1. Chapter 5 and Module B ELECTRONIC COMMERCE: Strategies For The New Economy & THE WORLD WIDE WEB AND THE INTERNET THE WORLD WIDE WEB AND THE INTERNET

2. WWW and the Internet World Wide Web World Wide Web Internet Internet Web site Web site Web page Web page URL (uniform resource locator) URL (uniform resource locator) Top-level domain Top-level domain

3. Understanding Addresses Consider www.uts.edu.au (University of Technology in Sydney) Consider www.uts.edu.au (University of Technology in Sydney)www.uts.edu.au http:// - starts most addresses but may be left off http:// - starts most addresses but may be left off www – World Wide Web www – World Wide Web uts – the organization uts – the organization edu – top-level domain (organization type) edu – top-level domain (organization type) au – country location (if none, then current country) au – country location (if none, then current country)

4. Top-Level Domains com – commercial or for-profit business com – commercial or for-profit business coop – cooperative coop – cooperative edu – educational institution edu – educational institution gov – U.S. government agency gov – U.S. government agency mil – U.S. military organization mil – U.S. military organization net – Internet administrative organization net – Internet administrative organization int – International treaties organization int – International treaties organization info – general information info – general information biz – business biz – business museum – accredited museum museum – accredited museum name – personal name – personal pro – Accountant, doctor, lawyer, etc. pro – Accountant, doctor, lawyer, etc. Many more Many more Note: Can also use specialized TLDs like.nba – requires a fee of $185,000

5. WEB 2.0 Web 2.0 (Live Web) – second generation of the Web; focuses on online collaboration, users as both creators and modifiers of content, dynamic and customized information feeds, etc. Web 2.0 (Live Web) – second generation of the Web; focuses on online collaboration, users as both creators and modifiers of content, dynamic and customized information feeds, etc. Wikis Wikis Social networking sites Social networking sites Blogs Blogs RSS feeds RSS feeds Podcasting Podcasting Many others Many others

6. The Internet Backbone Internet backbone -- major set of computer connections on Internet Internet backbone -- major set of computer connections on Internet Network access point (NAP) Network access point (NAP) Network service provider (NSP) Network service provider (NSP) Internet service provider (ISP) Internet service provider (ISP)

7. Internet Servers Internet server computer – provides information and services on the Internet Internet server computer – provides information and services on the Internet Web server – provides information and services on the Web Web server – provides information and services on the Web Mail server – provides e-mail services Mail server – provides e-mail services ftp (file transfer protocol) server – maintains files you download ftp (file transfer protocol) server – maintains files you download IRC (Internet Relay Chat) server – supports discussion groups and chat rooms IRC (Internet Relay Chat) server – supports discussion groups and chat rooms

8. Communications Protocols Information moves on the Internet according to communications protocols Information moves on the Internet according to communications protocols Communications protocol (protocol) Communications protocol (protocol) set of rules that every computer follows to transfer information set of rules that every computer follows to transfer information Most widely used Most widely used TCP/IP (transport control protocol / Internet protocol) TCP/IP (transport control protocol / Internet protocol) http (hypertext transfer protocol) http (hypertext transfer protocol) ftp (file transfer protocol) ftp (file transfer protocol)

9. Telecommunications Hardware To access and use the Web, you also need hardware To access and use the Web, you also need hardware Mainly, some sort of modem Mainly, some sort of modem Telephone Telephone DSL DSL Cable Cable Satellite Satellite

10. Opening Case: Advertising $$ go where the Eyes are

11. The Internet The Internet Adults spend 29% of their time there Adults spend 29% of their time there Advertisers spend only 8% of $$ there Advertisers spend only 8% of $$ there Newspaper Newspaper Adults spend only 8% of their time there Adults spend only 8% of their time there Advertisers spend 20% of $$ there Advertisers spend 20% of $$ there Opening Case: Advertising $$ go where the Eyes are

12. Electronic Commerce E-commerce is changing everything E-commerce is changing everything Electronic commerce (e-commerce) Electronic commerce (e-commerce) Electronic business (e-business) Electronic business (e-business) Mobile commerce (m-commerce) Mobile commerce (m-commerce)

13. Types of Businesses Brick-and-Mortar Brick-and-Mortar Click-and-Mortar (or Bricks-and-Clicks) Click-and-Mortar (or Bricks-and-Clicks) Dot-Coms (or Pure Plays) Dot-Coms (or Pure Plays)

14. E-COMMERCE BUSINESS MODELS

15. B2B E-Commerce Business to Business e-commerce Business to Business e-commerce Where all the e-commerce money is Where all the e-commerce money is Basically, it’s about businesses doing business with other businesses Basically, it’s about businesses doing business with other businesses Supply chain management (from Chapter 2) is a big part of B2B e-commerce Supply chain management (from Chapter 2) is a big part of B2B e-commerce

16. B2C E-Commerce Business to Consumer e-commerce Business to Consumer e-commerce Business sells product/service to consumer Business sells product/service to consumer B2C is the glitzy e-commerce like iTunes, eBay, etc. B2C is the glitzy e-commerce like iTunes, eBay, etc.

