In this e-business era all the companies are very much interested in attracting customers by presenting a nice looking website with all the relevant information. As a professional in E-commerce we would like to bring some comparative analysis of different competitors in sports business to highlight the best possible option to start an E-business in sports sector. In our survey we have chosen three well known companies who competes radically in the market, these are listed below with their website address:
Sports Direct: http://www.sportsdirect.com
JD Sports: http://www.jdsports.co.uk
Kitbag: http://www.kitbag.com
Though the above companies are performing similar business, but still their activities do not very resemble each other. These companies differ from each other from various pints of view; some of them are summarized below:
Company information of Sports Direct:
In sports business Sports Direct is controlling a whole range of steering in UK. This owns a wide range of elegant brands of products. Sports Direct is trading under its own name and also accompanied by some other companies like Lillywhites, McGurks, and Exsports as a group of companies. As a group of company they sell a wide range of owned brand such Dunlop, Slazenger, Lonsdale and the most famous 3rd party brands as Adidas, Nike, Umbro, Reebok and Puma. They claim themselves as the best sports goods retailers because of the readily availability of branded goods which makes them famous among others. Sports Direct along with its 359 outlets comprises different other companies as partners provides a great deal of offers which allows it be competitive in this trade. Strategically Sports Direct builds up the trading relationship with others so that they can run the business with less competition.
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Customer services:
In trading business customers are the basic underpin on which companies run their operation. Customer satisfaction is a most powerful trigger of business. Sports Direct is always keen to provide good customer services all over the world. For serving the customer satisfactorily Sports Direct has the provision of updated information regarding best deal of products, which is a part and parcel in online businesses. They also take care of the customers by providing helpline, return policy, and secure payment method, online terms and conditions for shopping and so on. It also keeps in mind about the customers of European countries where it created a specialized site for them. Sports Direct also facilitates the customers by secured login support by which the customer can track down their account, which tells them the shopping details at any point of time.
Customer information regarding the rights of customers:
In E-commerce customers are treated as the weaker part of trade. Customers are those who purchase goods and services for consumption as well as for selling. There are lots of rules and regulation in UK to protect customers from fraud. Sports Direct provides the rights to its customer to have the terms and condition printed, get an overall ideas about the products in terms of price and quality, the rights to have the personal data safe according to terms and conditions, get the delivery all over the UK and also international through delivery partner Etail services LDT, return the defective goods, get a reasonable warranty, give complain for various issues, both the customers and the company has the right to accuse each other in case of any contractual breach to the court of England and Wales.
Product warranties:
In case of product warranty Sports Direct has just put up a statement which will satisfy the customers regarding the quality assurance as described in its website. This company doesn’t give any warranty of virus or other malicious program free website.
Design and ease of website use:
The design of the website is mostly represented by the homepage where one can get all the relevant information about the company. In Sports Direct.com the home page is mostly contained of some of the inductive offers of products including little description of it. This site also contains an easily accessible and readable navigation bar, a search button, a display of shopping basket, a sign in option to open an account with the company, online payment options and company information in detail. The customers can find their suitable product that they are looking for from the navigation bar where it is given be the name or type of the products. The colour combination and the look and feel of the site is as expected. With all these information and navigation in the design it can be regarded as easily accessible site.
Company information of JD Sports:
JD Sports started its launch in 1981 and has grown up very quickly with about 400 stores gaining high reputation of selling own and third party brand of goods. Its overriding performance was basically based on the sales of third party brands e.g. Nike, Adidas, Reebok etc. In the rising trend JD Sports acquired many other stores to form the group of business as a competitive advantage. This sports giant has also included its corporate information e.g. share details, little bit of company structure, and the rate of growth which ultimately shows the high performing capacity of the company. In company information they have included a wide range of supplements to give a clear view of it.
Customer services:
All the businesses are dependent on the customers so they carry out vital activities for a company. In JD Sports they have given high priority to the customers with highly valuable services. For good services JD Sports has incorporated various activities like shopping pattern, delivery information, returning of defective goods, tracking system of order, secure site for payment and different product list including their respective sizes. It has also created a search button for finding the stores around the UK.
