Second Movers in E-Commerce - Research Guidelines
EssayChat / Jan 3, 2017
The idea of second movers in e-commerce (not only related to professional writing services) is not something that should be ignored, either by existing e-commerce companies or entrepreneurs who might be thinking about a business venture that will provide a competitive edge in a difficult economic climate. Many of the companies that are widely known and respected at the present time are second-movers. These companies include Microsoft, Netflix, and Priceline. What has made these companies successful is that they were able to take an idea that had been developed by another company and improve upon and provide a better interaction and level of service for customers. The following four principles are meant to provide guidance on the actions and behaviors that second movers need to take in order to become leaders in markets that have already been created and are dominated by first movers in e-commerce.
The idea of going where users go means just that: find out what people are doing or buying on the internet and go to them. Do not make users come to you when it is relatively easy to find out where internet users already think is important and have a desire to user or buy online. One of the prime examples of this was the battle between Netscape and Microsoft for supremacy with their web browsers. Netscape made the web browser popular and desirable as an easier and much nicer way to obtain information from the internet. It was easy to realize that millions of people were using the Netscape browser as a normal part of the internet experience. Rather than creating some completely new way of visiting web sites, Microsoft simply went where the users had already gone and created their own web browser.
The difference in Microsoft's web browser as compared to that of Netscape, however, was that it was somewhat easier to use. Even more importantly, it had additional features that allowed web sites to provide more interactive content. Microsoft also made it somewhat easier to add functionality to the basic web browser so that videos could be played directly in the browser. The end result is that Microsoft was able to overtake the web browser market from Netscape. However, its own second-mover in the form of an organization called Mozilla is not challenging Microsoft's dominance in the web browser industry.
The Mozzilla FireFox browser has gained a great deal of attention and respect from users because Mozilla went where the users were in terms of open source software and the ability to collaborate in order to make the software more responsive and friendly for users. Mozilla freely allows independent programmers to come together and add functionality to its core web browser. This idea allowed Mozilla to take advantage of the open source software movement and appear more friendly and more connected with its users than Microsoft (Mozilla). This shows how going where the users go is an important principles for second movers. By going where the users go, it is easier to gain their attention. It is also easier to take advantage of the foundation that has been created by another company and then make changes that are desirable from the standpoint of customers.
The battle between Microsoft and Mozzilla for control of the web browser industry partially illustrates the idea of putting customers in control. The internet has created a realm where users are truly in control and certainly want to feel in control over the decisions that they make. If they feel that they are being controlled, it is very easy for them to find a company that will provide them with the level of control that they demand. While Mozilla has put its users in control of their web browsing experience, Priceline has put users in control of their hotel and vacation buying experience.
There were other companies before Priceline that allowed users to purchase hotel rooms and rental cars at cheaply discounted prices. Companies such as Travelocity and Expedia were giants in the industry for several years. However, Priceline recognized that these sites simply listed the discounted prices offered by hotels and rental car companies and made them available to the public. These sites did not allow users to actually be in control of determining the price that they were willing to pay, or even to ensure that they were indeed receiving the lowest price possible for a hotel room or rental car. Priceline took the idea of booking discounted hotel rooms on the internet a step further by actually allowing users to tell hotels and other companies in the hospitality industry where they would be willing to pay.
The result for Priceline has been aggressive competitive against similar services such as Expedia and Travelocity. Priceline has made users feel that they have control over their experience of booking hotel rooms. Even more, Priceline has generated millions of users who would rather take control of their experience of booking hotel rooms than simply view a list of hotel rooms and choose one based on the price that is stated by someone else. Priceline is a strong example of putting customers in control and how that one idea creates a level of differentiation in e-commerce that will make a company stand out even when they are other sites that offer what is essentially the same product or service.
