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E-Commerce Systems Chapter 9 McGraw-Hill/IrwinCopyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.

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Presentation on theme: "E-Commerce Systems Chapter 9 McGraw-Hill/IrwinCopyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved."— Presentation transcript:

1 e-Commerce Systems Chapter 9 McGraw-Hill/IrwinCopyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.

2 9-2 Identify the major categories and trends of e-commerce applications Identify the essential processes of an e-commerce system, and give examples of how they are implemented in e-commerce applications Identify and give examples of several key factors and Web store requirements need to succeed in e-commerce Learning Objectives

3 9-3 Identify and explain the business value of several types of e-commerce marketplaces Discuss the benefits and trade-offs of several e-commerce clicks and bricks alternatives Learning Objectives

4 9-4 Introduction to e-Commerce Electronic commerce encompasses the entire online process of –Developing –Marketing –Selling –Delivering –Servicing –Paying for products and services Relies on Internet and information technologies

5 9-5 RWC 1: Mobile Shopping Mobile shopping increasing Social networking –Web sites and too many steps –Sales pitches on social networks increasing Birthday prompts ad for Flowers –Impulsive buyers Cell phones –Starbucks Mobile Card App Preloaded spending money Scannable bar code –Last minute game tickets

6 9-6 Scope of e-Commerce

7 9-7 E-Commerce Technologies

8 9-8 Essential e-Commerce Architecture

9 9-9 Access Control and Security E-commerce requires mutual trust and secure access –User names and passwords –Encryption key –Digital certificates and signatures Restricted access areas –Other people’s accounts –Restricted company data –Webmaster administration areas

10 9-10 Profiling and Personalizing Profiling captures behavior and choices –User registration –Cookie files and tracking software –User feedback Profiling is used for –Personalized (one-to-one) marketing –Authenticating identity –Customer relationship management –Marketing planning –Website management

11 9-11 Search Management Find specific product or service –Website search engine Google or Requisite Technology –Search on content or by parameters

12 9-12 Content and Catalog Management Content Management Software –Maintain text and multimedia for e-commerce Catalog Management Software –Maintain catalog content Catalog and content management software –Works with profiling tools to personalize content –Product configuration and mass customization

13 9-13 Example of Workflow Management

14 9-14 Event Notification Monitors e-commerce processes Records relevant events –First website –Payments –Problem situations Notifies involved stakeholders Works with user-profiling software

15 9-15 Collaboration and Trading Processes needed by customers, suppliers, and other stakeholders Online communities of interest – , chat, discussion groups –Enhances customer service –Builds loyalty

16 9-16 Electronic Payment Example

17 9-17 Securing Electronic Payments Sniffers easily recognize credit card formats Protection –Encrypt data Between customer and merchant Between customer and financial institution –Take sensitive information off-line

18 9-18 RWC 2: Driving the “Buzz” on the Web Companies attempt to identify “influentials” that create online “word of mouth” –Increase sales –Influence opinions Differing opinion –Sales data don’t match “influentials” –Influentials go with the flow, not effect change

19 9-19 E-Commerce Application Trends

20 9-20 E-Commerce Success Factors Selection and value Performance and service Look and feel Advertising and incentives Personal attention (one-to-one marketing) Community relationships Security and reliability

21 9-21 Differences in Marketing

22 9-22 Web Store Requirements

23 9-23 Developing a Web Store Build a website –Choose or set up web hosting –Use simple design tools and templates –Include a shopping cart and payment support Market the website –Include Web page and advertising and promotions –Exchange advertising with other Web stores –Register with search engines and directories –Sign up for affiliate programs

24 9-24 Getting Customers to Find You Submit your site to a search engine Improve the quality and number of visitors –Search Engine Optimization (SEO) Link Farms Keyword stuffing Organic Search

25 9-25 Serving Your Customers Convert visitors into loyal customers –Develop one-to-one relationship with customers –Create incentives to encourage registration –Use Web cookies to identify visitors –Use tracking services to record and analyze website behavior and customer preferences –Create an attractive, friendly, efficient store –Offer fast order processing and payment –Notify when orders are processed and shipped –Provide links to related websites

26 9-26 Managing a Web Store Manage both the business and the website –Record and analyze traffic, inventory, sales –Use CRM features to help retain customers –Link sales, inventory data to accounting systems Operate 24 hours a day, seven day a week Protect transactions and customer records –Use security monitors and firewalls –Use redundant systems and power sources –Employ passwords and encryption –Offer 24-hour tech support

27 9-27 B2B E-Commerce Wholesale and supply side –Businesses with other businesses Relies on multiple technologies –Catalog systems –Trading systems –Data interchange –Electronic funds transfers

28 9-28 E-Commerce Marketplaces One to Many –Sell-side marketplaces –One supplier dictates product offerings and prices Many to One –Buy-side marketplaces –Many suppliers bid for the business of a buyer Some to Many –Distribution marketplaces –Unites suppliers who combine their product catalogs to attract a larger audience

29 9-29 E-Commerce Marketplaces Many to Some –Procurement marketplaces –Unites major buyers who combine catalogs –More competition –Lower prices Many to Many –Auction marketplaces –Dynamically optimizes prices

30 9-30 B2B Commerce Web Portals

31 9-31 Clicks and Bricks

32 9-32 E-Commerce Integration Move traditional strategies to e-commerce Integrate e-commerce into traditional business –Sharing of established brands –Sharing of key business information –Joint buying power and distribution efficiencies

33 9-33 E-Commerce trade-offs

34 9-34 Other Clicks and Bricks Strategies Partial e-commerce integration –Joint ventures and strategic partnerships Complete separation –Spin-off of an independent e-commerce company Barnes and Noble’s experience –Spun off independent e-commerce company –Gained venture capital, entrepreneurial culture, and flexibility –Attracted quality management –Accelerated decision making –Failed to gain market share

35 9-35 E-Commerce Channel Choices An e-commerce channel is the marketing or sales channel created by a company for its e-commerce activities –No universal strategy or e-commerce channel choice –Both e-commerce integration and separation have major business benefits and shortcomings –Most businesses are implementing some measure of clicks and bricks integration

36 9-36 E-Commerce Strategy Checklist Questions to ask and answer –What audiences are we attempting to reach? –What action do we want those audiences to take? –Who owns the e-commerce channel within the organization? –Is the e-commerce channel planned alongside other channels? –Is there a process for generating, approving, releasing, and withdrawing content? –Will our brand translate to the new channel? –How will we market the channel itself?

37 9-37 RWC 3: Success for Second Movers Entellium is a successful second mover –Same approach –Better products and services –Lower cost. Another strategy –Combine successful business models

38 9-38 RWC 4: Brands Go On-Line Companies must protect brand names, logos and trademarks –BrandProtect, MarkMonitor, and NameProtect offer help Challenge has grown exponentially Another type of violation is using logos without permission


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