Professional Documents
Culture Documents
Agenda
Marketing
Commerce
History of Internet
Computer, Networks
Intro to E-commerce
History of E-commerce
WWW
What is E-commerce
Forces shaping E-commerce
E-commerce today
Categories of E-commerce
What is a web based business
E-commerce marketing strategies
Setting up for E-marketing (online)
Benefits of E-commerce
Strategy Formulation
Business Model
Definition of Marketing
Philip Kotler
Social and Managerial process by which
individuals and groups obtain what they need
and want through creating, offering, and
exchanging products of value with others.
Definition (cont)
Needs exist in biology they are not
created by marketers i.e. shelter, food,
clothing, safety, belonging, esteem
Wants Need food want hamburger, fries,
coke.
Desire Wants for specific products
backed by an ability and willingness to buy
them
Definition of Commerce
The exchange of goods and services for
money
Consists of:
Buyers - these are people with money who
want to purchase a good or service.
Sellers - these are the people who offer
goods and services to buyers.
Producers - these are the people who
create the products and services that sellers
offer to buyers.
Elements of Commerce
In the 1980s
Personal computers or terminals were
connected to a server.
The server was a mainframe, or connected
to a mainframe computer.
The mainframe was connected to another
mainframe of the company in another
location via dedicated lines.
Only large companies could afford the
expense and investment in equipment.
Today
Connections across countries and
continents made through dedicated fast
lines.
A company may have one local network
(LAN) in NY, which is connected to the
Internet through a Regional network.
Well established in N.A., Europe and
certain Asian countries
Computer classifications
Mainframes:
- term for very large computers
- used to handle large amount of data or
complex processes
- main advantage is reliability
Midrange:
- medium sized, less expensive and smaller
- usually a server
Micro-computer:
- work stations with computing capabilities
- single-users systems linked to form a network
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What is a network
Series of points or nodes interconnected by
communication paths
Node is a connection point for transmitting
data
Network can interconnect with other
networks to form global networks
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Benefits of a network
Facilitates resource sharing
Provides reliability
Cost effective
Provide a powerful medium across
geographical divide
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Geographical Distance
Local area network (LAN): small area,
share a single server
Metropolitan area network (MAN): a
wider network, can bridge several LANs
Wide area network (WAN): a broader area
covered, can include several MANs
Internet: a network of networks that covers
the entire globe
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Assimilation of Technology
Introduction to E-commerce
E-Commerce, Web, Networks, Internet
The evolution of new businesses
The adoption of Brick and Mortar
companies to the new economy
Market failures and economic explanations
for the new economy
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History of E-commerce
EC applications first
developed in the early
1970s
- Electronic funds
transfer (EFT)
Limited to:
- Large corporations
- Financial institutions
- A few other daring
businesses
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E-Commerce Mechanisms
Multimedia documents:
- Text
- Images
- Sounds
- Drawings
- Video
Hypertext:
- Links to other documents
- Can begin execution of a program
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Web Browsers
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Web Servers
Computers that run server software.
A server waits for request to arrive from a
user.
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What is E-commerce
Distributing, buying, selling and marketing
products and services over electronic systems
E-business for commercial transactions
Involves supply chain management, e-marketing,
online marketing, EDI
Uses electronic technology such as:
- Internet
- Extranet/Intranet
- Protocols
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Digitalization &
Connectivity
Intranets : connect people
within a company.
Extranets : connect a
company with its suppliers,
distributors, and outside
partners.
Internet : connects users
around the world.
Internet Explosion
Explosive worldwide
growth forms the heart of
the New Economy.
Increasing numbers of
users each month.
Companies must adopt
Internet technology or risk
being left behind.
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Definitions
Internet:
- A collection of computers that speak a common
language protocol
Intranet:
- Private version of the Internet
- Main purpose to share company information
and computing resources among employees
Extranet:
- Private network that users outside the company
can access
- Requires security and privacy
- Collaborate with other companies
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E-commerce Today
The Internet is the perfect vehicle for ecommerce because of its open standards and
structure.
No other methodology or technology has proven
to work as well as the Internet for distributing
information and bringing people together.
Its cheap and relatively easy to use it as a
medium for connecting customers, suppliers, and
employees of a firm.
