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Friday, November 10, 2006

Distributors Capitalizing on Web Businesses have to Tech Up to Keep Up in many ways has turned the distribution business in the US upside down possibly as much if nor more than Wal-Mart's amazing purchasing power.  The difference is that the impact of Amazon is still spreading out and Wal-Mart's impact is already built into the system.

I say this as I look at a new generation of online E-Commerce.  Business model 1.0 for E-Commerce held that a person would setup a store, go purchase products and start selling them.

Business model 1.5 provided that the business would prefer it if the distributor saved everyone some time trouble and money and shipped the product on behalf of the store owner directly to the end consumer whenever an order came into the system.  This was Amazon's contribution.  In the early days Amazon worked very hard to prove their legitimacy by establishing large warehouses and moving lots of books.  Can you remember those news stories about Amazon shipping some of the earliest Harry Potter books?

Well in between that time and now something happened on the internet.  It suddenly became much easier for anyone to setup a website, and millions of people did just that especially websites crafted as personal journals called a Web Log or Blog for short. 

With a weblog a person doesn't initially need to know much about web design.  They just write something, hit submit button kind of like sending an email, and their message is published to the internet.  If you are curious what a blog looks like, well you are reading one right now!

What does a blog have to do with Distribution?

Google and many companies made a fortune realizing that the masses could generate content for them day in and day out year long and advertising could be thrown in there and you have a virtually renewable source of content, advertising, advertising dollars and readers of the content.

So what happens if you mix the Blogging Model with the Amazon 1.5 business model?

Online E-Commerce 2.0

In online E-Commerce 2.0 one single company does not sell everything to everybody.  Instead a company establishes a website with a e-commerce store front generating tool.  They set up partnership with major product suppliers and distributors receiving data feeds for products and prices.  They set up fulfillment relationships as well to have the distributors and suppliers drop ship the product direct to consumers providing tracking information detail as well.  They outsource customer support functions to best in class providers and then they open the door to the masses.   |  Wait they don't open the door to the consumer masses.  No they open the door to the masses of people that want to open their own store and sell a niche of products to consumers. 

Setting up a store through this process can be done in less than 30 minutes and within an hour a person can have products online and for sale at prices that are competitive with a major retailer.

Here's a situational example:

Jeanne Noll setup a online store.  She's not a lost member of the Sam Walton family.  She is a standup comic, Stand up Comedian and mother and is a budding young entrepreneur.

She set up a store called Rosie's Place

Check out Rose's Place!

The store is outfitted with a number of products that Jeanne knows and understands and will attract shoppers like herself.

Her prices are good.  The store design is excellent.  Its secure and she has world class service and support backing her up along the way. It's a great example of how to setup an organize an Online Store.

Distributors that are going to survive the rollout of Online E-Commerce 2.0 around the world are going to have to build out a very intelligent and automated business.  These tools and services are available in North America now.  They are rapidly spreading all around the world.

What will you do to prepare for this business development?


Its a  great little store that offers a great selection of Books for children, Baby items, some great gift ideas for the holidays and more.

Jeanne is well on her way to building a great business

Don't miss her performances either if you are in the New Jersey or NYC.  Buy something from her store now, and keep the receipt it will probably be worth a fortune after she makes it big in comedy.  In the meantime there's no better way to show her a little support than by visiting her store.