2Learning Outcomes 14.1 Compare e-commerce and e-business 14.2 Compare the four types of e-businessmodels14.3 Describe the benefits and challengesassociated with e-business14.4 Explain the differences among e-shops, e-malls, and online auctions
3E-BusinessThe Internet is a powerful channel that presents new opportunities for an organization to:Touch customersEnrich products and services with informationReduce costs
4E-Business How do e-commerce and e-business differ? E-commerce – the buying and selling of goods and services over the InternetE-business – the conducting of business on the Internet including, not only buying and selling, but also serving customers and collaborating with business partners
9Business-to-Business (B2B) Electronic marketplace (e-marketplace) – interactive business communities providing a central market where multiple buyers and sellers can engage in e-business activities
10Business-to-Consumer (B2C) Common B2C e-business models include:e-shop – a version of a retail store where customers can shop at any hour of the day without leaving their home or officee-mall – consists of a number of e-shops; it serves as a gateway through which a visitor can access other e-shopsBusiness types:Brick-and-mortar businessPure-play businessClick-and-mortar business
11Consumer-to-Business (C2B) Priceline.com is an example of a C2B e-business modelThe demand for C2B e-business will increase over the next few years due to customer’s desire for greater convenience and lower prices
12Consumer-to-Consumer (C2C) Online auctionsElectronic auction (e-auction) - sellers and buyers solicit consecutive bids from each other and prices are determined dynamicallyForward auction - sellers use as a selling channel to many buyers and the highest bid winsReverse auction - buyers use to purchase a product or service, selecting the seller with the lowest bid
13Consumer-to-Consumer (C2C) C2C communities include:Communities of interest - people interact with each other on specific topics, such as golfing and stamp collectingCommunities of relations - people come together to share certain life experiences, such as cancer patients, senior citizens, and car enthusiastsCommunities of fantasy - people participate in imaginary environments, such as fantasy football teams and playing one-on-one with Michael Jordan
14E-Business Benefits and Challenges E-Business benefits include:Highly accessibleIncreased customer loyaltyImproved information contentIncreased convenienceIncreased global reachDecreased cost
15E-Business Benefits and Challenges E-business challenges include:Protecting consumersLeveraging existing systemsIncreasing liabilityProviding securityAdhering to taxation rules
16E-Business Benefits and Challenges There are numerous advantages and limitations in e-business revenue models including:Transaction feesLicense feesSubscription feesValue-added feesAdvertising fees
17CHAPTER FOURTEEN Opening Case Study Questions Identify the type of e-business model eBay is using and explain why it has been so successfulOther major Web sites, like Amazon.com and Yahoo!, have entered the e-marketplace with far less success than eBay. How has eBay maintained its dominant position?What are the three different types of online auctions and which one is eBay using?
18CHAPTER FOURTEEN CASE 7-Eleven’s Dream Team 7-Eleven Japan has integrated its online site 7dream.com with its physical storesThrough the 7dream.com Web site, 7-Eleven Japan enables consumers to choose from an online assortment of 100,000 products which are picked up from one of 8,400 store locations
19Chapter Fourteen Case Questions What 7dream.com sells is “convenience.” Explain how integrating the Internet into its existing business is the key to its successIdentify new electronic relationships 7-Eleven Japan can create to increase customer acquisitionsExplain how 7-Eleven Japan can leverage the advantages of an e-marketplace to increase customer retention
20Chapter Fourteen Case Questions Why is 7-Eleven Japan’s e-business venture successful?Would 7-Eleven Japan’s e-business venture be successful in the United States? Discuss the challenges facing 7-Eleven’s e-business model in the United StatesHow can companies leverage knowledge gained abroad to improve stateside business process?