Professional Documents
Culture Documents
1. Define electronic commerce (EC) and describe its various categories. 2. Describe and discuss the content and framework of EC. 3. Describe the major types of EC transactions. 4. Discuss e-commerce 2.0. 5. Understand the elements of the digital world.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
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6. Describe the drivers of EC as they relate to business pressures and organizational responses. 7. Describe some EC business models. 8. Describe the benefits and limitations of EC to organizations, consumers, and society.
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electronic commerce (EC) The process of buying, selling, or exchanging products, services, or information via computer e-business A broader definition of EC that includes not just the buying and selling of goods and services, but also servicing customers, collaborating with business partners, and conducting electronic transactions within an organization
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OTHER EC CONCEPTS
Pure Versus Partial EC EC Organizations
brick-and-mortar (old economy) organizations Old-economy organizations (corporations) that perform their primary business off-line, selling physical products by means of physical agents virtual (pure-play) organizations Organizations that conduct their business activities solely online click-and-mortar (click-and-brick) organizations Organizations that conduct some e-commerce activities, usually as an additional marketing channel
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electronic market (e-marketplace) An online marketplace where buyers and sellers meet to exchange goods, services, money, or information
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Interorganizational information systems (IOSs) Communications systems that allow routine transaction processing and information flow between two or more organizations Intraorganizational information systems Communication systems that enable e-commerce activities to go on within individual organizations
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intranet An internal corporate or government network that uses Internet tools, such as Web browsers, and Internet protocols extranet A network that uses the Internet to link multiple intranets
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AN EC FRAMEWORK
Five support areas for EC applications
People Public policy Marketing and advertisement Support services Business partnerships
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business-to-business-to-consumer (B2B2C) E-commerce model in which a business provides some product or service to a client business that maintains its own customers consumer-to-business (C2B) E-commerce model in which individuals use the Internet to sell products or services to organizations or individuals who seek sellers to bid on products or services they need
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intrabusiness EC E-commerce category that includes all internal organizational activities that involve the exchange of goods, services, or information among various units and individuals in an organization business-to-employees (B2E) E-commerce model in which an organization delivers services, information, or products to its individual employees
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consumer-to-consumer(C2C) E-commerce model in which consumers sell directly to other consumers collaborative commerce (c-commerce) E-commerce model in which individuals or groups communicate or collaborate online
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e-learning The online delivery of information for purposes of training or education e-government E-commerce model in which a government entity buys or provides goods, services, or information from or to businesses or individual citizens
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social computing An approach aimed at making the humancomputer interface more natural Web 2.0 The second-generation of Internet-based services that let people collaborate and share information online in new ways, such as social networking sites, wikis, communication tools, and folksonomies
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social network A category of Internet applications that help connect friends, business partners, or individuals with specific interests by providing free services such as photo presentations, e-mail, blogging, and so on using a variety of tools
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social network service (SNS) A service that builds online communities by providing an online space for people to build free homepages and that provides basic communication and support tools for conducting different activities in the social network social networking The creation or sponsoring of a social network service and any activity, such as blogging, done in a social network (external or internal)
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virtual world A user-defined world in which people can interact, play, and do business. The most publicized virtual world is Second Life
How Students Make Money in a Virtual World
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digital economy An economy that is based on digital technologies, including digital communication networks, computers, software, and other related information technologies; also called the Internet economy, the new economy, or the Web economy
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digital enterprise A new business model that uses IT in a fundamental way to accomplish one or more of three basic objectives: reach and engage customers more effectively, boost employee productivity, and improve operating efficiency. It uses converged communication and computing technology in a way that improves business processes
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corporate portal A major gateway through which employees, business partners, and the public can enter a corporate Web site
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The Business Environment and Performance Impact Model Business Pressures Organizational Response Strategies
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business model A method of doing business by which a company can generate revenue to sustain itself
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3. Electronic marketplaces and exchanges 4. Viral marketing 5. Social networking and Web 2.0 tools
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1. Describe the major electronic commerce (EC) activities and processes and the mechanisms that support them. 2. Define e-marketplaces and list their components. 3. List the major types of e-marketplaces and describe their features. 4. Describe electronic catalogs, search engines, and shopping carts. 5. Describe the major types of auctions and list their characteristics.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 2-39
6. Discuss the benefits, limitations, and impacts of auctions. 7. Describe bartering and negotiating online. 8. List the major Web 2.0 tools and their use in EC. 9. Understand virtual worlds and their use in EC. 10. Discuss competition in the digital economy. 11. Describe the impact of e-marketplaces on organizations, intermediation, and industries.
