intro2e_ch01.ppt

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Overview of Electronic Commerce

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Copyright 2009 Pearson Education, Inc.Publishing as Prentice Hall 1

Learning Objectives

1. Define electronic commerce (EC) anddescribe its various categories.

2. Describe and discuss the content andframework of EC.

3. Describe the major types of EC transactions.4. Describe the digital revolution as a driver of

EC.

5. Describe the business environment as adriver of EC.


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Learning Objectives

6. Describe some EC business models.7. Describe the benefits of EC to organizations,

consumers, and society.

8. Describe the limitations of EC.9. Describe the contribution of EC to

organizations responding to environmentalpressures.

10.Describe online social and businessnetworks.

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Electronic Commerce:

Definitions and Concepts

electronic commerce (EC)The process of buying, selling,

transferring, or exchanging products,

services, or information via computer

networks.


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Electronic Commerce:Definitions and Concepts

e-businessA broader definition of EC that includes

not just the buying and selling of goods

and services, but also servicing

customers, collaborating with business

partners, and conducting electronictransactions within an organization.

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PURE VERSUS PARTIAL ECEC Organizationsbrick-and-mortar (old economy)

organizations

Old-economy organizations (corporations) thatperform their primary business off-line, sellingphysical products by means of physical agents.

virtual (pure-play) organizationsOrganizations that conduct their businessactivities solely online.


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click-and-mortar (click-and-brick)organizations

Organizations that conduct some e-commerceactivities, usually as an additional marketing

channel.

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INTERNET VERSUS NON-INTERNETEC

intranetAn internal corporate or government

network that uses Internet tools, such as

Web browsers, and Internet protocols.extranetA network that uses the Internet to link

multiple intranets.

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electronic market (e-marketplace)An online marketplace where buyers and

sellers meet to exchange goods,

services, money, or information.


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Interorganizational information systems(IOSs)

Communications systems that allow routine

transaction processing and information flow

between two or more organizations.

intraorganizational information systemsCommunication systems that enable

e-commerce activities to go on within

individual organizations.

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The EC Framework,

Classification, and Content


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The EC Framework,Classification, and Content

CLASSIFICATION OF EC BY THE NATUREOF THE TRANSACTIONS OR INTERACTIONS

business-to-business (B2B)E-commerce model in which all of the participants arebusinesses or other organizations.

business-to-consumer (B2C)E-commerce model in which businesses sell toindividual shoppers.

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The EC Framework,


e-tailingOnline retailing, usually B2C.

business-to-business-to-consumer(B2B2C)

E-commerce model in which a businessprovides some product or service to a client

business that maintains its own customers.


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consumer-to-business (C2B)E-commerce model in which individuals use

the Internet to sell products or services to

organizations or individuals who seek

sellers to bid on products or services they

need.

mobile commerce (m-commerce)E-commerce transactions and activities

conducted in a wireless environment.

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The EC Framework,


location-based commerce (l-commerce)M-commerce transactions targeted toindividuals in specific locations, at specifictimes.

intrabusiness ECE-commerce category that includes allinternal organizational activities that involvethe exchange of goods, services, orinformation among various units andindividuals in an organization.


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business-to-employees (B2E)E-commerce model in which an organizationdelivers services, information, or products toits individual employees.

collaborative commerce (c-commerce)E-commerce model in which individuals or

groups communicate or collaborate online.consumer-to-consumer (C2C)

E-commerce model in which consumers selldirectly to other consumers.

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The EC Framework,


peer-to-peerTechnology that enables networked peercomputers to share data and processing with eachother directly; can be used in C2C, B2B, and B2Ce-commerce.

e-learningThe online delivery of information for purposes oftraining or education.

e-governmentE-commerce model in which a government entitybuys or provides goods, services, or informationfrom or to businesses or individual citizens.


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exchangeA public electronic market with many buyers

and sellers.

exchange-to-exchange (E2E)E-commerce model in which electronic

exchanges formally connect to one anotherfor the purpose of exchanging information.

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The EC Framework,


THE INTERDISCIPLINARY NATUREOF EC

The Google RevolutionEC FailuresEC Successes


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Web 2.0The second-generation of Internet-based

services that let people generate

content, collaborate, and share

information online in perceived new

wayssuch as social networking sites,wikis, communication tools, and

folksonomies.

