virtual value chain blanks

8/8/2019 Virtual Value Chain Blanks

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Virtual Value Chain

Internet Marketing

Dr. Mary Wolfinbarger


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Value Chain

The series of _____-adding activities

connecting a companys ______ side

(raw materials, inbound logistics andproduction processes) with its ______

side (outbound logistics, marketing and

sales).


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Value Chain

Idea: By analyzing ______ of a value

chain, can redesign internal and

external processes to improve _______and ___________


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Mirroring Capability

When companies move activities

from the _____ to the _____, they

begin to create a virtual value chainthat parallels but improves on the

physical value chain.


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Value Chain

Original VC model treats info only as a

_________ element

But ____ can be a source of value Example: FedEx online tracking

In the ________managers create value

with info


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Virtual Value Chain

Rayport and Sviokla suggest businesses

operate in two words:

A ________ world (marketplace) A ________ world (marketspace)

The two spaces are two interacting

value-adding processes


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Virtual Value Chain

Example:

For consumers, a phone answering machine

is in _______

Electronic answering services are in (virtual)

__________

_________ often sells in both types of spaces

If it can be_______, it can be done in themarketspace


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Creating Value in the VC

Involves Information:

1. Gathering

2. Organizing3. Selecting

4. Synthesizing

5. Distributing

(Sounds like_________!)


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Creating Value in the VC

Just as someone takes raw material and

refines it into something useful as in

the sequence of tasks involved inassembling an automobile on a

production line so a manager today

collects raw information and adds

value through these steps.Rayportand Sviokla


10/27

Three stages of value-adding

informational processes

1. Visibility: ability to track ______

operations more effectively

2. Mirroring capability: substitute ______activities for _______ones

3. Create new ________relationships:

use flow of info to deliver value tocustomers in new ways


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Visibility

IT allows managers to ___ ________

more effectively

Example: Frito-Lays info revolutioninitiative

Managers can visualize the entire chain

from ordering corn to planning localpromos


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Visibility How does Frito-Lay do it?

Employees in field collect info on sales ofproducts daily and feed it to co.

Field employees also collect store infoabout sales and promo of competing andnew products

Frito-Lay continuously optimizes, reducinginventory and supplier risk, planning truckrouting

Still technology plays a support role only


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Goes beyond simply using information

in a _____role

Central issue: How can activities bemoved from the _________to the

_________to become faster, better,

more flexible, cheaper?


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Example: Fords use of a virtual design

team and testing of prototypes in

simulated environments with colleaguesover a computer network around the

world

Suppliers were even drawn into the

design process


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Mirroring Capabilities

Every manager knows that stayingcompetitive today depends on achievinghigher levels of performance forcustomers while incurring lower costs inR & D and productionOn the VVC,companies may find dramatic low-costapproaches to delivering extraordinarilyhigh-value results to customers. Rayport & Sviokla


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Mirroring Capabilities

Can provide mirroring which movescustomer from place to space as well

Example: eCommerce brings

customers to the _____ Bad Example?: Lands End shop with a friend

Opt-in email mirrors direct marketing

Arbitrons portable people meter

Online course registration

Online classes?


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New Customer Relationships

Not just creating values in the space,but extracting value from it

Establish space-based _____withcustomers

Also ____ _____with competitors inco-opetition: example: webrings and

reciprocal marketing (e.g. Amazonsnumerous partners)


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WWW Examples:

Virtual or limited ________ _______(software or sampling music)

R-tech (_________ technology) Example:Amazon.com -- Listmania, product

suggestions based on purchase history(collaborative filtering), ability to read reviews of

products, Just Like You Planetfeedback.com (entire biz built on new

ways of gathering info)


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More Examples:

Using customer ________to go into newbusinesses (USAA insured boat owners, then

designed financing packages for boatpurchase)

Customer as _______ (underground music;tracking your order at Dell)

Personalized pages (for B to C & B to B) Affiliate programs (Customer as__________)

Your idea here.


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Implications

In the marketspace, many of the

business axioms that have guided

managers dont apply. Rayport &Sviokla


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Five principles:

1. The Law of Digital Assets

Digital assets not _____ ___

when consumed Music, content, entertainment,

pictures.

Can price aggressively


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Five principles:

2. New Economies of Scale

__________ services that rely on info

can efficiently be utilized www.myway.com

Musicmatch allows users to customize

styles of music or artists you listen toon your personalized radio station


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Five principles:

3. New Economies of Scope

Can ______ _____of operations

by using present customer info

(use info about present customers to

suggest new products/business

directions)


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Five principles:

4. Transaction-Cost Compression

Transaction costs of ______

_______about customers andtheir behavior is lower than ever


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Five principles:

5. Rebalancing supply and demand

Combines previous 4 principles focus is shifting from ______-side to

______-side thinking More opportunities to ______ and

______ to customer desires Example: Amazon sends email when an author Ive

previously purchased releases a new book they knew I

wanted it before I did! Some e-commerce providers are sending sweeteners to

customers who abandon shopping carts


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Assignment: (in class)

How does and how could CSULB and/orCollege of Business Administration and/orthe Marketing department use the VVC to

1. Increase visibility of operations?2. Mirror activities currently carried on in the

marketplace (physical world) in themarketspace (virtual world)?

3. Increase strength of relationships with itscustomers (students) and potentialcustomers?

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