Customer information regarding the rights of customers:
According to the terms and conditions the customers are bound by the company’s policy. The customers can only consume the products but not sell them outside as per company aim. Users of this site have access restriction to some parts of it, which reduces the rights of customers in a sense. In this site the rights of customers and other related entities are clearly stated. The company is not held liable for any damage of customer’s physical goods like computers through any kind of virus infections. So the customers do not have the right to complain against such sort of damages. JD Sports provides a legal right to customers to return defective goods at any point of time after purchasing and cancel the order within 7 (seven) days. Customers have the right to accuse the company regarding any illegal issues.
Product warranties:
JD Sports provides a warranty period of 28 days of purchasing. If the products do not satisfy the quality of purpose or fit for the purpose then the customer has the right to return back to the company. The company then either replace it or refund the full price after checking the defectiveness of faultiness of the products. JD Sports has also illustrated all the policies and procedures of returning goods under the regulation of product warranty.
Design and ease of website use:
In designing the website JD Sports has given tremendous efforts. It has differentiated the products gender wise and also age wise, so that the customers don’t have to waste their precious time in finding specific products. The special offers are also incorporated and updated time to time under separate section. All these information has made the site wonderful in sense of design and easy accessibility.
Company information of Kitbag.com:
In the sports goods and accessories world Kitbag is one of the best company. The targeted area of business is mostly EU, but it has expanded its business to UK and US as well. They sell different third party branded products e.g. Nike, Adidas, Puma etc. through their shops and online. They have a wide range of products to sell from cloths, gifts or souvenirs to exercise equipments for all ages of customers. Kitbag.com site is a Hitwise award winner which built on their success day by day. As a sports giant with its associates Kitbag has the right of restricting the users of this site who have breached the terms and conditions.
Customer services:
As all the company tries harder for its customers, Kitbag also is not out of the community. For its most important stakeholder (customer) Kitbag has also provided enormous and attracting supports. For the customer services it has created a section to create personal account, help option, search button, currency differentiation button, making complains and comments. It has also provided an affiliate network options so that the customers can choose from a larger variety of others as well.
Customer information regarding the rights of customers:
Customers of Kitbag has all the basic right of using the website e.g. placing orders, easy way of secure payments, get the delivery all around the UK, US and EU, returning of goods, and keep the personal data protected with the company. It addition to this customers have also an important right to remove personal information recorded in the company database. In the return policy customer may return the goods within 14 days from purchase including all belongings with the good, but in that case recorded delivery is preferred by the company which may be a bit costly. Kitbag also allows the customers to cancel the orders in certain condition.
Product warranties:
Although a big company it hasn’t provided clear and distinguished illustration about the products warranty. It has only depicted the information of returning defective goods in one section.
Design and ease of website use:
In the home page of this site all the relevant links are included from which customer can easily access their respective pages. In the menu bar all products ranges are enlisted to display the products name at a glance. To get the best and up to date offers Kitbag has kept a special search bar for the convenience of the customers. With all these circumferences of this site it can be considered as very well designed and easily accessible site.
Comparative analysis of above competitors and proposal for best practice:
In case of company information it is clearly revealed that Sports Direct has depicted all sorts of information regarding the company compared to two other companies. A company doing business in the civilized world should give the details of it to get people know about their intention and purpose. So in this perspective Sports Direct is further ahead than other two.
In case of customer services JD Sports is very much close to standard. Because all three company has more or less support for customer services but JD Sports has a special section for services even in the site.
In case of the third aspect which is customer rights Kitbag has priority over others. Sports Direct and JD Sports provide customers the right to perform basic activities when do some shopping from them, and Kitbag in addition give the right to erase customers personal detail from the company record which relieves the company from some sort of liability in case of any fraudulent activities by third party (hacker).
In case product warranty JD Sports is superior to others. The reason is that JD Sports has specific time duration for product warranty with the illustration of refund policy in the site as well.
In case of design and easy accessibility JD Sports scores the highest points. Because the texts in the site are fully readable, the product differentiation by gender and age group is transparent enough; all the links are on a finger tip of the customers.
So, considering the above analysis and comparison I would like to advise the client to follow JD Sports’ online business strategy to set up their own business. They should also consider Sports Direct and Kitbag in respect of detail company information and terms and condition, and customer rights respectively. The ultimate target of this new business should be adopting a site which is dynamic, well defined, realistic, clear in view and finally most customer acceptable.