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e-marketplace An online market, usually B2B, in which buyers and sellers exchange goods or services; the three types of e-marketplaces are private, public, and consortia marketspace A marketplace in which sellers and buyers exchange goods and services for money (or for other goods and services), but do so electronically
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back end The activities that support online order fulfillment, inventory management, purchasing from suppliers, payment processing, packaging, and delivery intermediary A third party that operates between sellers and buyers
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TYPES OF E-MARKETPLACES
Private E-Marketplaces
sell-side e-marketplace A private e-marketplace in which one company sells either standard and/or customized products to qualified companies buy-side e-marketplace A private e-marketplace in which one company makes purchases from invited suppliers
Public E-Marketplaces
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storefront A single companys Web site where products or services are sold e-mall (online mall) An online shopping center where many online stores are located
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Web portal A single point of access, through a Web browser, to critical business information located inside and outside (via Internet) of an organization
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Types of Portals
Commercial (public) portal Corporate portals Publishing portals Personal portals mobile portal A portal accessible via a mobile device voice portal A portal accessed by telephone or cell phone Knowledge portals
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electronic catalogs (e-catalogs) The presentation of product information in an electronic form; the backbone of most e-selling sites
Online Catalogs Versus Paper Catalogs
desktop search Search tools that search the contents of a users or organizations computer files, rather than searching the Internet. The emphasis is on finding all the information that is available on the users PC, including Web browser histories, e-mail archives, and word-processed documents, as well as in all internal files and databases
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search engine A computer program that can access databases of Internet resources, search for specific information or keywords, and report the results
Software (Intelligent) Agents Voice-Powered Search
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electronic shopping cart An order-processing technology that allows customers to accumulate items they wish to buy while they continue to shop
Product Configuration
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auction A competitive process in which a seller solicits consecutive bids from buyers (forward auctions) or a buyer solicits bids from sellers (backward auctions). Prices are determined dynamically by the bids electronic auctions (e-auctions) Auctions conducted online
Innovative Auctions
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dynamic pricing Prices that change based on supply and demand relationships at any given time
One Buyer, One Seller One Seller, Many Potential Buyers
forward auction An auction in which a seller entertains bids from buyers. Bidders increase price sequentially
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reverse auction (bidding or tendering system) Auction in which the buyer places an item for bid (tender) on a request for quote (RFQ) system, potential suppliers bid on the job, with the price reducing sequentially, and the lowest bid wins; primarily a B2B or G2B mechanism name-your-own-price model Auction model in which a would-be buyer specifies the price (and other terms) he or she is willing to pay to any willing and able seller. It is a C2B model that was pioneered by Priceline.com
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Limitations of E-Auctions
Minimal Security Possibility of Fraud Limited Participation
Impacts of Auctions
Auctions as a Coordination Mechanism Auctions as a Social Mechanism to Determine a Price Auctions as a Highly Visible Distribution Mechanism Auctions as an EC Component Auctions for Profit for Individuals
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ONLINE BARTERING
bartering The exchange of goods and services e-bartering (electronic bartering) Bartering conducted online, usually in a bartering exchange bartering exchange A marketplace in which an intermediary arranges barter transactions
ONLINE NEGOTIATING
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BLOGGING (WEBLOGGING)
blog A personal Web site that is open to the public to read and to interact with; dedicated to specific topics or issues vlog (or video blog) A blog with video content
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micro-blogging A form of blogging that allows users to write messages (usually up to 140 characters) and publish them, either to be viewed by anyone or by a restricted group that can be chosen by the user. These messages can be submitted by a variety of means, including text messaging, instant messaging, e-mail, MP3, or just on the Web
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Twitter A free micro-blogging service that allows its users to send and read other users updates. tweets Text-based posts up to 140 characters in length posted to Twitter Commercial Uses of Blogs Using Blogging to Facilitate Collaboration Potential Risks of Corporate Blogs Bloggers and Politics
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social bookmarking Web service for sharing Internet bookmarks. The sites are a popular way to store, classify, share, and search links through the practice of folksonomy techniques on the Internet and intranets
wiki (wikilog) A blog that allows everyone to participate as a peer; anyone may add, delete, or change content
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avatars Animated computer characters that exhibit humanlike movements and behaviors BUSINESS ACTIVITIES AND VALUE IN VIRTUAL WORLDS
Types of business activities in virtual worlds:
Creating and managing a virtual business Conducting regular business activities Providing services for those who build, manage, or make money with virtual properties
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TRANSFORMING ORGANIZATIONS
Technology and Organizational Learning The Changing Nature of Work Disintermediation and Reintermediation
disintermediation Elimination of intermediaries between sellers and buyers reintermediation Disintermediated entities or newcomers take on new intermediary roles
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REDEFINING ORGANIZATIONS
New and Improved Product Capabilities mass customization A method that enables manufacturers to create specific products for each customer based on the customers exact needs build-to-order (pull system) A manufacturing process that starts with an order (usually customized). Once the order is paid for, the vendor starts to fulfill it
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1. Describe electronic retailing (e-tailing) and its characteristics. 2. Define and describe the primary e-tailing business models. 3. Describe how online travel and tourism services operate and their impact on the industry. 4. Discuss the online employment market, including its participants, benefits, and limitations. 5. Describe online real estate services. 6. Discuss online stock-trading services.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 3-79
7. Discuss cyberbanking and online personal finance. 8. Describe on-demand delivery of groceries and similar products/services. 9. Describe the delivery of digital products and online entertainment. 10.Discuss various online consumer aids, including comparison-shopping aids. 11.Describe disintermediation and other B2C strategic issues.
