Introduction
This course has been invaluable in equipping me with the foundational knowledge and strategic frameworks needed to navigate the complex world of online commerce.
This portfolio serves as a living document of my learning journey throughout the semester. It's structured to reflect on lecture insights, delve into practical applications from various case studies, and ultimately, connect these learnings directly to how it can help in building a successful and impactful company.
I believe that understanding the nuances of consumer behavior, the power of digital technologies, and the dynamics of different business models are critical for any aspiring e-commerce leader. To further my understanding I approached this assignment with the mindset of starting my own company to transform each lesson into a practical learning.
I believe that understanding the nuances of consumer behavior, the power of digital technologies, and the dynamics of different business models are critical for any aspiring e-commerce leader. To further my understanding I approached this assignment with the mindset of starting my own company to transform each lesson into a practical learning.
Technology Infrastructure for E-Commerce
May: Understanding Digital Technologies
This section shifted my focus from marketing strategies to the underlying technological backbone of e-commerce. Understanding how digital technologies transform business models is critical for any innovative startup.
Key Learnings and Core Tasks:
We started by defining a business model as a description of how an organization "creates, provides and captures value". The "iron triangle" of the digital business model emphasizes three core questions: Who creates and delivers the value? How is value configured? How is the value captured?. This framework provides a robust lens through which to analyze and design my own company's business model.
Digitalization involves not just converting analog data to digital (digitization) but also using digital tools to develop new products, services, and business models.
Key Digital Technologies
Augmented Reality (AR)
Overlays digital content onto the real world, enhancing the shopping experience by allowing customers to visualize products in their environment.
Artificial Intelligence (AI)
Powers personalized recommendations, chatbots, and predictive analytics to enhance customer experience and operational efficiency.
Blockchain
A distributed and shared ledger that enables secure, transparent transactions and supply chain tracking.
Internet of Things (IoT)
Connected devices that gather and exchange data, enabling smart retail experiences and efficient inventory management.
These technologies are creating "digitally-enabled generativity" – the ability of digital systems to empower users to create and innovate.
Wikipedia.com
Internet Structure and Security
Clear Web
Publicly accessible websites
Deep Web
Content not indexed by search engines
Darknet
Accessible via anonymization networks like Tor
The Darknet, accessible via anonymization networks like Tor, ensures encrypted communication and user anonymity, though traceback is not impossible. Encryption is the process of encoding information for authorized access, crucial for protecting data transmissions and user anonymity in both e-commerce and the Darknet.
Blockchain, as a distributed and shared ledger, underlies cryptocurrencies but also has broader applications for secure and anonymous transactions. This concept raises an important ethical question: Should anonymous transactions be legal in some industries?
Immersive Commerce and Spatial Marketing
We also explored Immersive Commerce and Spatial Marketing, which leverage technologies like AR, Virtual Reality (VR), Spatial Computing, IoT, voice assistants, and gesture control to create unique shopping experiences. Spatial commerce merges physical and digital realms, allowing users to interact with their environments in new ways. IKEA's use of VR for showroom experiences is a prime example.
What is Important to Know for My Professional Life (Starting a Company):
Embrace Digital Transformation
I need to think beyond simply digitizing existing processes. My business model must leverage digitalization to create new value, potentially through AI-powered personalization, or AR for product visualization.
Leverage AI for Personalization
AI and machine learning can enable tailored market offers and product adaptations based on past behavior, much like Amazon uses algorithms to change prices and recommend products. This can significantly enhance the customer experience and drive sales.
Explore Immersive Technologies
Incorporating AR into my e-commerce platform could allow customers to virtually "try on" products or place furniture in their homes, reducing uncertainty and improving the online shopping experience. This can lower "cognitive load" for understanding products.
Blockchain for Trust and Transparency
While the ethical implications of anonymous transactions on the Darknet are clear, blockchain's core function of secure, transparent, and immutable record-keeping can be leveraged to build trust in legitimate e-commerce, perhaps for secure payment systems.
