Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign University of Illinois at Urbana Champaign (UIUC) Center For Information Systems and Technology Management Michael J. Shaw, Director Research and Learning Center –UIUC Critical Research Initiatives (CRI) Sponsorship –Electronic Commerce Forum –Integration of Technology and Business Strategy Multi-disciplinary Research –College of Commerce and Business Administration, National Center for Super Computing Applications (NCSA), Beckman Institute for Advanced Science and Technology, College of Engineering, and Department of Psychology Academic Research and Industrial Partnerships –Integration of Educational Objectives, Rigorous Research, and Business Practices

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Center For Information Systems and Technology Management Industrial Partnerships Identify Research Problems of Common Interests Match Research Expertise with Research Needs Types of Partnerships –Partner Program –Specific Sponsored Projects Benefits WIN-WIN Solutions

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Web Based Strategies To Fulfill Consumer Needs * Web Advertising * Virtual Communities * Interactive catalogs * Virtual store-front * Virtual Reality New Consumer Processes * Global Supply Chain Integration * Sense and Respond * Digital Interactivity * Multimedia Databases * Customer Profiling * Interactive Marketing * Consumer Interface Quick Response Mass Customization Intelligent Virtual Stores Product Promotion

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Consumer Purchase Needs Knowledge Aggregation Customization Networking Ubiquity Interaction Experience

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Consumer Purchase Needs Knowledge - Having access to specialized information and feedback about the product or service Interaction - Fulfilling the need to communicate with the provider of product or service Networking - Connecting to and interacting with other consumers who have similar needs or experiences Sensory experiences - Using sensory input such as sight and sound to arrive at a purchase decision Ubiquity - Having all that the consumer needs at the time and place of consumer’s convenience, rather that at the provider’s convenience Aggregation - Bringing together a number of related and required services at a single point of contact Customization / Personalization - Tailoring products to consumer’s needs rather than adjusting consumer needs to available product ranges

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign The Web As The Consumer Interface Interactivity Realistic experience Global access Targetability Tracking of customers Flexibility Aggregation of services The Web is most suited to fulfill all of the needs of the consumer through a single channel

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Product Promotion - Web Advertising Banners Buttons Keyword Ads Advertorial Destination Site - Advertising designed to blend with the editorial content of the page - Web page becomes a central access point for customer to provide information, education, news, entertainment Issues: - Measurements - Strategy - Effectiveness Web Portals - Starting web page from where user accesses services like search, news, and

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Product Promotion - Virtual Communities Characteristics –Collective knowledge –Targetable audience –Influential opinion leader –Increasing returns Marginal cost effect Learning curve effect “Network externalities” Membership of community Potential Revenues

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Building and exploiting virtual communities Product Promotion - Virtual Communities

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Benefits of virtual communities To consumers Identify and interact with consumers of similar interests without constraints of time and space Aggregated experience of the product usage Better informed purchase decisions Reduced search costs for product information Special price, customized offers and better service Product Promotion - Virtual Communities To sponsor organization Reduced search costs Effective targeting of products and services Influence the purchase decisions of new members Loyalty can be exploited to offer range of products and services to consumers Global reach at much lower costs To participating vendors Target audience with known demographics and interests Effective response for promotion messages Reduced search costs of target customers Global reach at much lower costs

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Virtual Store-Front Services * Product display services * Electronic catalog services * Customization features * On-line search engine * On-line order processing

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Interactive Web Catalog Features Product search - by use, category, price, related products Product visualization - using virtual reality Product customization On-line order placement - links to related services like credit agencies, bank, product stock status, packaging and delivery services Virtual conference - with sales representatives and other consumers

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Educational Esthetic Passive Participation Immersion Active Participation Absorption Escapist Entertainment The Four Realms Of An Experience B. Joseph Pine II and James H. Gilmore, Harvard Business Review, July-August, 1998

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Customers provide potential interests Sample of likely matches presented Image Database Product Catalog Customer “Virtually” tries & matches Selections Is Selected Set Satisfactory? Customer Recommends Changes to Selections Yes No Customer decides on a Selection Customer Database Customer Preferences Interactive Iterative Process Virtual Stores - A Vision

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Mass Customization Mass market goods and services uniquely tailored to the needs of the individuals who buy them. Highlights –Driven by customer needs –Implemented through the Web –Uses latest technology Databases - customer and product Computer controlled design, production and packaging Supply chain management –Helps build a strong relationship with customer Benefits – Cuts inventory – Makes very small niche markets viable – Retailers become regional distribution centers, cutting costs

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Mass Customization - Example Garments Tools 3-D scanning tools Visualization tools Cloth draping algorithm Virtual reality tools Image databases Artificial intelligence interface Internet for integrated design, marketing and retailing Steps Customer’s 3-D image scanned Customer interactively selects color, model, and print design Order transmitted through web to factory Garment stitched and delivered Bar-code used to store customer choices

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Mass Customization - Benefits Customer’s 3-D image can be saved and used in future Customer can select fabric type, color, texture, pattern and print Customer can fit and visualize selected garment Customer can design garment or use available designs for the fit Customer’s feedback used in general garment design

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Mass Customization - Interactive Digitization Image Storage and Retrieval Image Synthesis Interactive Feature Specification Integration with Supply Chain

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Mass Customized Products - Examples Personal computers Dell Computers Garments Levi’s Strauss Eye glasses LensCrafters Vitamin pills Acumin Appliances Furniture

Mike Shaw Center for Information Systems and Technology Management University of Illinois at Urbana Champaign Market Intelligence Analysis Web Store Front Order Entry Enterprise Resource Planning Customer Service & Sales Consumer Knowledge Base Customer Delivery Payment & Account Management Product Engineering Logistics Support SCN Internet Integrated Supply Chain Network