What are the steps for a business to develop an e-commerce strategy?

First, don't plan for more than 24 months

Because in an uncertain business environment, where opportunities come and go quickly and grandiose plans usually cannot be implemented, survival is more important than growth. While it is still essential to have a business strategy that guides the entire business activity, traditional strategic planning such as planning for the medium to long term as far as five years away is no longer relevant, largely due to the shift in the business environment brought about by the Internet. The business environment has changed to such an extent that no plan can be applied for 24 months. Beyond 24 months, it should be envisioned that the business environment will change drastically, and the strategy will need to be redefined accordingly. In addition, the pace of implementation must be accelerated; a strategy that takes more than 12 months to implement is equally unlikely to be successful.

Second, do not develop e-commerce strategy is not related to the overall business strategy

E-commerce is also closely related to business services, but also for the original business development **** enjoy. Managers are eager to quickly carry out independent of the business sector's business strategy outside of the "e-commerce" strategy, in many cases, this is due to the "new economy" of rapid response to the desire and rapid introduction of e-commerce driven by the desire, which implies a layer of There is an implicit assumption that developing an entire business strategy is a cumbersome and time-consuming process, and that waiting to develop an e-commerce strategy until the business strategy has been developed will lead to its failure. The opposite is true. Firstly, the commerce strategy can be carried out in a short period of time and secondly, not understanding the impact of carrying out an e-commerce program on the existing distribution channels and the commerce as a whole may lead to the failure of that commerce strategy. For traditional brick and mortar companies, an e-commerce strategy that is created as a different approach to the "new economy", separate from the business strategy, is often counterproductive and is bound to fail.

Thirdly, it is important to be realistic

Different e-commerce strategies are adopted depending on industry, geography and culture. There is often internal pressure to develop an enterprise-wide e-business strategy, and this approach is only effective for smaller businesses whose operations are concentrated in a single shopping center. In terms of Business Process Reengineering (BPR) and Customer Relationship Management (CRM), we have learned that the most effective business strategies are those that focus on specific market segments. While an enterprise-wide strategy should be technologically constructed, the business strategy must be targeted at well-defined market segments. Such market segmentation should take into account all the factors that influence buyer behavior and needs, such as industry, geography, and culture. Industry is clearly the main factor influencing consumer demand, and geography and culture are closely related to it, although some aspects of geography can affect costs and logistics, and in some cases geography can be used as a substitute for culture. Cultural differences will affect how buyer expectations interact with the e-commerce model, and even for buyers with similar demographics and demand characteristics, different strategies may be necessary to take into account the different buyer behaviors that result from their cultural differences.

Fourth, in the strategy analysis, to internal and external processes

Beginning e-commerce companies have a tendency to focus on the impact of the Internet on internal or external processes. This trend is reflected in the popular terms "B2B" and "B2C". Although B2B and B2C are often treated as separate business models, they actually give the same value chain to both the supply side and the demand side. When the term B2C is used, the focus is usually on the distribution channel and how the business organization will sell its products to the end-users; when the term B2B is used, the focus tends to be on internal costs, especially purchasing costs, even though external suppliers are included. An effective strategy should consider how e-commerce can be used to improve internal operations and external communications.

Fifth, get the full support of the board of directors and relevant stakeholders

A project is bound to affect many parties and require many resources, so it is crucial to get the support of the board of directors, which is the highest level. The main thing is to get approval for the costs involved. But getting the board's approval will make the whole project healthy. Introducing e-commerce usually means increasing the complexity of the business model and establishing a market presence on the Internet that has never been seen before (B2C or B2B). Implementing a new business model and establishing a new market image may take considerable time. The board needs to understand the timeframe required and the metrics that will be used to measure progress in implementing the strategy (perhaps including other traditional financial metrics such as earnings per share or return on investment).