Cybersecurity and Data Privacy
The discussions on the Darknet and security issues from companies underscore the critical importance of robust security and clear privacy policies. My company must prioritize data protection, encryption, and address potential vulnerabilities to maintain customer trust. This directly relates to the ethical concerns of information rights and public safety and welfare in e-commerce.
Insights from Discussions with Classmates:
The discussion on ethical concerns in data-driven business models (data protection vs. monetization, filter bubbles vs. democracy, "the winner takes all") was particularly impactful. My classmates highlighted the fine line between personalization and manipulation. For my future company, this means being upfront about data collection practices, offering users control over their data even beyond EU privacy protection laws, and designing systems that prioritize user well-being over aggressive engagement tactics.
The idea of "could anonymized commerce be useful in regulated markets?" and "should marketers explore encrypted identity services?" is also an interesting subject that was unfortunately not discussed by us students in class.
Additional learnings:
IoT and 5G are enabling a more connected world, impacting everything from remote control of devices to advanced smart retail experiences. While these might not be immediate considerations for a startup, understanding their long-term implications for supply chain efficiency, smart inventory management, and even advanced customer service (e.g., predictive maintenance for products sold) is valuable.
The trend towards spatial computing and the metaverse indicates a future where digital interactions become even more immersive. This is good to keep in mind for future growth and innovation for my company.
June: E-Commerce in Action
This final section truly brought everything together, focusing on how different e-commerce business models operate and the evolving landscape of retail and services. It solidified my understanding of market dynamics and the opportunities that exist for new entrants.
Online Retail Business Models
Virtual Merchants
Single-channel e-commerce firms generating almost all revenue from online sales (e.g., Amazon, Wayfair). Challenges include building brand quickly, low barriers to entry (many competitors), substantial website costs, steep learning curve, and high consumer acquisition costs, leading to a "winner takes all" scenario.
Omnichannel Merchants
Companies with physical stores as their primary retail channel, also operating online (e.g., Walmart, Macy's). Challenges include high costs of physical infrastructure and staff, coordinating prices across channels, and handling complex cross-channel operations. Walmart's strategy of using stores as fulfillment centers to offer faster delivery is a strong example.
Manufacturer-Direct
Single or multi-channel manufacturers selling directly to consumers online, bypassing retailers (e.g., Apple, Dell). Challenges include channel conflict and switching from a traditional supply-push approach, where inventory is pushed to consumers, to a more dynamic demand-pull model that responds directly to customer preferences and behavior.
Catalog Merchants
Traditional mail-order businesses that have adapted to online sales channels while maintaining their catalog operations.
Social E-Commerce and Service Sector
Social e-commerce was revisited as a rapidly growing phenomenon where e-commerce transactions occur on social media platforms (e.g., SHEIN, WeChat). This includes influencer marketing and user-generated content becoming strategic tools. The rise of live shopping, particularly successful in China, shows the potential for driving impulse purchases and high conversion rates. Companies like Temu and Shein have disrupted the market with aggressive social media advertising and low prices, challenging established giants like Amazon.
The service sector, the largest part of advanced economies, is also being transformed by e-commerce, with major institutions deploying online services. Examples include online banking (including neobanks), financial services, and the online travel market. The online job recruitment industry has also seen trends like social recruiting (LinkedIn), mobile applications, video/remote recruiting, and the use of data analytics/AI for hiring.
On-demand service companies (e.g., Uber, Airbnb, Instacart) utilize platforms for users to share/lease assets and resources, collecting fees from both sellers and buyers and often relying on online reputation systems and peer reviews. These disruptors lower service costs.
What is Important to Know for My Professional Life (Starting a Company):
1
Choosing the Right Business Model
I would carefully consider whether my startup will be a virtual merchant (lower overhead, global reach but high competition) or a manufacturer-direct model (full control, but potential channel conflict). A virtual merchant model might be the most accessible starting point, focusing on building a strong brand and managing customer acquisition costs effectively.
2
Leveraging Social Commerce
The success of companies like Temu and the growth of live shopping demonstrate the power of social media for customer acquisition and direct sales. My marketing strategy must heavily incorporate social media, including collaborations with creators and exploring live shopping functionalities on platforms like TikTok. Building a strong community and leveraging word-of-mouth will be essential, as people trust referrals from friends and family.