No other mechanism has been created that allow
organizations to reach out to anyone and
everyone like the Internet.
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E-commerce Today
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Consumers
Business
B2B
C2B
Consumers
B2C
C2C
And selling
to...
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Business to Business (B2B) refers to the full spectrum of ecommerce that can occur between two organizations.
This includes purchasing and procurement, supplier
management, inventory management, channel management,
sales activities, payment management &service and support.
Examples: FreeMarkets, Dell and General Electric
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Business
Consumers
And Selling to
Business
Publishers order
paper supplies from
paper companies
Amazon orders
from publishers
Consumers buy
thousands of Harry
Potter books from
Amazon
Consumers
Consumers search
out sellers, offers
and initiate
purchases from
Amazon
Consumers resell
copies on eBay
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Appeal of E-commerce
Larger catalogs
Improved customer interactions - company.
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Limitations of E-commerce
To organizations: lack of security, reliability,
standards, changing technology, pressure to
innovate, competition, old vs. new technology
To consumers: equipment costs, access costs,
knowledge, lack of privacy for personal data,
relationship replacement
To society: less human interaction, social
division, reliance on technology, wasted
resources, JIT manufacturing
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Technical limitations
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Business Opportunity
The Internet revolutionized ways of doing
business
Entrepreneurs found ways to exploit
market failures and earn economic rents
New businesses were created that were not
feasible earlier
The new economy poses threats to old
economy firms that do not wish to adapt
The transformation is still in process. The
evolution continues
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Access
to new customers
Scalability
Challenges
Cannibalization
Channel
conflict
Customer
Investor
confusion
confusion
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e-marketing
e-purchasing (e-procurement)
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Types of e-Marketers
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Click-Only Companies
E-tailers
Enabler
Sites
Content
Sites
Types of
Sites
Transaction
Sites
Search
Engines and
Portals
Internet
Service
Providers
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Click-and-Mortar Companies
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websites
Placing online ads and
promotions
Creating or using Web
communities
Using E-mail
Corporate
websites
websites
Engage consumers
and attempt to influence
purchase
Website
design
7 Cs of effective website
design
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Conducting E-Commerce
Seven Cs of Website Design
Context
Communication
Content
Connection
Community
Commerce
Customization
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Content
Commerce
Community
Connection
Customization
Communication
The ways sites enable site-touser communication or two-way
communication
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Context
Content
Community
Customization
Communication
Connection
Commerce
Consistent Reinforcement
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Creating
websites
Placing online ads
and promotions
Creating or using
Web communities
Using E-mail
Web Advertising
This is a pop-up ad
Click here to close me
Web Advertising
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Web Advertising
Content Sponsorship: are sites that pay for placement in search
results on keywords that are relevant to their business
The upper: This is the part of the shoe that wraps around and over the top of the foot. It may be made of leather or a synthetic material that is lighter and
breathable (to reduce heat from inside the running shoe). The tongue of the upper should be padded to cushion the top of the foot against the pressure from the
laces. Often, at the back of the running shoe, the upper is padded to prevent rubbing and irritation against the achilles tendon.
The heel counter: This is a firm and inflexible cup which is built into the upper of running shoes and surrounds the heel. It is usually very firm so that it can control
motion of the rearfoot.
Post or footbridge: This is the firm material in the midsole which increases stability along the inner side (arch side; medial side) of the running shoe.
