Popular in Course
verified elite notetaker
Popular in Department
This 0 page Study Guide was uploaded by kimwood Notetaker on Friday November 6, 2015. The Study Guide belongs to a course at a university taught by a professor in Fall. Since its upload, it has received 22 views.
Reviews for BUS508_assignment 2
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 11/06/15
Absract Change is one of the one few definate facts of life with out change many things would become obsolite Peter F Drucker describes innovation as the specific instrumrnt of entrepreneurship he calls it the act that endows resources with new capacity to create wealth Inovation is key to our everyday lives webseters defines it as change that creates a new dimension of performance According to Business week today innovation is about much more than new products It is about reinventing business processes and building entirely new markets that meet untapped customer needs Most important as the Internet and globalization widen the pool of new ideas it39s about selecting and executing the right ideas and bringing them to market in record time In the 1990s innovation was about technology and control of quality and cost In todays world it39s about taking corporate organizations built for efficiency and rewiring them for creativity and growth quotThere are a lot of different things that fall under the rubric of innovationquot says Vij ay Govindarajan a professor at Dartmouth College39s Tuck School of Business and author of Ten Rules for Strategic Innovators From Idea to Execution quotInnovation does not have to have anything to do with technologyquot Leonard Riggio Acquires Barnes amp Noble Leonard Riggio the company39s chairman began his bookselling career while attending New York University in the early 1960s Working as a clerk in the university bookstore he became convinced that he could do a better job serving students and he opened a competing store of his own With a small investment Mr Riggio established the Student Book Exchange SBX in Manhattan39s Greenwich Village in 1965 The store quickly became one of New York s finest bookstores known for its knowledgeable staff wide selection and great service By the 1970s Mr Riggio s thriving business which included six other college bookstores acquired the agship Barnes amp Noble trade name and agship bookstore in Manhattan which had fallen into decline Within a few years Mr Riggio transformed the Fifth Avenue store into quotThe World s Largest Bookstorequot with 150000 textbook and trade titles Mr Riggio s commitment to students continues today through Barnes amp Noble College Booksellers a wholly owned subsidiary of Barnes amp Noble that operates more than 600 college bookstores on college and university campuses in 50 states serving nearly 4 million students and more than 250000 faculty Innovations Throughout the 1970s and 1980s the company made a number of groundbreaking moves In 1974 Barnes amp Noble was the first bookseller in America to advertise on television Aired in the New York market the Barnes amp Noble Of Course Of Course commercials won awards and were so memorable that customers still recall them In 1975 the company took a bold and audacious step by becoming the first bookseller in America to discount books by offering New York Times bestsellers at 40 off publishers list prices Barnes amp Noble expanded on that idea by opening a 40000squarefoot Sale Annex directly across from its agship store The company began to expand in the New YorkBoston markets by opening smaller discount bookstores In addition it acquired two local chains BookMasters and Marboro Books which were converted to Barnes amp Noble discount stores Initially these stores were very successful and expanded to 50 locations They were eventually phased out in favor of the company s largerformat book superstores The acquisition of Marboro Books gave Barnes amp Noble a foothold in the growing mailorder business which served as a platform to reach customers nationwide This business served as a laboratory that revealed undercurrents of demand prompting Barnes amp Noble to begin publishing its own books for sale to its growing mailorder customer base These titles were primarily outofprint books that were reissued in high quality affordable editions our history The history of Borders Group is a tale of two brands Borders and Waldenbooks and its enterprising founders who instilled passion and innovation into the bookselling business Today the company remains rooted in a key component of its past now shaping its future its people Through its more than 19000 employees the company continues to provide customers with the books music movies and other entertainment products they love in a relaxing enjoyable atmosphere while constantly redefining the consumer experience through new products and services 1933 1962 1971 1984 1992 1995 1996 2001 Lawrence Hoyt opens a rental library in Bridgeport CT Hoyt opens his first independently owned bookstore in Pittsburgh PA and calls it The Walden Book Store in tribute to Henry David Thoreau39s literary classic Walden Tom and Louis Borders open an 800squarefoot used bookstore in the academic community of Ann Arbor MI and call it Borders Book Shop Over the coming years Tom and Louis expand their operation opening new stores in new markets Kmart Corporation purchases Waldenbooks and Waldenbooks purchases Brentano39s a chain of distinguished tailored book stores Kmart acquires Borders and forms the BordersWalden Group The BordersWalden Group is renamed Borders Group Inc and goes public through an initial public offering Waldenbooks39 headquarters moves from Stamford CT to Ann Arbor the home base of Borders Borders Group launches the Borders Group Foundation to support its employees and their families through needbased grants merit scholarships and key relationships with other caring