Review the given case: North Point Eyewear
Wei Shen is the owner of North Point Eyewear, a glasses and contacts store. Along with an optometrist, Dr. Tiffany Kim, Wei Shen has been selling designer (Gucci, Armani, etc.) frames and contact lenses for the past 15 years.
When he first opened up the store, Wei (who had a management information systems degree) focused on using the latest information technology to enhance the store. He first created a database that kept track of all transactions and information about the customers who made the order. He could use the database to search for trends on sales for a particular month, and customers buying habits. This database proved useful and he constantly added new information technologies to the store. For instance he started using a supply chain management system to automatically send emails to his lenses and frame suppliers about orders. This has not always worked for Wei since there are many scheduling and goal conflicts between the frames suppliers and North Point. Wei is trying to work them out. The last innovation was in 2008 when Wei launched an e-commerce website. On the site, people could order and pay for their glasses and contacts. Visitors could look at the catalogue of different frames and choose what was right for them. The e-commerce site worked so well that Wei decided to no longer adopt new technologies. When visitors came to the web site, the first thing they need to do is pick their frames and choose the colour. They will also need to determine the size of the frame. The customers can determine the size they need by looking at their old frames or by guessing how a certain frame size will fit their face. The customer then must pick options for their new lenses (assuming they need new lenses); this includes anti-reflective coating and ultraviolet protection. They also have to pick the thickness of the lens ranging from standard to high-index. The customers then must give pupillary distance and their prescription type (single vision, bifocal, trifocal, progressives, etc.). The customers put all of this data into a web form and it is sent to the North Point order database. Wei designed the site but the backend server was developed by his friend Ilyana. She left the country years ago but Wei was able to make changes to the site and add new items to the database. Luckily the server had not needed any upgrading in the past six years.
Since he was able to integrate the web form with his current database and supply chain management system, Wei found that he used it for offline orders as well as online orders. When an order was inputted by Wei or a customer the frames would be checked against North Point's current stock. If Wei did not have the size and colour in stock then an order would be inputted to the supply chain management website an email would be sent to the frames designer. At the same time, the system would send an email with the order to North Point's lens supplier, Kennedy Lenses. Kennedy would cut the lenses to the specifications in the order and send the lenses to North Point. One benefit of the supply chain management system is that Kennedy's supply department could see whether frames needed to be ordered as well, and could time their delivery so that the lenses and frames got to North Point at the same time. Once the frames and lenses arrived, Dr. Kim would put them in the frames and, for local orders, call the customer or, for online orders, send it to the customer by mail.
However, recently a new site called Pendrew Eyecare was launched; and a few months later, Wei lost a large share of his online business. The number of online orders outside of BC fell by 50%. When talking to customers, Wei found that the main reason was that Pendrew Eyecare had lower prices. Instead of having a storefront Pendrew Eyecare was just a warehouse in the middle of Saskatchewan and so had low rent and little overhead. Without a physical storefront location the company is able to offer lenses and frames at least 15% below the price of North Point.
With this loss of business Wei Shen hired some consultants to help him figure out what to do. "Well Mr. Shen," the consultants started. "After some research we found that you need to differentiate yourself from Pendrew Eyecare. "Thanks!" Wei said sarcastically. "And how should I do that?" They did not have an answer.
Disappointed with the $5000 that he wasted on useless advice, Wei decided to do some research on his own. He called up one of his most loyal customers to chat about why he came to the store. Jackie Ma was a customer of Wei for almost as long as North Point had been open. Even when Jackie went to NYU he ordered his contacts through North Point and when he wanted new glasses, he came to North Point when he was on break.
"Well the main reason I come to the store is that the prices are reasonable and you understand what I want." Jackie said. "But couldn't you get cheaper prices online at Pendrew's?" Wei asked. "Well yeah but I don't really like to shop online. When I want to buy new frames it is so much better to just go down to the store. I can bring my girlfriend and she can help me pick out a pair. I tried looking at
frames on your website and it really didn't work out. I saw the glasses but didn't really know how it fit on me. I also live close by so when I get off the bus I can just go across the street and get more contacts or cleaning solution. When I am online I have to go on a computer and make the order. It is kind of bothersome. What would be really cool is if I could ‘try on' glasses while I was on my computer in NYC. Or like a 3D model of the glasses. That would be great."
This would be a problem for Wei though since he would have to greatly increase the size of the database. Also since Wei had not setup the server himself he was loathed to start messing with the system now. Doing a little bit of digging he found that he might be able to use Amazon Web Services to host his site.
Wei had heard about the cloud but he is not exactly sure how it would solve his problem. What areas of his business, other than the website, would benefit from using the cloud? How could he use it? How would his business change if he did use the cloud? Could he use it to help him turn his online store into something similar to his physical store?