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Web Advertising
http://www.autotrader.com/
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Viral Marketing
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websites
Placing online ads
and promotions
Creating or using
Web communities
Using E-mail
Web
communities allow
members with special
interests to exchange views
Social communities
Work-related
communities
Marketers find welldefined demographics and
shared interests useful when
marketing
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websites
Placing online ads and
promotions
Creating or using Web
communities
Using E-mail
marketing
Benefits of E-commerce
To consumers: 24/7 access, more choices, price
comparisons, improved delivery, competition
To organizations: International marketplace
(global reach), cost savings, customization,
reduced inventories, digitization of
products/services
To society: flexible working practices, connects
people, delivery of public services
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Benefits to Consumers
Convenience
Buying is easy and private
Provides greater product access and selection
Provides access to comparative information
Buying is interactive and immediate
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Benefits to Organizations
Powerful tool for building customer relationships
Can reduce costs
Can increase speed and efficiency
Offers greater flexibility in offers and programs
Is a truly global medium
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Benefits to Society
More individuals can work from home
Benefits less affluent people
Third world countries gain access
Facilitates delivery of public services
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Discussion Questions
What
Business Pressures
The term business environment refers to
the social, economic, legal,
technological, and political actions that
affect business activities
Business pressures are divided into the
following categories:
- Market (economic)
- Societal
- Technological
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Organizational Responses
Strategic systems
- Provide organizations with strategic advantages, enabling
them to:
Productivity
Quality
Customer service
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Organizational Responses
Business alliances
- Alliances with other companies, even competitors, can be
beneficial
- Virtual corporationelectronically supported temporary
joint venture
Electronic markets
- Optimize trading efficiency
- Enable their members to compete globally
- Require the collaboration of the different companies and
competitors
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Organizational Responses
Strategy Formulation
Porters three generic strategies for
business:
- focus
- low cost leadership
- differentiation
Differentiation in the new e-commerce
sector is the key to success
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Goals
External
Analysis
Strategy
Formulation
Internal
(Company)
Analysis
Corporate
Business-unit
Functional
Operating
Implementation
Control and
Monitoring
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Technology Leadership
Service Leadership
Established strategies of customer still apply
Internet service strength derived from providing
additional information to the customer
Internet provides a low-cost, high-quality
service channel with a global reach
Call centre strategy must be defined
E-mail interface channel must be defined
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Brand Leadership
Branding strength comes from being a first
mover
Brand reinforcement is a continuous task
Brand positioning can be defined using the
Internet service value chain
Brand followers need to reposition as
quickly and effectively as possible
Four brand
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Strategic Question
Resources
Simple Rules
Establish position
Leverage resources
Pursue opportunities
Identify an attractive
market
Locate a defensible
position
Fortify and defend
Establish a vision
Build resources
Leverage across markets
Works Best In
Moderately changing,
well structured markets
Rapidly changing,
ambiguous markets
Duration of
Advantage
Sustained
Sustained
Unpredictable
Risk
Performance Goal
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Business Model
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Business Models
A method of doing business by which a
company can generate revenue to sustain
itself
Spells out where the company is positioned
in the value chain
Business models are a component of a
business plan or a business case
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Business case:
- A written document
that is used by
managers to garner
funding for specific
applications or
projects; its major
emphasis is the
justification for a
specific investment
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- Transaction fees
- Subscription fees
- Advertisement fees
- Affiliate fees
- Sales
- Other models
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Transaction costs
Value Stream
Create long-term sustainability
Benefit for business stakeholders
Can be achieved in four ways:
- creation/participation in an e-marketplace
- creation/participation of virtual communities
- additional value offers
- exploitation of offers
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Creation/participation in an e-marketplace
Creation/participation of virtual
communities
Bringing together members of a community
Larger communities mean larger sources
Improves customer service
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Exploitation of offers
E-commerce/Internet economy founded on
information
Value can be added by using this information
Target customers demographically
Can bridge the uncertainty gap
Can post RFPs
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Revenue Stream
Logistical stream
Examines organization restructure to
deliver value added and revenue streams
Issues such as:
- organizational culture
- pre/post restructuring
- implementing information
- communication and training
- reward systems for motivation
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New Business
Distribution
Mass
Manufactures push
Middleman
Personalized
Customer Pull
Direct
Communications
Closed
Open
Finance
Slow
Difficult
Local
Mass
Physical
Fast
Easier
Global
Niche
Virtual
Markets
Assets
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PRE-PURCHASE
Information Search
Evaluation of Alternatives
PURCHASE
Purchase Decision
Satisfaction
POST-PURCHASE
Loyalty
Disposal
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Pre-Purchase
Purchase decision
Message selection (medium and content)
Information Search
Evaluation of Alternatives
Purchase
Purchase Decision
Post-sales support
Order tracking
Customer service
Satisfaction
PostPurchase
Loyalty
Disposal
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Metrics
Metrics: If it moves, measure it!
Measures of performance; may be quantitative
or qualitative
Response times
Site availability
Download times
Timeliness