organizations Through an alliance with Amazoncom Borders Group offers online shopping giving consumers access to a vast selection of books music and DVDs as well as content unique to the website Borders Group develops and launches the Value of Employment VOE strategy to focus the company on activities that matter most to its employees The strategy concentrates on four areas Benefits and Services Pay and Rewards Employee Development and Work Environment 2003 Borders Group and TMobile team to make TMobile WiFi HotSpot service available in Borders stores in the US 2004 Borders Group and Seattle39s Best Coffee LLC a whollyowned subsidiary of Starbucks Corporation sign a licensing agreement to open Seattle39s Best Coffee cafes in Borders stores in the US beginning in early 2005 Borders Group acquires Paperchase Products Limited a United Kingdom based company that offers a unique assortment of stationery gift packaging greeting cards art paper and materials seasonal items and other gifts Borders Group announces plans to open the firstever Borders store in Malaysia under a planned franchise agreement with Berj aya Group In specific markets Borders Group converts some Waldenbooks stores to Borders ExpressTM 2005 AARP recognizes Borders Group as a member of the AARP National Employer Team in an effort to connect mature workers 50 years and older with job opportunities Berj aya Corporation Berhad opens a 60000 square foot Borders franchise in Malaysia at Kuala Lumpur39s Berjaya Times Square shopping mall the largest Borders store in the world Later that year Berj aya Corporation opens a second Borders franchise at The Curve Mutiara Damansara shopping complex 2006 Agreement is announced with Al Maya Group to open franchise stores in United Arab Emirates 2007 The company unveiled its strategic plan to revitalize refocus and ultimately reinvent the company Borders Group announces the sale of its UK and Ireland subsidiaries 2008 Borders opened its first concept store nationwide in Ann Arbor Michigan in February 2008 Please visit the concept store media room to read all about and see photosvideo of this breakthrough shopping experience There you39ll find a list of all 14 concept stores the company has opened Borders launches its own ecommerce site Borderscom Borders Group announces the sale of its AustralianNew ZealandSingapore businesses 2009 Borders launches free Wifi in virtually all Borders stores nationwide Borders partners with Kobo a global eReading service to deliver eBooks 2010 Michael Edwards appointed Chief Executive Officer for Borders Borders announces the sale of its Paperchase stationery and gift division Borders launches its eBookstore on Borderscom Borders launches a paid Borders Rewards Plus loyalty program and enhances its existing free paid program The milestone of 40 million Rewards members is reached Company History Considered a pioneer in online retailing Amazoncom Inc expanded during the late 1990s to offer the quotEarth39s Biggest Selectionquot of books CDs videos DVDs electronics toys tools home furnishings and housewares apparel and kitchen gadgets Through thirdparty agreements Amazoncom also sells products from wellknown retailers including Toysruscom Inc Target Corporation Circuit City Stores Inc the Borders Group Waterstones Expedia Inc Hotwire National Leisure Group Inc and Virgin Wines Sometimes criticized for its focus on market share over profits Amazoncom put investor fears to rest when it secured its first net profit during the fourth quarter of 2001 The Early 1990s Beginnings Throughout the 1990s the popularity of the Internet and World Wide Web swept across the world and personal computers in most businesses and households got hooked up in some form or another to Internet providers and Web browser software As use of the Internet became more prevalent in society companies began looking to the Web as a new avenue for commerce Selling products over the Internet offered a variety of choices and opportunities One of the pioneers of ecommerce was Jeff Bezos founder of Amazoncom In 1994 Bezos left his job as vicepresident of the Wall Street firm DE Shaw moved to Seattle and began to work out a business plan for what would become Amazoncom After reading a report that projected annual Web growth at 2300 percent Bezos drew up a list of 20 products that could be sold on the Internet He narrowed the list to what he felt were the five most promising compact discs computer hardware computer software videos and books Bezos eventually decided that his venture would sell books over the Web due to the large worldwide market for literature the low price that could be offered for books and the tremendous selection of titles that were available in print He chose Seattle as the company headquarters due to its large hightech work force and its proximity to a large book distribution center in Oregon Bezos then worked to raise funds for the company while also working with software developers to build the company39s web site The web site debuted in July 1995 and quickly became the number one bookrelated site on the Web In just four months of operation Amazoncom became a very popular site on the Web making high marks on several Internet rankings It generated recognition as the sixth best site on Point Communications39 quottop tenquot list and was almost immediately placed on Yahoo39s quotwhat39s cool listquot and Netscape39s quotwhat39s new listquot The site opened with a searchable database of over one million titles Customers could enter search information prompting the system to sift through the company database and find the desired titles The program then displayed information about the selection on a customer39s computer screen and gave the customer the option to order the books with a credit card and have the books shipped in a just a few days Unlike its large competitors such as Barnes amp