where staff members are available to assist students in interpreting the rules and regulations (SU 1.602, 972/883-6391).
A student at the university neither loses the rights nor escapes the responsibilities of citizenship. He or she is expected to obey federal, state, and local laws as well as the Regents’ Rules, university regulations, and administrative rules. Students are subject to discipline for violating the standards of conduct whether such conduct takes place on or off campus, or whether civil or criminal penalties are also imposed for such conduct. |
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Academic Integrity |
The faculty expects from its students a high level of responsibility and academic honesty. Because the value of an academic degree depends upon the absolute integrity of the work done by the student for that degree, it is imperative that a student demonstrate a high standard of individual honor in his or her scholastic work.
Scholastic dishonesty includes, but is not limited to, statements, acts or omissions related to applications for enrollment or the award of a degree, and/or the submission as one’s own work or material that is not one’s own. As a general rule, scholastic dishonesty involves one of the following acts: cheating, plagiarism, collusion and/or falsifying academic records. Students suspected of academic dishonesty are subject to disciplinary proceedings.
Plagiarism, especially from the web, from portions of papers for other classes, and from any other source is unacceptable and will be dealt with under the university’s policy on plagiarism (see general catalog for details). This course will use the resources of turnitin.com, which searches the web for possible plagiarism and is over 90% effective. |
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Email Use |
The University of Texas at Dallas recognizes the value and efficiency of communication between faculty/staff and students through electronic mail. At the same time, email raises some issues concerning security and the identity of each individual in an email exchange. The university encourages all official student email correspondence be sent only to a student’s U.T. Dallas email address and that faculty and staff consider email from students official only if it originates from a UTD student account. This allows the university to maintain a high degree of confidence in the identity of all individual corresponding and the security of the transmitted information. UTD furnishes each student with a free email account that is to be used in all communication with university personnel. The Department of Information Resources at U.T. Dallas provides a method for students to have their U.T. Dallas mail forwarded to other accounts. |
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Withdrawal from Class |
The administration of this institution has set deadlines for withdrawal of any college-level courses. These dates and times are published in that semester's course catalog. Administration procedures must be followed. It is the student's responsibility to handle withdrawal requirements from any class. In other words, I cannot drop or withdraw any student. You must do the proper paperwork to ensure that you will not receive a final grade of "F" in a course if you choose not to attend the class once you are enrolled. |
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Student Grievance Procedures |
Procedures for student grievances are found in Title V, Rules on Student Services and Activities, of the university’s Handbook of Operating Procedures.
In attempting to resolve any student grievance regarding grades, evaluations, or other fulfillments of academic responsibility, it is the obligation of the student first to make a serious effort to resolve the matter with the instructor, supervisor, administrator, or committee with whom the grievance originates (hereafter called “the respondent”). Individual faculty members retain primary responsibility for assigning grades and evaluations. If the matter cannot be resolved at that level, the grievance must be submitted in writing to the respondent with a copy of the respondent’s School Dean. If the matter is not resolved by the written response provided by the respondent, the student may submit a written appeal to the School Dean. If the grievance is not resolved by the School Dean’s decision, the student may make a written appeal to the Dean of Graduate or Undergraduate Education, and the deal will appoint and convene an Academic Appeals Panel. The decision of the Academic Appeals Panel is final. The results of the academic appeals process will be distributed to all involved parties.
Copies of these rules and regulations are available to students in the Office of the Dean of Students, where staff members are available to assist students in interpreting the rules and regulations. |
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Incomplete Grades |
As per university policy, incomplete grades will be granted only for work unavoidably missed at the semester’s end and only if 70% of the course work has been completed. An incomplete grade must be resolved within eight (8) weeks from the first day of the subsequent long semester. If the required work to complete the course and to remove the incomplete grade is not submitted by the specified deadline, the incomplete grade is changed automatically to a grade of F. |
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Disability Services |
The goal of Disability Services is to provide students with disabilities educational opportunities equal to those of their non-disabled peers. Disability Services is located in room 1.610 in the Student Union. Office hours are Monday and Thursday, 8:30 a.m. to 6:30 p.m.; Tuesday and Wednesday, 8:30 a.m. to 7:30 p.m.; and Friday, 8:30 a.m. to 5:30 p.m.
