JOINT BUY
VALUE PROPOSITION TEST
(BASED ON CUSTOMER INTERVIEW)
SURVEY METHOD
Buyer
Survey
4 F2F Interviews
17 online surveys
Age group
20~30s
Fake
Deal
Seller
Survey
1 Email Interview
8 online surveys
Amazon/Ebay
Small-size
Sellers
Steve
Feiberg
30 Requests
for price quotation
Amazon/Ebay
Electronics
Sellers
VALUE PROPOSITION
VP Hypothesis for Buyer Side
VP Hypothesis for Seller Side
1. Discount on products
1. Selling products in bulk
2. Power to choose product for
group deal *NEW*
2. Low transaction fees
3. Buyer community feedback on
products and sellers *NEW*
3. Marketing for their brand name
*NEW*
New Hypotheses from F2F Customer
Interview
and
Mentoring
1)
In F2F interviews, buyers said that Groupon’s offers were too limited in
terms of product selection and that there is no buyer community.
2)
In meeting with our mentor, George, we realized that sellers can also
gain valuable marketing when selling products to large groups of
buyers.
VALUE FOR BUYERS #1
DISCOUNT ON PRODUCTS
Buyer Survey
Fake E-Mail
•
• 5~10% discount offer in size of
30,50,100 in digital camera, laptop
75% people are attracted by cheaper
price
•
60% people are willing to form a group
• 80% people shared discounts with
• 8% transaction fee in that category in
Amazon
other people
Conclusion
1)
Buyers are definitely interested in getting a cheaper price on products. Most
buyers are willing to form groups to get a discount and will even share
information about a discount to other people.
2)
But considering the fake-email responses, the discount rates are not as big
as we expected. That might be due to the fact that most of the sellers
surveyed were electronics sellers or the fact that the quantities that we
proposed were not big enough to get more discount.
VALUE FOR BUYERS #2
POWER TO CHOOSE PRODUCT
FOR GROUP DEAL
Buyer Survey
• 57% said they want to choose which products are group discounted and 40% said
kind of
• 55% said that product selection attracts them to an e-commerce site
Conclusion
The majority of people prefer to choose which product they want
to buy for a group deal. Most people regard product selection as
a major reason for using an e-commerce site.
VALUE FOR BUYERS #3
BUYER COMMUNITY
Buyer Survey
• 25% said large buyer community attracts them to an e-commerce site
Conclusion
Some buyers value having a large buyer community on an ecommerce site. It is possible that the other buyers do not realize the
importance of buyer product reviews on sites like Amazon.com The
co-creation of value on Amazon.com was cited in the business
model book as one critical factor in Amazon’s success.
VALUE FOR SELLERS #1
SELLING PRODUCTS IN BULK
Seller Survey
• More than 17 out of 30 sellers answered that they are willing to sell
in bulk
• Only 33% are willing to offer discounts proportional to group size.
Conclusion
3 Sellers are willing to offer group discounts. But some sellers
are not willing to offer significant discounts. This is probably
because the sellers surveyed are mostly small sellers.
VALUE FOR SELLERS #2
LOWER TRANSACTION FEES
Seller Survey
•
56% said they pay 10-20% transaction fees, 22% said they pay 5-10%
fees
•
78% said transaction fees they pay are too much
•
Amazon transaction fees are 15% for music, books, software, videos,
wireless phones, office products, watches but only 8% for electronics
Conclusion
1)
Most sellers agree that their transaction fees are too high. But
the transaction fees for selling electronic products on Amazon is 8%
which is lower than we expected.
2)
However, the transaction fees are still 15% for many other product
categories on Amazon. Perhaps we should target sellers of other
categories other than electronics.
VALUE FOR SELLERS #3
MARKETING FOR THEIR BRAND NAME
Seller Survey
• Most of sellers on Amazon have their own website
• 44% market their items by using Amazon
Conclusion
1) Some sellers use the e-commerce site where they sell their
products as their marketing channel. This means that when
sellers use our website, that can already be a significant source of
marketing for their business.
SUMMARY
VP Hypothesis for Buyer Side
Result
1. Discount on products
Somewhat confirmed.1
2. Power to choose product for
group deal *NEW*
Confirmed.
3. Buyer community feedback on
Not confirmed.2
products and sellers *NEW*
1 Need to consider changing category of products to offer and
larger buying groups.
2 Need to ask more detailed questions about this to investigate
further and carefully design our customer community feature.
VP Hypothesis for Seller Side
Result
1. Selling products in bulk
Somewhat confirmed.3
2. Low transaction fees
Confirmed.
3. Marketing for their brand name
*NEW*
Confirmed.
3 Need to ask larger sellers more questions about their cost
structure.