Background
Lesen.ch currently employs a staff of four who are principally engaged in duties connected with the book trade. Maintenance of the IT infrastructure, warehousing and transport are outsourced.

As a former executive at a leading Swiss bookseller, Christoph Bürgin decided not only to go independent but to become a virtual bookseller at the same time – principally because he considered that the adjustment to the possibilities of internet trading among traditional suppliers was taking far too long.

He risked this step, despite the fact that virtual bookshops had already been set up by companies with a great deal more financial clout. He is convinced that niche strategies are possible in the internet, too. In 2001, Lesen.ch was awarded the FDP’s top prize for SMEs in recognition of its commitment and success.


Industry, products, target groups
Lesen.ch sells books, videos, DVDs and software to end customers. This puts the company on a par with the majority of retailers in the book trade. Its lack of a physical presence means that impulse buyers, i.e. people who buy a book for reading entertainment before going on holiday, are not reached. Its strong virtual presence, by contrast, opens up various customer groups that remain inaccessible to the competition.

Like other virtual traders, Lesen.ch plays a dual role. It has rivals in both the book market and in the market for software solutions for operating sales portals.

The Swiss book market is still characterised by de-facto vertical price fixing. Thus, the end retail prices are identical at all bookshops. For years, the market has stagnated at approx. CHF 800 million. The overseas virtual book trade generates around 2.5% of this volume. Altogether, the share of virtual trading is thought to be some 15%. The market is also strongly dominated by trading at fixed locations. There, overcapacities are apparent that are leading to a process of concentration. The traditional mail-order business still represents serious competition; Lesen.ch sets itself apart from it through differentiating measures.

The market for software solutions for operating sales portals, however, is still in its pioneering phase. Above all the lack of standards in uniform design of internet business processes, coupled with the considerable need for reorganisation, mean that companies with functioning solutions are positioned to take ever-increasing advantage of business opportunities.

At night and at weekends, Lesen.ch sells mainly to private customers (B2C); during the day, its custom comes mainly from companies, institutions and administrations (B2B). Lesen.ch’s customers are definitely not bargain hunters. They are people who count on assured fulfillment at fair prices with good guidance. Despite this, Lesen.ch regularly offers special deals (e.g. five books from various Swiss authors at an attractive price). It was decided not to set up a bonus programme specially for Lesen.ch. To ensure that customers are still rewarded for buying as often as possible at Lesen.ch, a partnership was created with the Qualiflyer Programme. Interestingly, this partnership has been extremely successful. The emotional aspects of the travel-bonus programme are remarkable according to Armin Luginbühl.

Around 60% of orders originate from customers who have already bought from Lesen.ch in the past. Most orders come from Switzerland.


2. E-business vision and e-business strategy
Christoph Bürgin und Armin Luginbühl have a clear vision for Lesen.ch:

“We want to be booksellers in the ’net, not a general warehouse.”
Both believe that their concentration on the book trade will pay off, even if many other virtual traders pursue another strategy.


Strategy
An important aspect of fulfillment is that customers receive competent advice automatically and personally. Any title requested is usually available through Lesen.ch because its experts use various tools to predict demand and to instantaneously order copies from the wholesaler promising the fastest delivery.

What is important, however, is that the product book is not merely considered in its printed form. Increasingly, a book may also be a file or a CD-ROM. Lesen.ch specialises in selling content. Which format it is traded in makes no difference. New technologies are adapted as quickly as they are considered useful by customers. Thus, the Lesen.ch range changes at the same pace as the media carriers for what we today term books.

The cornerstone of marketing strategy is customer benefit. “We have never discussed whether we should include a function in the website that has been requested by our customers. We have always programmed it immediately and resolutely.” The same is true of their readiness to deliver. Despite this, people stopped believing long ago that demand can be influenced through an informed selection of particularly readable books.


The provider’s e-business concept
The web strategy in force at Lesen.ch is highly important because the web is firstly a resource and secondly, the sole sales platform. This area of strategy is also oriented to customers. The aim is to maintain the quickest and easiest to use website that is perforce “bookish” at the same time. “Bookish” means that the customer is presented with up-to-date quality content that far exceeds the product descriptions. One measure by Lesen.ch to put this strategy into practice is the publication of Switzerland’s first integrated catalogue. It enables faster database queries than offered by the competition, who access the wholesalers’ data for every query. A customised software solution running in the background ensures a high degree of integration is achieved. The data from third-party catalogues is synchronised once a day. Some data, e.g. privately published books, is added by Lesen.ch as required.


Scope of services
Lesen.ch provides a typical e-commerce solution. Customers either access www.lesen.ch directly or are taken to the search and order processes via external websites.

The e-commerce solution comprises a product catalogue, common functions for registering, ordering and order tracing. In addition Lesen.ch boasts many functions that are conducive to communication between and with customers. These include news lists, bestseller lists, electronic postcards and much more. The optimisation of processes on the website and in the database for locating books are worth a special mention as are the many methods of ordering. A returning user is able to place a book order within 20 seconds. First-time customers or buyers who would prefer not to register also have the option of entering separate order details.


Partners
Initially, Lesen.ch focused on creating the website. It outsourced many tasks that were not directly connected to the internet. Today the company is more strongly vertically integrated. For example, all ordered books are first directed to Lesen.ch from where they are redirected to customers. Until a few months ago, delivery was in part undertaken directly by the suppliers (wholesalers). Christoph Bürgin is now convinced that if it is to be successful, all aspects of customer care – in other words, after-sales service, too – must be among Lesen.ch’s core competencies. The outsourcing of physical delivery led to a variety of problems. For instance, erroneous deliveries and defective goods could not be intercepted and customised packaging and sorting was not always possible.

Fulfillment partners
The founders of Lesen.ch understand fulfillment to include all tasks that ensure customers are perfectly satisfied – receiving exactly what they ordered. It covers the following:

• Implausible orders are discussed with the customer.
• Goods arrive at the customer’s on the date promised in faultless condition.
• Billing or credit-card transactions are only completed once the goods have been received in full.
• Customers are informed of delivery delays, immediately and with all details.
• Customer e-mail queries are answered within a few minutes.
• Notes on the order form are also taken into account.
• An increasing number of wholesalers are sent queries to target the shortest delivery times for customers.

Fig. 4.1: The fulfillment sub-process before and after the redesign [Business processes]

• Availability queries and orders are sent to ComelivresNet with Eurobook’s help.
• Invoices and delivery notes can be generated and printed directly.
• Eurobook keeps all customer and supplier information at the ready for viewing from any workstation.

Fig. 4.2: Software solution [System architecture]

• Article database for display on the website and synchronisation with the suppliers’ article databases using proprietary data formats and updated daily (automated, batch job).
• Shopping solution for the website and export of shopping baskets in Eurobook by e-mail with XML body (automated, real-time).
• Admin. tool to manage orders, automated customer information showing delivery times and manual input of special articles.
• A function enabling customers to track their orders.

Fig. 4.3: Technical platform

• Slow/organic growth and a sound company policy
• Competence in the book trade combined with competence in web design
• Competence in guerrilla marketing and quick adjustment to demand