Virtual Store-front

A store is not just a place for commerce, but an appealing social environment experienced by the consumer.  People like to walk by brilliantly lit display windows with artfully decorated product displays.  Usually there is no immediate pressure to purchase, but just the curiosity to see and know about products.  But recent surveys show that consumers may be spending less time visiting shops to learn about products.  Catalogs are convenient, but in most cases, it may require a visit to the actual stores.  This is where a virtual store-front come in.  With a few clicks of the mouse, an Internet user can visit a virtual store, find all that she needs about any product and make the purchase online.

4.1 Virtual Store-front Services

A virtual store-front is an online stores accessed through the Web or other online services. A virtual store has the potential to deliver both convenience and economy, the two major consumer benefits that have driven new retail formats (Burke, 1998). A typical store-front provides several services which can be categorized as follows:

1.   Product Display: This service is provided by almost all the online stores.  The products are categorized for convenience. For example, Peapod (http://www.peapod.com) categorized the groceries as Deli, Bakeshop, Diary, General Groceries, etc. Each category may provide some sub categories. To be effective, the product display in an online store should be user-friendly for easy navigation and should be interesting to retain the attention of the consumer. 

2.   Catalog Services: The online catalog services provide a detailed booklet of products offered by well known catalog retailers and allow consumers to browse or order for the free catalog. Electronic catalogs are interactive and can be programmed to learn a consumer’s preferences and provide a personalized catalog.  Further, product demonstrations and manufacturer’s responses to consumer’s queries can be built into the catalogs to make them more effective.

3.   Search Engines: The search service is a more advanced service offered on a virtual shop-front.  This allows an online consumer to search for specific information related to the products or her needs.  These services help consumers in their purchase decisions, but are more relevant for information intensive and customized products like insurance, financial services and travel. Travel agencies have long provided services to search for the best deal for a consumer travelling from one place to another.  As more and more consumers demand products or services customized to their needs, search engines will be an integral part of all virtual stores.

4.   Transactions: Transaction capability provides the most advanced of the services offered by online stores.  This includes fulfillment and logistics services, and the mechanism for secure payment mechanisms. Though not many online stores have transaction services currently, we expect all stores to offer this facility soon as a convenient way for a consumer to fulfill the purchase needs.

5.   Customization: This service allows consumers to tailor the product to their needs and tastes.  Dell Computers (http://www.dell.com) provide one of the best examples of the customization capabilities available on the online stores. Here a consumer can build a computer online by  choosing the processor, memory, disk storage and other accessories instead of just selecting one of the several computers already available for sale. Customization will be very relevant for services like financial products, insurance, clothing, travel and entertainment where the preferences of the consumers are varied and cannot be easily aggregated.

Online store such as Peopod and Amazon.com  provide product display, search and transaction services.  Other stores such as LL Bean (http://www.llbean.com) and Sears (http://www.sears.com) provide catalogs, product displays, and transactions. Dell provides product information, transaction and customization services in its online stores.

4.2 Promotion Strategies In A Virtual Store-front

A virtual store-front represents the product display window of an online stores.  It can be considered an extension of online advertisements, in which the advertiser offers to provide all details of the products on display and to complete the purchase transactions, if needed. Some of the advantages of the online shelf space are:

1.   Interactivity

2.   Unlimited shelf space

3.   24 hour accessibility

4.   Selector and aggregator of consumers

5.   Potentially global audience

Marketers can follow a combination of the following strategies for promoting their products on virtual store-fronts.

1.   Promotion through online product catalogs.

2.   Exclusive advertising rights whenever specific products are accessed on other online store-fronts. For example, a snack food maker can have a banner for his brand of potato chips to appear whenever the snacks food category is accessed from an online grocery stores.

3.   Advertising through banners or buttons on the free space of other online stores.

4.   Providing hyperlinks to product sites from the results of the online store’s search engines.

5.   Creating own store-front with a combination of the services mentioned in section 4.1.

The real benefit of virtual stores to marketers is the ability to exploit the interactive capabilities of the Internet. Virtual store-front displays can be customized according to the preferences of the online shopper, thus providing a personal shopping experience for each shopper. As the marketer learns more about the consumer through the online interactions, a closer relationship can be established with the consumer, offering to fulfil more of the consumer needs, and  strengthening the relationship further.

Internet advertising and virtual store-fronts are ways of exploiting the richness and interactivity of the new medium. Now, the Internet gives the marketers a new promotion tool in the form of virtual communities. Marketers are building virtual communities as a deliberate strategy to build a long-lasting and beneficial relationship with their consumers. In the following section we will take up for discussion the dynamics of these virtual communities and how they can be used as an innovative promotion channel.