David Eales: PI:T7777644: T171 02:

Module 3 Exercise 3.6 Examining e-commerce operations

 For the site you visited in the last exercise (Looking at richness and reach) you should explore the site and try and answer the following questions:
 
  1. Does this business disintermediate other businesses, i.e. does it remove the need for existing intermediaries? How?
  2. How does the business hope to make money? Is it through selling products, advertising, a mixture of approaches?
  3. What are the challenges for such a business? In terms of technology what is required? What about logistics, e.g. delivering the product?
  4. What additional features might the site offer?

1.

Expedia been an online travel agent removes the intermediary of the sales assistant in the high street shop in the same way as the ATM did for the bank teller. Expensive printing and delivery of glossy brouchers is also removed.

2.

It is hard to see from the site if it gets a commission from the sale of holidays, flights etc. or if it buys surplus capacity from airlines, holiday companies etc. and then sells them on I expect its a mixture.
I see from the site that in 2001 USA Networks, Inc. bought a controlling interest of Expedia from Microsoft, USA Networks, Inc. run by CEO Barry Diller owns a wide range of companies including Ticketmaster.co.uk and a large interactive television service which will undoubtedly be a positive resource for Expedia in the future. this will allow it to use other parts of the group to maximise ticket sales.
Its insurance, train tickets and money exchange will be on a commission bases.

3.

The challenge for Expedia is to be current (right up to date) its no good selling flights that left yesterday or holidays that are booked up. For this it needs a very large and rapidly updating data base a large computer network with a very large bandwidth.
Good arrangements with the postal system or courier service for delivery of the documents.

4.

An addition that the site might offer over and above its already large selection is out of the ordinary or exotic trips.
:-  balloon rides.
:-  F15 or Mig fighter aircraft.
:-  or the most exotic of all Space flight.

 Reference.