How to Manage
in Digital Markets
Dr Fiona Ellis-Chadwick
Senior Lecturer in Retail Management
The Breakfast Briefing event
Wednesday 25 April 2012
Chapter 1 The Beginning
Twenty years ago today…..
Fiona Ellis-Chadwick
Chapter 2 -Trail blazers
Compuserve CIS
Netscape – web browser
Leading internet companies…
were making claims that:
“by 1997, 5% of all retail
spending in England,
Scotland and Wales will
be done over the net”
(Computing 1996); “By
the year 2005 it will
capture between 8 and
30 per cent of the UK
retail market”
Aol - GIS
Alta vista – search engine
Pipex Dial NSP
The WELL – virtual community
CDnow
– retailer
Demon
– NSP
IE - web browser
Webvan – home delivery
Fiona Ellis-Chadwick
Tesco.com- retailer
Chapter 3 the end of the beginning
But what was the fate of each
these companies?
The Well
Bankruptcy
- WebVan
Closed
– Alta
Vista
AOL
& Time
WarnerAcquisition
by
Amazon
Merged
with
Talk
Hostile
takeover byTalk
Cable
then disappeared
and Wireless
Survivors
Fiona Ellis-Chadwick
Chapter 4 New horizons
Take over the high street
Promises and predictions
became drives ……………
Replace the middle man
Pirate the value chain
Enter new markets
Leverage rapid growth
Perfect competition
Take on market leaders on
a level playing field
Source http://mariacalinescu.eu/ebusiness/internet-a-market-withperfect-competition/
Fiona Ellis-Chadwick
Chapter 5: 50/50; phone a
friend or ask the audience?
When you arrived you
were asked to answer 3
questions:
1) What is the vision that drives
the online part of your
business ?
2) What is the key message you
want visitors to receive (in the
first 3 seconds) when they
arrive on your home page?
3) How do you realise 1) and
implement 2)?
Fiona Ellis-Chadwick
Chapter 6 Creative thinkers.
What did the following people
have in common?
Stelios Haji-Ioannou
Jeff Bezos
Pierre Omidyar
Steve Jobs
Passion + Commitment +
Vision = Deliverance
Fiona Ellis-Chadwick
Chapter 7: Young Upstarts
Making it happen; young
entrepreneurs:
Suleman Sacranie
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Chapter 8: Hard Core - overview
Factors affecting success
come from different sources
Managerial
influences
Market
influences
Relative
advantage
Doherty & Ellis-Chadwick, [1999, 2003, 2010.]
Fiona Ellis-Chadwick
Chapter 9: Hard Core – detail 1
Managerial Influences
influences. This group of factors (1, 2, 3,
4, 6, and 7) is characterised by a fairly steady rise in mean
values from ‘nonadopters’ to the adoption of an ‘active
website’. The implication of this pattern is that these six
factors all exert a positive influence on an organisation’s
adoption of the Internet. Consequently, as an organisation
makes progress in the adoption of an ‘active website’, there is
an increasing recognition of the importance and influence of
factors, such as the availability of an appropriate ‘infrastructure
and development capability’ and an ‘Internet strategy’.
4.3.1.2. Negative influences. Two of the factors, ‘cost of
Internet trading’ and ‘consumer sensitivity’ are exerting a
negative influence. It can be seen that there is a steady
decline in mean values from ‘nonadopters’ to ‘active website’.
The implication of this pattern is that both these factors
have strongly influenced the ‘nonadopters’ to refrain from
investing, but the influence of the cost of Internet trading
and consumer sensitivity gradually weakens as an organisation
progresses to an ‘active website’.
4.3.1.3. Variable influences. One of the nine significant
factors, ‘Internet communications’, displays a distinctly
different pattern to the others. While its influence rises
steadily from the ‘nonadopter’ to the ‘active planning’
phase, it then starts to decline as the organisation progresses
through ‘active development’ to ‘interactive website’.
The implication of this is that while the Internet’s
ability to facilitate communications strongly influences an
organisation to commence an Internet project, once the
project is underway, its perceived importance gradually
diminishes.
4.3.1.1. Positive
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Strategy
Leadership style
Resources
Capabilities
Targeting, segmentation and
positioning strategy
+
= leads to success
= leads to failure
+/- = unpredictable outcome
-
Chapter 10 : Hard Core – detail 2
Market influences:
Digital market place
Customer
behaviour/experiences
Competition – local and
global
Pace of technological
change
Fiona Ellis-Chadwick
Nick Wheeler founder
of Charles Tyrwhitt
Chapter 11: Hard core- detail 3
Relative advantage:
Successful companies use
digital technology to:
create opportunities to
serve their markets better
Improve the financial
potential of their operations
Create innovative
marketing opportunities
Fiona Ellis-Chadwick
Digital technologies provide amazing
opportunities but companies which
successfully create competitive
advantage are those with leverage
relative advantage rather than taking
finding a digital solution at any cost…
Chapter 12: Social Media: an
Opportunity or a threat?
What’s the relative
advantage of Social Media?
Tweeting for a
businesses
Fiona Ellis-Chadwick
Chapter 13: The Future
So what has become of the
early predictions and
drivers?
High street is under threat

Pirates and cannibals

A radical new market place 
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Exponential growth

A level playing field
X
Chapter 14: The beginning of the
end (of this presentation)
Traditional business models
have been turned over.
Leading dot coms have
created markets by giving
away their core products;
in less than 15 years Google
has moved from start-up to
multi-billion dollar global
corporation.
Strategic thinking in the
digital age requires:
Clarity of purpose
Understanding of the
market
Analysis of Relative
advantage of the
technology
Releasable goals
Effective implementation
Fiona Ellis-Chadwick
Postscript: Buy the books and
read the research
Recent papers:
Latest Books:
Ellis-Chadwick, F, and Doherty, NF (2011) 'Web
advertising: The role of e-mail marketing',
Journal of Business Research, available online
5 February.
Doherty, NF, and Ellis-Chadwick, F (2010)
'Internet retailing: the past, the present and the
future', International Journal of Retail &
Distribution Management, vol. 38, no. 11/12,
pp. 943-965.Accessible at:
Doherty, Neil F. and Ellis-Chadwick, Fiona
(2009). Exploring the drivers, scope and
perceived success of e-commerce strategies in
the UK retail sector. European Journal of
Marketing, 43(9/10), pp. 1246–1262.
Available at: The Open University Research
Repository
Fiona Ellis-Chadwick
PPS: The End?
Universal solutions and
plans to take over the
world begin here
…………………
Fiona Ellis-Chadwick
To fiona@ellischadwick.com
Thank you
Fiona Ellis-Chadwick