The contact information for the Office of Disability Services is: The University of Texas at Dallas, SU 22 PO Box 830688 Richardson, Texas 75083-0688 (972) 883-2098 (voice or TTY)
Essentially, the law requires that colleges and universities make those reasonable adjustments necessary to eliminate discrimination on the basis of disability. For example, it may be necessary to remove classroom prohibitions against tape recorders or animals (in the case of dog guides) for students who are blind. Occasionally an assignment requirement may be substituted (for example, a research paper versus an oral presentation for a student who is hearing impaired). Classes enrolled students with mobility impairments may have to be rescheduled in accessible facilities. The college or university may need to provide special services such as registration, note-taking, or mobility assistance.
It is the student’s responsibility to notify his or her professors of the need for such an accommodation. Disability Services provides students with letters to present to faculty members to verify that the student has a disability and needs accommodations. Individuals requiring special accommodation should contact the professor after class or during office hours. |
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Religious Holy Days |
The University of Texas at Dallas will excuse a student from class or other required activities for the travel to and observance of a religious holy day for a religion whose places of worship are exempt from property tax under Section 11.20, Tax Code, Texas Code Annotated. The student is encouraged to notify the instructor or activity sponsor as soon as possible regarding the absence, preferably in advance of the assignment. The student, so excused, will be allowed to take the exam or complete the assignment within a reasonable time after the absence: a period equal to the length of the absence, up to a maximum of one week. A student who notifies the instructor and completes any missed exam or assignment may not be penalized for the absence. A student who fails to complete the exam or assignment within the prescribed period may receive a failing grade for that exam or assignment. If a student or an instructor disagrees about the nature of the absence [i.e., for the purpose of observing a religious holy day] or if there is similar disagreement about whether the student has been given a reasonable time to complete any missed assignments or examinations, either the student or the instructor may request a ruling from the chief executive officer of the institution, or his or her designee. The chief executive officer or designee must take into account the legislative intent of TEC 51.911(b), and the student and instructor will abide by the decision of the chief executive officer or designee. |
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Off-Campus Instruction and Course Activities |
Off-campus, out-of-state, and foreign instruction and activities are subject to state law and University policies and procedures regarding travel and risk-related activities. Information regarding these rules and regulations may be found at http://www.utdallas.edu/BusinessAffairs/Travel_Risk_Activities.htm. Additional information is available from the office of the school dean. |
These descriptions and timelines are subject to change at the discretion of the Professor.
GROUP PROJECT – Idea for Topic
Each group will prepare a business model in a clearly specified industry or a particular e-marketplace (not from an existing case study) and turn it in. The type of business is flexible, but you need to get approval from me before you begin. Be original and creative. Here is a menu of ideas. You are encouraged to choose from this menu. Your choice is due by the end of the second lecture.
Startup capital: You have initial capital of $20,000.
Topics to choose from:
1.Arts and Crafts. A site for arts and crafts (jewelry, art) that brings together hobbyist makers of crafts from the DFW area with buyers interested in finding bargains.
2. Pet Owners. A site for pet owners offering local services such as pet sitting, pet walking and pet grooming by local unaffiliated DFW labor.
3. Tutoring. A site that brings together tutors and those in need of instruction. The site can (and probably should) be focused on one field. Possible fields: Music instruction, dance instruction, sports instruction, college tutors, home schooling tutors, …
4. Event planning[1]. Focus on one are: Birthdays, weddings, funerals…
5. Handyman Services. A site matching labor with those seeking labor.
6. Moving Services. A site matching labor with those seeking labor.
7. Legal advice. A site offering legal advice in one field. (a) teens in trouble (b) elderly seeking estate planning, ….
8. Medical tourism. A site offering potential routes and services for those seeking medical services in more affordable countries
Specific guidelines
The site cannot simply list items. It must devise algorithms to optimally match buyers and sellers (hence the added value), to optimally customize itself to buyers and sellers, and to offer only relevant, yet valuable (and preferably proprietary) information. Note that you are not creating Amazon, eBay or Craig’s List, so just a market for used or new items is out of the question. You cannot compete with these sites, so you must choose items that are local in nature or that are so specialized that a general site like eBay, Amazon, or Craig’s list cannot handle nor find it profitable or feasible to do so.
