Topic1 Intdsadro

8/11/2019 Topic1 Intdsadro

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Introduction to E-commerce

Definitions: What is e-commerce?

Major types of e-commerce

E-commerce: Then and now EC evolution

EC forecast Benefits and limitations of E-commerce

eadin!s: Te"t#oo$ % Chapter &


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What is e-commerce?E-business?

E-commerce

The use of the Internet and the Web to transact

business, i.e. digitally enabled commercial

transactions between and among organizations

and individuals.

E-business

Digital enablement of transactions and processeswithin a firm, involving information systems under

the control of the firm.

EC definitions


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Why Study E-commerce?

E-commerce technology is different, more

powerful than previous technologies

E-commerce bringing fundamental changes to

commerce

Traditional commerce:

Passive consumer

Sales-force driven

Fixed prices

nformation asymmetry

E! definitions


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Keep in mind when studyingIT1004 .

Are there really NEW concepts in e-commerce

vs traditional commerce?

Is this an old concept in new packaging?

Is this an old concept with a new twist?

Is this a brand new concept?

What is the implication? The impact?


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8 Unique features of E-commerce technologies

5


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EC Technology Features(Read on your own)

EC definitions

EC tech dimension Business Significance

Ubiquity Extension of mktplace beyond traditional boundaries.

Marketplace is no longer restricted to a physical spaceGlobalreach

Commerce enabled across cultural and national boundariesseamlessly and ithout modification

Uni!ersal stds "ne set of technical media standards across the globe

#ichness $ideo% audio% text messages integrated into a singlemarketing message and consuming experience

&nteracti!ity Consumers are engaged in a dialog that dynamically ad'uststhe experience of users. Consumers are co(participant in the

process of deli!ering goods to market&nfo density &nformation is cheap% plentiful and accurate

)ersonali*ation )ersonali*ation of marketing messages and customi*ation ofproducts+ser!ices based on indi!idual characteristics

Social technology &nternet social , business models enable user content

creation and distribution and support social netork


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Web 2.0

User-centered applications and social mediatechnologies create, edit, and distribute content

share preferences, bookmarks, and online personas

participate in virtual lives

Build online communities

Examples YouTube, Photobucket, nstagram

!acebook, "inkedn, Tumblr T#itter,

$ikipedia

E% definitions

Ch i i f W b 2 0 E( d fi iti


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Characteristics of Web 2.0applications

User-created/consumer-generated content

E.g. blogs, home-made videos, facebook widgets

Easy search capability

High interactive, connecting to people

E.g. facebook friend finders, games etc.

Attract etremely large audience

!n" How can companies harness these #ualities of $eb%.& applications to their benefit'

E( definitions

f EC


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Major Types of E-commerce

Classified by relationship

Business-to-Consumers (B2C)

Business-to-Business (B2B)

Consumer-to-Consumer (C2C)

E-Government

Classified by technology

Peer-to-Peer (P2P)

M-Commerce

ypes of EC


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E-commerce: Brief History

19952000: Innovation

Key concepts developed

Dot-coms; heavy venture capital investment

20012006: onsolidation

!mphasis on "usiness-driven approach

2006#resent: $einvention

!%tension o& technolo'ies

(e) models "ased on user-'enerated content* social

net)or+s* services

!#: )en and now


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EC 1995-2000: Innovation

For computer scientists Inexpensive, universal communications and computing

environment accessible by all

For economists: Nearly perfect competitive market;

friction-free commerce

Lowered searc costs, disintermediation, price transparency,elimination of unfair competitive advantage

For entrepreneurs

!xtraordinary opportunity to earn far above normal returns oninvestment"first mover advantage

#onclusion: $isions of profiting from new tec, acieving very ig market

visibility% &ource of finance ' venture capital funds (econstruction and disintermediation

!#: )en and now

!#: )en and now


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EC 2000-2006:

Consolidation

&ift of focus from tecnology driven to business

driven

)raditional firms learn to use te *eb to strengtenteir market position and brand extension%

#apital market sun start-ups and return to more

traditional bank financing based on profitability

returned%

!#: )en and now

!#: )en and now


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EC 2007 Future:

