Sunday, August 17, 2008

"e"lectronics products - Dell or Amazon !!!

Whenever I plan to buy an electronics item after looking at all other opportunities like e-bay(could have left e-bay aside as these guys are primarily resellers and work on a marketplace model), best buy, deals4all, circuit city, buy and several other online vendors my gut insists me to keep going back to Dell or Amazon (Not considering the one time opportunities available with vendors like woot, dealcatcher etc).
I wonder if this is something to do with just me or it happens with others as well. I am sure and the numbers can talk that all the former set of online vendors that I mentioned too have loyal customers and they have been pioneers in doing a several strategies that has wooed people to them. But even then why is it that Kotler's and Drucker's of the marketing world just don't have too many words for these other vendors. I can cite some reasons for the same :
  1. The brand built for over (at least) a decade
  2. A strong focus on customer satisfaction and customer retention
  3. A strong collaborative relation with the payment & logistics partners
  4. Solid technology focus as support functions
  5. Economies of scale (knowing that most of the other vendors are present only in US)
  6. Outsourcing

I am sure that these points are cliche' as they have been repeated over and over again by people but the point I am driving here is that these brands have done it over years and hence they manage to be No. 1 or No.2 in the business they are in and this trend is suspected to continue further. So what about these other vendors, do these vendors come take advantage of the windfalls during peak periods and then focus on regular sales if any from their loyal customers.

So some questions that I pose to myself and to the rest of the people who would be interested in participating into this forum are:

  • How long would these vendors survive?
  • Are we on the edge of another dotcom burst?
  • If most of other vendors manage to meet even 4 of the 6 points I mentioned above then what changes would the leaders have to do further to ensure that they remain leaders?
  • What can be some new initiatives taken by the other vendors so that they can get a First Movers Advantage (FMA)?

To answer these questions I just have a one line answer " change or perish " and this principle needs to be followed by not just the followers but also the leaders else we might expect another burst in the years to come.

Any takers .....

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