Sixth, choose your business model carefully -- buy, divest, or transform

Once you're ready to establish an e-business presence, you must clearly consider the options for reaching your strategic goals. In some cases, it may be feasible to set up an internal e-commerce department and then spin it off as a separate entity; in others, there can be a high-level interplay between e-commerce processes and traditional business processes. For example, the Internet may offer the opportunity to set up complementary distribution channels. In these examples, the best way to implement a new business model may be to inject new energy and to revamp existing business processes; another way to gain new energy is to buy a software application business or a .com business to implement the new business model. It is important to carefully consider these alternative ways of implementing an e-business strategy.

Seventh, follow the new rules of the game

Partly because they are in their infancy, e-commerce operates under new rules. Recent .com startups must compete with traditional business organizations on the same market pie by building market share quickly. They will work hard to gain market share, which may include huge advertising investments, heavily discounted prices, and other ways that result in net attrition in the short term. Building market share is the key to the long-term survival of these companies. Latecomers or traditional companies trying to build their Internet market presence must play the game with an understanding of the new rules. Even a traditional company with an established brand name will fail if it sells its products online at a higher price than the heavily discounted prices of .com companies. Stepping into the realm of .com business organizations with such a strategy only reinforces the image of traditional companies as inefficient and overpriced in the new economy. Traditional companies must be prepared to enter the marketplace as a new interloper selling products at the same level of discounted prices, or they will not be able to establish their identity on the Web.

Eighth, improving or restructuring distribution channels based on real capabilities and value

This is an important source of new profits through value chain restructuring. One of the very forward-looking promises of networking is the reduction of costs through the elimination of intermediaries, and while theoretically possible, this promise is clearly overblown. In some cases, companies have used frothy estimates of e-commerce revenues to temper the paradox that setting up a channel often leads to lower revenues, and it has become commonplace for manufacturers' e-commerce programs to alienate distributors. Using objective estimates of e-commerce revenues in planning processes is critical, however, recognizing when e-commerce provides a more effective distribution channel than any existing channel is equally critical. Choosing the right strategy requires realistic, quantitative estimates of revenue from new and existing distribution channels. Estimates of the energy and value of each of a firm's new and existing channels can be used to assess the channel's efficiency and the potential future it holds for that particular firm.

Ninth, a set of parameters for evaluating the effectiveness of e-commerce programs needs to be established to ensure the viability of these projects

American cinema is famous for saying, "If you build it, it's the future." This is often used to describe the "blind trust" attitude toward conducting e-commerce. This attitude usually involves setting up a Web site to sell products to end-users on the basis that "that's just the way it should be done". Often, this attitude is not accompanied by an evaluation program, and in many cases, the parameters of the evaluation have not even been defined. Evaluating the effectiveness of an e-commerce program will almost always use new parameters, but some of the parameters used to evaluate the effectiveness of the overall business process may be the same as those used in the past. New parameters, such as "stickiness," may be specific to e-commerce and Web sites. Established parameters, such as market share, may also be specific to e-commerce programs. However, traditional valuation metrics such as net income and earnings per share cannot be ignored due to the recent decline in value demonstrated by .com companies. Just as it is important to integrate e-commerce strategy into the overall business strategy, it is equally important to integrate business valuation metrics. The metrics used must be able to assess progress toward the goals of the business strategy, and they must capture the interplay between e-commerce and traditional distribution channels. For example, when merchandise must be "touched and felt," a smart design might include delivering samples from a Web site to a traditional shopping mall, where each distribution channel affects the success of the other. It is difficult to determine the effectiveness of an e-commerce program without metrics, and information from independently operated evaluation systems must be combined to form an overall framework.

Tenth, the quest for speed and thorough implementation

E-commerce demands a higher degree of speed and efficiency in the basic architecture of the enterprise than anything encountered in the past. The e-commerce environment and competitive landscape is changing so rapidly that e-commerce strategies must be implemented quickly, bureaucracy must be cut out, and bureaucracy that impedes the progress of e-commerce programs must be shunned or crushed. And the managers responsible for the e-business program must have the full freedom and authority to quickly bring the program to fruition.