C2. Old Metamora
Betty Shriver is the owner of Betty’s Crystal, a small shop that sells collectible glass figurines. Betty’s shop carries many items that she purchased from estate sales and regional auctions, but the shop also sells new crystal figurines from manufacturers such as Baccarat, Lalique, Orrefors, and Swarovski. The shop is located in Metamora, Indiana, which is a popular tourist destination for weekend travelers in the Midwest. The town of Old Metamora is a small historic area in a rural setting that is less than a day’s drive from seven major metropolitan areas: Chicago, Cincinnati, Columbus, Detroit, Indianapolis, Louisville, and St. Louis.
The shop is very busy on weekends and during the spring and summer months when tourists flock to Old Metamora. In the early fall, the tourist traffic slows considerably, and in the winter months, the town becomes almost deserted. Two years ago, Betty began to pick up extra business during the off season by auctioning items on eBay. Not only did the auctions help keep inventory moving during the slow months, but Betty found that she was able to carry a wider selection of items in the store. In the past, she would see unusual items at estate sales and auctions that she feared would not sell quickly in the shop. Now Betty knows that any item that does not sell in the shop can be auctioned online quite easily. Another unexpected benefit of participating in online auctions is that Betty developed relationships with regular buyers of crystal figurines and with people who run collectibles stores in other parts of the country. Every auction involves at least two e-mails (one to confirm the final bid and another to confirm the payment). Many successful bidders also send e-mail messages to Betty when they receive the item with questions about the item, or just to thank Betty for sending the item so quickly. Some of these e-mail exchanges continue with discussions related to crystal figurines and other collectible items.
Betty’s online auction experiences prompted her to consider expanding the online portion of her business. She has heard (from other shop owners) that eBay allows people to create online stores within the eBay site and that Amazon.com offers a similar service that lists seller’s items on Amazon.com’s regular product pages. She is also interested in creating a Web site that contains photos and descriptions of popular crystal figurines with additional information about how they are made. Betty also wants to include a list of figurines that are no longer manufactured (which makes them more valuable) and a guide to buying collectible crystal figurines that could help her customers and bidders on her auctions make more informed decisions as they add to their collections. She believes that such a site could attract a large number of people interested in crystal figurines. She wants to find ways to direct these site visitors to her auctions and her proposed Web store. Betty has hired you as a consultant to build on her ideas and to help her develop an expansion strategy for her online business activities.
1. Search for information about Amazon Marketplace and eBay Stores on the Web and in your library that will help you make a recommendation to Betty regarding which alternative would provide the best avenue for her online business expansion. Support your recommendation with relevant facts, including specific costs of operating each type of store and specific benefits that Betty could gain by using one or the other. Summarize your recommendation and supporting facts in a report to Betty of 400 words.
C2. Ellasaurus Products Enterprises
Ellen Carson is the author and illustrator of a successful series of children’s books that chronicle the adventures of Ellasaurus, a 4-year-old orange dinosaur. Ellen has done well with the books, but her business advisors have told her that she could earn considerably more money by creating a...