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The Digital business strategy for bsuiness
1.
Slide 5.1 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Digital business strategy
2.
Slide 5.2 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Learning outcomes • Follow an appropriate strategy process model for digital business • Apply tools to generate and select digital business strategies • Outline alternative strategic approaches to achieve digital business
3.
Slide 5.3 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Management issues • How does digital business strategy differ from traditional business strategy? • How should we integrate digital business strategy with existing business and information systems strategy? • How should we evaluate our investment priorities and returns from digital business?
4.
Slide 5.4 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Michael Porter on the Internet ‘The key question is not whether to deploy Internet technology – companies have no choice if they want to stay competitive – but how to deploy it.’ Porter, M. (2001) Strategy and the Internet, Harvard Business Review, March 2001, 62–78.
5.
Slide 5.5 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Alternative definitions of strategy • What is strategy? – ‘Defines how we will meet our objectives’ – ‘Sets allocation of resources to meet goals’ – ‘Selects preferred strategic option to compete within a market’ – ‘Provides a long-term plan for the development of the organisation’.
6.
Slide 5.6 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Figure 5.1 Different forms of organisational strategy
7.
Slide 5.7 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 What happens where there is no digital business strategy? • Missed opportunities for additional sales on the sell-side and more efficient purchasing on the buy-side • Fall-behind competitors in delivering online services – may become difficult to catch-up • Poor customer experience from poorly integrated channels.
8.
Slide 5.8 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 What happens when digital business strategy is not clearly defined? • Missed opportunities from lack of evaluation of opportunities or insuficient resourcing of digital business initiatives. • Inappropriate direction digital business strategy, e.g. poorly defined objectives. • Limited integration of digital business at a technical level, resulting in silos of information in different systems. • Resource wastage through duplication of digital business development in different functions and limited sharing of best practice.
9.
Slide 5.9 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Digital channel strategies Examples: • Mobile commerce strategy • Social media strategy • Social CRM strategy • Supply chain or ERP strategy Multichannel Digital Business Strategy: How electronic channels are used in conjuction with other channels?
10.
Slide 5.10 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Sell-side e-commerce strategy or e- marketing/CRM strategy • Sell-side e-commerce is a channel strategy • Objectives for online contribution percentage should drive our strategy • Our e-commerce strategy defines how we should – Hit our channel leads and sales targets • Acquisition, Conversion, Retention, Service, Profitability – Communicate benefits of using this channel – Prioritise products available through channel – Prioritise audiences targeted through channel – Select partners for this channel • Channel strategy thrives on differentials • BUT, need to manage channel integration.
11.
Slide 5.11 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Buy-side e-commerce strategy or e-supply chain management strategy • Buy-side e-commerce strategy is about maximising operational efficiencies while improving customer service quality • Operational efficiency KPIs should drive our strategy • Our buy-side e-commerce strategy defines how we should – Automate internal processes – Link internal resource management systems with external purchasing systems – Prioritise suppliers/partners collaborating using this channel – Prioritise applications for SCM – create a roadmap • Involves selection of appropriate strategic partners.
12.
Slide 5.12 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Relationship between digital business strategy and other strategies
13.
Slide 5.13 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Figure 5.3 BA communicates its online value proposition Source: Based on Revolution (2005); wwwbritishairways.com
14.
Slide 5.14 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 A generic strategy process model
15.
Slide 5.15 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Dynamic digital business strategy model Source: Adapted from description in Kalakota and Robinson (2000).
16.
Slide 5.16 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Elements of strategic situation analysis for the digital business
17.
Slide 5.17 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 A stage model for digital business development Strategic Analysis – Stage Model
18.
Slide 5.18 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Strategic Analysis – Resource Analysis Review of the technological, financial, and human resources of an organisation and how they are utilised in business processes. Analysis of Resources vs. Capabilities Resources -> Assets used in value creation Capabilities -> Ability to use resources
19.
Slide 5.19 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Matrix for evaluation of external capability against internal capability . Strategic Analysis – Resource Analysis
20.
Slide 5.20 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Capability maturity model of the adoption of e-business Strategic Analysis – Resource Analysis
21.
Slide 5.21 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Summary applications of a portfolio analysis for an example B2B company Strategic Analysis – Portfolio Analysis
22.
Slide 5.22 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 SWOT analysis Strategic Analysis – SWOT Analysis
23.
Slide 5.23 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Strategic Analysis – Demand Analysis Assessment of the demand for e-commerce services amongst existing and potential customer segments. Strategic Analysis – Competitor Analysis Review of digital business services offered by existing and new competitors and adoption by their customers. Internal strenghs are identified by ‘core competencies’.
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Slide 5.24 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Competitive threats acting on the digital business Strategic Analysis – Evaluating Threats
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Slide 5.25 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Elements of strategic objective setting for the digital business
26.
Slide 5.26 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Strategic Objectives – Vision Mission: includes ambition of the company and success factors for the business Vision: longer term picture of strategic priorities Scenario-based Analysis: Models of the future environment are developed from different starting points How can digital business create business value? •Adding value •Reduce costs •Manage Risks •Create new reality
27.
Slide 5.27 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 An evaluation tool relating information to business value. An organisation’s use of information Strategic Objectives – Creating business value
28.
Slide 5.28 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Strategic Objectives – SMART Setting SMART objectives •Specific •Measurable •Actionable •Relevant •Time-related Efficiency and Effectiveness Measures •Efficiency: doing the thing right •Effectiveness: doing the right thing
29.
Slide 5.29 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Strategic Objectives Online revenue contribution An assessment of the direct or indirect contribution of the Internet to sales, usually expressed as a percentage of overall sales revenue. •Conversion marketing: Using marketing communications to maximise conversion of potential customers to actual customers. •E-channel service contribution: The proportion of service-type processes that are completed using electronic channels. Conversion modelling
30.
Slide 5.30 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 An example of conversion modelling for an online retailer Strategic Objectives Conversion modelling
31.
Slide 5.31 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Research Online Purchase Online example Strategic Objectives Conversion modelling
32.
Slide 5.32 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Strategic Objectives - Balanced Scorecard A framework for setting and monitoring business performance. Metrics are structures according to customer issues, internal efficiency measures, financial measures and innovation. The main areas of the balanced scorecard are: • Customer concerns. • Internal measures. • Financial measures. • Learning and growth.
33.
Slide 5.33 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Elements of strategy definition for the digital business
34.
Slide 5.34 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Matrix for evaluating digital business strategy alternatives
35.
Slide 5.35 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Strategic Definition e-business Strategic Decisions 1. Digital business channel priorities 2. Market and product development 3. Positioning and differentiation strategies 4. Business and revenue models 5. Marketplace restructuring 6. Suppy-chain management capabilities 7. Internal knowledge management capabilities. 8. Organisations resourcing and capabilities.
36.
Slide 5.36 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Strategic options for a company in relation to the importance of the Internet as a channel e-business Strategic Decisions Digital business channel priorities
37.
Slide 5.37 Chaffey, Digital
Business and E-commerce Management Powerpoints on the Web, 6th edition © Marketing Insights Limited 2015 Using the Internet to support different growth strategies e-business Strategic Decisions Market and product development
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