On-line shopping
A Dixons Group case study

Page 1: Introduction

Britain is turning into a dot.com nation. By May 2001 10 million homes had connected to the Internet compared with 6 million a year earlier. In addition, many people access the Internet through cyber cafés and through access at schools, colleges and universities. In recent years, more and more people (particularly the young) have turned to electronic purchasing. The number is certain to...
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Page 2: Building on Dixons' strengths

Recent events have demonstrated that selling via the Internet is not a certain success for all companies. Some Internet ventures have collapsed even though billions of pounds were spent on trying to build the brands. Examples include: Boo.com, an on-line fashion and sports clothes retailer, which failed despite having £12million ploughed into creating awareness of it. Webvan, which soaked...
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Page 3: Overcoming initial obstacles

It is not easy to set up and operate an on-line retailing service because there are many costs and difficulties associated with this method of selling: Delivery to individual homes adds to the cost of running a business operation and can eat into profits. In conventional shops the customer travels to buy so the retailer does not have to fund delivery costs that would otherwise erode margins. It...
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Page 4: On-line shopping

Many consumers approach on-line shopping with some apprehension. It is vital, therefore, that the experience is as user-friendly as possible. To reassure customers the Dixons sites display the phone numbers and locations of all Dixons stores so that customers know how to find Dixons representatives if they feel the need. This is very important in giving confidence to customers. Equally...
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Page 5: Evaluating the success of on-line business

Three measures are commonly used to provide a useful guide to the success of a new on-line business: traffic: the number of people who look at the site and the proportion of these that convert into sales. sales by value. profitability. These measures broadly indicatehow attractive the business is, how efficient it is in making sales, and how profitable it is. Growing profits depend on moving...
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Page 6: Conclusion

Being able to buy any time, any place, anywhere, provides exciting opportunities not only for Dixons customers but for the Group as a whole, and these benefits are likely to increase over time.For potential customers, the site enables them to browse before they shop, and to research the product so they have more confidence in what they are buying. For Dixons, the site offers greater exposure and...
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