17. C2B E-Commerce Consumer to Business e-commerce Consumer to Business e-commerce True economic inversion of the B2C model True economic inversion of the B2C model Fotolia is a good example (www.fotolia.com) Fotolia is a good example (www.fotolia.com)www.fotolia.com There you can post photos and videos and businesses will pay you a royalty to use them (if they like what you offer) There you can post photos and videos and businesses will pay you a royalty to use them (if they like what you offer) You can also advertise businesses on your personal Web site (called an affiliate program) and receive monies for visitors who jump from your site to the business’ Web sites You can also advertise businesses on your personal Web site (called an affiliate program) and receive monies for visitors who jump from your site to the business’ Web sites

18. C2C E-Commerce Consumer to Consumer e-commerce Consumer to Consumer e-commerce You selling to another person (or the reverse) You selling to another person (or the reverse) Usually occurs through an intermediary such as eBay Usually occurs through an intermediary such as eBay

19. Government E-Commerce Business to Government (B2G) e-commerce Business to Government (B2G) e-commerce Lockheed providing products and services to DoD Lockheed providing products and services to DoD Fairly large e-commerce model in terms of revenue Fairly large e-commerce model in terms of revenue Most U.S. government entities (for sure at the federal level) won’t do business with your business if you can’t do it electronically Most U.S. government entities (for sure at the federal level) won’t do business with your business if you can’t do it electronically Consumer to Government (C2G)e-commerce Consumer to Government (C2G)e-commerce You selling something to the government You selling something to the government This market is quite small This market is quite small Most times, “you” must register as a business before selling something to the government, which would then become B2G e- commerce Most times, “you” must register as a business before selling something to the government, which would then become B2G e- commerce

20. Government E-Commerce Government to Business (G2B) e-commerce Government to Business (G2B) e-commerce SBA providing surety guarantees, disaster assistance, etc to small businesses SBA providing surety guarantees, disaster assistance, etc to small businesses TSA holding auctions and selling off confiscated items (most times, you must be a “business” to participate in these auctions) TSA holding auctions and selling off confiscated items (most times, you must be a “business” to participate in these auctions) U.S. Geological Survey (DOI) selling detailed survey data to businesses U.S. Geological Survey (DOI) selling detailed survey data to businesses Government to Consumer (G2C) e-commerce Government to Consumer (G2C) e-commerce Does not fit well at all within the traditional supply-and-demand e- commerce notion Does not fit well at all within the traditional supply-and-demand e- commerce notion Paying taxes, registering vehicles, etc Paying taxes, registering vehicles, etc Government to Government (G2G) e-commerce Government to Government (G2G) e-commerce Mainly about information sharing, not commerce Mainly about information sharing, not commerce

21. E-COMMERCE RULES TO LIVE BY 1. Understand your business, products, services, and customers 2. Find customers and establish relationships 3. Move money easily and securely

22. 1. UNDERSTAND YOUR BUSINESS, PRODUCTS, SERVICES, & CUSTOMERS To be successful, you must… To be successful, you must… Define your products and services Define your products and services Define your target customers Define your target customers B2B (other businesses) B2B (other businesses) B2C (individuals) B2C (individuals) Define your customers perception of the value of your products and services Define your customers perception of the value of your products and services

23. Who Are Your Customers? Business to Business Business to Business Other businesses Other businesses Business to Consumer Business to Consumer Individuals Individuals Each is different and has different needs and wants Each is different and has different needs and wants

24. B2C: Convenience Versus Specialty Convenience Convenience Lower priced Lower priced Purchased frequently Purchased frequently Example: common food items Example: common food items Specialty Specialty Higher priced Higher priced Purchased less frequently Purchased less frequently Example: Stereos, computers Example: Stereos, computers Commoditylike Commoditylike Same no matter where you purchase it Same no matter where you purchase it Examples: books, music, movies Examples: books, music, movies Price and ease of ordering are important Price and ease of ordering are important Digital Digital Purchased and delivered over the Internet Purchased and delivered over the Internet Best product type for B2C e-commerce Best product type for B2C e-commerce Examples: Music, software Examples: Music, software B2C: Commoditylike and Digital

25. B2C: Mass Customization Mass customization Mass customization the ability of an organization to give its customers the opportunity to tailor its products or services the ability of an organization to give its customers the opportunity to tailor its products or services Dell – customized computer purchases Dell – customized computer purchases Apple iTunes – only the music you want (not necessarily the whole album) Apple iTunes – only the music you want (not necessarily the whole album)

