1. MIS E-COMMERCE Working 24//7 Net Flix ADWORDS E-bake
CHAPTER 8
E-COMMERCE
Net Flix
ADWORDS
Working 24//7
Hossein BIDGOLI
E-bake
Google – m-commerce

2. Chapter 8 E-Commerce
l e a r n i n g o u t c o m e s
LO1 Define e-commerce and describe its advantages, disadvantages, and business models.
LO2 Explain the major categories of e-commerce.
LO3 Describe the business-to-consumer e-commerce cycle.
LO4 Summarize the major models of business-to- business e-commerce.
LO5 Describe mobile- and voice-based e-commerce.

3. l e a r n i n g o u t c o m e s (cont’d.)
Chapter 8 E-Commerce
l e a r n i n g o u t c o m e s (cont’d.)
LO6 Explain two supporting technologies for e- commerce.

4. Defining E-Commerce ___________________________ E-commerce
Business applications that use the Internet:
Buying and selling products and services
Collaborating with other companies
Communicating with business partners
Gathering business intelligence on customers and competitors
Providing customer service
Making software updates and patches available
Offering vendor support
Publishing and disseminating information

5. Value Chain Analysis
Is a process of ______________ an organization’s activities to determine where value is added to products and/or services and what costs are incurred in doing so.

6. Net Flix
Net Flix
Describe Net Flix’s competitive advantage and what are the sources of that competitive advantage ?
Discuss where you feel Net Flix uses of information systems helps them add value in the Value chain.

7. Revenue Paradigms How do we make a buck? Margin * Volume
E-bake
Revenue Paradigms
Sales
- Cost of goods sold
Gross margin
- Expenses
Net income
How do we make a buck?
Margin * Volume
(SP – cost) * Volume

8. Dell Computer: E-Commerce in Action
Sells computers, hardware, and software directly to customers
Lower manufacturing costs, faster delivery, and more customized products and services
Just-in-time (JIT) inventory system
Keep inventory around for no more than 8 to 11 days

9. Advantages of E-commerce
Better relationships with suppliers, customers, business partners
Price transparency
Round the clock and globe operations
____________ information on potential customers
Increasing customer involvement
Improving customer service
Increasing flexibility and ease of shopping
Sales
- Cost of goods sold
Gross margin
- Expenses
Net income

10. Advantages of E-Commerce
______________ the number of customers
Increasing opportunities for collaboration with business partners
Increasing return on investment because inventory needs are reduced
Offering personalized services and product customization
Reducing administrative and transaction costs
Sales
- Cost of goods sold
Gross margin
- Expenses
Net income

11. Disadvantages of E-Commerce
Bandwidth capacity problems
Security issues
Accessibility
Acceptance

12. E-Commerce Business Models
E-commerce companies focus their operations in different parts of the value chain
Types
Merchant
Brokerage
______________
Mixed
Informediary
Subscription
ADWORDS

13. Major Categories of E-Commerce
Exhibit 8.3
Major E-Commerce Categories
Major Categories of E-Commerce

14. Business-to-Consumer E-Commerce (cont’d.)
Companies sell directly to consumers
Examples:
Amazon.com
Barnesandnoble.com
Onsale.com
Types:
Pure-play
Brick and mortar stores with virtual storefronts

15. Business-to-Business E-Commerce
Involves electronic transactions between businesses
Electronic data interchange (EDI) and electronic funds transfer (EFT)
Fastest growing segment of e-commerce
Uses:
Purchase orders, invoices, inventory status, shipping logistics, business contracts, and other operations
Example:
Walmart

16. Consumer-to-Consumer E-Commerce
Involves business transactions between users
Online classified ads:
Craigslist.org
Online auction sites:
eBay.com

17. Consumer-to-Business E-Commerce
Involves people selling products or services to businesses
Example:
Creating online surveys
Search for sellers of a product and services
Priceline.com

