E-Commerce & E-Business

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31 Οκτ 2013 (πριν από 3 χρόνια και 7 μήνες)

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E
-
Commerce & E
-
Business


Electronic commerce can take several forms depending on the
degree of digitization (the transformation from physical to digital).


The degree of digitization relates to:


the
product

(service) sold


the
process


the
delivery agent

(or intermediary).

E
-
commerce

describes the process of buying, selling, transferring, or exchanging
products, services, and/or information via computer networks, including the
Internet.
E
-
business

refers to a broader definition of e
-
commerce, not just the
buying and selling of goods and services, but also servicing customers,
collaborating with business partners, conducting e
-
learning, and processing
electronic transactions.

Turban et al., 2005

E
-
Business


Transaction Medium

Most e
-
commerce is done over the Internet. But EC can also be conducted
on private networks, such as
value
-
added networks

(
VANs, networks that
add communication services to existing common carriers
), on local area
networks (LANs) or wide area networks (WANs)

14
-
3

Scope of E
-
commerce


Applications supported by infrastructure


Hardware


Software


Messaging, multimedia, interfaces, business services


Networks


communications


Support areas


People


Legal and public policy and regulations


Marketing and advertisements


Support services ranging from payments to order delivery


Business partnerships like joint ventures, e
-
marketplaces, affiliations


14
-
4

Advantages


Advantages:


Expands marketplace globally


Expands availability of
resources


Shortens marketing
-
distribution channels


Decreases expenses


Reduces inventory


Aids small businesses in
competing


Enables specialized niches


Quicker delivery of information


Enables individuals to work
from home


Facilitates delivery of public
services



Allows for purchase of
goods at lowered prices


Enables customization,
personalization


Decreases costs to
customers, while
increasing their choices


Allows for 24 hour
shopping


Makes electronic auctions
possible


Enables people to
interact in electronic
communities





14
-
5

Limitations


Limitations:


Lack of universal standards


Insufficient bandwidth


Software
-
development tools are still evolving


Integration difficulties


Need for special Web servers in addition to network servers


Accessibility expensive


Unresolved legal issues


Lack of national and international governmental regulations


Lack of mature methodologies to measure benefits and justify


Customer resistance


Security questions


Insufficient number of buyers and sellers for profitable e
-
commerce
operations



Types of Commerce

Commerce


Electronic
Commerce

Physical or Traditional Commerce


Internet

Commerce






Business

focused

e
-
commerce

Consumer focused

e
-
commerce

E
-
Business


Transaction Types

E
-
commerce transactions can be done between various parties.


Business
-
to
-
business (B2B)


Collaborative commerce (c
-
commerce)


Business
-
to
-
consumers (B2C)


Consumers
-
to
-
businesses (C2B)


Consumer
-
to
-
consumer (C2C)


Intra
-
business (intra
-
organizational) commerce


Government
-
to
-
citizens (G2C)


Mobile commerce (m
-
commerce)

Turban et al., 2005

Digital Phenomenon


What do you think?


What are the drivers of e
-
commerce?

D
ata networks

I
ntense competition

G
lobalization

I
nformation age

T
echnologies

A
utomation

L
ow cost high quality products/services

DIGITAL

E
-
commerce from different
perspectives


E
-
business
: a wider perspective than e
-
commerce.


E
-
commerce improves the value chain.


E
-
commerce provides an effective tool for
building, managing and enhancing these
relationships.



E
-
Commerce today


Why e
-
commerce is different


Ubiquity (omnipresent)


Global reach


Universal standards


Richness


Interactivity


Information density


Personalization/customization


Electronic Commerce and the Internet

Reach


Access and connection :


the number of customers a business can connect with;


the number of products it can offer to those customers.


Unconstrained by physical limitations
-

Reach explodes !


Example : Navigation function (catalogue) separated from physical
function (inventory).

Evans and Wurster, 1999

Implications of Reach


Unstable business boundaries;


Suppliers
-

bypass retailers and build relationship with end consumer;


Large suppliers
-

lose control of navigation and sources of differentiation;


Must achieve the reach that the buyer values.

Richness


Two dimensions :


Depth and detail of information that the business can give the
customer;


Depth and detail of information that it collects about the customer

Richness

Rich Customer Information


Opportunity for rich customer information:


Example
-

browsing behaviour, purchase history & demographics
etc.;


Integrate information from a variety of sources;


Potential barriers:


Privacy constraints;


Consumer can search for and organise information.

Evans and Wurster, 1999

Affiliation


Affiliation
-

whose interests the business represents;


Navigators
-

opportunity to affiliate with customers;


Consumer given greater variety and sophistication:


Rich information from wide
-
reaching sources at negligible costs;


‘Meta Navigators’
-

use technologies that compare multiple electronic
retailers;


Supplier industries
-

greatest difficulty with controlling navigation.

Evans and Wurster, 1999

How is e
-
business different?


Reduction in physical boundaries and distance;


Serve larger customer base more efficiently;


Target specific customer groups;


The Internet is an interactive marketing medium;


More detailed information on customer transactions; and


Improved transaction efficiency.



