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The innovation model of E-commerce businessThe internet is a place which is full of all kinds of legend and “myth”.And the E-commerce Business which is considered as the “battleground”of the internet industry are undoubtedly a field which is full of expectation and imagination.From the “horse race to encircle”of the 360 Buy to the rapid rise of the Vancl, and from the outshining of the Groupon to its popping,and from the struggling alone of the online shopping enterprises to the “marriage”of the E-business and SNS, the E-businesss energy and vitality is highlighted incisively and vividly.Behind the prosperity is the new business model is brought forth through the old one.The management guru Peter Drucker has said that the competition between enterprises is not only the competition of production but also competition of the business pattern. And the E-commerce business is even more so. To some extent, the innovation model means a lot to the future of the E-commerce business. 1.the general path of the innovationWhat can be called business model? Generally speaking, it is the basic logic of the way companies making profits. A good business model must go forward around the customers,the products(or service),the key resource and the core competence. For the on-line companies,the business model includes following paths: Product positioning:whether the product is competitive and able to help clients and customers to make profits and values? Personalized product and service is the prerequisite and the key to achieve the goal.Users data mining: whether your business model conforms to the on-line users consumption,and be able to lead or develop the consumption concept? The young age group is backbone of the users and their incomes is comparatively lower. As the developing of the internet and the consumption concept has converted,the demand has developed from unitariness to diversity with apparent tint of entertainment.Technical innovation: internet is an technical-intensive industry.The use of new technology is a key method for the company being competitive.Nowadays there are many business models which is based on the technical innovation, such as SNS and micro-blog bases on Web2.0. Means of transaction:whether the means of transaction and the way of payment is convenient and safe.The means of transaction directly determines whether the user experience and enterprise values can be smoothly realized.Quick logistic and distribution system and safe on-line transition system can be a goals of internet firms.Cost control:whether the biggest value is created at the lowest costs.Internet is a money-consuming industry?whether a company can cut the cost down and shorten the cycle from loss to profits which is an important aspect to test the creativity of the business.2.Six models of E-commerce business innovationAccording to the extent of innovation,there are two types of the innovation:first is Macro-innovation,the second is Micro-innovation.The former one is revolutionary to the original business model which includes”a sheer fabrication out of nothing” and model extension,etc.The later one is a local revised version based on existing business model, improving the efficiency of business operation including accurate user positioning,innovative user experience,perfect logistics system and changing transaction system,etc.We call these methods “Six models of E-commerce business innovation”.And two methods will be mainly discussed.The first is perfect logistics system.The second is changing transaction system.Perfect logistics system-360 BuyLogistics and distribution is a vital important part of E-commerce business, but also a bottleneck to restrict the development of E-commerce business especially the development of B2C companies.Under the E-commerce circumstance, the customers will sets a much higher demands such as the distribution speed be faster,the quality is higher,the range of distribution be broader.Therefore,establishing a perfect and efficient logistics and distribution system will be a key factor for B2C E-commerce company to gain competitive advantages and also an important entry point.There are three models of E-commerce logistics and distribution:self-building logistics and distribution system, the third-party logistics and distribution system,and self-building combined with outsourcing logistics and distribution system.The first model is commonly be applied in some comprehensive on-line malls or large vertical on-line shopping enterprises with large varieties are and quantities.The second model is suitable for small and midsize companies with comparatively smaller varieties and quantities of goods. They need not to build their own logistic systems or outsource their logistics to the third party out of some professional consideration.The third one is applied to some companies with some logistic resources,but the existing logistic resources can not meet the demand of business expansion.These three models all have its own advantages and disadvantages,but with the business volume increasing,self-building logistic system is more crucial for E-commerce business. Take 360 Buy for examples.It is the largest 3C on-line shopping platform in Chinese B2C market which keeps increasing by a speed of 300% per year, and the sales reached 10.2 billion yuan. 360 Buys rapid expansion benefited from its valuing the logistic system highly and generous investment in it establishing a “Flexibility of supply chain”.Now 360 Buy has completed the layout of the first-level fulfillment center in five cities in Beijing,Shanghai, Gongzhou, Chengdu, Wuhan and established the logistic systems in sixty cities nationwide;Meanwhile 360 Buy also invest 20 million yuan for establishing its own express deliver company.Recently,360 Buy also purchase 260 acre of land for establishing the biggest modern B2C logistic center in Asia which includes 150 thousand to 200 thousand square meters of warehouses. In the support of strong logistic system ,360 Buy launching a service called “ 211 arriving in limit time” delivering service,that is to say, placing orders before 11 oclock every day,and goods arrives in the afternoon; placing orders at 23 oclock, and goods arrives the next day,which posted the record of the fastest speed in the field of E-commerce business. At the same time, the inventory turnover has be shortened to about 12 days,slightly higher than Amazons level of 7 to 10 days. Changing transaction ways- groupon Transaction ways is the most important link which can reflect the values of E-commerce business and also a important path to attract the attention of users and increase the popularity.Traditional E-commerce website transaction is mainly about parity deals of one to one or one to many. In recent years,some creative dealing ways are born such as auction,SecKill and group-buying. Especially the emerge of Groupon ,to large extent, changed the layout of the competition of the E-commerce, attracting lots of companies to “test the water” of Groupon business. Strictly speaking,Groupon is actually not a new type of business model but a personalized development of B2C model.It is a buying pattern which unites the new customers and the frequent customers in order to get the priority in price. In a short word, it is a way to gather a certain number of customers to get the most cost-effective deal. Groupon originated from American Groupon, which is a website established in November 2008. Just within one year, the user traffic increased more than10 times, and reached about 0.4 billion, becoming “the fastest growing company” (ranked by Forbes).Because of the low barrier in the technology and the high-growth, many companies in home all followed suit. An estimates indicates that 1800 Group-buying websites arose just in 2010.The uniqueness of the Groupon lies in:the first one is putting the quality before quantity and only recommending the most suitable products to customers,and just one product at a time.The second is regional operation,suiting ones measure to the local condition,providing different kinds of products and services.The third is the steep discount. The discount of each kind of products range from 40% to 90% to make users getting the greatest benefits;The fourth is that the production and services are provided by the sellers not involving the logistics and storage so that the cost can be cut down largely, which the reason why the Groupon has such magics. Innovation,never endsE-commerce innovation has gone through the wilderness at the early stage, survived in the bitter cold winter, and after experiencing a rapid growth, the spring finally co
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