Section 2: Company name and Intellectual Property
To start a business a name for the company should be chosen. The name should be legally available and registered with proper authority. Before choosing the name the company type should be identified. Here we would suggest to have limited type of company, more specifically private limited company. We would suggest the name as Sports Craft limited company considering all the legal issues and registration regulation. The reason behind choosing this type of company is that, the shareholders are not liable for disaster in business or have limited liability. Other reasons behind the suggestion are of smaller size, shareholder flexibility in terms of number of shareholders, and executive authority formation of the company.
As we would suggest a limited type of company, so the name should
End with the word limited as Sports Craft Limited Company,
The similar name should not be chosen, which is already in the index,
The name can’t be offensive to the people.
If a name sounds same as another company it can be accepted by spelling differently for example, if there is another company name, called Kraft Sports Limited then our suggested name can be accepted, but it is better to select a unique name to avoid objection of other companies and get registration easily.
Before applying for registration we would suggest to check the name at companies house website whether it is readily and legally available or not as opposed to similar name.
After choosing the name, registering the company with authorised body will come up as a next step to take place. The registration in UK is done through a body named “Companies House” under the current companies’ act 2006. Some provisions or clause of companies’ act 2006 are not enforced so that the act of 1985 is also in force in respective areas. For the registration of the company you may choose to deal directly with the companies’ house or can go through the different agents those have experienced solicitors and accountants in the field of company formation. To start this registration process you should send off some documents with relevant fee to the companies’ house. The documents are as follows:
A Memorandum of Association which includes the name, established location, and its function in business, it can be available from a law stationery or agent.
Articles of Association which include full description of the way of running business (e.g. selling sports goods and providing good service to the customers online), rights and powers of stakeholders and company directors, it can be available from a law stationery or agent.
A form 10 after completion which provides the details of company office, name and addresses of directors and secretary of Sports Craft Limited Company.
A form 12 after completion which will provide the compliance of the Sports Craft Limited Company to the legal requirement of company formation. If the registered office needs to be in England or Wales the documents should be sent to companies’ house in Cardiff. These two types of forms are available in companies’ house as downloadable format.
A private company like Sports Craft Limited Company must appoint correct number of directors and secretary according to its article of association and who should be formally qualified. The director of Sports Craft Limited Company should be over the age of 16 and at least one should be neutral to the company. After the company being formed some sort of notification should be sent to the companies’ house about:
Appointing a new officer
Resignation of the officer of the company
Changes of details of an officer that was provided in Form 10
Changes of registered office address details.
After all the necessary checks and examination which will be done by companies’ house regarding the name and relevant documents an incorporation certificate will be issued towards Sports Craft Limited Company.
Advice on the trademark and domain name issues:
Trademark is a distinguishable and graphically presented sign that a company can use for the goods or services they provide in respect to differentiate their products from others and is comprised of words, letters, alphanumeric, and also be a logo. Through the trade mark one can protect his/her personal property from infringement. The trade mark of a company can be protected by the Trade Mark Act 1994. If the member of Sports Craft Limited Company have seen a trade mark of a company in Canada and would like to use that as his own company mark, then we suggest to check first whether the Canadian company has the mark registered or not. If it is registered then the chance of having the mark is less. Even if the Canadian company hasn’t registered the mark but it has reputation in business, then he can get it protected by the passing off rights. In case of trade mark the principle is “Filing First” but the not the “Using first”. If the Canadian company has the trade mark registered and its business is not multinational or limited to Canada then Sports Craft Limited Company will be able to use that mark under the UK Trade Mark Act 1994. The above situation will also be considerable for Sports Craft Limited Company. If Sports Craft Limited Company wants to do business in Canada, then in case of any dispute the Canadian company has to prove that the mark is registered or applied before the application of Sports Craft Limited Company. But if the mark is not registered then Canadian company has to prove his reputation in doing the business in case of goods and services. The above suggestions should be followed by the newly formed company after examining all the possibilities by experts.
These are all top level domain names but there is nothing to deal with level to get the name registered. In UK the domain name is registered through Nominate and it is done first come first serve basis. The domain name should be unique in every aspect. Domain name infringement is based on UK Trade Mark Act 1994 where if the mentioned three names are identical to any registered trade mark or any goods and services in any way then it will be called an infringement of domain name. Before choosing any of the names Sports Craft Limited Company has to investigate whether they are already registered or not. Literally it is evident that all three names are registered under the domain name registrar. Although they all are doing different business than Sports Craft Limited Company but due to the principle of uniqueness there is no chance to get those names as domain name. Those companies can make a dispute which will fall under Domain Name Envy where two or more company have similar domain name. Sports Craft Limited Company might be given right to have any of those three names if it attains good reputation or it already has the reputation in other business. In that case there is provision for reallocation of domain names and a dispute resolution procedure. There are seven issues concerned with the domain name dispute resolution which are as follows:
Did the other party register the domain name before you registered yours? If not then you proceed on registering with any of the three mentioned names.
