Case 11.1. eBags: The 4Ps of a

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Case 11.1. eBags: The 4Ps of a
Successful Online Retailer

Anthony

Liisi

eBags


1998 Jon Nordmark left

Samsonite


eBags: online retailer

of bags


Profitable


Growing ~30% a year


Marketing program: 4P
-
s

Question 1


Describe eBags’ positioning strategy. Do you
think the strategy is effective? Why or why
not?

Question 1


4P


Product


Deep selection


More than 36 000 products


520 brands


Colors


Question 1


4P


Price


Lowest
-
price guarantees


Completely free return policy


Practices tested before implementation


Question 1


4P


Promotion


Word of mouth, public relations


Easy
-
to
-
navigate website


Searching engine


Special catalogue


Press releases


Customer reviews


Question 1


Question 1


4P


Place



Same as Dell


but better


Drop shipping


Products directly to customers


No inventory


Box with eBags logo and name


“Category killer”


Question 2


In a short paragraph, describe eBags’ brand.
Comment on the strenghts and/or weaknesses
of that brand.

Question 2

Strengths

Weaknesses


Wide range of standard
products (color, size)


Specialized in travelers’
needs (universal plug
adapter, packing cube,
scale grip)


Positioning as a middle
-
product (few competitors)



Brand’s recognition low


Brand weak against
copycats


Question 3


What steps has eBags taken to energize its
customers? How has eBags turned its
customers into advocates for eBags and the
products it sells?

Question 3

1.
Reviews

2.
Price guarantees

3.
Videos

4.
Search Engine

Reviews

1.

L
ove

the space
this lapto
p

bag

gives, the
pockets for organization are wonderful. Easy
to carry and transport.“

2.
"Nice
b
ack
bag

for basic organization and a
book or two. Laptop sleeve is a bit tight and
smaller than advertised.“

3.
"Very nice

purse
, but a bit small.“

4.
"Buy it. This
suitcase

is a little work horse and
drives beautifully. It's compact, small, and after
5 flights look brand new.



Question 4


What is the difference between eBags’ core
product and its actual product? Describe its
actual product and your assessment of
whether the actual product provides an
attractive or an unattractive mix of
characteristics?

Question 4


Product mix: all the product lines and items that a
particular seller offers for sale


Range of associated products that yields larger sales
revenue when marketed together than individually or in
isolation from others


Width: number of different product lines


Depth: number of different versions of each product (size,
flavor, color)


Consistency: how closely related product lines are to one
another

Question 4

Question 4

Question 4

Application Question 1


Draw a product attribute map for eBags.

Application Question 1

0
20
40
60
80
100
PRICE
QUALITY
SERVICE /
PAYMENT
SOLUTIONS
DECOR (WEBSITE)
USER-FRIENDLY
NR OF PRODUCTS
Application Question 2


Compare and contrast eBags and Zappos (the
subject of Case 9.2).

Zappos


Online shoe retailer


Sales:


1990 $0


2005 $370 million


2008 $1 billion



Excellent customer service


Human resource management policies




#1 Online bag retailer since 1999


2.5 million customer reviews


14.8 million bags shipped


2.5/14.8 = 16.8%

Zappos


Why do you think Zappos

doesn’t drop ship like eBags does?



Speed


Different product


Consumer service


What would eBags gain and
what would it lose if it adopted
Zappos’s approach to
warehousing and distributing
products?



Increasing Cost (warehouse, employees, inventory)



Increasing Profit margins



A real company culture