Module 0-Introduction-Conducting business in the 4th industr

1.3Types of digital business models

Basic: Small businesses. Small presence on a digital platform means you still need to use traditional marketing methods e.g. direct mail and print advertising.

Intermediate: Small business uses tools like websites with basic functions. There are no e- commerce functions. You can list on online directories and 3rd party market places.

Advanced: The business has a website with a mobile app version and e-commerce functions. They rely heavily on social media, apps, video conferencing. This is where you want to be. There is no store or shop and work is only done online and you engage with customers through the internet.

Advantages and disadvantages

Traditional

Digital

 More capital to start up  You need premises, furniture, transport, staff, and other utilities  Specific products or services are offered to customers, and this is set and rigid.  Customers get to feel, touch, try-on and browse stock.  Less marketing spend as marketing strategies are diversified to attract customers from local areas and online customers. However, their reach is restricted when compared to digital businesses.  There are restrictions when and where they function. Timings are rigid (e.g., shopping hours) and customer service is also not flexible. Very few traditional businesses operate 24.7.

 Less capital to start up, however, you do need to money for data, electricity, etc.  You need a computer and reliable and fast connectivity  Convenient for customers (24/7) and offers a variety of products and different costs for products.  The digital model is not yet perfect when it comes to real-time customer experience. For example, you cannot try a cellphone before you buy it. You rely on customer reviews and specifications on the website. This doesn’t happen in the traditional model.  Larger marketing spends and constant updating on social media sites is required.

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