Devise approaches to attract traffic. This traffic can then be translated into revenue through ads and clicks. Projects have generally lacked proprietary information sources, a solid revenue model, and have been characterized by exaggerated (overoptimistic) revenue forecasts from advertising and clicks. To do well, you need to come up with unique information sources, a way to organize and customize these sources to create a competitive advantage, and a way to obtain revenues without exaggerating forecasts.
The project needs to be double spaced. It can be no less than 25 pages of text and no more than 40 pages of text (not including tables, figures and references). It should have no less than 6 pages of exhibits and no more than 15.
The written project will have three parts, which are detailed in the Table of Contents provided at the end. The three parts should be roughly equal in length and depth.
Keep in mind that this is not an “imaginary” business proposal. You have seed money of up to $20,000. That is, do not assume you have a million dollars and exclusive alliances.
If you plan to have exclusive alliances, sponsors, or financing, explain how you plan to obtain them and why your collaborators would be enticed.
Do not blah, blah. Every claim should be backed up from some source (company web page, case reports, SEC or 10K filings, news articles, et.). Each reference should follow the claim and the full reference should be provided in a footnote or the endnotes.
GROUP PROJECT PRESENTATION
Each group will present its business model. DO NOT PRESENT YOUR INDUSTRY ANALYSIS, although you may have one slide summarizing competitor strengths and competitive threats. The class will then rate each group on the following dimensions:
Group Project Table of Contents
Pat I. Model
Executive Summary
Value Proposition
Marketspace offering (including egg diagram which is referenced in text but appears at the end)
Company Description
Resource System
Industry Overview
Competitive Analysis (a minimum of three competitors)
For each competitor, provide history, business model, and SWOT
Customer Analysis (here you need extensive research, with references, as well as customer surveys)
Target Customers
Customer Profile
Part II. Strategy
SWOT Analysis
Web Interface (discuss site map and flowchart)
Outline of the 7 C’s
Communication and Media
Branding
Communities
Personalization Tools (discuss role of clickstream data)
B2B Activities
Part III. Financial
Demand Assessment
Revenue Model and Pricing Strategies
Financial Forecast
Conclusion
References
Exhibits (any figure that appears in the exhibits but is not referred to in the text is an automatic deduction of points)
Egg Diagram
Resource Diagram
Snapshots of competitors’ websites
Snapshots of your website
Customer Survey
Site Map
Flowchart
Checklist before you turn in your group project
(Summary of the paper)
In section 1, we discussed ….. Our research indicated that …. As a result it appears that … would be a distinct competitive advantage.
In section 2, ... (same as the above format)
(Links) Note that our resources (section ___) are uniquely suited to address the focal benefits in our value proposition (section ____). Our community (section ___) plays a central role in our online offering (section _______). (punchline) The following quote from ____________ best summarizes the idea behind our business model: “………..” There is a clearly a need, a trend and a vacuum which we are uniquely positioned to fill.
Thank you for participating in this study. The findings from this study will be used for a business proposal for a new type of business involving [give a brief description of the business]. Your answers are confidential and will not be linked to your identity or used for any non-research purpose. Should you be interested in the findings of this study, please contact us at [your email here]. Thanks again for your time and cooperation.
