Client: Leading Ecommerce company

Industry: Information Technology

Business Impact: • Significant actionable intelligences• Competitive perspective

www.blueoceanmi.com

Evaluating the cost of ownership of a new Ecommerce website aiming to gain competitor perspectives

Business Challenge

In the hyper-competitive Ecommerce industry with dynamic business models, Blueocean Market Intelligence’s client needed to understand the costs associated with setting up a new Ecommerce website for retail and digital goods.

The client wanted to also gain a competitive perspective so that an appropriate solution could be devised based on the scale of the merchant’s business requirements (small, medium or large).

Solution

The study started with the 360 Discovery Approach, rounded up information available on the respective vendor’s site and other publically available sources to identify various vendors and their services in the space. Then, to arrive at a few decisive and suitable number of assumptions of prime importance, the costing model for the client was prepared.

• Identifying different types/layers of vendors (on premise licensed software vendors, hosted end-to-end Ecommerce platform vendors, payment service providers, niche players etc.) that a merchant or seller needs to tie up with in order to launch and perate an Ecommerce Webstore

• Identifying various costing options available to the merchant through various business models (on premise/on demand/SaaS)

Case Study

About Blueocean Market Intelligence

Blueocean Market Intelligence is a global analytics and insights provider that helps corporations realize a 360-degree view of their customers through data integration and a multi-disciplinary approach that enables sound, data-driven business decisions.

Since we live in a highly dynamic and multi-dimensional world, we believe the most effective business decisions come from a synthesis of data streams and not from one-dimensional sources.

Using our 360 Discovery approach, we ensure the comprehensive use of all available structured and unstructured data sources, enabling us to bring the best to bear against each engagement. Strong decision support is enabled through a combination of analytics, domain expertise, engineering and visualization skills brought together in harmony.

Leading companies have benefited from our partnership with financial growth, 360 views of their markets and competition, and improved customer acquisition, satisfaction and retention.

For more information or to request a consultation, please email info@blueoceanmi.com or visit us online at www.blueoceanmi.com.

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• Identifying vendors that offer services across layers

• Understanding the cost structure of identified vendors

• Finding out the total cost of ownership for retail merchant that offers products like clothing, shoes, accessories etc. under various business models

• The same was repeated for digital goods merchants, offering products like software (distributed online), online gaming, consumer apps etc. under various business models

Findings of the costing model were also summarized in the form of a representational deck with powerful visualization for the client as final delivery.

Outcome

Blueocean Market Intelligence was able to share significant and actionable insights from this deep dive into the best practices around costing, pricing and valuation of websites in the Ecommerce and the consumer app distribution space. Amongst them was one finding that indicated that although the cost structure for most consumer app online marketplaces was around the 30% industry standard baseline, the client’s app store clearly stood out as an exception.

Another interesting insight suggested that in the case of the distribution of software through a company’s own website or through online markets, the expenses involved are inversely proportional to the costs of transactions.

The cost model developed by Blueocean Market Intelligence was well-received and leveraged by the client to further map additional vendors across the Ecommerce space. It was also used to compare the positioning of the client’s services in the same space for different features.