Amazon.com versus Barnesandnoble.com
In Electronic Commerce, Schneider explains the different types of revenue models for electronic commerce (eCommerce) that work for both business-to-business (B2B) and business-to-consumer (B2C) eCommerce. These models include Web catalog, advertising-supported, advertising-subscription mixed, and fee-based models (Schneider, 2002). As Schneider (2002) defines it, a revenue model is ôa general term for the combination of strategies and techniques that a company uses to generate cash flow into the business from customersö (84). Titans of pure eCommerce such as Amazon.com rely on such strategies and techniques to earn revenue, while titans of brick and mortar operations like Barnes & Noble are increasingly relying upon a mixture of traditional and eCommerce revenues models as they try to compete for market share via the Internet. Such an enterprise like Barnes & Noble is referred to as a ôbrick and clickö model of commerce as opposed to Amazon.comÆs pure ôclickö model. This analysis will compare and contrast these two leading booksellers, including successes and failures, strategies and techniques, major challenges, and operations. A conclusion will offer recommendations for each company based on the analysis in this comparison and contrast.
The story of Amazon.com versus Barnes & Noble reads more like the story of two prizefighters rather than the two leading booksellers. Both companies have different business revenue models but compete head-to-head in the bookselling industry. While Amazon.comÆs model offers the virtual storefront, Barnes & Noble combines a ôbrick-and-clickö approach. A brief profile of each company that compares their size, revenues, and business model is below:
Revenues (2nd Quarter û 2000) = $578 million
Revenues (2nd Quarter û 2000) = $67.4 million
Physical Storefronts only until 1997 û Becoming major Internet presence.
The obvious differe...