3
Focusing on Customer Value
The trends in the service sector show that convenience, digital accessibility, and personalization are key. My company needs to offer a seamless, intuitive online experience that provides clear utility to the customer.
4
Understanding Competitive Dynamics
Amazon's dominance and other companies efforts to catch up highlight the intense competition in e-commerce. My company will need a distinctive value proposition that appeals to consumers beyond just price, ensuring repeat purchases. This could involve focusing on niche products, unique customer service, or a strong brand narrative.
Insights from Discussions with Classmates:
Key Challenges for Ethical E-Commerce
- Balancing profitability with sustainability
- Ensuring transparent marketing and ethical data use
- Maintaining ethical supply chain practices
Our class discussions on the biggest challenges for e-commerce businesses trying to adopt ethical and sustainable practices were insightful. The pressure to offer low prices and fast delivery often contradicts sustainable sourcing and fair labor practices. Overcoming this means building a business model where sustainability is a core value, not an afterthought, and communicating this value proposition effectively to customers who are increasingly willing to pay for it.
Ádditional learnings:
In our Business Project I learned that the recommerce and circular economy movement is gaining traction, largely due to regulatory pressure from the EU but also driven by Gen Z and Millennials who value sustainability. eBay's focus on pre-owned goods and initiatives like "Imperfects" show a viable market for sustainable e-commerce. This presents a unique opportunity for my company to potentially tap into this growing segment, offering products that align with consumer values for reduced waste and environmental impact.
Closing Activities and Case Study Insights
Marketing Strategies Analysis: Warby Parker
For this activity, I've chosen to analyze Warby Parker, a "digital native vertical" that successfully disrupted the eyewear industry and later integrated brick-and-mortar retail. Their marketing and advertising strategies offer valuable lessons for my aspiring company.
Company Overview:
Warby Parker launched in 2010, offering high-quality prescription frames starting at $95, significantly undercutting traditional designer frames by cutting out middlemen like licensing fees and major retailers. They started as an online-only brand but later embraced physical retail.
Marketing and Advertising Strategies using the LEAD Funnel:
1
2
3
4
1
L - Lead Generation (Awareness & Interest)
- Home Try-On Program: This was a game-changer. Customers could order five frames for free to try at home.
- PR & Media Placements: Early buzz was generated through placements in high-profile magazines like GQ and Vogue.
- Digital Marketing: They heavily relied on digital marketing to get "eyeballs" on their brand.
- Physical Stores as "Billboards": Opening physical retail locations served not just for sales but also as street-level billboards.
2
E - Engagement & Nurturing (Consideration & Intent)
- Website Experience: A user-friendly website with easy access to product information.
- Customer Service: Responsive customer service throughout the decision process.
- Brand Story & Values: Strong narrative around affordability, style, and social impact.
3
A - Activation (Purchase)
- Streamlined Purchasing: The online store facilitates direct purchases.
- Omnichannel Integration: Sales are split evenly between online and in-store.
4
D - Retention & Advocacy (Post-Purchase & Loyalty)
- Post-Purchase Support: Comprehensive support after purchase.
- Customer Satisfaction: Focus on making customers "feel good about Warby Parker."
Effectiveness Evaluation:
Disruption
They successfully disrupted a stagnant industry by offering a compelling value proposition of affordable, stylish eyewear directly to consumers, cutting out traditional middlemen.
Customer Acquisition & Retention
The Home Try-On program was brilliant for customer acquisition, significantly lowering perceived risk and driving interest. Their focus on the customer experience fostered loyalty.
Omnichannel Success
Their ability to integrate online and offline channels, with stores acting as both sales points and marketing assets, showcases a robust omnichannel capability.
Challenges
Despite their success, Warby Parker initially faced challenges in profitability due to high marketing costs per customer ($40 in 2020). This highlights that even disruptive models require significant investment to scale.
Implications for My Company:
- Innovative Customer Acquisition: I must think creatively about how to lower the barrier to entry for my products/services and offer unique value, similar to Warby Parker's Home Try-On.
- Build a Strong Brand Narrative: Beyond the product, my company needs a compelling story and clear values that resonate with my target audience.