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SIZE AND GROWTH OF THE B2C MARKET WHAT SELLS WELL ON THE INTERNET CHARACTERISTICS AND ADVANTAGES OF SUCCESSFUL E-TAILING
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Travel Computer hardware and software Consumer electronics Office supplies Sport and fitness goods Books and music Toys and hobbies
Health and beauty Entertainment Apparel and clothing Jewelry Cars Services Food and drugs Pet supplies Others
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Pure-Play E-Tailers
virtual (pure-play) e-tailers Firms that sell directly to consumers over the Internet without maintaining a physical sales channel
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click-and-mortar retailers Brick-and-mortar retailers that offer a transactional Web site from which to conduct business brick-and-mortar retailers Retailers who do business in the non-Internet, physical world in traditional brick-and-mortar stores multichannel business model A business model where a company sells in multiple marketing channels simultaneously (e.g., both physical and online stores)
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Online travel bookings and associated travel services are one of the most successful e-commerce implementations SPECIAL SERVICES ONLINE
Wireless services Direct marketing Alliances and consortia Travel-Oriented Social Networks
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Limitations
Many people do not use the Internet The amount of time and the difficulty of using virtual travel agencies can be significant Complex trips or those that require stopovers might not be available online Copyright 2010 Pearson Education, Inc.
Publishing as Prentice Hall
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CORPORATE TRAVEL
Many large corporations receive additional services from large travel agencies To reduce corporate travel costs, companies can make arrangements that enable employees to plan and book their own trips Travel authorization software that checks availability of funds and compliance with corporate guidelines is usually provided by travel companies
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A Consortium of Large Employers and College Career Advisors Online Job Markets on Social Networking Global Online Portals
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BENEFITS AND LIMITATIONS OF THE ELECTRONIC JOB MARKET Probably the biggest limitation of the online job market is the fact that some people do not use and do not have access to the Internet, although this problem has declined substantially
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INSURANCE ONLINE
Companies use Internet to offer standard insurance policies, such as auto, home, etc. often at a substantial discount to individuals
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electronic (online) banking or e-banking Various banking activities conducted from home or the road using an Internet connection; also known as cyberbanking, virtual banking, online banking, and home banking
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VIRTUAL BANKS
Have no physical location; only conduct online transactions
FRESHDIRECT
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ONLINE ENTERTAINMENT
Adult Entertainment Internet Gambling Online Dating Services
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shopping portals Gateways to e-storefronts and e-malls; may be comprehensive or niche oriented shopping robots (shopping agents or shopbots) Tools that scout the Web on behalf of consumers who specify search criteria
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SPY SERVICES
Wireless Shopping Comparisons
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A traditional brick-and-mortar store with a mature Web site that uses a click-and mortar strategy is able to do the following:
Speak with one voice Leverage the multichannels Empower the customer
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disintermediation The removal of organizations or business process layers responsible for certain intermediary steps in a given supply chain reintermediation The process whereby intermediaries (either new ones or those that had been disintermediated) take on new intermediary roles
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cybermediation (electronic intermediation) The use of software (intelligent) agents to facilitate intermediation channel conflict Situation in which an online marketing channel upsets the traditional channels due to real or perceived damage from competition
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DETERMINING THE RIGHT PRICE PRODUCT AND SERVICE CUSTOMIZATION AND PERSONALIZATION FRAUD AND OTHER ILLEGAL ACTIVITIES HOW TO MAKE CUSTOMERS HAPPY
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What should our strategic position be? What are the limitations of e-tailing? How should we introduce wireless shopping? Do we have ethics and privacy guidelines? How will intermediaries act in cyberspace?
