dot com or dot History . . .
Since Mid 2000 ...
! Dot.com failures (#) by hundreds
! Capital raised by internet IPOs " 88%
! Average first day gain of internet IPOs " 55%
! Marketing expenditures vs " 33%
revenue ratio
! Nasdaq " 54%
Source: Gartner Group, Deutsche Bank, Accenture analysis
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What’s Really Happening . . . .
Since Mid 2000 ...
! Global online population # 38%
! e-Mail messages sent daily # 64%
! USA DSL/cable connections # 88%
! No. of web pages # 80%
! USA B2B e-commerce # 119%
! Projected B2B trade - US$ 6 trillion by 2005
(1) e-Commerce Business magazine, December 2000
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Dow e-business Vision
he
To be t chemical i ndustry
leader by using technology
to improve delivery of
products and serv ices and
t
create new solu ions for our
custo m ers
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New e-businesses are difficult!….the
Un-problem
! Un-predictable Customer buying behavior
! Un-proven and un-invented Business
models
! Un-used Technological advances
"
$´Martini`-ware
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First mover advantage -defending against the
MirrorMove
%You define the business model, others follow
%Whilst they are following, you are evolving
%You have 100% industry share of the e-space (for a time)
%You are building community (loyalty)
%You get the best portal partners/alliances & set the terms
%You get the best people
%You get free editorial in the press
%Money follows the leader (IPO)
%1st mover = clear competitive advantage
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Jack Welch - GE
The whole economy is on fire,
in every way you can imagine.
But it´s not a big bonfire, it´s lots of tiny
bic lighters everywhere
5
New e-business ventures ?
! Extension of your business strategy
! Opportunity to develop
new business models
! Lowering of your transaction costs
6
Which business models will be successful?
1999 - .com start-ups, matchmakers
2000 - B2B marketplaces, ´hubs´
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The Hub Approach
Elemica.com
Omnexus.com
Envera.com
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OMNEXUS and ELEMICA were led by
traditional industry players!
- Thermo Plastics
BASF AG Bayer AG Mitsubishi
Dow Chemical DuPont LG Chem.
Ticona/Celanese Borealis AtoFina
Solvay DSM PolyOne
Resinex Ellis & Everard Biesterfeld
Clariant
- Basic, Fine, and Specialty Chemicals
AtoFina BASF AG Mitsubishi
Bayer AG BP Amoco Mitsui
Dow Chemical DuPont Sumitomo
Rohm & Haas Shell Royal Vopak
Celanese Ciba Specialty ChemCentral
PPG Rhodia Brentag
Degussa Huls Millennium Air Products
DSM
* Founding Companies
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Customers still buy most direct,
but more spot using various internet channels
Your customers
distribution .com Dow Direct portals
e-mkt.
. com
places
You and your competitors
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Ultimately….
Your customer will choose
how to buy
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Value Proposition
www.e-epoxy.com
One stop shop to easily buy epoxy and
related products at cost competitive
prices on an electronic self-service
basis
What are the differences ?
www.e-epoxy.com Dow & distributors
! 8 products ! Product palette
! longer lead-time (variable) ! rush orders
! Penalties for changes ! consignment stock
! penalties for late payment ! flexible payment terms, even late
! fixed payment terms (world) ! cheque collection
! 20mt or 10mt (bulk, bags) ! language
! no TS, samples ! entertainment
! no phone, only e-mail ! local storage
! 24/7 availability ! tech service
! Newsletter by e-mail ! EPIcenter/personal help
! no paper ! trainings
! no contracts, rebates, admin ! samples
! promo codes ! price protection: 1 - 6 months - upward!
! spot price, no stability ! Price changes in writing
! contracts/rebates/admin.
! Travel to customer´s premises
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Which business models will be successful?
1999 - .com start-ups, matchmakers
2000 - B2B marketplaces, ´hubs´
2001 - ´port-iches´ - buy-side & sell-side
´port-
2001/2 - merger mania, logistics
alliances & standardisation
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Portal Products & Suppliers - phase 2
We are looking for suppliers to sell ….
! Hardeners
! TiO2
! Carbon black
! Fillers
! Solvents
! Polyester (saturated for powder)
! Reactive Diluents
! Specialty Epoxy
! Bis-F
! Phenolic resins
! Additives, pigments
! Novolacs (Cresol)
! others?
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New e-business ventures ?
! Extension of your business strategy
! Opportunity to develop
new business models
! Lowering of your transaction costs
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Questions to ask yourself….
! How will you and your customers buy
and sell in the future?
! What business models will exist and
how will you use them?
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Site stats - surfaid (IBM)
Total number of visits per week
20,000
15,000
# of visits 10,000
5,000
0
1 2 3 4 5 6 7 8 9
Jan28 weeks
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Internet - down but not out….
! Internet ventures that are based on sound business
strategy will survive.
! Companies with the ´bricks, clicks and tricks´ will
be successful
! As long as you ´start smart´, you have a better
chance of success
! there is a lot to learn about customers, technology,
business models and your own business dynamics.
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Challenges facing the industry
! Diverse corporate objectives
! Connectivity via e-standard (CiDX)
! Role of traditional sales channels
! Buyer driven hubs vs seller driven hubs
! Fast changing enabling technologies
! Regulatory agencies reaction to industry led
platforms
! People - vision and entrepreneur
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What comes before ´e´ ?
! DEDICATED manpower & vision
! DIFFERENTIATED offering
! DISCIPLINE to keep this
differentiation
3 D before ´e´
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Want slides ….?
itelford@e-
itelford@e-epoxy.com
CONTACT US on www.e-epoxy.com
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