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| E-Commerce Business Plan -- Topics | |||
| 1. | Introduction | 4. | Competitive Analysis |
| 2. | Product Analysis | 5. | Financial Analysis |
| 3. | Market Analysis | 6. | Implementation Plan |
| . | |||
E-Commerce Business Plan
Product Analysis
by Maggi Hall, E-Commerce Adviser staff (rev022708)
Factors for Success
E-Commerce Product Analysis
Product positioning can make or break a business.
Competing in a crowded field without any distinguishing chararteristics is almost definite failure. That is, unless a strong promotional strategy can compensate for the weak product positioning.
But rather than compensating, find a niche. A niche can be based on price, quality, support, etc. It can also be based on a broader strategy, such as a vertical strategy.
After you complete the market analysis and competitive analysis, come back to the product analysis and determine what product features can be "tweaked" to improve product positioning for the target market.
product analysis
, because most likely it was some product or service idea that started you thinking about an e-commerce website.The objective of a product analysis is to understand the factors for success and failure and to establish a foundation for an overall e-commerce strategy, in particular determining if your product or service is can be sold on the Internet.
Below are some of the details you want to compile about your products.
Product Analysis Features:
A complete and thoughtful list of product features is very important to understanding your product positioning. Product positioning details are key in defining a competitive strategy, a marketing strategy and a financial analysis. If you don't have all of the details immediately available, add a topic "placeholder" to your analysis, so you don't forget about it and then add the details later. Also, some details may only be a "best estimate" -- that's OK.Below is a sample list of features that should be included in a product analysis. You should also include any details not listed below that may be specific to your products/services.
- Price: Determining price usually starts by setting a minimum price based on cost. An upper limit incorporates value to the customer and "Best Case" profit objectives. Actual prices incorporate additional factors, such as competition, customer's price sensitivity, marginal costs, etc.
- Quality: high-end products, bargain products, etc.
- Options: Color/Size/etc.
- Add-ons (e.g. service contract)
- Brand-name or generic
- Return Policy
- Quantity Discounts
Sourcing and Fulfillment:
How products and services are supplied to your business and then in turn to customers significantly influences cost structure, quality control and liabilities. For example, working with drop shippers minimizes product inventory costs, but also limits control over product and service quality. Producing your own products requires a greater financial investment, but allows greater control. A sample of sourcing and fulfillment options are:- In-house Production
- Wholesalers/Manufacturers
- Shippers (e.g. UPS, Fedex)
- Drop Shipper
Keywords and Keyphrases:
As you assemble a list of products, you should begin to identify search engine "keywords." Keywords and keyphrases describe products in focused, specific terms of usually one to three words. For example, if you sell books, "book" can be a keyword to describe your products. However, it is a very broad and the broader the terms used, the more competition you'll have. So instead of just "book" be more specific, e.g. american history book or american revolution book. (See E-Commerce Marketing Strategy: Search Engine Optimization for addition keyword details.)For each product identify a minimum of 2 keyphrases with each phrase being 2 or 3 words. This information will be used in developing website content for serach engine optimization.
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