18. Government and Nonbusiness E-Commerce
E-government applications
Categories:
Government-to-citizen (G2C)
Government-to-business (G2B)
Government-to-government (G2G)
Government-to-employee (G2E)

19. Government and Nonbusiness E-Commerce (cont’d.)
Nonbusiness organizations:
Universities
Nonprofits
Political and social organizations

20. Organizational or Intrabusiness E-Commerce
Involves e-commerce activities that take place inside an organization
Can include
Exchange of goods, services, or information among employees
Conducting training programs and offering human resource services
Supporting activities in Porter’s value chain

21. A B2C E-Commerce Cycle Major activities: Information sharing Ordering
Payment
Fulfillment
Service and support

22. B2B E-Commerce: A Second Look
B2Bs use these additional technologies extensively:
Intranets
Extranets
Virtual private networks
Electronic data interchange (EDI)
Electronic funds transfer (EFT)
Lowers production costs and improves accuracy
By eliminating many labor-intensive tasks

23. Major Models of B2B E-Commerce
Three major types of B2B e-commerce models, based on who controls the marketplace:
Seller
Buyer
Intermediary (third-party)

24. Seller-Side Marketplace
Most popular B2B model
Sellers who cater to specialized markets come together to create a common marketplace for buyers
E-procurement
Enables employees in an organization to order and receive supplies and services directly from suppliers
Can also automate some buying and selling activities
Major vendors of e-commerce and B2B solutions include I2 Technologies, IBM, Oracle, and SAP

25. Buyer-Side Marketplace
Buyer, or a group of buyers, opens an electronic marketplace
Invites sellers to bid on announced products or requests for quotation (RFQs)
Buyers can:
Manage the procurement process more efficiently
Lower administrative costs
Implement uniform pricing
Large corporations, such as General Electric or Boeing

26. Third-Party Exchange Marketplace
Controlled by a third party
Marketplace generates revenue from the fees charged for matching buyers and sellers
Usually active in vertical or horizontal market
Offers suppliers a direct channel of communication to buyers through online storefronts

27. Mobile and Voice- Based E-Commerce
Mobile commerce (m-commerce)
Based on Wireless Application Protocol (WAP)
Using handheld devices, such as smart phones or PDAs, to conduct business transactions
______________ technologies:
Wireless wide-area networks and 3G networks
Short-range wireless communication technologies
Examples:
iPhone apps
Internet Explorer Mobile
Google mobile
Google – m-commerce

28. Mobile Commerce Issues confronting m-commerce
Working 24//7
Mobile Commerce
Issues confronting m-commerce
User-friendliness of the wireless device
Network speed
Security
________________ of life

29. E-Commerce Supporting Technologies
Electronic payment systems
Web marketing
Search engine optimization

30. Electronic Payment Systems
Money or scrip that is exchanged only electronically
Payment cards:
Credit, debit, charge, and smart cards
Smart cards
Credit card sized
Contains an embedded microprocessor chip storing important financial and personal information
Other types of payments:
E-cash
E-check
E-wallets
PayPal
Micropayments

31. Web Marketing
Uses the Web and its supporting technologies to promote goods and services
Terms:
Ad impression
Banner ads
Click
Cost per thousand (CPM)
Hit
Cost per click (CPC)
Click-through rate (CTR)
Cookie
Meta tag
Page view (PV)
Pop-up ads
Pop-under ads
Splash screen
Spot leasing

32. Search Engine Optimization
Method for improving the volume or quality of traffic to a Web site
Some companies offer SEO service
Editing a site’s contents and HTML code to increase its relevance to specific keywords
Recommendations for optimizing a Web site:
Keywords
Page title
Inbound links

33. Summary
Michael Porter’s value chain, compared e- commerce with traditional commerce
Major e-commerce business models
Main categories of e-commerce
B2C e-commerce business cycle
B2B e-commerce business models
Mobile and voice e-commerce
Supporting technologies