1. E-COMMERCE: DIGITAL MARKETS, DIGITAL GOODS Part-II

2. E-commerce opportunities
Communication and community
Social networking sites: Link people through their mutual business or personal connections
Have become powerful marketing tools for businesses
Social shopping: Online meeting places where people swap shopping ideas
Social Shopping allows users to stay updated with trends, celebrity looks and deals all in one place, powered by magazines, celebrities, bloggers, and its users. Based on their interests and location, Shopcade users benefit from personalised deal alerts. Shopcade also offers a click-through purchasing functionality and its own e-commerce platform.

3. E-commerce opportunities
Digital content, Entertainment, and Services
Internet has created new alternatives to traditional print, broadcast media
Online versions of newspapers, online games, radio, TV, music downloads
Podcasting: Publishing audio broadcasts via Internet; inspired by Apple’s iTunes service and iPod
Enables independent producers
New distribution method

4. E-commerce opportunities
Achieving customer intimacy
Interactive marketing and personalization
Enabled by gathering customer data from Web site registrations or activities
Clickstream tracking tools
Web pages can be tailored to customer preferences or interests
Collaborative filtering
Compares user information to data about other customers to make recommendations based on assumed interests

5. Web Site Visitor Tracking
E-commerce opportunities
Web Site Visitor Tracking
Figure 10-3
E-commerce Web sites have tools to track a shopper’s every step through an online store. Close examination of customer behavior at a Web site selling women’s clothing shows what the store might learn at each step and what actions it could take to increase sales.

6. E-commerce opportunities
Achieving customer intimacy
Corporate blogs:
Used as new channel for reaching customers, maintaining existing customers
Provide personal and conversational way for businesses to present information to the public and prospective customers about new products and services

7. E-commerce opportunities
Achieving customer intimacy
Customer self service:
Web sites and used to answer customer questions or to provide customers with product information, reducing need for human customer-support experts
New software products can integrate Web with customer call centers
E.g. by directing representative to phone user regarding query

8. E-commerce and Business Models
Pure-play business models
Based purely on Internet
Do not have bricks-and-mortar portion of business
E.g. Amazon.com, eBay.com, YouTube.com
Clicks-and-mortar models
Internet presence is extension of bricks-and-mortar businesses
E.g. L.L.Bean, Office Depot, Wall Street Journal

9. E-commerce and Business Models
Three major e-commerce categories
Business-to-consumer (B2C)
E.g. Amazon.com
Business-to-business (B2B)
E.g. ChemConnect.com
Consumer-to-consumer (C2C)
E.g. eBay.com
M-commerce
Use of handheld wireless devices for purchasing goods and services from any location

10. Business-to-business e-commerce
Electronic data interchange (EDI)
Computer-to-computer exchange of standard transactions such as invoices, purchase orders
Major industries have EDI standards that define structure and information fields of electronic documents for that industry
More companies increasingly moving away from private networks to Internet for linking to other firms
E.g. Procurement: Businesses can now use Internet to locate most low-cost supplier, search online catalogs of supplier products, negotiate with suppliers, place orders, etc.

11. Electronic Data Interchange (EDI)
Business-to-business e-commerce
Electronic Data Interchange (EDI)
Companies use EDI to automate transactions for B2B e-commerce and continuous inventory replenishment. Suppliers can automatically send data about shipments to purchasing firms. The purchasing firms can use EDI to provide production and inventory requirements and payment data to suppliers.
Figure 10-5

12. Business-to-business e-commerce
Private industrial networks (private exchanges)
Large firm using extranet to link to its suppliers, distributors and other key business partners
Owned by buyer
Permits sharing of:
Product design and development
Marketing
Production scheduling and inventory management
Unstructured communication (graphics and )
Example: VWGroupSupply.com

13. A Private Industrial Network
Business-to-business e-commerce
A Private Industrial Network
A private industrial network, also known as a private exchange, links a firm to its suppliers, distributors, and other key business partners for efficient supply chain management and other collaborative commerce activities.
Figure 10-6

14. Business-to-business e-commerce
Net marketplaces (e-hubs)
Internet-based marketplace for buyers and sellers
Industry-owned or independent intermediary
May establish prices through online negotiations, auctions, requests for quotations or use fixed prices
Generate revenue from transactions and other services
May focus on direct goods or indirect goods
May serve vertical or horizontal markets
Example: Exostar

15. Business-to-business e-commerce
A Net Marketplace
Figure 10-7
Net marketplaces are online marketplaces where multiple buyers can purchase from multiple sellers.

16. Business-to-business e-commerce
Exchanges
Independently owned third-party Net marketplaces
Connect thousands of suppliers and buyers for spot purchases
Many provide vertical markets for single industry
Primarily deal with direct goods
Proliferated during early years of e-commerce, but many have failed
Exchanges encourage competitive bidding, driving prices down, and do not offer long-term relationships
Example: FoodTrader.com

17. M-Commerce M-Commerce services and applications
Popular for services that are time-critical, that appeal to people on the move, or that accomplish task more efficiently than other methods
Especially popular in Europe, Japan, South Korea
Content and location-based services
Example: checking train schedules, searching for local businesses, Banking and financial services
Wireless advertising and retailing
Games and entertainment
Banking and financial services

18. Global M-Commerce Revenue, 2000-2009
M-commerce sales represent a small fraction of total e-commerce sales, but that percentage is steadily growing. (Totals for 2006–2009 are estimated.)
Figure 10-8

19. M-Commerce Challenges and Opportunities
Keyboards and screens tiny and awkward to use
Data transfer speeds (2G networks) slow compared to Internet connections for PCs
Time-based connection fees
Limited memory and power supplies
M-commerce will benefit from:
3G networks and other broadband services
Standardized mobile payment systems

20. Types of Electronic Payment Systems
Digital credit card payment systems
Extend functionality of credit cards for online shopping payments
Provide mechanisms for authentication and transferring money from bank to seller
Digital wallets
Software stores credit card and other information to facilitate form completion and payment for goods on Web.
Example: Google Wallet

21. Types of Electronic Payment Systems
Micropayment systems: For purchases of less than $10, such as downloads of individual articles or music clips
Accumulated balance digital payment systems: Accumulate debit balance that users pay periodically on credit card or telephone bills
Stored value payment systems: Allow instant online payments based on value stored in digital account (e.g. checking, credit card accounts
May require use of digital wallet
Example: Smart cards and devices like EZ Pass

22. Types of Electronic Payment Systems
Digital cash: “Currency” represented in electronic form that moves outside normal network of money.
Client software allows exchange of money with other e-cash user over Internet or with retailer accepting e-cash
Peer-to-peer payment systems: Serve people who want to send money to vendors or individuals who are not set up to accept credit card payments
Digital checking payment systems: Electronic check with secure digital signature
Electronic billing presentment and payment systems: Used for paying routine monthly bills from bank or credit card accounts

23. Digital payment systems for m-commerce
Utilize any form of e-commerce payment systems
Many payments are small purchases (soft drinks, mobile games, sports scores) requiring micropayment systems
In Europe/Asia, mobile payments often added and presented on single bill such as mobile phone bill

24. Thank You End of Part-II