E-Commerce: Chapter 2

Brokers

A company that facilitates transactions between buyers and sellers

Virtual Mall

A company that helps consumers buy from a variety of stores

Comparison Agent

A company that helps consumers compare different stores

Shopping Facilitator

A company that provides currency conversion, language translation, payment features, delivery solution and user-customized interface.

Search Engine

A computer program that can access a database of internet resources, search for specific information or keywords, and report the results

Metamediary

A firm that offers customers access to a variety of stores and provides them with transaction services, such as financial services

Marketspace

A marketplace in which sellers and buyers exchange goods and services for money (or for other goods and services), but do so electronically

Features in a storefront

A search engine An electronic cart E-auction facilities A payment gateway A shipment court

Consortia

A small group of major buyers may create an e-marketplace to deal with suppliers, usually in their same industry

Early Liquidity

Achieving a critical mass of buyers and sellers as fast as possible, before a start-up company's cash disappears

Back-end-

Activities like order aggregation, fulfillment, inventory management, purchasing from suppliers

E-Distribution

An e-commerce intermediary that connects manufactures (suppliers) with buyers by aggregating the catalogs of many suppliers in one place-the intermediary's website

Electronic Markets

An electronic or web storefront refers to a single company's web site where products and services are sold

Informational Portal (Advertising Online)

An information portal is a personalized single point of access through a web browser to critical business

E-Mall

An online shopping center where many online stores are located.

Customized Catalogue

Assembled specifically for: A company An individual shopper

Public e-marketplaces

B2B markets that include many sellers and many buyers, also known as exchanges

Types of online intermediaries

Brokers Infomediaries

Competition in the internet ecosystem (Defination)

Business model of the online econmy

Support Services

Certification and trust services

Customization systems can

Create branded, value-added capabilities Allow users to compose order May include individualized prices, products and display formats Automatically identify the characteristics of customers based on the transaction records

Classifications of Electronic Catalogue

Dynamics of information presentation: Static (text and static pictures) or dynamic (animation, sound) Degree of customization: Ready made or customize

Types of stores and malls

E-Mall General Stores/Malls Specialized stores/Malls Regional vs Global Stores Pure online organizations vs Click-and-mortar stores

Regional vs Global stores

E-groceries or sellers of heavy furniture, serve customers that live in a close-by area

Seller Characteristics

EC reduces search costs, allowing costs, allowing consumers to find sellers offering lower prices

Front-end-

Electronic catalogs, a shopping cart etc

Reintermediation

Establishment of new intermediary roles for traditional intermediaries that were disintermediated

Functions of markets

Facilitation of Transactions: Logistic, settlement and trust

E-auction facilities

Features in a storefront

Infrastructure

Hardware, Software and Networks

Liquidity

Having critical mass of buyers and sellers

A search engine

Helps consumer to find products in the catalog

An electronic cart

Holding items until check-out

Consumer Characteristics

Impulse, patient, or analytical. E-markets are more conducive to consumers who do some comparisons and analyses before buying

Competition in the internet ecosystem

Inclusive of low barrier to entry Self-organizing Old rules may no longer apply Competition is intense Lower buyer's search costs Speedy comparison Differentiation Personalization

Functions of markets

Institutional Infrastructure- Legal, regulatory

Industry Characteristics

Intelligent system may replace brokers

General stores/ Malls

Large marketspaces that sell all types of products

Marketspace Components

Marketspace Customers Sellers Products Front-end- Back-end- Intermediaries/ Business partners Support Services Infrastructure

Customers

Marketspace Components

Intermediaries/ Business partners

Marketspace Components

Sellers

Marketspace Components

Functions of markets

Matching buyers and sellers- Determination of product offerings, search, price discovery

Evolution of electronic catalogs

Merchants- Advertise and promote Customers- Source of information and price comparisons Consist of product database, directory and search capability and presentation function Replication text that appears in paper catalogs More dynamic, customized, and integrated

Electronic catalogs allow integration of

Order taking and fulfillment Electronic payment Intranet workflow Inventory and accounting system Supplier's extranet Relationship to paper catalogs

Private e-marketplaces

Owned by a single company, Sell-side-company either standard or customized products to qualified companies. Buy-side-company makes purchases from invited suppliers

A payment gateway

Payments arrangements can be made

Products

Physical or Digital

Types of Marketplaces

Private Public Consortia

E-Market success factors

Product characteristics Industry characteristics Seller characteristics Consumer characteristics

Informediaries

Provide and/or control information flow.

Possible Solutions to overcome uncertainty

Provide free samples Return if not satisfied Insurance, escrow and other services are available to ensure quality and prevent fraud

Differentiation

Providing a product or service that is unique

Types of informational portal

Publishing portals Commercial portals Personal portals Corporate portals Mobile portals

E-commerce uses both search engines and intelligent agents

Search engines- Find products and services Software Agents- Conduct other tasks (comparisions) Electronic Shopping Chart: An order-processing technology that allows customers to accumulate items they wish to buy while they continue to shop

Specialized stores/Malls

Sell only one or a few types of products

A shipment court

Shipping arrangements are made

Software (intelligent) agent

Software that can perform routine tasks that require intelligence. Software agents can be used in e-commerce to support tasks such as shopping, interpreting information, monitoring activities, and working as an assistant

Personalization

The ability to tailor a product, service or web content to specific user preference

Electronic Catalogue

The presentation of product information in an electronic form; The backbone of most e-selling sites

Quality uncertainty

The uncertainty of online buyers about the quality of products that they have never seen, especially from an unknown vendor

Matching Services

These match jobs to openings, buyers to products, dating candidates and so forth

Product characteristics

Types of products: Digitizable products can be electronically distributed to customers, resulting in very low distribution costs

E-Marketplaces

Usually B2B, in which buyers and sellers negotiate

Different types of brokers

Virtual Mall Metamediary Comparison Agent Shopping Facilitator Matching Services

Pure online organizations vs Click-and-mortar stores

Virtual organizations are pure online organizations and physical stores that sell online

Disintermediation

the elimination of intermediaries such as wholesalers or distributers from a marketing channel/ Between buyers and sellers