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1. Describe the factors that influence consumer behavior online. 2. Understand the decision-making process of consumer purchasing online. 3. Describe segmentation and how companies are building one-to-one relationships with customers. 4. Explain how consumer behavior can be analyzed for creating personalized services. 5. Discuss the issues of e-loyalty and e-trust in electronic commerce (EC). 6. Describe consumer market research in EC.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 4-115
7. Describe the objectives of Web advertising and its characteristics. 8. Describe the major advertising methods used on the Web. 9. Describe various online advertising strategies and types of promotions. 10. Describe permission marketing, ad management, localization, and other advertising-related issues. 11. Relate Web 2.0 and social networks to Internet market research and advertising.
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CUSTOMER DECISION SUPPORT IN WEB PURCHASING PLAYERS IN THE CONSUMER DECISION PROCESS
Initiator Influencer Decider Buyer User
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personalization The matching of services, products, and advertising content with individual consumers and their preferences user profile The requirements, preferences, behaviors, and demographic traits of a particular customer cookie A data file that is placed on a users hard drive by a remote Web server, frequently without disclosure or the users consent, which collects information about the users activities at a site
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behavioral targeting Targeting that uses information collected about an individuals Web-browsing behavior, such as the pages they have visited or the searches they have made, to select an advertisement to display to that individual
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collaborative filtering A market research and personalization method that uses customer data to predict, based on formulas derived from behavioral sciences, what other products or services a customer may enjoy; predictions can be extended to other customers with similar profiles
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CUSTOMER LOYALTY
e-loyalty Customer loyalty to an e-tailer or loyalty programs delivered online or supported electronically
Business Intelligence and Analytical Software
SATISFACTION IN EC
Satisfaction is one of the most important success measures in the B2C online environment
TRUST IN EC
trust The psychological status of willingness to depend on another person or organization
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spyware Software that gathers user information over an Internet connection without the users knowledge clickstream data Data that occur inside the Web environment; they provide a trail of the users activities (the users clickstream behavior) in the Web site Web mining Data mining techniques for discovering and extracting information from Web documents; explores both Web content and Web usage
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BIOMETRIC MARKETING
biometrics An individuals unique physical or behavioral characteristics that can be used to identify an individual precisely (e.g., fingerprints) By applying the technology to computer users, we can improve security and learn about the users profile precisely
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click (click-through or ad click) A count made each time a visitor clicks on an advertising banner to access the advertisers Web site CPM (cost per thousand impressions) The fee an advertiser pays for each 1,000 times a page with a banner ad is shown conversion rate The percentage of clickers who actually make a purchase
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 4-138
click-through rate The percentage of visitors who are exposed to a banner ad and click on it click-through ratio The ratio between the number of clicks on a banner ad and the number of times it is seen by viewers; measures the success of a banner in attracting visitors to click on the ad hit A request for data from a Web page or file
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visit A series of requests during one navigation of a Web site; a pause of a certain length of time ends a visit unique visit A count of the number of visitors entering a site, regardless of how many pages are viewed per visit stickiness Characteristic that influences the average length of time a visitor stays in a site
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advertising networks Specialized firms that offer customized Web advertising, such as brokering ads and targeting ads to select groups of consumers
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BANNERS
banner On a Web page, a graphic advertising display linked to the advertisers Web page keyword banners Banner ads that appear when a predetermined word is queried from a search engine random banners Banner ads that appear at random, not as the result of the users action
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banner swapping
An agreement between two companies to each display the others banner ad on its Web site
banner exchanges
Markets in which companies can trade or exchange placement of banner ads on each others Web sites
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GOOGLETHE ONLINE ADVERTISING KING ADVERTISING IN CHAT ROOMS OTHER FORMS OF ADVERTISING
Advertising in Online Newsletters Posting Press Releases Online Video Ads advergaming The practice of using computer games to advertise a product, an organization, or a viewpoint
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social network advertising Online advertising that focuses on social networking sites
Types of Social Network Advertising
Direct advertising that is based on your network of friends Direct advertising placed on your social network site Indirect advertising by creating groups or pages
viral marketing Word-of-mouth marketing by which customers promote a product or service by telling others about it
Viral Marketing in Social Networks
Web video analytics A way of measuring what viewers do when they watch an online video
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PERMISSION ADVERTISING
spamming Using e-mail to send unwanted ads (sometimes floods of ads) permission advertising (permission marketing) Advertising (marketing) strategy in which customers agree to accept advertising and marketing materials (known as opt-in)
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ad management Methodology and software that enable organizations to perform a variety of activities involved in Web advertising (e.g., tracking viewers, rotating ads) localization The process of converting media products developed in one environment (e.g., country) to a form culturally and linguistically acceptable in countries outside the original target market
