Airline reservations systems were already centralized in big computers going back as far as the 1960s. Adding a Web interface to those computers turned into profitable businesses for Expedia, Orbitz, and Travelocity.
The unexpected achievers turned out to be online communities. Nearly every ecommerce dotcom failed yet Amazon succeeded. To understand why, imagine if a new store opened up across the street from your house. It appeared well-stocked and clean but after a month you'd never seen anyone go in. Would you be willing to shop there? The typical business-to-consumer ecommerce site was the online analog of this offline situation. A venture capital firm would put up $100 million. The site would launch with fancy graphics and an impressive-sounding product catalog. But each person who looked at a page from the shop would be, as far as he or she knew, the only person who had ever looked at that page. At Amazon, by contrast, a product page would also contain 10 reader reviews. You could assume therefore that at least 10 people had purchased that book from Amazon, received it in the mail, and were able to read it. Amazon is an online community of consumers where as it happens you can buy stuff. In June 2003 Amazon has a market capitalization of $14 billion and nearly all of the people who tried to sell without the community angle are bankrupt.
America Online made money with a combination of connectivity and community, taking in roughly $9 billion in revenue for 2002. Yahoo Finance describes eBay Inc. as "a Web-based community in which buyers and sellers are brought together to browse, buy and sell items online..." and lists its annual sales as 1.45 billion of which nearly one third was profit
No comments:
Post a Comment