Does either party own a registered trademark?
Is the domain name generic?
Does the domain include a celebrity’s name?
Does the domain name include a well-known brand?
Can you prove bad faith?
How long has this been going on?
After considering all the above issues you can decide to get a domain name from the three names. If you want to choose the domain name as, www.Sportscraft.com which has similar word like the mentioned others, so it may come under dispute resolution. In this case we would like to remind you about the case of Microsoft VS. MikeRoweSoft, where although Mike Rowe started a business in dissimilar domain name, but the software giant Microsoft made a dispute against him because of resemblance of the name.
Section 3: Privacy and data protection
Privacy in e-commerce draws the attention of world business people and also the consumers to protect themselves from fraud. Because of the vulnerability in online shopping customer are getting tensed and unwilling to visit any online shopping site irrespective of their shopping habit, which is a threat to e- business. Online fraudulence through malfunction security measures imposed the customers to and businessmen to pressurise the authority for developing regulatory policies for collecting and using of gathered personal data. So the importance of privacy and data protection should not be ruled over while starting an online business.
The legal requirements of online business in respect of UK data protection act 1998 can be categorized as follows:
The collection of personal data
-Get consent from the customers by using a check box
-Sending email and text messages for marketing reasons
-Making automated calls
-Faxing
-Sending cookies
The above marketing strategy for goods and services requires the prior consent of the customers. The UK e-privacy regulations control these activities with the help of data protection act 1998.
Data trafficking
Routing of data
Duration of keeping the data.
Reason behind keeping the personal data for longer period
Location data
Identification of the customers location
Transfers and usage of personal data need to be regulated
Fare use of data
Adequacy, relevancy, and range of excessiveness of personal data
Accuracy and security of personal data while transferring
Three main issues in website privacy policy are:
Securely and fairly processing of customer’s personal data
Secondary or reuse of data by authorised company and by third party, where transfer of personal data should be restricted.
Accessibility in financial information and use of cookies to recognize past customers.
Now we would like to advise our client in respect of collecting personal data for business and reutilization purposes. In collecting the personal data the above legal issues or requirements should be fulfilled by the company. In descriptive way we would suggest the company the following:
The personal information should be collected for legal and purposeful reason.
The collected data should be kept secured and processed fairly which means prevent the third parties to access and carryout the examining of data.
The personal information should not be kept for longer than needed unless some exceptions such as investigation for crime, terrorism under the investigatory powers act 2000 or crime and security act 2001 or otherwise for billing purposes. For billing purposes the personal data can be stored for duration of six years.
The customers can have the power of erasing their information from the database of the company by using technology.
The transfer of information to third party should require consent from the customers.
The transfer of personal information should be prohibited to outside business region unless there is enough security and protection of those data.
The transfer of data should not be rejected for the reasons of contract formation, public interest, legal proceedings, taxation, national security, and information commission’s office authorization.
The racial identity information is treated as sensitive personal information which can come under ethnic group. The racial identity information should be kept and processed with more care than the standard personal information such as it must satisfy the fair and lawful processing together with one of mentioning conditions: 1) explicit consent of customers, 2) secure the interest of the customers, and 3) to secure the legality of the information.
Section 4: Advertising and marketing:
The e-commerce advertisement should have the characteristics of
Truthfulness/transparency: Where marketing communication should not be misleading by faulty and ambiguous information.
Safe from customer vulnerability: This means the customers should not be motivated or enticed to commit dangerous activities resulting in social unrest.
Descent in respect of content: Marketing communication should not contain anything on the platform of racial, religious, sexual orientation and disability.
Reality of promotional offer: Where promotional goods and services should maintain the normal quality with mentioning the correct duration, and promoters should not be disappointed in any situation.
Fair competitiveness
And secured linking.
The site design should be clear enough to be understood by the customers. All the products are meant to be available for delivery as advertised for promotion unless any exception included in the terms and conditions. The price content should not include any hidden charges. Direct marketing can be introduced with the legal perspective and customer consent.
