Duke University—Fuqua School of Business
Electronic Commerce
Marketing 462--Fall 2002
Professor Joel Huber
Joel.Huber@duke.edu
660-7785
Assistant: Janine Zanecki: 660-7786
Fuqua School of Business
Office: 333 Magat Center
Office hours :
Wednesday 2:00-4:00
Course Website: http://faculty.fuqua.duke.edu/~jch8/Marketing462
The complete syllabus is available on the website. The class list will also be available on the
site. Use it to begin forming teams. You will need to form a study team before the second class.
Welcome to Electronic Commerce.
This is one of the most exciting and dynamic areas in business and society today. Our task in this
class is to jointly investigate how electronic commerce will change current as well as new
businesses.
The course has four objectives. They are:
1. To investigate the strategic implications of e-commerce with emphasis on existing companies
2. To navigate the broad range of positioning strategies available within the e-commerce
landscape
3. To develop the ability to quickly and effectively research Internet companies and strategies
4. To learn to distinguish between temporary tremors and seismic shifts in the unstable ecommerce landscape
Required Reading Materials:
 E-Commerce Management: Text and Cases, Sandeep Krishnamurthy, Thompson SouthWestern 2003
 Course packet containing cases and notes
Grading criteria
20% -- Course participation grade
40% -- Two individual 2-page essays and critiques
40% -- Group reports (One major report and a number of short assigned reports)
Course Participation:
Learning in this class will be continuous and interactive; your participation will include both
written and oral components. There is no final; work in this class will be front-loaded. It will be
important for you to come to class having first discussed and often written up the case with your
study team. Each day you can expect that there will be something to turn in for class. On the last
day of class we will have student presentations.
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The assignment for each class and a summary for each past class will be posted on the discussion
board labeled, Daily assignments. You are responsible for reading board before class as there
will often be minor clarifications or modifications in assignments.
You are expected come to all classes. You may miss one class simply by letting me know. Each
additional unexcused class will result in your final grade dropping by ½ a grade group.
Study teams:
By the second class (Thursday, October 31) you will need to form study teams comprising no
fewer than three, or more than six classmates. In the course of the term your study team will
submit and be graded on short questions about the cases or assignments. These questions can be
answered with PowerPoint or Word. They must be submitted electronically before the class
when they are due and will be returned to you in that form. To avoid free-rider problems, your
final grade will depend on a peer evaluation from members of your study team to be filled out at
the end of the course.
Individual Essays:
Essays provide a way for you to bring fast changing ideas to your classmates. They are to be
submitted and will be returned electronically. Post your essay directly in the discussion folder,
Final Essays so your classmates can have access to it. The model of an essay is a memo you
might send to your boss. It should be short, focused, and lead to a change in action or thinking.
It can be about a case, or concern an issue raised in class or in our text. You may also delve into
one of the topics raised in the text chapters we do not cover, such as permission marketing (ch 9)
or conducting online research (ch 12). A good essay has the following characteristics:
1.
2.
3.
4.
Under 1000 words, exclusive of tables or graphs (total file size <500KB)
It should focus on one well-defended idea
Your fellow students should find it interesting
It should build on the ideas of the course. An essay can be a response to another student’s
essay, or to a theme discussed earlier in the course
5. Each essay should show evidence of online or journal research, by citing the publication
source or the URL of the information
You can find examples of essays from past classes in the folder titled Example Essays. These
illustrate the characteristics of essays for this class. I have included a range of quality in the
essays shown. You may choose the topic and when you write your essays; however, your first
essay must be submitted before the 6th session on November 14 and your second one before the
last session on December 9.
Essay evaluations: For the 9th session, November 25th, you will be assigned to read 5 essays by
your classmates. Your job for that session involves writing comments about each essay
indicating (1) what you like about the essay (2) what can be improved and (3) extensions or
elaborations on the essays. These signed critiques will be short (about 200 words) per essay and
should be sent by e-mail directly to the author, with a copy to me.
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Group project/pitch: A group project involves a major report to the class by your study group.
It can be presented in one of three ways:
1. Orally during class. You will need to get permission to present during a given class. The
first groups that request will get priority for class time.
2. As a written document (less than 2000 words, exclusive of Excel attachments)
3. As a PowerPoint presentation with a corresponding real audio file. (total run time of
under 20 minutes)
The project will be shared with your classmates on the Folder Group Projects.