Part I. Demographics
1. You gender Male / Female
2. Employment status: Part time / Full time / Unemployed
3. Student Status: Part time / Full time / Not a student
4. Home ownership: Own / Rent / Live with parents
5. Your occupation __________________________
6. Marital Status Single / Married / Divorced / Widowed / Separated
7. Your age
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<20 |
20-25 |
25-30 |
30-35 |
35-40 |
40-45 |
>45 |
8. Your family’s combined annual income.
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<30K |
30K-60K |
60K-90K |
90K-120K |
120K-150K |
150K-180K |
>180K |
9. How many hours a week on average do you spend on the Internet?
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<5 |
5-10 |
10-15 |
15-20 |
20-25 |
25-30 |
>30 |
Part II. Consumption questions of specific relevance to this project
Examples:
3. What is the amount you spend monthly on your pet? [This is an example, groups should change this]
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<$10 |
$10-20 |
$20-50 |
$50-100 |
$100-200 |
$200-300 |
>$300 |
4. How often do you take your pet to a professional groomer?
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<once a year |
Once or twice a year |
3 to 5 times a year |
Every two month |
Every month |
Every two weeks |
Once a week or more |
5. How often do you purchase non-food items for your pet (e.g., clothing, toys)?
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<once a year |
Once or twice a year |
3 to 5 times a year |
Every two month |
Every month |
Every two weeks |
Once a week or more |
6. How often do you make purchases for your pet on the Internet?
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<once a year |
Once or twice a year |
3 to 5 times a year |
Every two month |
Every month |
Every two weeks |
Once a week or more |
Part III. Specific Value Questions
Our business consists of a web service that provides the following benefits. Please indicate the dollar amount each of the items below is worth to you?
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Service |
Dollar value to you |
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1. We send you reminders of when a visit is scheduled. |
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2. We link buyers and sellers. |
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3. We provide user-based ratings and feedback of eligible sellers
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4. We provide independent verifications of sellers |
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5. We bargain with sellers on your behalf to ensure the lowest prices |
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6. We compare prices with providers out of our partners |
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7. We provide articles written by users like you as well as a dedicate staff |
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8. We provide a community of users like you with whom you can share life experiences, relevant stories, and advice |
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9. We award prizes on a regular bases |
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10. We send your information to agencies that provide additional services |
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11. We provide a portal to all related sites |
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12. We provide forms and documents relevant to you |
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13. How much would you be willing to pay for a monthly subscription to this entire website, assuming you trusted the source and valued the quality |
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Part IV. Attributes of Importance
In a website like ours, how much do you value each of the attributes below (circle one)?
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Attribute |
Not important
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Somewhat unimportant |
Neutral |
Somewhat Important |
Very Important |
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1. Many others users |
1 |
2 |
3 |
4 |
5 |
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2. Strong community |
1 |
2 |
3 |
4 |
5 |
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3. Customer Services |
1 |
2 |
3 |
4 |
5 |
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4. Easy to use |
1 |
2 |
3 |
4 |
5 |
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5. Ease of navigation |
1 |
2 |
3 |
4 |
5 |
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6. Good graphics |
1 |
2 |
3 |
4 |
5 |
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7. Rich content |
1 |
2 |
3 |
4 |
5 |
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8. Relevant stories |
1 |
2 |
3 |
4 |
5 |
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9. Updated content |
1 |
2 |
3 |
4 |
5 |
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10. Alliances with providers |
1 |
2 |
3 |
4 |
5 |
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11. Cheap prices |
1 |
2 |
3 |
4 |
5 |
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12. Easy payment features |
1 |
2 |
3 |
4 |
5 |
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13. Strong brand name |
1 |
2 |
3 |
4 |
5 |
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14. Trustworthy |
1 |
2 |
3 |
4 |
5 |
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15. Reliable |
1 |
2 |
3 |
4 |
5 |
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16. Best in the business |
1 |
2 |
3 |
4 |
5 |
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17. Good value |
1 |
2 |
3 |
4 |
5 |
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18. Emphasis on DFW area |
1 |
2 |
3 |
4 |
5 |
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19. Quality of service |
1 |
2 |
3 |
4 |
5 |
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20. Quality of products |
1 |
2 |
3 |
4 |
5 |
[1] Since your group is not the provider of the actual services, but rather a website that collects these services and organizes them, it is important to focus on key competitive advantages. The competition is quite fierce in all these planning areas, so you must find a way to outdo the competition. Key in this is obtaining defensible alliances and clever cost-cutting and efficiency enhancing tools. What are some information sources that only you could have access to? What are some algorithms that you could think of to provide real cost savings to your customers? How can you personalize the site to enhance loyalty?