- Strategic Omnichannel Approach: Even if starting online, I will consider how a physical presence could later enhance brand discovery and customer relationships.
- Monitor Customer Acquisition Costs (CAC): I need to ensure my marketing spend translates into sustainable customer relationships, especially in the beginning.
Technological Trends in E-commerce: AR/VR
Report on AR/VR in E-Commerce:
Augmented Reality (AR) and Virtual Reality (VR), often grouped under Extended Reality (XR), are rapidly transforming the online shopping experience. These technologies merge the physical and digital realms, creating a "spatial commerce" experience where users interact with products in highly immersive ways. XR allows for a "simulated reality offering an escape from our everyday boundaries".
Implications for Online Businesses and Shopping Experiences:
Enhanced Product Visualization
AR allows customers to overlay digital product models onto their real-world environment. This means they can "try on" clothes, place furniture in their homes, or visualize how a new appliance would look, all before making a purchase.
Increased Confidence and Reduced Returns
By allowing customers to better visualize products in context, AR/VR increases their confidence in purchasing decisions. This leads to fewer surprises upon delivery and, consequently, lower return rates.
Deeper Engagement and Personalization
AR/VR experiences are inherently interactive and engaging, offering a richer experience than static images or videos. This increased engagement can lead to more time spent on site and a stronger emotional connection with the brand.
Creation of New Business Models
AR/VR can facilitate new forms of "immersive commerce" or "spatial marketing". For example, a business could offer virtual interior design services using AR, allowing clients to see changes in real-time within their own homes.
Competitive Differentiation
As these technologies become more accessible, early adopters can gain a significant competitive advantage by offering a superior and novel shopping experience that rivals cannot.
Example Company Using AR/VR: IKEA
IKEA is a leading example of a company leveraging AR and VR in e-commerce:
- IKEA Place (AR app): This app allows users to virtually "place" IKEA furniture in their own homes using their smartphone cameras.
- Virtual Reality Showrooms: IKEA has also developed VR experiences, like the "Virtual Home Experience," where customers can redecorate rooms, combine different fabrics, swap wall colors, and even change the time of day in a photorealistic 3D environment.
- 3D Model Bank: IKEA's extensive internal 3D model bank, built since 2009, contains 60,000 high-resolution models of their products and materials.
Implications for My Company:
AR/VR presents compelling opportunities. If my products are physical goods (e.g., home decor, fashion, electronics), implementing an AR "try-before-you-buy" feature could be a significant differentiator, boosting customer confidence and reducing returns. Investing in 3D modeling of my product catalog would be a foundational step, enabling future AR/VR integrations. Especially since 3D modeling and Photoscanning are incredibly innovative fields that keep getting cheaper and more accessible.
Sustainability in E-Commerce
Biggest Challenges E-commerce Businesses Face when trying to Adopt Ethical and Sustainable Practices:
1
Price Sensitivity vs. Ethical Sourcing
As highlighted by the success of Temu and Shein, consumers are often drawn to extremely low prices. Achieving these prices often involves questionable labor practices or unsustainable manufacturing in regions with lower costs and less regulation.
2
Speed of Delivery vs. Environmental Impact
The "race to the bottom" in delivery times puts immense pressure on logistics, often leading to increased carbon emissions from expedited shipping and less efficient routing.
3
Waste Generation from Returns and Packaging
The convenience of online shopping often leads to higher return rates, generating significant waste from transportation and discarded products/packaging.
4
Lack of Transparency in Supply Chains
Many e-commerce businesses have complex global supply chains, making it difficult to fully monitor and ensure ethical labor and environmental practices at every stage.
How these Challenges can be Overcome:
- Educate Consumers and Emphasize Value Beyond Price: Transparently communicate the true cost and benefits of sustainable practices.
- Optimize Logistics for Sustainability: Utilize micro-fulfillment centers, encourage consolidated shipping, and invest in sustainable packaging.
- Embrace the Circular Economy: Integrate recommerce, repair services, or take-back programs into the business model.
- Strengthen Supply Chain Transparency: Utilize technologies like blockchain to track products from origin to consumer.