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Automatic Versus Manual Web Page Translation Using Internet Radio for Localization
Internet radio A Web site that provides music, talk, and other entertainment, both live and stored, from a variety of radio stations
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B2B E-Commerce
1. Describe the B2B field. 2. Describe the major types of B2B models. 3. Discuss the characteristics of the sell-side marketplace, including auctions. 4. Describe the sell-side models. 5. Describe the characteristics of the buy-side marketplace and e-procurement. 6. Explain how reverse auctions work in B2B. 7. Describe B2B aggregation and group purchasing models.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 5-158
8. Describe other procurement methods. 9. Define exchanges and describe their major types. 10. Describe B2B portals. 11. Describe third-party exchanges. 12. Describe partner relationship management (PRM). 13. Describe how B2B can benefit from social networking and Web 2.0. 14. Describe Internet marketing in B2B, including organizational buyer behavior.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 5-159
business-to-business e-commerce (B2B EC) Transactions between businesses conducted electronically over the Internet, extranets, intranets, or private networks; also known as eB2B (electronic B2B) or just B2B THE BASIC TYPES OF B2B TRANSACTIONS AND ACTIVITIES
Sell-side Buy-side Exchanges Supply chain improvements and collaborative commerce
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Many-to-Many: Exchanges
exchanges (trading communities or trading exchanges) Many-to-many e-marketplaces, usually owned and run by a third party or a consortium, in which many buyers and many sellers meet electronically to trade with each other public e-marketplaces Third-party exchanges open to all interested parties (sellers and buyers)
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B2B CHARACTERISTICS
Parties to the Transaction: Sellers, Buyers, and Intermediaries
online intermediary An online third party that brokers a transaction online between a buyer and a seller; may be virtual or clickand-mortar
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Types of Transactions
spot buying The purchase of goods and services as they are needed, usually at prevailing market prices strategic (systematic) sourcing Purchases involving long-term contracts that usually are based on private negotiations between sellers and buyers
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sell-side e-marketplace A Web-based marketplace in which one company sells to many business buyers from e-catalogs or auctions, frequently over an extranet
B2B Sellers Customer Service
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AUCTIONING FROM THE COMPANYS OWN SITE USING INTERMEDIARIES IN AUCTIONS EXAMPLES OF B2B FORWARD AUCTIONS
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buy-side e-marketplace A corporate-based acquisition site that uses reverse auctions, negotiations, group purchasing, or any other e-procurement method
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PROCUREMENT METHODS
E-Procurement Organizations and Types
E-sourcing E-tendering E-reverse auctioning E-informing Web-based ERP E-marketsites E-MRO
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request for quote (RFQ) The invitation to participate in a tendering (bidding) system CONDUCTING REVERSE AUCTIONS
E-Tendering by Governments
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internal procurement marketplace The aggregated catalogs of all approved suppliers combined into a single internal electronic catalog Benefits of Internal Aggregated (Consolidated) Catalogs Quickly find what desired offering, check availability and delivery times, and complete electronic requisition forms, using fewer suppliers
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desktop purchasing
Direct purchasing from internal marketplaces without the approval of supervisors and without the intervention of a procurement department group purchasing The aggregation of orders from several buyers into volume purchases so that better prices can be negotiated
Internal Aggregation of Purchasing Orders External Aggregation for Group Purchasing
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BUYING AT SELLERS SITES AND COLLABORATIVE COMMERCE PURCHASING DIRECT GOODS bartering exchange An intermediary that links parties in a barter; a company submits its surplus to the exchange and receives points of credit, which can be used to buy the items that the company needs from other exchange participants
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FUNCTIONS OF EXCHANGES 1. Matching buyers and sellers 2. Facilitating transactions 3. Maintaining exchange policies and infrastructure
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dynamic pricing A rapid movement of prices over time and possibly across customers, as a result of supply and demand matching
Revenue Models
Transaction fees Service fees Membership fees Advertising fees Other revenue sources
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B2B portals Information portals for businesses vortals B2B portals that focus on a single industry or industry segment; vertical portals OWNERSHIP OF B2B MARKETPLACES
consortium trading exchange (CTE) An exchange formed and operated by a group of major companies in an industry to provide industrywide transaction services
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partner relationship management (PRM) Business strategy that focuses on providing comprehensive quality service to business partners E-COMMUNITIES AND PRM
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THE OPPORTUNITIES
Discover new business partners Improve recruitment Enhance ability to learn about new technologies, competitors, etc. Find sales prospects Improve participation in industry association activities
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THE USE OF WEB 2.0 TOOLS IN B2B SOCIAL NETWORKS IN THE B2B MARKETPLACE EXAMPLES OF OTHER ACTIVITIES OF B2B SOCIAL NETWORKS STRATEGY FOR B2B SOCIAL NETWORKING
Participate Monitor Use existing applications The Future of Social Networking
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THE MARKETING AND ADVERTISING PROCESSES IN B2B METHODS FOR B2B ONLINE MARKETING
Targeting Customers Electronic Wholesalers
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Which B2B model(s) should we use for e-procurement? Which B2B model(s) should we use for online B2B sales? Which exchange to join? Which solution vendor(s) should we select? What is the organizational impact of B2B? What are the ethical issues in B2B? How shall we manage the suppliers Which type of social network? Private (proprietary) or public? 9. Can we use B2C marketing methods and research in B2B?