Kim et al., 2004

Communications Types

C
4

C
5

C
1

C
2

C
4

O

Many
-
to
-
many communications via

the Internet medium

O
-

Organisation

M
-

Communicating Message

C
-

Customers

Internet Medium

C
3

O

O

O

Content

M

M

M

Content

M

M

M

Content

Content

Contrast with Conventional Marketing

“a many
-
to
-
many mediated communications model in which

consumers can interact with the medium, firms can provide

content to the medium and, in the most radical departure from

traditional marketing environments, consumers can provide

commercially oriented content to the medium.”


Hoffman & Novak, 1997

Why should organisations use the Internet?


Large companies in particular already computers, networks and
bandwidth;


Potential cost savings;


Network economic effects;


Many business transactions already conducted at a distance;


Opportunities for close alliances.

Coltman et al., 2001

The Growth of E
-
Commerce

Retail e
-
commerce revenues have grown exponentially since 1995 and have only recently “slowed” to a
very rapid 25 percent annual increase, which is projected to remain the same until 2008.

Source: Based on data from
eMarketer
, 2006; Shop.org and Forrester Research, 2005; and authors.

Different types of E
-
Commerce


Business

(organization)



Customer

(individual)




Business (organization)




Customer

(individual)




B2C

(
e.g

Amazon)




C2B

(e.g Priceline)




C2C

(e.g eBay)




B2B

(e.g TPN)

Business
-
To
-
Consumer


B2C



Electronic retailing

(
e
-
tailing
) is the direct sale of products
through electronic storefronts or electronic malls, usually
designed around an electronic catalog format and/or
auctions.



Electronic Storefronts.

Hundreds of thousands of solo
storefronts can be found on the Internet, each with its own
Internet name and EC portal, such as Home Depot, The
Sharper Image, or Wal
-
Mart.


Electronic mall
, also known as a cybermall or e
-
mall, is a
collection of individual shops under one Internet address.

Turban et al., 2005

E
-
tailing Issues


B2C



Resolving channel conflict


Resolving conflicts within click
-
and
-
mortar
organizations


Organizing order fulfillment and logistics


Determining viability and risk of online e
-
tailers


Identifying appropriate revenue models

The concept of retailing and e
-
tailing implies the sale of goods and/or services to
individual customers. The following are the major issues faced by e
-
tailers that may
be handled and supported by IT tools:

Turban et al., 2005

Key Questions for E
-
tailers


Does the Internet enable a company to significantly enhance its
value proposition to customers?


Does the Internet suit the nature of the company’s products and
appeal?


Can the company brand attract customers to the web site?


What value
-
added services and techniques can be employed to
encourage customer ‘lock
-
in’?


What is the relationship between online and offline activities?


Where do we obtain the necessary online marketing and web site
capabilities?

Service Industries


B2C



Electronic banking


International and Multiple
-
Currency Banking


Online Securities Trading


Online Job Market


Travel Services


Real Estate

Delivery of
services (buying an airline ticket or stocks)

can be done 100
percent electronically, with considerable cost reduction potential. Therefore,
online services is growing very rapidly.

Turban et al., 2005

B2C revenue model sources


B2C revenue model sources


Advertising


Web site offers providers and opportunity to
advertise


Subscription

Web site charges a subscription fee for access
to the site


Transaction


company receives a fee for executing a
transaction


Sales


a means of selling goods, information, or service
directly to customers


Affiliate


companies receive a referral fee for directing
business to an affiliate

E
-
Commerce Case
:
Amazon.com

In 2003, Amazon achieved a net profit margin of 0.7%. Though not
spectacular, this was a milestone for a company that had run large losses
in each and every year since its founding as an online bookstore in 1995.
Healthier net profit margins of 8.5% and 4.2% followed in 2004 and 2005,
respectively.

One of the keys to attaining profitability was the reconfiguration of
Amazon’s supply chain. At first Amazon had attempted to implement a
pure pull system without the use of warehouses. The internet had seemed
to pave the way to this mode of operation. Most of Amazon’s books came
from the wholesaler Ingram Book Group. Ingram maintained inventory but
received an appreciable amount of sales revenue in return. In addition,
Amazon shared Ingram’s inventory with other booksellers, leading to
costly
stockouts

during peak demand periods, such as the holidays.

Amazon adapted by redesigning its supply chain to include warehouses
that are managed as “push” operations. The retail part of operations,
however, remains a “pull” system, satisfying demand in the form of
individual orders
.


Business
-
to
-
Business (B2B)
E
-
Commerce


Business
-
to
-
Business (B2B) Evolution:


Automated order entry systems started in 1970’s


Electronic Data Interchange (EDI) started in the 1970’s


Electronic Storefronts emerged in the 1990’s


Net Marketplaces emerged in the late 1990’s



Benefits of B2B E
-
Commerce


Lower procurement administrative costs,


Low
-
cost access to global suppliers


Lower inventory investment due to price transparency/reduced response
time


Better product quality because of increased cooperation between buyers
and sellers, especially during the product design and development

CSC1720


Introduction to
Internet

All copyrights reserved by C.C. Cheung 2003.

