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This chapter is from the book

The Role of Product

Product plays a critical role in the online business's value proposition, in effective web store merchandising, and in the customer's ability to find and select specific items. But not all products are created equal. Most web stores, however, treat them the same when they list the products with only one-line descriptions.

The customer's relationship to the product is also important. As more customers become more experienced with shopping for a product, they will choose stores where the shopping process is the easiest. The Internet opened doors to scarce, unique, and hard-to-find items. It also changed the marketplace and added auction websites, allowing anyone to have an online "garage sale" of used items or to shop a worldwide "flea market."

Store product mix complicates online merchandising and influences the web design and navigation models that ultimately lead customers to the products they seek. Knowing the product and category value determines appropriate placement levels in the web store category hierarchies. Product knowledge as it relates to the total store performance, to other product performance, or to other category performance requires analysis to regulate profitability.

Other factors influencing web store design are product complexities, characteristics, and lifecycles. Many people research complex products online where the information is more in depth than retail sales help can provide, but they ultimately purchase at retail. Some products are shopped for frequently and routinely, while others are a one-time purchase. Still others are planned or impulse purchases.

Intimate product knowledge and customer insight determines the appropriate product mix for an online store. Product knowledge also brings organization to the category and online store and will better reflect customer-driven needs. Product brand, category value, and even product usage influence how products should be merchandised. Product information must be blended with target customer information relative to how people shop. Only then can successful navigation models be designed. Products, category market structures, and valuation are discussed in depth in Chapter 3.

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Last Update: November 17, 2020