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B2B E-Commerce
1. Describe the B2B field. 2. Describe the major types of B2B models. 3. Discuss the characteristics of the sell-side marketplace, including auctions. 4. Describe the sell-side models. 5. Describe the characteristics of the buy-side marketplace and e-procurement. 6. Explain how reverse auctions work in B2B. 7. Describe B2B aggregation and group purchasing models.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 5-199
8. Describe other procurement methods. 9. Define exchanges and describe their major types. 10. Describe B2B portals. 11. Describe third-party exchanges. 12. Describe partner relationship management (PRM). 13. Describe how B2B can benefit from social networking and Web 2.0. 14. Describe Internet marketing in B2B, including organizational buyer behavior.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 5-200
business-to-business e-commerce (B2B EC) Transactions between businesses conducted electronically over the Internet, extranets, intranets, or private networks; also known as eB2B (electronic B2B) or just B2B THE BASIC TYPES OF B2B TRANSACTIONS AND ACTIVITIES
Sell-side Buy-side Exchanges Supply chain improvements and collaborative commerce
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 5-201
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Many-to-Many: Exchanges
exchanges (trading communities or trading exchanges) Many-to-many e-marketplaces, usually owned and run by a third party or a consortium, in which many buyers and many sellers meet electronically to trade with each other public e-marketplaces Third-party exchanges open to all interested parties (sellers and buyers)
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B2B CHARACTERISTICS
Parties to the Transaction: Sellers, Buyers, and Intermediaries
online intermediary An online third party that brokers a transaction online between a buyer and a seller; may be virtual or clickand-mortar
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Types of Transactions
spot buying The purchase of goods and services as they are needed, usually at prevailing market prices strategic (systematic) sourcing Purchases involving long-term contracts that usually are based on private negotiations between sellers and buyers
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sell-side e-marketplace A Web-based marketplace in which one company sells to many business buyers from e-catalogs or auctions, frequently over an extranet
B2B Sellers Customer Service
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AUCTIONING FROM THE COMPANYS OWN SITE USING INTERMEDIARIES IN AUCTIONS EXAMPLES OF B2B FORWARD AUCTIONS
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buy-side e-marketplace A corporate-based acquisition site that uses reverse auctions, negotiations, group purchasing, or any other e-procurement method
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PROCUREMENT METHODS
E-Procurement Organizations and Types
E-sourcing E-tendering E-reverse auctioning E-informing Web-based ERP E-marketsites E-MRO
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request for quote (RFQ) The invitation to participate in a tendering (bidding) system CONDUCTING REVERSE AUCTIONS
E-Tendering by Governments
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internal procurement marketplace The aggregated catalogs of all approved suppliers combined into a single internal electronic catalog Benefits of Internal Aggregated (Consolidated) Catalogs Quickly find what desired offering, check availability and delivery times, and complete electronic requisition forms, using fewer suppliers
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desktop purchasing
Direct purchasing from internal marketplaces without the approval of supervisors and without the intervention of a procurement department group purchasing The aggregation of orders from several buyers into volume purchases so that better prices can be negotiated
Internal Aggregation of Purchasing Orders External Aggregation for Group Purchasing
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BUYING AT SELLERS SITES AND COLLABORATIVE COMMERCE PURCHASING DIRECT GOODS bartering exchange An intermediary that links parties in a barter; a company submits its surplus to the exchange and receives points of credit, which can be used to buy the items that the company needs from other exchange participants
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FUNCTIONS OF EXCHANGES 1. Matching buyers and sellers 2. Facilitating transactions 3. Maintaining exchange policies and infrastructure
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dynamic pricing A rapid movement of prices over time and possibly across customers, as a result of supply and demand matching
Revenue Models
Transaction fees Service fees Membership fees Advertising fees Other revenue sources