First movers in e-commerce often have the spend a great deal of money because they are creating the technology or the infrastructure that is the basis for the product or service they are offering. In addition, they have to spend money to show people that they product or service they are offering via the internet is indeed something that would improve their lives. Once first-movers have changed the way that internet users think about a particular product or service, second moves can enter the industry and provide the same product or service with a greater level of control for customers with less cost. For example, a company such as Ebay had to create the software that allowed it to conduct and manage hundreds of thousands of online auctions at the same time. A second mover can now enter the industry and use software that has already been developed and that may be even freely available as open source software and conduct a similar type of online auction site with much less initial cost.
The lesson is to not to think that an entirely new system for conducting online business needs to be developed. Instead, use what others have created as a way to reduce costs and increase profits. The cost savings is not only generated from the reduction is needing to create a new system for an e-commerce web site, but also from the savings that is generated from being able to get a business online and ready for consumers more quickly.
One of the reasons that second movers in e-commerce are able to take advantage of the work performed by the first movers is that they see the changes that can be made to a concept in order to better serve customers. Second movers can easily become the first movers that find themselves overtaken by others if they are not willing to change in order to respond to customers needs and demands. An example of a company that has recognized the need to make changes is Netflix. The company originally offered only DVDs via mail. However, as more people recognized the ease of receiving DVD rentals via mail, they recognized that the internet could also deliver the content immediately as opposed to waiting one to two days for a DVD to arrive in the mail. Netflix responded to this demand by beginning to offer DVD rentals that are streamed over the internet and play on a person's computer.
Second movers that take over the domain controlled by first movers must recognize that they found a better and less expensive way to serve customers in an e-commerce environment. In order to maintain the lead that they have built, they must continue to think about how customers' habits and behaviors are changing and how they can respond to those changes before another company is able to take advantage of the situation. It is possible that companies that are strong in the e-commerce sector, such as Priceline, Mozilla, and Netflix, could easily be overtaken by other companies if they do not recognize changes in how users of online reservation sites, web browsers, and DVD rentals want to interact with such products and services. These companies could easily become the Netscapes and Expedias of tomorrow if they do not continue to put customers in charge, go where the customers are, and provide the services that are desired with less expense than other companies.
Works Cited
Cohen, Adam. The Perfect Store: Inside Ebay. New York: Back Bay.
Custom Essay. Using Professional Writing Services in Schools and Businesses. Boston University.
Combe, Colin. Introduction to E-Business: Management and Strategy. London: Butterworth-Heinemann.
O'Brien, James A. Management Information Systems. New York: McGraw-Hill.
Principle 1: Go Where Users Go
The idea of going where users go means just that: find out what people are doing or buying on the internet and go to them. Do not make users come to you when it is relatively easy to find out where internet users already think is important and have a desire to user or buy online. One of the prime examples of this was the battle between Netscape and Microsoft for supremacy with their web browsers. Netscape made the web browser popular and desirable as an easier and much nicer way to obtain information from the internet. It was easy to realize that millions of people were using the Netscape browser as a normal part of the internet experience. Rather than creating some completely new way of visiting web sites, Microsoft simply went where the users had already gone and created their own web browser.The difference in Microsoft's web browser as compared to that of Netscape, however, was that it was somewhat easier to use. Even more importantly, it had additional features that allowed web sites to provide more interactive content. Microsoft also made it somewhat easier to add functionality to the basic web browser so that videos could be played directly in the browser. The end result is that Microsoft was able to overtake the web browser market from Netscape. However, its own second-mover in the form of an organization called Mozilla is not challenging Microsoft's dominance in the web browser industry.
The Mozzilla FireFox browser has gained a great deal of attention and respect from users because Mozilla went where the users were in terms of open source software and the ability to collaborate in order to make the software more responsive and friendly for users. Mozilla freely allows independent programmers to come together and add functionality to its core web browser. This idea allowed Mozilla to take advantage of the open source software movement and appear more friendly and more connected with its users than Microsoft (Mozilla). This shows how going where the users go is an important principles for second movers. By going where the users go, it is easier to gain their attention. It is also easier to take advantage of the foundation that has been created by another company and then make changes that are desirable from the standpoint of customers.
