E-Business and Ecommerce

Group Buying

If many people agree to purchase the product or service, they get significant discounts.Ex: Groupon

EC Web Sites: Attracting and Retaining Online Customers—Four Key Recommendations

1.The Web site should offer something unique 2.The Web site must motivate people to visit, to stay, and to return 3.You must advertise your presence on the Web 4.You should learn from your Web site

Credit and Debit Cards - Customer Verification Value (CVV)

Three-digit code on the back of a card Added to combat fraud in online purchases Not included in the magnetic strip information Code used for authorization by bank

Consumer-to Business (C2B)

Transactions between customers and businesses.Ex:A person offers his photographs at shutterstock.com

Consumer-to-Consumer (C2C)

Transactions between people not necessarily working together.Ex: A person purchases some memorabilia from another person via eBay.com.

Search Engine Optimization (SEO)

SEO attempts to improve a page's ranking in search engines like Google. Techniques include having other pages link to the page, keeping content updated, and including key words.

Sales Revenue Model

Sales of goods, information, or services.EX. Amazon, Gap,iTunes

Forward auction

Sellers post goods or services for sale Buyers bid on these items Highest bid wins

Search Engine Advertising (SEO)

Sponsored search Pay to ensure a spot on top of search results page Company in control of ad positioning Pay-per-click Can get costly

Internet Taxation

The Internet Tax Freedom Act - 1998 Created as an incentive for EC businesses Internet sales treated as mail-order sales No sales taxes paid in states where the company has no presence Problem Loss of tax incomes Unfair advantage for e-tailers

e Information

The use of the Internet to provide electronic brochures and other types of information for customers. Global customers can access timely , 24/7/365 Reduces cost and time needed to disperse materials No transactional capabilities

e-integration

customers can access dynamic, customized information (bank statements) no transactional capabilities

e-transaction

customers get real-time access to information about products and services customers can make purchases and payments and conduct banking or investment transactions Most advanced stage

Revenue Model

describes how the firm will earn revenue, generate profits, and produce a superior return on investment

Stages of B2C E-Commerce

e-information, e-integration, e-transaction

Common Revenue Model for EC

Advertising Subscriptions Transaction Fee Sales Affiliate

Government-to-citizen (G2C)

Allowing individuals to file tax returns, renew driver's licenses, and obtain various permits online.

Click-And-Mortar

Best Option -Hybrid Strategy A business that operates in a physical store and on the Internet EX: Barnes & Noble Added complexity combining 2 different environments

3 Types of Business Strategies

Brick-And-Mortar Click-Only Click-And-Mortar

Most Common Types Of E-Commerce

Business-to-consumer (B2C) Business-to-business (B2B) Consumer-to-business (C2B) Consumer-to-consumer(C2C)

Reverse auction

Buyers post a request for quote (RFQ) Seller proposes a bid Lowest seller bid wins Used frequently in B2B e-commerce

New Revenue and Pricing Models

Companies can earn revenues not only through traditional sales, but also through subscription, licensing, or transaction fees. Companies and individuals can earn money through Web advertising or affiliate marketing. Helps companies get rid of their excess inventory. Ex: Priceline.com

Click-Only

Company only operates on the web Can sell anywhere in the world 24/7 Customers uncomfortable with online transactions No face-to-face interaction with customers Must wait for products to be shipped

Securing Payments in the Digital World

Credit and Debit Cards Credit cards are a simple mechanism Consumers have to transfer a lot of personal information to the seller Risk of identity theft Managing Risk Businesses are financially liable for fraudulent transactions Businesses have to look for fraud indicators and sometimes reject risky transactions Payment Services Examples: PayPal, Google Checkout

Disintermediation

Cutting out the "middleman" and reaching customers more directly and efficiently buying directly from the website. Ex:Dell.com

C2C EC

E-auctions Online classifieds Forward Auction Reverse Auctions

E-Auction Fraud

E-auctions marred with more fraud than any other Internet activity 42% of all Internet-fraud related complaints Average loss: $1,155 Types of e-Auction fraud Bid luring Shipping fraud Payment failure Nonshipment

Business-to-Consumer (B2C)

E-commerce transactions between businesses and consumers.Ex: A person buys a book from Amazon.com

Business-to-Business (B2B)

E-commerce transactions between businesses.Ex: A manufacturer conducts business over the Web with its suppliers.

Government to Government (G2G)

Electronic interactions that take place between countries or between different levels of government within a country.Foreign government accessing U.S. federal regulations.

Characteristics of the Internet

External Communications General, Public and "advertorial" information Any user with an Internet connection Public and NOT restricted

Characteristics of the Extranet

External Comunnications Communication between business partners Authorized business partners Private and Restricted

Transaction Fee Revenue Model

Fee(commissions) for enabling or executing a transaction.EX: E-Trade & eBay

Affiliate Revenue Model

Fees for business referrals. Ex. mypoints.com

Advertising Revenue Model

Fees from advertisers in exchange for advertisements.Ex: yahoo.com & Facebook.com

Subscription Revenue Model

Fees from subscribers in exchange for access to content or services. Ex: WSJ (Wall Street Journal)

Mass customization

Firms can tailor their products and services to meet a customer's particular needs.

Government-to-business (G2C)

Government purchases supplies using Internet enabled procurement system.(software used to manage organizational spending)

E-auctions

Individual sellers can sell or barter items at online auctions Consumers place bids Examples: eBay.com and swap.com Revenue model based on small transaction fees, highly profitable

Characteristics of the Intranet

Internal Communications Specific,corporate, and proprietary information Authorized employees Private and Restricted

Extranet

Internet based B2B system Virtual private network (VPN) used to secure information transmission A private network that uses Internet technologies to share business information with select corporate partners or key customers. Allows invited users to access.Ex: clients & business partners .

Intranet

Internet based private network using Web technologies Firewalls used for security Only available for Employees within the organization

Online Classifieds

Just advertising, no online transactions Freecycling Example: craigslist.com

e-Tailing: Capabilities and Benefits (electronic retailing)

Mass Customization Disintermediation Group Buying New Revenue and Pricing Models Social Commerce

electronic commerce (e-commerce)

Online exchange of goods, services and money Among firms, between firms and their customers and between customers Supported by communication technologies and in particular, the "Internet"

Brick-And-Mortar

Physical locations only Traditional store Limited sales and support hours Limited geographical reach

E-Commerce benefits

Place Benefits -Can sell far wider variety of products Price Benefits - HIgh volumes and low overhead allow competitive pricing

E-government

Providing information about public services To citizens To organizations To other governmental agencies 1998 - Government Paperwork Elimination Act

Internet Marketing

Refers to advertising and marketing activities that use the internet, email and mobile communications to encourage direct sales via electronic commerce

C2B e-commerce

Relatively new phenomenon, consumers can sell small pieces of work (e.g., photos) or services to businesses It might be argued that anyone who made a living doing this is actually in business for themselves, so may be B2B

E-Commerce Challenges

Trust becomes an issue due to customers inability to adequately experience the product or services prior to their purchase. Uncertainty surrounding product delivery and returns.

Electronic Data Interchange (EDI)

Used prior to the introduction of the Internet EDI used for B2B systems an approach that puts information in a standardized format easily shared between different computer systems.

Social Commerce

Utilizing social networks to build lasting relationships and advertise products.