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Insights
This study examines the two most prominent consumer auction sites on the Web today—eBay and Priceline.com—to assess the continued prospects for dynamic pricing in retail Internet commerce. eBay is the largest consumer auction site on the Web and has achieved the status of the world's most successful online marketplace. Recently, eBay has expanded beyond auctions to include various fixed-price sales and has pursued innovative partnerships with major corporations such as Disney and IBM. But it is the auction format that has provided eBay with its status as a virtual central market for the world. Priceline.com has achieved a level of brand recognition almost as great as that of eBay. Priceline's primary auction niche is leisure-travel products: airline tickets, hotel rooms, and rental cars. Bidders on Priceline—those naming the price they are willing to pay in its reverse-auction format—must commit to a sale without knowing which airline or hotel or rental car company has accepted their bid. Despite its recent profitability, Priceline's business model is limited to those customers who are indifferent to brand and are willing both to spend time and to sacrifice convenience for a chance at an even cheaper airline ticket or hotel room than those available on a number of other discount travel sites. Whereas eBay's version of dynamic pricing has provided a solid foundation for community building and creative expansion, Priceline's dynamic pricing scheme has inherent limitations that will likely restrict its future growth. Author: Thomas M. McKenna. 12 pages. Index Keywords: Consumer Behavior; Electronic Commerce; Internet; Retail Trade.
The Internet has transformed society in the past decade. It has provided consumers and businesses with easy access to a plethora of information about every conceivable topic at the click of a mouse. E-mailing changed the way we communicate, businesses opened new sales channels, software updates are now instantaneous, and the entertainment industry has leveraged the new capabilities to provide new services and implement new business models. New applications emerged and became polished and sophisticated. Increased processing power in personal computers and faster network connections enabled new uses of the Internet. The more people connected to the Web and the more applications that appeared, the more obvious it became that the current infrastructure was reaching its limits. More sophisticated applications require a more sophisticated infrastructure. Unnoticed by the general public, new networks are already in place to allow academia and corporate research and development to leverage new possibilities. What do the new networks look like? What can we expect from more-advanced networks? What changes are in store for commercial applications? How can businesses leverage opportunities? This study describes properties of advanced networks, the applications that will benefit most by more sophisticated capabilities, and commercial applications. Author: Martin Schwirn. 14 pages. Index Keywords: Communications; Computer Networks; Internet Technologies; Intranet.
The so-called new biotechnology, which exploits modern scientific techniques such as recombinant DNA, first proved itself as a source of innovation in the pharmaceutical industry and is now attracting interest in other industries such as agriculture and chemicals. For these industries, industrial biotechnology is a key to achieving industrial and environmental sustainability, offering opportunities to reduce consumption of materials and energy and to manage pollution and waste generation—without compromising current levels of industrial production. However, despite biotechnology's track record in the pharmaceutical industry, other industries have so far been slower to adopt the technology. The most successful application outside the pharmaceutical industry to date has been the production of industrial enzymes through fermentation—a process with leading market applications in textiles, food, and detergents. Techniques for removing hazardous chemicals from the environment are also gaining interest, as is the potential to use biofuels in the energy sector. The use of genetically engineered microorganisms is not likely to gain acceptance for application in uncontrolled environments, but opportunities exist in settings that must contain the flow of materials. Wider adoption of biotechnology in industry depends on two key factors: competitive costs and public acceptance of the technology. In turn, government support will be critical to maintain commercial interest in biomass-based products. Author: Andrew Broderick. 10 pages. Index Keywords: Agriculture; Alternative Fuels; Biotechnology; Chemical Industry; Energy Technology; Environment; Pollution; Process Technology; Waste Management.
Robots continued to pique analysts' and consumers' interest in 2001 as robotic toys such as Sony's Aibo added features and television shows such as Battlebots gained popularity. Some companies predict that robots will be as ubiquitous as personal computers in the near future. However, analysts and early market entrants have been guilty of considerable hype about robots, raising consumers' expectations beyond the industry's ability to deliver. Indeed, even the definition of a robot remains a hotly debated question. In general, robots are mechatronic machines that combine sensing, actuation, and computerized control. But robotic applications vary widely in the number of human characteristics they mimic and in their level of sophistication. Many advances have taken place in enabling and combinatory technologies, but commercialization is still a long way off. One of the major barriers is consumer acceptance, particularly in the West, where people perceive robots as a potential threat to their jobs or as a replacement for humans. Technical barriers also exist, particularly in efforts to give robots autonomy and do away with remote controls. Monitoring early robot entrants and their progress in consumer markets is necessary to assess opportunities accurately in all industries. Companies should also look for spin-off opportunities emerging from current research and development in humanoid robots. Author: Lindsay C. Wilson. 12 pages. Index Keywords: Artificial Intelligence; Consumer Electronics; Innovation; Materials Technology; Research and Development; Robotics; Technology Development.
Signals of Change is a series of Business Intelligence Program research publications that help companies to identify signs of change and explore emerging opportunities. This study provides analysis of signals of change that the March 2002 Scan meeting in London, England, identified. The Scan meetings are, in essence, brainstorming sessions that take their cue from a list of news events and business developments and build on the knowledge of SRI Consulting Business Intelligence participants. This study discusses how China has become more interesting to global investors since the Chinese government began adopting reform and instituting a more open-door economic policy. But being aware of the opportunities for supplying goods and services to China and building the capability to reach these new markets are very different. China's industrialization is just as likely to create new international corporations that will target the United States and Europe as it is to create new opportunities for U.S. and European companies. Authors also discuss the changing relationship between the concepts of tool and toy. Traditionally, toys are products that designers create for leisure; consumers normally see tools as functional nonleisure items. But innovative designs and increased functionality are beginning to blur the boundaries between the two product categories, with an increasing number of products now fitting into both. Although the leisure potential of tools and the nonleisure potential of toys will increasingly present manufacturers with opportunities for growth, they will also confront manufacturers with additional threats to their traditional lines of business. The last section focuses on the idea that companies must innovate if they wish to remain competitive in today's dynamic business environment. What is new is that innovation provides a competitive advantage only if companies pitch it at a level that customers are able to understand. Although staying one step ahead of the competition is important, companies should not be so far ahead of the game that customers are unable to relate to their innovations and find the innovations too complex and difficult to incorporate into their daily lives. Authors: Rob Edmonds, Carl Telford, Erin Coberth, and Rosamund Gee. 9 pages. Index Keywords: Asia; Recreation and Leisure; Innovation; Product Development. News The summaries below describe current activities and programs not included in the B-I-P membership but of potential interest to members. VALS™ Changes SRI Consulting Business Intelligence announces the latest update to its VALS™ consumer psychographic segmentation system. Some changes are significant. A new innovation scoring dimension will give clients an improved yardstick for predicting diffusion rates and setting diffusion strategy. This algorithm update will not change definitions of segments or cause any shift in data. In addition, some segment names have changed to make the system more intuitive and accessible for users:
Current Watch-List B-I-P's scanning and research processes identify areas on the periphery of your business's focus area that constitute potential opportunities or threats. The areas that we decide bear watching go on B-I-P's watch list of defining forces that are transforming the business environment. Current watch-list topics include:
The Bulletin will periodically highlight each defining force, listing related B-I-P publications. |
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