Noble and Borders Amazoncom carried only about 2000 titles in stock in its Seattle warehouse Most orders through Amazoncom were placed directly through wholesalers and publishers so no warehouse was needed Amazoncom would simply receive the books from the other sources then ship them to the customer At first the company operated out of Bezos39 garage until it was clear that it was going to be a success necessitating a move to a Seattle office which served as the customer support shipping and receiving area It was interesting that because of the Internet such a small venture could realize such a broad scope so quickly within a month of launching the web site Bezos and Amazoncom had filled orders from all 50 states and 45 other countries As a pioneer in the world of Internet commerce Amazoncom strived to set the standard for web businesses With that goal in mind Bezos went to work on making the web site as customer friendly as possible and relating the site to all types of customers For those people who knew what book they were looking for and just wanted quick performance and low cost Amazoncom offered powerful search capabilities of its expanded 15 milliontitle database The company also began offering 10 to 30 percent discounts on most titles making the prices extremely affordable For other customers who were just looking for something to read in a general area of interest Amazoncom offered topic areas to browse as well as lists of bestsellers award winners and titles that were recently featured in the media Finally for people who could not decide Amazoncom offered a recommendation center There a customer could find books based on his or her mood reading habits or preferences The recommendation center also offered titles based on records of books the customer had purchased in the past if they were return customers to the site Other hits with customers were the little touches such as optional gift wrapping of packages and the quoteyequot notification service which sent customers emails alerting them when a new book in their favorite subject or by their favorite author came into stock The site also offered the ability for customers not only to write their comments about different books and have them published on the site but to read other customers39 comments about books they were interested in buying Going Public in 1997 After less than two years of operation Amazoncom became a public company in May 1997 with an initial public offering IPO of three million shares of common stock With the proceeds from the IPO Bezos went to work on improving the already productive web site and on bettering the company39s distribution capabilities To help broaden the company39s distribution capabilities and to ease the strain on the existing distribution center that came from such a high volume of orders in September 1997 Bezos announced that Amazoncom would be opening an East Coast distribution center in New Castle Delaware There was also a 70 percent expansion of the company39s Seattle center The improvements increased the company39s stocking and shipping capabilities and reduced the time it took to fill customers39 orders The Delaware site not only got Amazoncom closer to East Coast customers but also to East Coast publishers which decreased Amazoncom39s receiving time With the new centers in place Bezos set a goal for the company of 95 percent sameday shipping of instock orders getting orders to the customers much faster than before Another growth area for Amazoncom was the success of its quotAssociate39 program Established in July 1996 the program allowed individuals with their own web sites to choose books of interest and place ads for them on their own sites allowing visitors to purchase those books The customer was linked to Amazoncom which took care of all the orders Associates were sent reports on their sales and made a 3 to 8 percent commission from books sold on their sites The Associates program really began to take off in mid1997 when Amazoncom formed partnerships with Yahoo Inc and America Online Inc Both companies agreed to give Amazoncom broad promotional capabilities on their sites two of the most visited sites on the Web As the success continued Amazon also struck deals with many other popular sites including Netscape GeoCities Excite and AltaVista As the company continued to grow in 1997 Bezos announced in October that Amazoncom would be the first Internet retailer to reach the milestone of one million customers With customers in all 50 states and now 160 countries worldwide what had started in a Seattle garage was now a company with 1478 million in yearly sales Further Expansion in 1998 As Amazoncom ventured into 1998 the company continued to grow By February the Associates program had reached 30000 members who now earned up to 15 percent for recommending and selling books from their web sites Four months later the number of Associates had doubled to 60000 The company39s customer database continued to grow as well with cumulative customer accounts reaching 226 million in March an increase of 50 percent in just three months and of 564 percent over the previous year In other words it took Amazoncom 27 months to serve its first million customers and only six months to serve the second million This feat made Amazoncom the third largest bookseller in the United States Financed by a 75 million credit facility secured in late 1997 Amazoncom continued to reshape its services in 1998 To its catalog of over 25 million titles the company added Amazoncom Advantage a program to help the sales of independent authors and publishers and Amazoncom Kids a service providing over 100000 titles for younger children and teenagers Amazoncom also expanded its business through a trio of acquisitions in early 1998 Two of the companies were acquired to further expand Amazoncom39s business into Europe Bookpages one of