Presentation on theme: "E-Commerce in Business"— Presentation transcript:
1 E-Commerce in Business Chapter 2E-Commerce in Business
2 The E-Environment E-Commerce - E-Business - Business conducted via electronic methodsE-Business -Any process a business conducts over a computer network
3 E-Commerce vs. E-Business A business buying office supplies through an online auctionWithdrawing funds from an ATM machinePurchasing a book over the InternetA government employee reserves a hotel room over the InternetProduction process including procurement, ordering, automated stock replenishment, payment processing, and other links with suppliersCustomer Process including marketing, selling, processing of orders and paymentsManagement processes including employees services, training, information sharing
4 Why People Buy Online Reason % of Surveyed Shoppers Save time 70% Shop off hours69%Avoid holiday crowds68%Find better prices59%Find products more easily52%Products not available in stores50%Easier to compare prices47%Have gifts sent direct36%Avoid wrapping gifts13%Earn loyalty pointsPurchase from wish list10%
5 Benefits Limitless Buyers Open 24/7 Advertise Market and Analyze Brand Loyalty - a customer’s preference for a particular productCoke vs. PepsiManaging Inventory
6 Benefits Meeting Customer Needs Mass Customization - the production of goods that offer specialized choices to mainstream buyersValue Chain - the sequence of design, production, and marketing efforts a business conducts to deliver its products at the right place and timeStreamline the value chain - increase productivity and profitability
7 Benefits Starting Out Purchase domain name Build the site Select business modelPhotos of productsEstablish and ship goods
8 Benefits Pricing Competitively Online community makes it easier to compare pricesElastic demand - pricing changes will create a change in the amount of goods or services consumers are willing to buy at the certain price
9 How can e-commerce weaken or add to a local Think about it…How can e-commerce weaken or add to a localeconomy?
10 Did you pay attention?What does it mean for a company to “manage” its inventory?How is an online company’s inventory easier to manage than that of a bricks-and-mortar business?How can a company streamline its value chain?Why is it difficult to charge more than your competitors in an e-commerce marketplace?
11 Conducting Business on the Web You make the call…You are in the market for a new laptop. Youuse several manufacturers’ Web sites toresearch the different models available. Aftermaking your decision, you call the company’stoll-free number to place your order.Is this an e-commerce transaction?
12 Conducting Business on the Web Since no ownership of goods or services actually took place over the computer network, this is not technically an e-commerce transaction even though all of the components (hardware, buyer, seller) are present.
13 E-Commerce Business Models Online transactions occur 24/7Buy a shirt from AmericanEagle.comFile your income tax return electronicallyComputer manufacturer purchases componants from a suppler in ChinaBid on an item on eBayBusiness Model - a system of policies, operations, resources, and technologies used to generate revenue.
14 Common Business Models Business-to-Business (B2B)Business-to-Consumer (B2C)Consumer-to-Consumer (C2C)Consumer-to-Business (C2B)Business-to-Government (B2G)Government-to-Consumer (G2C)Intermediary Hub
15 Business-To-Business Applies when a business transacts information, goods, or services with another businessOldest and fastest growing form of e-commerceExample: A manufacturer in New Jersey uses Paychex for its payroll service
16 Business-To-Consumer Any business or organization that uses the Internet to sell its products of services to consumers or end usersAmazon.comfnfg.comWebMD.com
17 Business-To-Consumer Studies show that the longer a customer stays on a site, the more likely they are to buyKeep customers busy with a variety of products, services and information.Offer easy navigation, a secure way to purchase products, as well as offer a reason to return
18 Consumer-To-Consumer Allows customers to interact with one another online to transact goods and serviceseBay - the most successful online auction site.30 million people buy and sell more than $20 billion annuallyMore than the GDP of all but 70 countries in the world
19 Other ModelsBusiness-to-Government - connecting private sector to the government marketplaceBids for government contractsGovernment-to-Consumer - allows consumers to easily access relevant information from government agenciesirs.gov
20 What’s a hub?Intermediary Hub - a business that does not provide goods or services but instead acts as a middleman, bringing buyers and sellers togetherVertical Hubs - match buyers and sellers within a particular industryHorizontal Hub - provide the same types of products or services across various industries
22 How did you do?Why do e-commerce businesses strive to keep potential customers on their sites as long as possible?What are some of the key challenges facing the B2C model?How might the G2C model be helpful to the average consumer?