26. B2B: MRO Versus Direct Maintenance, repair, and operations (MRO) materials (indirect materials) Maintenance, repair, and operations (MRO) materials (indirect materials) materials necessary for running a company but do not relate to the company’s primary business activities materials necessary for running a company but do not relate to the company’s primary business activities Similar to convenience items in B2C Similar to convenience items in B2C Office supplies, repair parts, lubricating oils Office supplies, repair parts, lubricating oils

27. B2B: Horizontal Versus Vertical B2B e-commerce takes advantage of e- marketplaces B2B e-commerce takes advantage of e- marketplaces Electronic marketplace (e-marketplace) Electronic marketplace (e-marketplace) interactive business providing a central market where multiple buyers and sellers can engage in e-commerce interactive business providing a central market where multiple buyers and sellers can engage in e-commerce Horizontal e-marketplaces Horizontal e-marketplaces Vertical e-marketplaces Vertical e-marketplaces

28. E-Marketplaces

29. 2. FIND CUSTOMERS AND ESTABLISH RELATIONSHIPS You must first find customers You must first find customers Then establish relationships Then establish relationships Otherwise, you can’t make a sale Otherwise, you can’t make a sale B2C and B2B techniques are very different B2C and B2B techniques are very different

30. B2C Marketing Mix Tools Registering with search engines Registering with search engines Online ads Online ads Viral marketing Viral marketing Affiliate programs Affiliate programs

31. Registering with Search Engines Some search engines will list your site for free Some search engines will list your site for free Others charge a fee Others charge a fee For an additional fee, your site can appear at top of a search list (every time) For an additional fee, your site can appear at top of a search list (every time)

32. Online Ads Online ads (banner ads) Online ads (banner ads) small advertisements that appear on other sites small advertisements that appear on other sites Pop-up ad – small Web page advertisement that appears on your screen outside the current Web site Pop-up ad – small Web page advertisement that appears on your screen outside the current Web site Pop-under ad – pop-up ad you do not see until you close your current browser window Pop-under ad – pop-up ad you do not see until you close your current browser window

33. Viral Marketing Viral marketing Viral marketing Encourages users to encourage friends to join in Encourages users to encourage friends to join in Example: Blue Mountain Arts (www.bluemountain.com) Example: Blue Mountain Arts (www.bluemountain.com)www.bluemountain.com Send a card Send a card Card has link so the other person can send you a card back Card has link so the other person can send you a card back

34. Affiliate Programs Affiliate program Affiliate program Directs users from one site to another Directs users from one site to another If viewers buy at the second site, the second site pays a small fee to the first site If viewers buy at the second site, the second site pays a small fee to the first site Usually a percentage of the sale Usually a percentage of the sale Click-through Click-through Conversion rate Conversion rate

35. B2B Marketing Much more personal Much more personal Not usually done with generic ads designed for mass distribution Not usually done with generic ads designed for mass distribution Often take place in e-marketplaces Often take place in e-marketplaces Once a contact is made, the relationship must be established; this often requires face-to-face meetings Once a contact is made, the relationship must be established; this often requires face-to-face meetings Must also integrate the IT systems to the supplier business and customer business Must also integrate the IT systems to the supplier business and customer business

36. 3. MOVE MONEY EASILY AND SECURELY In e-commerce, most money moves electronically In e-commerce, most money moves electronically Security becomes very important Security becomes very important

37. B2C Payment Systems Credit cards Credit cards Financial cybermediaries Financial cybermediaries Electronic checks Electronic checks Electronic Bill Presentment and Payment Electronic Bill Presentment and Payment Smart cards Smart cards

38. B2B Payment Systems Business customers… Business customers… Make large purchases Make large purchases Will not pay with credit card or financial cybermediary Will not pay with credit card or financial cybermediary Use Financial EDI Use Financial EDI Pay for many purchases at once (perhaps the end of the month) Pay for many purchases at once (perhaps the end of the month)

39. Security: The Pervading Concern Security is very important when moving money Security is very important when moving money Some security measures… Some security measures… Encryption Encryption Secure Sockets Layers Secure Sockets Layers Secure Electronic Transactions Secure Electronic Transactions Many, many others Many, many others

40. E-BUSINESS TRENDS “E” is certainly changing many things “E” is certainly changing many things Many trends in every part of your life Many trends in every part of your life 1. Crowdsourcing when businesses provide enabling technologies that allow people to create, modify, and oversee the development of a product or service. when businesses provide enabling technologies that allow people to create, modify, and oversee the development of a product or service. 2. Virtual Goods nonphysical object nonphysical object 3. M-commerce electronic commerce transactions conducted over a wireless device such as a smartphone, laptop, or tablet PC. electronic commerce transactions conducted over a wireless device such as a smartphone, laptop, or tablet PC.