the largest online booksellers in the United Kingdom gave Amazoncom access to the UK market Telebook the largest online bookseller in Germany added its German titles to the mix Both companies not only gave Amazon com access to new customers in Europe but it also gave existing Amazoncom customers access to more books from around the world The Internet Movie Database IMD the third acquisition was used to support plans for its move into online video sales The tremendous resources and information of the IMD served as a valuable asset in the construction of a customerfriendly and informative web site for video sales Another big change in 1998 was the announcement of the company39s decision to enter into the online music business Bezos again wanted to make the site as useful as possible for his customers so he appealed to them for help Several months before officially opening its music site Amazoncom asked its bookstore customers and members of the music profession to help design the new web site The music store opened in June 1998 with over 125000 music titles available The new site which began operations at the same time that Amazoncom debuted a redesigned book site offered many of the same helpful services available at the company39s book site The database was searchable by artist song title or label and customers were able to listen to more than 225000 sound clips before making their selection Amazoncom ended the second quarter of 1998 as strong as ever Cumulative customer accounts broke the three million mark and as sales figures for Amazoncom continued to rise and more products and titles were added the future looked bright for this pioneer in the Internet commerce marketplace With music as a part of the company mix and video sales on the horizon Bezos seemed to have accomplished his goal of gathering a strong market share in the online sales arena As Bezos told Fortune magazine in December 1996 quotBy the year 2000 there could be two or three big online bookstores We need to be one of themquot Growth Continues 1999 and Beyond As such the company39s focus on growth continued In 1999 it launched an online auction service entitled Amazon Auctions It also began offering toys and electronics and then divided its product offerings into individual stores on its site to make it easier for customers to shop for certain items During the holiday season that year the firm ordered 181 acres of holiday wrapping paper and 2494 miles of red ribbon a sign that Bezos expected holiday shoppers to ock to his site as they had in the two past years Sure enough sales climbed to 16 billion proving that the founder39s efforts to create an online powerhouse had indeed paid off In 1999 Bezos reached the upper echelon of the corporate world when Time magazine honored him with its prestigious quotPerson of the Yearquot award While Amazoncom39s growth story was remarkable Bezos39 focus on market share over profits had made Wall Street uneasy and left analysts speculating whether the company would ever be able to turn a profit Sales continued to grow as the company added new products to its site including lawn and patio furniture and kitchen wares The company however continued to post net losses To top it off the quotdotcom boomquot of the late 1990s came to a crashing halt in the early years of the new millenium as many startups declared bankruptcy amid intense competition and weakening economies Bezos remained optimistic even as Amazoncom39s share price faltered During 2001 the company focused on cutting costs It laid off 1300 employees and closed a distribution facility The company also added price reduction to its business strategy which had traditionally been centered on vast selection and convenience Amazoncom inked lucrative thirdparty deals with such wellknown retailers as Target Corporation and America Online Inc By now products from Toysruscom Inc Circuit City Stores Inc the Borders Group and a host of other retailers were available on the Amazoncom site Amazoncom39s strategy worked In 2001 sales grew to 312 billion an increase of 13 percent over the previous year During the fourth quarter Amazoncom reached a milestone that many had regarded as unlikely it secured a net profit of 5 million In 2002 the company launched its apparel store which included clothing from retailers The Gap and Lands39 End Overall the company reported a net loss of 149 million for the year an improvement from the 567 million loss reported in 2001 In the fourth quarter of 2002 however the firm secured a quarterly net profit of 3 millionthe second net profit in its history While securing quarterly net profits was a major turning point for the young company a July 2002 Business Week article warned quotafter seven years and more than 1 billion in losses Amazon is still a work in processquot Indeed the company39s foray into providing the quotEarth39s Biggest Selectionquot had yet to prove it could provide profits on a longterm basis Nevertheless Bezos and his Amazon team remained confident that the firm was on the right track With 39 billion in annual sales Amazoncom had without a doubt come a long way from its start as an online book seller Principal Subsidiaries Amazon Global Resources Inc Amazoncomdedc LLC Fulfillcoksdc Inc Amazoncomkydc Inc Amazoncom Commerce Services Inc Amazoncom Holdings Inc Amazoncom International Sales Inc Amazoncom LLC Amazoncom Payments Inc NV Services Inc Amazon Fulfillment Services Inc AmazoncomTargetcom Inc Principal Competitors Barnes amp Noble Inc CDNow Inc eBay Inc Table 11 Functionality Design Content Originality Professionalism Effectiveness Amazoncom BamesampNoblecom Borderscom To compare and contrast the web sites of Amazoncom Barnes amp Nobel and Borders I evaluated overall performance on a scale of 1 t0 5 1 Poor 2 Fair 3 Good 4 Very Good 5 Excellent
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'