There is no actual legislation for controlling the content of advertisement. But some rules or code of conduct regulate the e-commerce advertising which are relevant to the trade, marketing and advertising in respective fields. The code of practice provides a self-regulatory environment which can be implemented in accordance with legislation or independently for dispute resolutions. The design of advertisement should comply with the code to rely on the legality, decency, honesty, truthfulness, and consumer confidence for marketing arrangements.
The following brief discussion of two UK laws regulating the content of advertisement would provide you some transparent view of advertising online.
1. Trade description act 1968:
The trade description act started enforcing since 30th November 1968. With the replacement and extendibility of previous trade legislation the trade description act 1968 enforce the business men providing actual description of goods and services in terms of price, size etc.
The Trade Description Act consists of subsections which comply with the trading as follows:
A) The business activities by a company can be treated as an criminal offensive action under the Trade Description Act 1968 when the business organization,
Present any goods and services in fictitious way in terms of price, size and the quality.
Make available such goods for supplying to customers which do not comply with the stated description in advertisement.
Provide fake and vague statement of different service facilities to confuse the customers and entice them to buy or use them.
B) Describing the trading pattern in terms of products, services, facilities, and the ultimate quality of them include
The dimension of the above in sense of size, quantity
Production mechanisms such as manufacture, processing
Content in terms of which is composed of
Quality assurance against the description
Results of testing and the approval from respected authority
Time duration of the goods and services understandable by the customers.
Under the Trade Description Act 1968 any false indication for any sort of goods and services by the trader is a punishable offense. For example the traders are not allowed to present or sell any products with the presentation of any royal family members or any famous person, even if the permission is granted from them. The failure of fulfilling any services stated by the trader is an offense and can be sued by the customers without the involvement of the Act. Spoken statement is outside the reach of the legislation, hence the compensation are not taken into consideration under this Act. Then it can be finalised with the help of civil law if the court thinks it perfect.
2. Misrepresentation Act 1967:
The Misrepresentation Act 1967 came in to force in 22 March 1967 by the amendment of two sections of Sales of goods Act 1893. Under this Act the following should be considered:
A) If any contract is formed with the misrepresentation of any products then the customers are entitled to cancel the contract without averring the fraudulent activities.
B) Where the customers are in a contract by the misrepresentation in advertisement and suffer a massive loss is entitled to claim for damages on the proof of fraudulent misrepresentation and vice versa.
C) If a contract is made between two parties with misrepresentation of products subject to accepting any terms and conditions regarding unintentional misrepresentation by the customers, then the traders may not be liable for any damage caused by it as long as it satisfy the section 11(1) of the Unfair Contract Terms Act 1977.
D) The trader should not represent any products which can be presumably considered as someone else’s product that has reputation or registered trademarks in the market.
Conformity of advertisement to those laws:
As mentioned above about the design or characteristics of Sports Craft Limited Company advertisement, we would like to relate the Trade Description Act 1968 to a) customer vulnerability, b) promotional offers for various products which should be described in clears view and compliance to the relevant products, c) fair competition in case of accurate information about the products advertised on line, d) price tagging where there should be no hidden charges, and e) secured linking of third party advertisement where the trader describes the products with appropriate information.
Also the Misrepresentation Act 1967 can be conformed to the a) truthfulness/ transparency of presenting a particular product, b) decency of content of the site, where representing any violated information can result in social hazards.
Advise in regard to direct marketing to athletes:
The direct email marketing is a campaign through advertisement to reach the targeted people with the ultimate purpose of selling products and differs from other traditional types of marketing strategy. It can be in a form of digital text, HTML, spamming as unsolicited mail etc. To start the email marketing a number of regulations should be taken into considerations which comply with the unsolicited electronic messages sent through different communication media.
The most important condition to consider first is that, the unsolicited electronic marketing is only possible with the permission of recipients in this case the athletes. These conditions are complied with the European Communities Ordinance 2004 and the Data Protection Act 1998 for the communication with individuals and organizations. The exceptions of this regulation are as follow:
The unsolicited mail or spam can be sent to athletes if their personal information has been gathered in case of any sale of products take place.
In case of marketing similar products
In case marketing giving the opportunity to unsubscribe the marketing arrangement by the customers while giving p
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