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B2B portals Information portals for businesses vortals B2B portals that focus on a single industry or industry segment; vertical portals OWNERSHIP OF B2B MARKETPLACES
consortium trading exchange (CTE) An exchange formed and operated by a group of major companies in an industry to provide industrywide transaction services
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partner relationship management (PRM) Business strategy that focuses on providing comprehensive quality service to business partners E-COMMUNITIES AND PRM
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THE OPPORTUNITIES
Discover new business partners Improve recruitment Enhance ability to learn about new technologies, competitors, etc. Find sales prospects Improve participation in industry association activities
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THE USE OF WEB 2.0 TOOLS IN B2B SOCIAL NETWORKS IN THE B2B MARKETPLACE EXAMPLES OF OTHER ACTIVITIES OF B2B SOCIAL NETWORKS STRATEGY FOR B2B SOCIAL NETWORKING
Participate Monitor Use existing applications The Future of Social Networking
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THE MARKETING AND ADVERTISING PROCESSES IN B2B METHODS FOR B2B ONLINE MARKETING
Targeting Customers Electronic Wholesalers
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1. Define the e-supply chain and describe its characteristics and components. 2. List supply chain problems and their causes. 3. List solutions provided by e-commerce (EC) for supply chain problems. 4. Describe RFID supply chain applications. 5. Define c-commerce and list the major types.
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6. Describe collaborative planning and collaboration, planning, forecasting, and replenishing (CPFR) and list the benefits of each. 7. Discuss integration along the supply chain. 8. Understand corporate portals and their types and roles. 9. Describe e-collaboration tools such as workflow software and groupware. 10. Describe Collaboration 2.0 technology and tools.
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supply chain The flow of materials, information, money, and services from raw material suppliers through factories and warehouses to the end customers e-supply chain A supply chain that is managed electronically, usually with Web technologies
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supply chain management (SCM) A complex process that requires the coordination of many activities so that the shipment of goods and services from supplier right through to customer is done efficiently and effectively for all parties concerned. SCM aims to minimize inventory levels, optimize production and increase throughput, decrease manufacturing time, optimize logistics and distribution, streamline order fulfillment, and overall reduce the costs associated with these activities
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e-supply chain management (e-SCM) The collaborative use of technology to improve the operations of supply chain activities as well as the management of supply chains
information visibility The process of sharing critical data required to manage the flow of products, services, and information in real time between suppliers and customers
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collaborative planning A business practice that combines the business knowledge and forecasts of multiple players along a supply chain to improve the planning and fulfillment of customer demand
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radio frequency identification (RFID) Tags that can be attached to or embedded in objects, animals, or humans and use radio waves to communicate with a reader for the purpose of uniquely identifying the object or transmitting data and/or storing information about the object
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RUBEE: AN ALTERNATIVE TO RFID? RuBee Bidirectional, on-demand, peer-to-peer radiating transceiver protocol under development by the Institute of Electrical and Electronics Engineers
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collaborative commerce (c-commerce) The use of digital technologies that enable companies to collaboratively plan, design, develop, manage, and research products, services, and innovative EC applications collaboration hub (c-hub) The central point of control for an e-market. A single c-hub, representing one e-market owner, can host multiple collaboration spaces (c-spaces) in which trading partners use c-enablers to exchange data with the c-hub
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vendor-managed inventory (VMI) The practice of retailers making suppliers responsible for determining when to order and how much to order RetailerSupplier Collaboration: Target Corporation Lower Transportation and Inventory Costs and Reduced Stock-Outs: Unilever Reduction of Design Cycle Time: Clarion Malaysia Reduction of Product Development Time: Caterpillar, Inc.