Principle 2: Put Customers in Control
The battle between Microsoft and Mozzilla for control of the web browser industry partially illustrates the idea of putting customers in control. The internet has created a realm where users are truly in control and certainly want to feel in control over the decisions that they make. If they feel that they are being controlled, it is very easy for them to find a company that will provide them with the level of control that they demand. While Mozilla has put its users in control of their web browsing experience, Priceline has put users in control of their hotel and vacation buying experience.
There were other companies before Priceline that allowed users to purchase hotel rooms and rental cars at cheaply discounted prices. Companies such as Travelocity and Expedia were giants in the industry for several years. However, Priceline recognized that these sites simply listed the discounted prices offered by hotels and rental car companies and made them available to the public. These sites did not allow users to actually be in control of determining the price that they were willing to pay, or even to ensure that they were indeed receiving the lowest price possible for a hotel room or rental car. Priceline took the idea of booking discounted hotel rooms on the internet a step further by actually allowing users to tell hotels and other companies in the hospitality industry where they would be willing to pay.
The result for Priceline has been aggressive competitive against similar services such as Expedia and Travelocity. Priceline has made users feel that they have control over their experience of booking hotel rooms. Even more, Priceline has generated millions of users who would rather take control of their experience of booking hotel rooms than simply view a list of hotel rooms and choose one based on the price that is stated by someone else. Priceline is a strong example of putting customers in control and how that one idea creates a level of differentiation in e-commerce that will make a company stand out even when they are other sites that offer what is essentially the same product or service.
Principle 4: Do It Cheaper
First movers in e-commerce often have the spend a great deal of money because they are creating the technology or the infrastructure that is the basis for the product or service they are offering. In addition, they have to spend money to show people that they product or service they are offering via the internet is indeed something that would improve their lives. Once first-movers have changed the way that internet users think about a particular product or service, second moves can enter the industry and provide the same product or service with a greater level of control for customers with less cost. For example, a company such as Ebay had to create the software that allowed it to conduct and manage hundreds of thousands of online auctions at the same time. A second mover can now enter the industry and use software that has already been developed and that may be even freely available as open source software and conduct a similar type of online auction site with much less initial cost.
The lesson is to not to think that an entirely new system for conducting online business needs to be developed. Instead, use what others have created as a way to reduce costs and increase profits. The cost savings is not only generated from the reduction is needing to create a new system for an e-commerce web site, but also from the savings that is generated from being able to get a business online and ready for consumers more quickly.
Principle 4: Be Willing To Change
One of the reasons that second movers in e-commerce are able to take advantage of the work performed by the first movers is that they see the changes that can be made to a concept in order to better serve customers. Second movers can easily become the first movers that find themselves overtaken by others if they are not willing to change in order to respond to customers needs and demands. An example of a company that has recognized the need to make changes is Netflix. The company originally offered only DVDs via mail. However, as more people recognized the ease of receiving DVD rentals via mail, they recognized that the internet could also deliver the content immediately as opposed to waiting one to two days for a DVD to arrive in the mail. Netflix responded to this demand by beginning to offer DVD rentals that are streamed over the internet and play on a person's computer.
Second movers that take over the domain controlled by first movers must recognize that they found a better and less expensive way to serve customers in an e-commerce environment. In order to maintain the lead that they have built, they must continue to think about how customers' habits and behaviors are changing and how they can respond to those changes before another company is able to take advantage of the situation. It is possible that companies that are strong in the e-commerce sector, such as Priceline, Mozilla, and Netflix, could easily be overtaken by other companies if they do not recognize changes in how users of online reservation sites, web browsers, and DVD rentals want to interact with such products and services. These companies could easily become the Netscapes and Expedias of tomorrow if they do not continue to put customers in charge, go where the customers are, and provide the services that are desired with less expense than other companies.
Works Cited
Cohen, Adam. The Perfect Store: Inside Ebay. New York: Back Bay.
Custom Essay. Using Professional Writing Services in Schools and Businesses. Boston University.
Combe, Colin. Introduction to E-Business: Management and Strategy. London: Butterworth-Heinemann.
O'Brien, James A. Management Information Systems. New York: McGraw-Hill.