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The EC Framework,



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The Digital RevolutionDrives E-Commerce

digital economyAn economy that is based on digital

technologies, including digital

communication networks, computers,

software, and other related information

technologies; also called the Interneteconomy, the new economy, or the Web

economy.

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The Digital Revolution

Drives E-Commerce

The digital revolution accelerates ECmainly by providing competitive

advantage to organizations.

The digital revolution enables manyinnovations


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The Business EnvironmentDrives E-Commerce

THE BUSINESS ENVIRONMENTThe Business Environment Impact ModelBusiness Pressures and OpportunitiesOrganizational Response Strategies

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The Business Environment

Drives E-Commerce


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EC BUSINESS MODELS

business modelA method of doing business by which a

company can generate revenue to

sustain itself.

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EC BUSINESS MODELS

TYPICAL EC BUSINESS MODELSOnline direct marketingElectronic tendering systems for procurement

tendering (bidding) systemModel in which a buyer requests would-be sellers tosubmit bids; the lowest cost or highest value bidder wins.

name-your-own-price modelModel in which a buyer sets the price he or she iswilling to pay and invites sellers to supply the good

or service at that price.


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EC BUSINESS MODELS

Find the best pricealso known as a search engine model

affiliate marketingAn arrangement whereby a marketing partner (a

business, an organization, or even an individual)

refers consumers to the selling companys Website.

viral marketingWord-of-mouth marketing in which customerspromote a product or service to friends or others.

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EC BUSINESS MODELS

group purchasingQuantity (aggregated) purchasing that

enables groups of purchasers to obtain a

discount price on the products purchased.

SMEsSmall-to-medium enterprises.

e-co-opsAnother name for online group purchasingorganizations.


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EC BUSINESS MODELS

Online auctionsProduct customization and service

personalization

customizationCreation of a product or service according to the

buyers specifications.

personalizationThe creation of a service or information

according to specific customer specifications.

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EC BUSINESS MODELS

Electronic marketplaces and exchangesInformation brokers (infomediaries)BarteringValue-chain integratorsValue-chain service providersSupply chain improversSocial networks, communities, and bloggingNegotiation


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EC BUSINESS MODELS

virtual worldA user-defined world in which people

can interact, play, and do business. The

most publicized virtual world is Second

Life.

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Benefits and Limitations of EC

THE BENEFITS OF ECBenefits to OrganizationsBenefits to ConsumersBenefits to SocietyFacilitating Problem Solving


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Benefits and Limitations of EC

THE LIMITATIONS AND BARRIERS OF ECTechnological LimitationsNontechnological Limitations

SOCIAL AND BUSINESS NETWORKSsocial networks

Web sites that connect people with specified

interests by providing free services such as photopresentation, e-mail, blogging, and so on.

Business-Oriented NetworksRevenue Models of Social and Business

Networks

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The Digital Enterprise

digital enterpriseA new business model that uses IT in a

fundamental way to accomplish one or more of

three basic objectives: reach and engage

customers more effectively, boost employeeproductivity, and improve operating efficiency.

It uses converged communication and

computing technology in a way that improves

business processes.


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The Digital Enterprise

corporate portalA major gateway through which

employees, business partners, and the

public can enter a corporate Web site.

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Managerial Issues

1. Is it real?2. Why is B2B e-commerce so attractive?3. There are so many EC failureshow can one

avoid them?

4. How can we exploit social/businessnetworking?

5. What should be my companys strategytoward EC?

6. What are the top challenges of EC?


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Summary

1. Definition of EC and description of itsvarious categories.

2. The content and framework of EC.3. The major types of EC transactions.4. The role of the digital revolution.5. The role of the business environment

as an EC driver.

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Summary

6. The major EC business models.7. Benefits of EC to organizations,

consumers, and society.

8.

Barriers to EC.9. Social and business online networks.


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All rights reserved. No part of this publication may be reproduced, stored in a

retrieval system, or transmitted, in any form or by any means, electronic,mechanical, photocopying, recording, or otherwise, without the prior written

permission of the publisher. Printed in the United States of America.

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intro2e_ch01.ppt