BARRIERS TO C-COMMERCE
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collaborative planning, forecasting, and replenishment (CPFR) Project in which suppliers and retailers collaborate in their planning and demand forecasting to optimize flow of materials along the supply chain
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advanced planning and scheduling (APS) systems Programs that use algorithms to identify optimal solutions to complex planning problems that are bound by constraints product lifecycle management (PLM) Business strategy that enables manufacturers to control and share product related data as part of product design and development efforts SUPPORTING JOINT DESIGN
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corporate (enterprise) portal A gateway for entering a corporate Web site, enabling communication, collaboration, and access to company information
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workflow The movement of information as it flows through the sequence of steps that make up an organizations work procedures workflow systems Business process automation tools that place system controls in the hands of user departments to automate information processing tasks workflow management The automation of workflows, so that documents, information, and tasks are passed from one participant to the next in the steps of an organizations business process
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ELECTRONIC TELECONFERENCING
teleconferencing The use of electronic communication that allows two or more people at different locations to have a simultaneous conference video teleconference Virtual meeting in which participants in one location can see participants at other locations on a large screen or a desktop computer
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data conferencing Virtual meeting in which geographically dispersed groups work on documents together and exchange computer files during videoconferences Web Conferencing
Collaboration 2.0 The technology and tools used for collaboration in the Web 2.0 world and in Enterprise 2.0 that are in sync with social networking and user-generated content
collaborative workspace An interconnected environment in which all the participants in dispersed locations can access and interact with each other just as inside a single entity
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instant messaging Technologies that create the possibility of realtime text-based communication between two or more participants over the Internet/intranet presence information Status indicator that conveys ability and willingness of a potential communication partner
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voice-over-IP (VoIP) Communication systems that transmit voice calls over Internet Protocolbased networks Blogs, Wikis, Virtual Worlds, Forums, and Other Tools
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1. Discuss the value-added attributes, benefits, and fundamental drivers of m-commerce. 2. Describe the mobile computing environment that supports m-commerce (devices, software, services). 3. Describe the four major types of wireless telecommunications networks. 4. Discuss m-commerce applications in finance. 5. Describe m-commerce applications in shopping, advertising, and provision of content.
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6. Discuss the application of m-commerce within organizations and across the supply chain. 7. Describe consumer and personal applications of m-commerce. 8. Understand the technologies and potential application of location-based m-commerce. 9. Describe the major inhibitors and barriers of mcommerce. 10.Discuss the key characteristics, critical technologies, and major applications of pervasive computing.
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mobile commerce (m-commerce, m-business) Any business activity conducted over a wireless telecommunications network or from mobile devices
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ATTRIBUTES OF M-COMMERCE
Ubiquity Convenience Interactivity Personalization Localization
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DRIVERS OF M-COMMERCE
Widespread availability of more powerful mobile devices The handset culture The service economy Vendors push The mobile workforce Increased mobility Improved price/performance Improving bandwidth
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wireless mobile computing (mobile computing) Computing that connects a mobile device to a network or another computing device, anytime, anywhere
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MOBILE DEVICES
Mobile computers personal digital assistant (PDA) A stand-alone handheld computer principally used for personal information management smartphone A mobile phone with PC-like capabilities
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wireless local area network (WLAN) A telecommunications network that enables users to make short-range wireless connections to the Internet or another network Wi-Fi (wireless fidelity) The common name used to describe the IEEE 802.11 standard used on most WLANs
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WiMax A wireless standard (IEEE 802.16) for making broadband network connections over a mediumsize area such as a city wireless wide area network (WWAN) A telecommunications network that offers wireless coverage over a large geographical area, typically over a cellular phone network
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digital divide Refers to the gap between people with effective access to digital and information technology and those without microfinance Refers to the provision of financial services to poor or low-income clients, including consumers and the self-employed
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The major objectives of these classes fell into one of six categories:
1. 2. 3. 4. 5. 6. Building brand awareness Changing brand image Promoting sales Enhancing brand loyalty Building customer databases Stimulating mobile word of mouth
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mobile entertainment Any type of leisure activity that utilizes wireless telecommunication networks, interacts with service providers, and incurs a cost upon usage
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MOBILE GAMBLING
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location-based m-commerce (l-commerce) Delivery of m-commerce transactions to individuals in a specific location, at a specific time
The services provided through location-based mcommerce focus on five key factors:
1. 2. 3. 4. 5. Location Navigation Tracking Mapping Timing
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L-COMMERCE INFRASTRUCTURE
Mobile devices Communication network Positioning component Service or application provider Data or content provider
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Positioning Components
network-based positioning Relies on base stations to find the location of a mobile device sending a signal or sensed by the network terminal-based positioning Calculating the location of a mobile device from signals sent by the device to base stations global positioning system (GPS) A worldwide satellite-based tracking system that enables users to determine their position anywhere on the earth
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Location-Based Data
Locating Navigating Searching Identifying Event checking
geographical information system (GIS) A computer system capable of integrating, storing, editing, analyzing, sharing, and displaying geographically-referenced (spatial) information
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BARRIERS TO LOCATION-BASED
M-COMMERCE Lack of GPS in mobile phones Accuracy of devices The costbenefit justification Limited network bandwidth Invasion of privacy
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pervasive computing Invisible, everywhere computing; computing capabilities embedded into the objects around us
Invisible Computing
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Internet of Things
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radio frequency identification (RFID) A short-range radio frequency communication technology for remotely storing and retrieving data using devices called RFID tags and RFID readers
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