Like an essay, a pitch/project leaves the class with a clear set of conclusions and
recommendations. Often, it will be about one of the cases in the course packet, or about a related
company or industry. If it is about a current case, it is due to me before the session on that case.
It is important that the team present from a clearly articulated point of view, for example from
the perspective of Priceline’s hotel reservation group.
Web searches: To remain current in the volatile world of e-commerce you need to be a fluid
user of web-searches and standard databases. The URL’s should be commonly referenced in
your essays or projects. In addition, at the end of each case we will use web searches to update
the business to the present.
A good place to start is at Fuqua's electronic library. A special page has been set up for this class
at http://www.lib.duke.edu/fsb/mba462.htm . For some databases, you will need to register for a
password. Passwords are usually provided to you within 24 hours of your request (Monday Friday). First go to DowJones Interactive, which has a good search engine for current
publications. Business and Industry Data base will provide trade journals, and OneSource has
useful current summary articles. You should also become proficient at searching directly from
the Web, typically with the search engine of your choice (my favorite is Google.com).
Referencing and crediting work of others: Throughout the class you will be referencing work
of others. Typically URL's will be sufficient, but for some databases the URL will not bring a
new person to the site. For those, you can simply give enough information so a reader wanting to
know more can know where to begin (e.g. One-source: Corporate overview for Priceline).
Additionally, it is fine to write essays or reports that build on what you have done before. The
rule for any use of previously written material is that you clearly note its source. For example if
your essay derives from an essay you, or someone else wrote for a strategy class, you must
include a note in your essay indicating how your current essay builds on that earlier material.
The use of case updates: Because change is so rapid, we will spend time at the end of each case
discussing what has happened. When we discuss the case, you may not use what you know
happened after the case to buttress your points about what they should have done at the time of
the case. We will act in discussions as if we are making decisions at the time of the case. At the
end of each case discussion, we will reserve some time to discuss what happened and lessons
that can be drawn.
Pre-assignment:
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1. Monday, October 28: Introduction
Text E-Commerce Management: Chapters 1 and 2 and boo.com (p.129)
Read: “Online Retailers” attached
In class we will discuss the flow of the course to enable you to start early planning for your
group presentation and essays. Chapters 1 and 2 in our text provide a good overview what is
going on in the internet today. The case note “Online retailers,” offers one of the best available
accounts of the reason for the e-commerce bubble in the e-retailing sector. Before class prepare
the following questions:
1. In what general ways has and will the Internet change society?
2. A major hypothesis of Eisenman and Brown in “Online Retailers” is that the Get Big Fast
strategy was accounted for the speculative bubble in e-retailing. Do you agree or
disagree?
3. Very smart people were mistaken by Internet hype. What can we learn from that
experience and how can we avoid making the same kind of mistakes in the future?
2. Thursday, October 31: A Pure Play e-business
Text Ch. 3
Case: InPart
In preparing for the class, each study group should send me a short (under 500 words) response
to one of these questions.
1. To be successful InPart requires the integration of three groups: parts manufacturers,
CAD vendors and designers. Detail the costs and benefits these groups and implications
to InPart’s system with respect to (1) segmentation, (2) pricing and (3) selling strategy.
2. Using the concepts in Text Chapter 3, characterize and detail the business model for
InPart.
3. Do a search for what happened to InPart. What lessons do you take from this search?
3. Monday, November 4: The cost of transition
Text: Ch 4
Note: Your first essay topic and your group project topic are due today.
Case: Charles Schwab Corp (A): This case chronicles Schwab’s strategy as it moved from a
storefront to a web-based company. Each study team should come to class with the price
Pottruck should charge to regular and electronic companies, and how, if at all, services should be
allocated. We will begin class by putting your prices for electronic trades on the board. Then we
will back into your justification for your strategy.
We also will use this class to discuss web search strategies. On pages 21-22 of your text are
some challenges requiring you to get information from the internet. Take one of the Starting to
Sweat or Brutal Questions and come to class prepared to share how you got your answer.
