2 What is E-commerceDistributing, buying, selling and marketing products and services over electronic systemsE-business for commercial transactionsInvolves supply chain management, e- marketing, online marketing, EDIUses electronic technology such as:- Internet- Extranet/Intranet- Protocols
3 E-commerce as the Networked Economy Create value largely through gathering, synthesizing and distribution of informationFormulate strategies that make management of the enterprise and technology convergentCompete in real time rather than in “cycle time”Operate in a world characterized by low barriers to entry, near-zero variable costs of operation and shifting competitionOrganize resources around the demand side rather than supply sideManage better relationships with customers through technology
4 E-commerce TodayThe Internet is the perfect vehicle for e- commerce because of its open standards and structure.No other methodology or technology has proven to work as well as the Internet for distributing information and bringing people together.It’s cheap and relatively easy to use it as a medium for connecting customers, suppliers, and employees of a firm.No other mechanism has been created that allow organizations to reach out to anyone and everyone like the Internet.
5 E-commerce TodayThe Internet allows big businesses to act like small ones and small businesses to act big.The challenge to businesses is to make transactions not just cheaper and easier for themselves but also easier and more convenient for customers and suppliers.It’s more than just posting a nice looking Web site with lots of cute animations and expecting customers and suppliers to figure it outWeb-based solutions must be easier to use and more convenient than traditional methods if a company hopes to attract and keep customers.
6 Business originating from... Four Categories of E-CommerceBusiness originating from...BusinessConsumersBusinessB2BC2BAnd selling to...ConsumersB2CC2C
7 Distinct Categories of E-Commerce Business to Business (B2B) refers to the full spectrum of e-commerce that can occur between two organizations.This includes purchasing and procurement, supplier management, inventory management, channel management, sales activities, payment management &service and support.Examples: FreeMarkets, Dell and General ElectricBusiness to Consumer (B2C) refers to exchanges between business and consumers, activities tracked are consumer search, frequently asked questions and service and support.Examples: Amazon, Yahoo and Charles Schwab & Co
8 Distinct Categories of E-Commerce (cont’d) Peer to Peer (C2C) exchanges involve transactions between and among consumers. These can include third party involvement, as in the case of the auction website Ebay.Examples: Owners.com, Craiglist, MonsterConsumer to Business (C2B) involves when consumers band together to present themselves as a buyer in group.Example:
9 Key Drivers of E-commerce Technological – degree of advancement of telecommunications infrastructurePolitical – role of government, creating legislation, funding and supportSocial – IT skills, education and training of usersEconomic – general wealth and commercial health of the nationTele comm factors – infrastructure, architecture, pricing, range of service available, speed of developmentPolitical – gov’t incentive to use and support technology, laws supporting or restricting useSocial – skill of workforce, number of users, accessibility to computers, level of education, PZc skills, computer literacyEconomic – GDP, average income, cost of technology, cost of access
10 Key Drivers of E-business Organizational culture- attitudes to R&D, willingness to innovate and use technologyCommercial benefits- impact on financial performance of the firmSkilled/committed workforce- willing and able to implement and use new technologyRequirements of customers/suppliers- in terms of product and serviceCompetition- stay ahead of or keep up with competitorsComm benefits, in terms of cost savings and improved efficiencyRequirements if you are not up to date customers go somewhere else
11 Conducting E-Commerce Seven C’s of Website DesignContextContentCommunityCommunicationConnectionCommerceCustomization
12 The 7C’s of Website design ContextSite’s layout and designContentText, pictures, sound and video that web pages containCommerceSite’s capabilities to enable commercial transactionsCommunityThe ways sites enable user-to-user communicationConnectionDegree site is linked to other sitesCustomizationSite’s ability to self-tailor to different users or to allow users to personalize the siteCommunicationThe ways sites enable site-to-user communication or two-way communication
13 Seven Unique Features of E-commerce Technology and Their Business Significance Introduction toe-commerce - G53DDB
14 Benefits of E-commerce To consumers: 24/7 access, more choices, price comparisons, improved delivery, competitionTo organizations: International marketplace (global reach), cost savings, customization, reduced inventories, digitization of products/servicesTo society: flexible working practices, connects people, delivery of public servicesTurns a single marketplace into a borderless marketplace, access to people all around the world, cost of creating, processing, distributing etc., has decreased in a paper based env., enables products to be configured to cust specs., ‘pull’ type supply chain mgmt. based on collecting orders and delivering through JIT manufacturing (Dell). In case of software/music sent directly to cust.Immediate to online tracking of products, competition for discounts, bulk ordering.Work from home, reduces travel time, people in rural areas to connect, health services, doctor’s information, etc.
15 Benefits to Consumers Convenience Buying is easy and private Provides greater product access and selectionProvides access to comparative informationBuying is interactive and immediate
16 Benefits to Organizations Powerful tool for building customer relationshipsCan reduce costsCan increase speed and efficiencyOffers greater flexibility in offers and programsIs a truly global medium
17 Benefits to Society More individuals can work from home Benefits less affluent peopleThird world countries gain accessEnables more individuals to work at home, resulting in less traffic on the roads, less traveling and lower air pollutionAllows some merchandise to be sold at lower prices, benefiting less affluent peopleEnables people in Third World countries and rural areas to enjoy products and services which otherwise are not available to themFacilitates delivery of public services at a reduced cost, increases effectiveness, and/or improves qualityFacilitates delivery of public services