Case 11.1. eBags: The 4Ps of a
Successful Online Retailer
Anthony
Liisi
eBags
1998 Jon Nordmark left
Samsonite
 eBags: online retailer
of bags
 Profitable
 Growing ~30% a year
 Marketing program: 4P-s

Question 1

Describe eBags’ positioning strategy. Do you
think the strategy is effective? Why or why
not?
Question 1
4P – Product
 Deep selection
 More than 36 000 products
 520 brands
 Colors

Question 1
4P – Price
 Lowest-price guarantees
 Completely free return policy
 Practices tested before implementation

Question 1
4P – Promotion
 Word of mouth, public relations
 Easy-to-navigate website
 Searching engine
 Special catalogue
 Press releases
 Customer reviews

Question 1
Question 1
4P – Place
 Same as Dell – but better
 Drop shipping
 Products directly to customers
 No inventory
 Box with eBags logo and name
 “Category killer”

Question 2

In a short paragraph, describe eBags’ brand.
Comment on the strenghts and/or weaknesses
of that brand.
Question 2
Strengths



Wide range of standard
products (color, size)
Specialized in travelers’
needs (universal plug
adapter, packing cube,
scale grip)
Positioning as a middleproduct (few competitors)
Weaknesses


Brand’s recognition low
Brand weak against
copycats
Question 3

What steps has eBags taken to energize its
customers? How has eBags turned its
customers into advocates for eBags and the
products it sells?
Question 3
1.
2.
3.
4.
Reviews
Price guarantees
Videos
Search Engine
Reviews
1. “Love the space this laptop bag gives, the
pockets for organization are wonderful. Easy
to carry and transport.“
2. "Nice backbag for basic organization and a
book or two. Laptop sleeve is a bit tight and
smaller than advertised.“
3. "Very nice purse, but a bit small.“
4. "Buy it. This suitcase is a little work horse and
drives beautifully. It's compact, small, and after
5 flights look brand new. ”
Question 4

What is the difference between eBags’ core
product and its actual product? Describe its
actual product and your assessment of
whether the actual product provides an
attractive or an unattractive mix of
characteristics?
Question 4





Product mix: all the product lines and items that a
particular seller offers for sale
Range of associated products that yields larger sales
revenue when marketed together than individually or in
isolation from others
Width: number of different product lines
Depth: number of different versions of each product (size,
flavor, color)
Consistency: how closely related product lines are to one
another
Question 4
Question 4
Question 4
Application Question 1

Draw a product attribute map for eBags.
Application Question 1
PRICE
100
80
NR OF PRODUCTS
60
40
QUALITY
20
0
SERVICE /
PAYMENT
SOLUTIONS
USER-FRIENDLY
DECOR (WEBSITE)
Application Question 2

Compare and contrast eBags and Zappos (the
subject of Case 9.2).
Zappos
Online shoe retailer
 Sales:




1990 $0
2005 $370 million
2008 $1 billion
Excellent customer service
 Human resource management policies





#1 Online bag retailer since 1999
2.5 million customer reviews
14.8 million bags shipped
2.5/14.8 = 16.8%
Zappos
Why do you think Zappos
doesn’t drop ship like eBags does?

Speed
 Different product
 Consumer service

What would eBags gain and
what would it lose if it adopted
Zappos’s approach to
warehousing and distributing
products?

Increasing Cost (warehouse, employees, inventory)

Increasing Profit margins

A real company culture