- Promote Mindful Consumption: Engage in content marketing that promotes responsible consumption and product longevity.
Can Technological Trends Help to Adopt More Sustainable Practices?
AR/VR
By providing highly accurate virtual product visualization, AR/VR can significantly reduce product returns (a major source of waste) because customers have a clearer understanding of what they are buying.
AI and ML
Can optimize inventory levels, plan fuel-efficient delivery routes, improve demand forecasting, and enhance personalization to reduce returns.
Blockchain
Can provide immutable and transparent records of a product's journey through the supply chain, verifying ethical sourcing, fair labor, and sustainable materials.
Case Study Insights
Analyzing the "TEAM" case studies has provided me with a broader and deeper perspective on real-world e-commerce dynamics, including strategies, challenges, and ethical considerations. Each case offers unique insights directly applicable to my future company.
1
Pinterest
Key Lessons: Visual search dominance, inspiration-driven commerce, and unbranded search opportunity. Pinterest's strength lies in capturing users at the early "inspiration" stage of the customer journey, before they know what they want. Their visual search capabilities and shoppable pins transform browsing into purchasing opportunities.
Application to My Company: I should invest in high-quality visual content and capture users at the early "inspiration" stages through platforms like Pinterest. Creating mood boards, style guides, and inspirational content could drive traffic and early brand awareness.
2
TikTok (My Group)
Key Lessons: Power of short-form video content and the creator economy as a marketing channel. TikTok's algorithm favors authentic, engaging content over polished advertisements. The platform has become a powerful discovery engine, particularly for younger demographics.
Application to My Company: My marketing strategy should prioritize engaging video content and authentic creator partnerships. Building relationships with micro-influencers and content creators could provide more authentic reach than traditional advertising. I should also consider TikTok Shopping features for direct sales.
3
Zoom
Key Lessons: Security and privacy as non-negotiables, scalability planning, and trust as a core business asset. Zoom's rapid growth during the pandemic highlighted both the opportunities and vulnerabilities of digital platforms. Their "Zoombombing" challenges showed how quickly trust can be eroded.
Application to My Company: My company must implement robust security measures from day one. Privacy policies should be transparent and easily accessible. Building trust through reliability and security will be crucial for customer retention and brand reputation.
4
Big Tech
Key Lessons: Understanding market dynamics, antitrust concerns, and finding niche opportunities. Big Tech's dominance creates barriers but also opportunities for specialized players. The case highlighted how market concentration can stifle innovation and the importance of fair competition.
Application to My Company: I should focus on identifying underserved segments and building on principles of fair competition. Rather than competing directly with giants like Amazon, I should find specific niches where I can provide superior value and customer experience.
5
eBay
Key Lessons: Adaptability and evolution, the power of recommerce and sustainability, and technology investment. eBay's transformation from auction site to recommerce leader demonstrates the importance of pivoting with market trends. Their focus on pre-owned goods aligns with sustainability trends.
Application to My Company: My company must be agile and willing to pivot its strategy in response to market shifts. The growing interest in sustainable consumption presents opportunities for businesses that can facilitate circular economy models like resale, refurbishment, or upcycling.
6
LinkedIn
Key Lessons: Trust as a competitive advantage, professional networking, and content marketing for professionals. LinkedIn's success stems from creating a trusted professional environment where networking and business relationships flourish. Their content marketing approach focuses on thought leadership and professional development.
Application to My Company: I should actively cultivate trust through transparency and integrity. If my target market includes professionals, LinkedIn could be a valuable platform for content marketing and relationship building. Establishing thought leadership through quality content could differentiate my brand.
7
Alibaba
Key Lessons: Platform business model, B2B e-commerce potential, and logistics as a differentiator. Alibaba's ecosystem approach, connecting buyers and sellers while providing supporting services like payments and logistics, created multiple revenue streams. Their focus on enabling others to do business proved more scalable than direct selling.
Application to My Company: If my company's vision involves facilitating transactions between multiple parties, this asset-light platform model could be highly scalable. Investing in logistics capabilities and payment systems could create competitive advantages and additional revenue streams beyond just product sales.