Reinvention

+ise of new business models based on

consumer-generated content, social networking

and virtual online lives%

!#: )en and now

E commerce Then s!#: )en and now


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E-commerce: Then vs

Now

!#: )en and now

1995-2000 2000-2006 2007-future

)ec-driven usiness driven #ommunity driven

+evenue growt

empasis

!arnings and profits

empasis

udience . social network growt

empasis$enture capital

financing

)raditional financing !arly small buyouts by large online

players

/ngoverned &tronger regulation and

governance

!xtensive government surveillance

!ntrepreneurial Large traditional firms Large pure web-based firms

(isinterme-

diation

&trengten

intermediaries

&mall online intermediaries renting bi0

processes of larger firms

1erfect market Imperfect mkt, brands

. network effects

2arket imperfection

1ure online

strategies

2ixed bricks and clicks

strategies

+eturn of pure online strategies in new

mkts; bricks and clicks in traditional mktFirst-mover adv &trategic follower

strengt

First mover adv in new markets

A i E!#: )en and now


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Assessing E-commerce:Successes, Surprises & Failures

&tunning tecnological success

mixed success from business perspective

2any early visions not fulfilled

Friction-free commerce

Consumers less price sensitive Considerable price dispersion

Perfect competition

Information asymmetries persist

Intermediaries have not disappeared

First mover advantage Fast-followers often overtake first movers

!#: )en and now


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34

What does the future hold? )ecnology will propagate troug all commercial activity

!-commerce margins and profits will rise to levels more

typical of all retailers #ast of players will cange

Traditional Fortune 500 companies will play dominant

role New startup ventures will emerge with new products,

services

Number of successful pure online stores will remainsmaller tan integrated offline5online stores

+egulatory activity worldwide will grow

enefits5Limitations


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Benefits of E-commerce

enefit to 6rgani0ation

!xpands te market place

&ignificant cost savings

Improves business organi0ation and processes

1romotes interactivity wit customers and business

partners

enefits5Limitations


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enefits to customers

#onvenience, speed and cost

#onsumer empowerment

uy customi0ed products and personali0ed services

at reasonable costs

Improved interactions wit mercants and oter

customers

Benefits/+imitations


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Benefits to society

Enables more individuals to work at home, and to do

less traveling for shopping, resulting in less traffic onthe roads, and lower air pollution

Allows some merchandise to be sold at lower pricesbenefiting less affluent people

Facilitates delivery of public services at a reduced

cost, increases effectiveness, and/or improvesquality

Helping the handicapped

http//www!youtube!com/watch"v#k$i%&%'a(E)*feature#related

+enefits'imitations


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Telecommuting About 37 percent of US companies have adopted some kind of

flexible work arrangement, growing by 11 each year!

"n#office employees took less satisfaction in their $obs and felt less of a

relationship and obligation to their company

disappointed at having fewer and weaker relationships!

frustrated at a perceived increase in workload anddifficulties that telecommuting can present to finishingpro$ects and building strong working relationships!

Suggestions to mitigate this problem %ead the article

Source& http&''arstechnica!com'news!ars'post'())*)113#study#telecommuting#makes#work#worse#for#non#telecommuters!html

Benefits!imitations


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Limitations of E-commerce

Technical limitations

Systems security and reliability continues to be achallenge

Insufficient telecommunication bandwidth (certain

parts of the world) Software development tools and standards are still

evolving

Integration issues with existing applications anddatabases

Problems of interoperability and compatibility acrossplatforms and applications

Benefits!imitations


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"onsumer and social factors # $xpensive technology

Sophisticated s%ill set

Security and Privacy

!ac% of touch and feel online &nresolved legal issues

Persistent global ine'uality limiting access to

or% ethics

0enefits12imitations


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Work ethics??

CyberSource found that the peak shopping houron a recent

high-volume week (December 3 through December ! duringthe critical online holiday shopping season" was # pm $acifictime (% pm &astern time" ' work hours by anyones definition)

*n the other hand! online transactions hit their low point

between the hours of ## pm and % am $acific time (+ am and, am &astern time") fter that! as employees began going into work on the &ast Coast and then across the nation!shopping volumes also began climbing to their midday peak)

.he survey found a marked difference between workdays andweekends! too) .he highest-volume online shopping dayswere /onday and .uesday! while Saturday and Sunday hadthe lowest volumes)

Source http11www)emarketer)com1rticle)asp4?#55%3,67src8article9head9sitesearch

Wed 4pm peak online


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+%

Wed 4pm peak onlineshopping time :nternet shopping is ,; per cent higher at %pm on Wednesdays

compared to the esearch-shows-peak-time-online-shopping-

work)html


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+;

Read on your own

istory of e-commerce

@rowth of the :nternet and the web

*rigins of e-commerce

.echnology and e-commerce in perspective

$rediction for the future &-commerce organiAation themes


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+6

Interesting References

istory of the :nternet (Bideo clips"

http11www)youtube)com1watch?v8r>pcSck%wo7feat

ure8related

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