The dissemination of the internet has had a large impact on business and has created new opportunities for companies. It has opened new distribution channels for both business-to-business (B2B) and business-to-consumer (B2C) products and services. Around the year 2000 a lot of new ventures were founded but also soon disappeared when the "dot-com bubble" burst. The remaining companies in the market however had time to expand their business at a steady pace. B2C online retailing is growing with the dissemination of broadband access (Schneider, 2011).
Table of Contents
1. Electronic Commerce as a New Sales Channel
1.1 Business-to-Consumer Retailing
1.2 Market Participants in Electronic Business
1.3 Online Retailing in Germany
2. The Consumer Electronics Market in Germany
3. Consumer Electronics' Competitive Analysis
3.1 Entry barriers
3.2 Power of Suppliers
3.3 Power of Buyers
3.4 Threat of Substitutes
3.5 Rivalry
4. Opportunities for Traditional Outlets
5. Threats to Traditional Outlets
6. Case Study: Media-Saturn Holding
7. Internal Analysis of Media Markt
7.1 Strengths
7.1.1 Brand Reputation
7.1.2 Localisation
7.1.3 Touch-and-Feel-Effect
7.2 Weakness
7.2.1 Advertising Strategy
8. Position of Competitors
9. Integrating an Online Shop
Objectives and Core Themes
This work examines the strategic transition of traditional consumer electronics retailers toward electronic commerce, using Media-Saturn Holding as a central case study to explore the challenges of balancing physical retail dominance with digital market demands.
- Evolution of B2C online retailing in Germany
- Market competitive dynamics within the consumer electronics sector
- Internal SWOT analysis of the Media Markt brand
- Strategic implications of integrating online and traditional sales channels
- Impact of the acquisition of redcoon on the Media-Saturn group
Excerpt from the Book
INTERNAL ANALYSIS OF MEDIA MARKT
Koo et al. (2006, p. 289) explain which strengths traditional businesses can use to put them ahead of their pure online competitors, i.e. a "strong reputation on quality, reliability and convenience and customer base to offer unique products and services, proprietary contents, distinctive physical activities, sophisticated product information and personalized customer services." Media Markt's unique resource, i.e. its strong brand reputation could well be used to establish an online shop. Trust is an important issue for customers when shopping online (Kim, 2010) and the established brand would provide an advantage for Media-Saturn.
Localisation and proximity are additional strengths of Media-Saturn. As was stated above, managers of the outlets can act very independently and especially design prices to suit their local area. However, the store managers profit from the holding structure which enables them to purchase large quantities and thus offer low prices to consumers. Convenience is another important feature of Media-Saturn. Outlets have a good connection to shopping infrastructure and offer e.g. free parking space for customers. Customers are thus expected to collect their purchases at the store; delivery is offered at additional cost. In return customers expect the items to be on stock. Media Markt's localisation is therefore an advantage compared to online retailers, who cannot deliver instantly to the customer.
Summary of Chapters
Electronic Commerce as a New Sales Channel: Provides an overview of B2C retail developments and classifies market participants based on their degree of integration with the internet.
The Consumer Electronics Market in Germany: Analyzes the market structure and the dominant role of traditional retail chains in the German consumer electronics sector.
Consumer Electronics' Competitive Analysis: Applies Porter’s Five Forces to assess industry challenges, including entry barriers, buyer power, and competitive rivalry.
Opportunities for Traditional Outlets: Highlights potential growth areas such as specialized home installation services for complex integrated home networks.
Threats to Traditional Outlets: Discusses the risks posed by the ongoing growth of online sales and the potential for traditional outlets to lose market share.
Case Study: Media-Saturn Holding: Profiles the Media-Saturn group and its historical approach to online retail experimentation versus its recent acquisition strategy.
Internal Analysis of Media Markt: Evaluates the internal strengths (brand, localization) and weaknesses (advertising strategy) of the Media Markt brand.
Position of Competitors: Examines the broader retail landscape, noting the common struggle of traditional electronics retailers to establish successful online presence.
Integrating an Online Shop: Discusses the strategic challenges of harmonizing traditional and online sales channels and evaluates the integration of redcoon.
Keywords
Electronic Commerce, B2C, Media-Saturn, Media Markt, Online Retailing, Consumer Electronics, Competitive Analysis, Porter's Five Forces, Brand Reputation, Localisation, Digital Strategy, Channel Cannibalism, redcoon, Retail Management, Business Strategy
Frequently Asked Questions
What is the primary focus of this paper?
The paper examines how traditional retailers, specifically Media-Saturn, navigate the shift toward electronic commerce in the consumer electronics industry.
What are the central themes discussed?
Key themes include the competitive landscape of German consumer electronics, the challenges of hybrid (click-and-mortar) retail strategies, and the strategic importance of brand reputation and local proximity.
What is the main research question?
The work seeks to understand why large traditional electronics retailers like Media-Saturn initially avoided full-scale online shops and how they are currently attempting to integrate digital channels into their existing business model.
Which scientific methods are employed?
The paper utilizes industry market data, corporate case study analysis, and Porter’s Five Forces framework to evaluate competitive dynamics.
What is covered in the main body of the text?
The main body covers a market analysis of the German electronics sector, an internal SWOT analysis of Media Markt, and a discussion regarding the acquisition of the online retailer redcoon.
Which keywords characterize this work?
Core keywords include E-Commerce, Consumer Electronics, Media-Saturn, Market Analysis, and Strategic Integration.
Why is the "touch-and-feel-effect" considered a decreasing strength?
While historically a foundation of Media Markt's success, the report notes it is becoming less unique as competitors adopt similar store concepts and as consumers increasingly rely on online research.
What role does the acquisition of redcoon play for Media-Saturn?
Redcoon serves as a portfolio investment that allows Media-Saturn to gain expertise in the online market without immediately cannibalizing the business of its traditional brick-and-mortar outlets.
- Arbeit zitieren
- Kristina Sturm (Autor:in), 2011, Online shops for consumer electronics: A case of Media-Saturn, München, GRIN Verlag, https://www.hausarbeiten.de/document/189552
