E-commerce Chapter Five Review Questions

2. Identify and describe the business model element that specifies how the company's product will fulfill the needs of its customers.

"value proposition" defines how a company's product or service fulfills the needs of customers

1. What distinguishes an e-commerce business plan from a traditional business plan?

An e-commerce business model aims to use and leverage the unique qualities of the Internet, the Web, and the mobile platform.

10. What is an unfair competitive advantage?

An unfair competitive advantage occurs when one firm develops an advantage based on a factor that other firms cannot purchase (Barney, 1991).

18. What are five generic business strategies for achieving a profitable business?

Differentiation, Cost competition, Scope, Focus/market niche and Customer intimacy

6. What types of services does Amazon provide for businesses? Which e-commerce business models do Amazon's services fall into?

E-tailer, Online version of retail store, where customers can shop at any hour of the day or night without leaving their home or office. Market Creator, create a marketplace to bring seller and buyer togheter. and E-distributor to B2B

4. What is a freemium strategy?

In a freemium strategy, the companies give away a certain level of product or services for free, but then charge a subscription fee for premium levels of the product or service.

20. What are the main elements of an elevator pitch?

Incubators, Angel investors, Venture capital investors and Crowdfunding

12. What has been the effect of e-commerce technologies on general interfirm rivalry?

Inter-firm rivalry (competition) is one area of the business environment where e-commerce technologies have had an impact on most industries. In general, e-commerce has increased price competition in nearly all markets.

17. What kinds of firms are considered to be e-commerce enablers?

They provide the hardware, operating system software, networks and communications technology, applications software, Web design, consulting services, and other tools required for e-commerce

7. What is an on-demand services company?

a company that offers content or services charges a subscription fee for access to some or all of its offerings monthly.

13. What revenue models do content providers use, and what is the key to becoming a successful content provider?

advertising, subscription, transaction fee, sales, and affiliate. a firm must produce returns greater than alternative investments. Firms that fail this test go out of existence.

9. What are the benefits offered by incubator investor firms over other traditional sources of capital?

also provide an array of services to start-up companies that they select to participate in their programs, such as business, technical, and marketing assistance, as well as introductions to other sources of capital.

11. What is an industry structural analysis and what is its place in the e-commerce business plan?

an industry structural analysis helps you understand the impact of e-commerce technology on the overall business environment in an industry, a more detailed industry value chain analysis can help identify more precisely just how e-commerce may change business operations at the industry level.

14. What disadvantages are faced by "first-mover" companies entering a marketspace?

most first movers often lack the complementary resources needed to sustain their advantages, and often follower firms reap the largest rewards

19. Define market opportunity and describe how you would determine a new company's realistic market opportunity

refers to the company's intended marketspace and the overall potential financial opportunities available to the firm in that marketspace. The realistic market opportunity is defined by the revenue potential in each of the market niches where you hope to compete.

5. What is a disruptive technology, and how does it differ from a sustaining technology?

technologies that underpin a business model disruption, substaining technologies are technologies that enable the incremental improvement of products and services

15. What are the major similarities and differences between exchanges and e-distributors?

with exchanges critical mass is a factor. With e-distributors, the more products and services a company makes available on its site, the more attractive that site is to potential customers.