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REPORT PREPARED FOR: Business Model Analysis Presented by: Bharti Bhargava, Olga Karpova , Udara Wickramasinghe POSTGRADUATE DIPLOMA IN BUSINESS APMG 8119: DIGITAL ENTERPRISE 2014. Business Background. High-end fashion boutique offering “ plus size” clothing for women - PowerPoint PPT Presentation
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>>APMG 8119: DIGITAL ENTERPRISE
REPORT PREPARED FOR:
Business Model Analysis
Presented by:Bharti Bhargava, Olga Karpova, Udara
Wickramasinghe
POSTGRADUATE DIPLOMA IN BUSINESSAPMG 8119: DIGITAL ENTERPRISE
2014
>>APMG 8119: DIGITAL ENTERPRISE
• High-end fashion boutique offering
“plus size” clothing for women
• A small family-owned business
• Brick & Mortar Store - Mt Eden Road - in 2008
• Online shopping - themillhouse.co.nz - in 2013
Business Background
>>APMG 8119: DIGITAL ENTERPRISE
Retail industry focuses on: effective stock & margin management Resource optimization Staff rostering Customer satisfaction Clothing retail industry:
High margins Low productivity
Intense competition
Fashion retail industry trends: Local (Zebrano, Frontline) and global competition Digitalization (online & offline) Innovative business models (Burberry, Rent the Runway, Style Mint)
Industry Overlook
>>APMG 8119: DIGITAL ENTERPRISE
Manufactures Retailers Customers
Challenges: intense competition
difficulty in differentiation
low switching costs
growing customers expectations
The Retail Business Model
goodsgoods
communication
Brick-and-mortar stores Online stores
>>APMG 8119: DIGITAL ENTERPRISE
Customer RelationshipsRevenue through relationshipsTaking first mover advantageWinning customer’s preferenceLead the few players in the market
Customer Segments Affluent, plus size ladies
ChannelsTheir brick and mortar store in the Mt Eden – Auckland is the only distribution centre.Website works as the channel for gaining 50% of their revenue
Revenue Creation
>>APMG 8119: DIGITAL ENTERPRISE
For what value are our customers really willing to pay?
• homemade brand • higher quality• designer clothes • value generated by meeting uncommon needs
For what do they currently pay?
• need fulfilment they experience with the company which is not easy to find in the common market.
Revenue Creation
>>APMG 8119: DIGITAL ENTERPRISE
Retail Cost Structure
Context
Size
Supply/Production Technology
Process Turbulence
Organisation structure
Formalisation
IT Adoption
Centralisation
Technocratic specialization labour
Integration
Retail Cost Structure
>>APMG 8119: DIGITAL ENTERPRISE
Cost Creation - The Mill House
EMPLOYEE
Marketing Cost
Security and Payment gateway
>>APMG 8119: DIGITAL ENTERPRISE
Key Partnership Paypal-Payment partner
iTheme (Security)
Courier Services
Designers-Suppliers
Marketing agency
>>APMG 8119: DIGITAL ENTERPRISE
Key Resources and Activities – driving the business
Key Activities
Buying from suppli
ers
Advisory on
dressing -Services
Selling to customers-
Online & Offline
MossObi,Chocolate, Ashley, Fogel, Sakaguchi, Trelise Cooper,Paula Ryan
Employees at The Mill House
Marketing Agency
Technology Partner
Security for customer details-iTheme
Payment Partner-Paypal express
Courier & Delivery
Major Cost Contributor
Ou
tsou
rced p
artners
>>APMG 8119: DIGITAL ENTERPRISE
Brick-and-mortar store: High quality & Prestige Convenience Customized customer service / Style advice Refined premises Guest parking Prize draws
Online store: Content (Product & Information)
Customer Experience Platform (Internal & External)
Value Creation
>>APMG 8119: DIGITAL ENTERPRISE
POSITIVE: Terms and Conditions: precise and easily found
New collections immediately appear on web site
NEGATIVE: whole range of stock is not available online product description is very limited No information about size fitting No additional information (blog, articles, lookbooks, links) No customer reviews or testimonials The content is maintained by the Sales Manager
Digital Content(product & information)
>>APMG 8119: DIGITAL ENTERPRISE
POSITIVE: web-site layout is appealing and easy to use
order and payment process is simple and safe
NEGATIVE: limited product range creates serious threats of losing potential
customers product display is confusing no possibility to select products by categories; it is only available to
browse by brand and size absence of proper inventory controlling system results in the possibility
to order a product which is already out of stock
Customer Experience
>>APMG 8119: DIGITAL ENTERPRISE
The only platform delivered through the web site is an online retail shopping platform, which is simple and standardized, however lacking any enhanced options
Facebook is the only social media platform, which is utilized mostly as a one way business-to customer informative channel, without fostering interaction with clients
Platform
>>APMG 8119: DIGITAL ENTERPRISE
Digital Transformation
>>APMG 8119: DIGITAL ENTERPRISE
CUSTOMER VALUE MANAGEMENT SUPPLIERS AND PARTNERS INTEGRATION
PRACTICAL IMPLICATIONS TO FURTHER DIGITALIZATION:
Product range
Content
Usability
Customer engagement
Mobile-friendly
Responsible staff
Industry engagement
(communication platform)
Addittional services
Recommendations:
>>APMG 8119: DIGITAL ENTERPRISE
Thank You!