28

B2B Service Providers


B2B service providers make the B2B transactions
easier.


These e
-
Businesses help other businesses improve
their policies, procedures, services and general
operations.


Solutions include supply chain management,
logistics, procurement.


www.ariba.com


www.freemarkets.com


www.liveperson.com

© 2005 Prentice Hall, Decision
Support Systems and
Intelligent Systems, 7th Edition,
Turban, Aronson, and Liang

14
-
29

B2B Applications


Electronic exchanges


E
-
marketplaces with many sellers and buyers


Types


Systematic sourcing by vertical distributors of direct
materials


Indirect materials sold on “as needed” basis with dynamic
pricing


Systematic sourcing for indirect materials at fixed pricing


Spot sourcing of services on “as needed” basis




14
-
30

Collaborative E
-
commerce


Non
-
sales based e
-
commerce transactions between
organizations


Electronic support of communication, information
sharing, joint decision making


Types


Retailers/suppliers


Vendor
-
managed inventories supplied to retailers


Product design


Collaborative manufacturing through outsourcing of
components and subassemblies


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-
31

Collaborative E
-
commerce


Collaborative workflow management


Planning and scheduling


Design


New product information


Product
-
content management


Order management


Sourcing and procurement


14
-
32

Intrabusiness E
-
commerce


B2E


Intranet
-
enabled business between business and
employees


E
-
commerce between business units


Organization units sell and buy materials and products
from each other


E
-
commerce between corporate employees


Classified ads


Sales force automation


Empowerment of salespersons

14
-
33

E
-
government


Use of Internet technologies and e
-
commerce to deliver
information and services to citizens


Gives citizens more access to information


Allows for more feedback from citizens


Facilitates fundamental changes in relationships between citizen and
government


Types


Government
-
to
-
citizens (G2C)


Electronic benefits transfer, payment of taxes


Government
-
to
-
business (G2B)


RFQs, RFBs, reverse auctions


Government
-
to
-
government (G2G)


Sharing of databases, information


14
-
34

E
-
learning


Online delivery of information for educational or training
purposes


Benefits


Eliminates barriers of time, distance, socioeconomic status


Saves money, reduces travel time


Increases access to experts


Enables large numbers to take classes


Provides on
-
demand, self
-
paced learning


Limitations


Special training for instructors and students


Requires special equipment and support services


Lack of face
-
to
-
face interaction

14
-
35

Customer to Customer

E
-
commerce


Buyers and sellers not businesses


Types


Auctions


Classified ads


Personal services


Bartering

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-
36

Variants of E
-
Commerce


Mobile commerce


E
-
commerce through use of mobile computing devices on wireless
networks


Advantages


Mobility


People can be reached at any time


L
-
commerce


Location
-
based mobile commerce


Information pushed out to recipient based on their current location


Pervasive computing


Computations become part of the environment


Embodied in things


Based on intelligent systems


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-
37

Portals


Commercial


Offer content to broad audiences


Routine


Little personalization


Publishing


Based on specific interests


Extensive search capabilities


Personal


Target specific filtered information


Narrow content


Personalized


Mobile


Accessible through mobile devices


14
-
38

Portals


Voice


Audio interfaces


Accessible through phones


Corporate


Access to business information located both within and
outside of organization


Rich content


Limited communities


Organized focal point


Suppliers


Customers


Employees


Supervisors


E
-
commerce scenarios


Retailing


Servicing


Publishing


Supply chain management


Discussion: How are they changing?

Discussion


How should different departments participate
in an e
-
commerce project?


Management


Marketing


Production


Finance


Procurement


Customer support



Transformation of a Compartmentalized
Organization into Integrated Organization

Management

Production


Department

Finance


Department

Marketing
Department

Personnel
Department

Management

Production

Marketing


Finance

Personnel

CSC1720


Introduction to
Internet

All copyrights reserved by C.C. Cheung 2003.

42

Electronic Data Interchange (EDI)


Standard format to exchange business data.


EDI message is a string of data that represents

price

,

product number

,

product name

,
etc.


EDI message can be encrypted.


EDI is one form of E
-
commerce, also include
email, fax.




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.

44

M
-
Commerce


What is Mobile Commerce?


Mobile commerce is the term applied to
online financial transactions
-

shopping or the
electronic transfer of funds
-

using a mobile
device.


Mobile commerce transactions are being
enhanced by developments in the world of
mobile communication.


M
-
Commerce services and applications


Content and location
-
based services


Banking and financial services


Wireless advertising


Games and entertainment


Accessing information from the wireless Web


M
-
Commerce challenges


M
-
Commerce

46

MasterCard & M
-
Commerce

Three
-
tier Technical Model

Client side

Service system

Backend system

Server side

Architecture of Web
-
based
E
-
Commerce System

Backend system

Firewall


Internet

Server side

Intranet

(Secure)

Web Server

Application Server

Database

Service system

Client side

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49