iMotors.com (B): New Competition in Used Cars

Published 01 Oct 2001
Reference 4977
Topic Strategy
Region North America
Summary

iMotors was an online used car retailer. Its business model reconfigured the industry value chain and allowed it to create significant new value for consumers. The case highlights the tension between value creation and value appropriation, limits to growth and the importance of establishing legitimacy in creating new categories. It also raises the question of the sustainability of competitive advantage.

Teaching objectives

1. How does one consider competition in emerging industries? 2. How does the Internet allow established industry practices to be transformed to allow for value innovation? 3. How should investments for growth be balanced with requirements for profits? 4. What makes competitive advantage sustainable? 5. How should uniqueness be balanced with legitimacy?

Keywords
  • E-commerce
  • Business models
  • Industry evolution
  • Internet strategy
  • Supply chain re-design
  • Value appropriation
  • Value creation
  • Value innovation