Final Reflection and Application of Learnings in My Future Career
This E-commerce portfolio project has been an incredibly insightful journey, especially since I entered it with the mindset of trying to apply everything I learned to a possible future company. It has not only reinforced my desire to start a company but has also provided me with a strategic roadmap for doing so.
How this knowledge will help me in my future career:
Strategic Business Model Development
The "iron triangle" of digital business models has given me a robust framework to conceptualize and iterate on my company's core operations. I now understand that value creation, provision, and capture are intertwined, and that my company's success will depend on how effectively I orchestrate resources, interact externally with partners and customers, and maximize the value of my entire ecosystem. I won't just think about what I sell, but how I facilitate the exchange of value in a networked environment.
Customer-Centric Marketing
The emphasis on building trust and credibility is now ingrained in my approach. My company will differentiate itself not just by its products, but by its unwavering commitment to transparency, data privacy, and exceptional customer service. The LEAD Funnel and FISH model provide concrete strategies for attracting, engaging, converting, and retaining customers, ensuring every marketing effort has a clear purpose and measurable outcome. I will leverage data-driven insights from online metrics to continually optimize my marketing spend and customer journey.
Technological Acumen & Innovation
The discussions on AI, AR/VR, Blockchain, and IoT have highlighted that technology is not just a tool but a driver of new business models and customer experiences. I will continually seek to integrate innovative technologies, such as AR for product visualization to reduce returns (inspired by IKEA), or blockchain for supply chain transparency, to gain a competitive edge and enhance customer trust. I understand that embracing digitalization is about creating new value, not just improving existing processes.
Navigating the Competitive Landscape & Regulations
The Big Tech case study was a sobering but necessary lesson on market dominance and antitrust. It has taught me to identify niche markets, to focus on ethical competitive practices, and to be highly aware of regulatory environments, especially if I consider global expansion. I aim to build a company that thrives by offering superior value and fostering genuine relationships, rather than resorting to aggressive, potentially anti-competitive tactics.
Embracing the Creator Economy & Social Commerce
The insights from TikTok and Pinterest have shown me the immense potential of the creator economy and social commerce. I plan to integrate user-generated content and strategic creator partnerships into my marketing strategy, building a community around my brand that leverages authentic peer-to-peer influence. My company will look for opportunities to engage with creators and potentially offer them fair and transparent monetization models.
Sustainability and Ethics as Core Values
The June reflections on sustainability solidified my conviction that my company must be built on ethical and sustainable practices from the ground up. Leveraging recommerce (inspired by eBay) and optimizing logistics for environmental impact will be central to my mission, ensuring that profitability does not come at the expense of people or the planet. I understand the "friction" between price sensitivity and ethical sourcing, and I'm committed to finding innovative ways to balance these.
My Favorite Topic of the Course and Why:
My favorite topic of the course, without a doubt, was the "Creator Economy" and its intersection with social commerce and digital marketing. The concept that individuals can leverage digital platforms to turn their passions into livelihoods, bypassing traditional gatekeepers, is incredibly inspiring and relevant for me, as someone who grew up watching content creators and now even being employed by one.
What fascinated me most was understanding how these creators build trust and influence, and how brands can effectively partner with them to reach highly engaged audiences. The idea that "people trust influencers" and that "social media users get news from influencers more often than from journalists" is something I can realate to but I realize that it also signifies a fundamental shift in how information and purchasing decisions are made.
If I really was to start a company, this means that authentic relationships and compelling storytelling will be more powerful than traditional advertising. Learning about the monetization strategies of creators (sponsorships, subscriptions, direct sales) and the dynamics of platforms like TikTok and Pinterest provided concrete strategies for how I can engage with this growing segment and working side by side with an influencer will give me the best tools to navigate that landscape.
The challenges faced by creators, such as burnout and the struggle for fair pay, also highlighted the importance of ethical engagement and support for creative talent, which is something I would want to integrate into any creator partnership program my company develops.
This topic felt incredibly current and dynamic, offering tangible, human-centric strategies that resonate deeply with my interests in content creation and sales and marketing. It's truly where the future of e-commerce marketing lies.