4. Thursday, November 7: Priceline’s magic show
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Case: Priceline.com: Name Your Own Price
Text: Chapter 5
This case covers Priceline’s merchandising of airline tickets, hotel rooms, home financing and
new cars. We will constrain our discussion to the first two. Priceline acts as an intermediary
between consumers and suppliers of these services. Each study team will turn into me a short
report (<500 words) covering one of these three questions.
1. What are the costs and benefits of Priceline’s innovative system to the supplier and the
consumer?
2. Discuss Priceline’s revenue model. What are its growth prospects?
3. What happened to Priceline? How do you evaluate its prospects today?
5. Monday, November 11: Auctions
Text: eBay.com (p.136)
Before class each member should participate in an auction. You do not have to buy anything in
the auction, but you must go through process of registering and making a bid. Come to class
having prepared in your group to present a brief PowerPoint presentation on one of the questions
below:
1. How does eBay deal with the negative aspects of auctions? In what directions would you
recommend that eBay evolve in the future to continue its growth path?
2. Go into eBay.com and evaluate eBay’s elaborate buyer and seller rating system. How
well does it work? What does eBay have to do to make sure this rating system facilitates
trust in the system.
3. What is your projection of the ultimate gross sales of eBay following 2000? Build an
Excel model and make projections from the data and projections from 139-141.
6. Thursday, November 14: Bringing Buyers and Sellers Together
Text Ch7:
Case: FreeMarkets Online
FreeMarkets is one of the few web intermediaries that have been successful. In your group
submit one of the following questions.
1. How does FreeMarkets Online create value for its customers? How is it different from
existing or traditional markets?
2. What is your view of their initial revenue generation model?
3. Which of the following alternatives should the company chose in order to go forward?
a. Horizontal expansion vs. vertical market dominance?
b. Technology vs. user support subscription licensing
4. Examine their auctions on freemarkets.com. How have they resolved the problems with
auctions?
5. Provide a follow up on FreeMarkets. How have they done? What are their current
problems?
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7. Monday, November 18, Establishing Community
First individual essays must be in before this session
Text Chapters 7 and 11:
Case: Alloy.com
For class submit the one of following questions in your groups:
1. Report on a competitive (Gap.com, Guess.com, Daisymaze.com, jcrew.com) or possibly
allied site (Yahoo.com, aol.com). What unique features does the site have that can either
complement or threaten Alloy.com?
2. Criticize the current Alloy.com website (remember it is not aimed at you!). What are its
strengths? How could it be improved?
3. Give arguments for and against the AOL deal.
4. Evaluate Alloy’s business model. What is the appropriate role of their website in that
model?
8. Thursday, November 21: Content Providers
Case: BizRate.com
There are two reasons we are studying the BizRate case. First, it is very useful when you want to
evaluate shopping sites. For example, use it to evaluate how others view the Alloy, Priceline or
the Schwab website. Second, as business case it reflects the changes that a dotcom must suffer
in response to market and fiscal pressures. Each study team will submit a short (<500 words)
report on one question below:
1. What are the costs and benefits of BizRate to participating companies it evaluates?
2. What are the benefits to consumers of the BizRate’s system, how could it be improved
from the consumer’s perspective?
3. Consider the options given on page 10 of the case. Give arguments as to which you
would do. How would you lead BizRate through this fork in the road?
4. Contrast BizRate’s website at the time of the case and now. How has it changed? What
do you infer about BizRate’s strategy from that change? Do you agree with the changes?
9. Thursday, November 28: Essay evaluations
You will be assigned 5 essays for which you will provide feedback to the authors. These
assignments are to be found on the Essay Evaluations thread of Announcements. Send the
authors an e-mail indicating what you like about the essay, how it could be improved and any
extensions elaborations on what they found. Examples of feedback for essays are provided in
Example Essay Feedback thread in the Essays folder. Each will average about 200 words.
During class we will have presentation of selected essays or group projects.
10. Monday, December 2: Live Case: To be determined
Group projects due today
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11. Thursday, December 5: Web intermediaries
Case: Autobytel.com
In your groups hand in one of these questions:
1. What are the costs and benefits to consumers of Autobytel’s system?
2. What is its value proposition for dealers?
3. Evaluate Autobytel’s revenue generation model. How much can they grow?
4. How has Autobytel's strategy changed since the case? Which parts of their strategy
have been most effective?
12. Monday, December 9 Wrap up and Group presentations: Second individual essays due
today
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