Transcript E-Business and E

Part III. Web, Wireless, and Social Media Strategies
C hapter 6
E-Business and E-Commerce
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Chapter 6 Outline
6.1 e-Business Challenges and Strategies
6.2 Business-to-Consumer (B2C) e-Commerce
6.3 Business-to-Business (B2B) e-Commerce and e-Procurement
6.4 e-Government
6.5 e-Commerce Support Services: Payment & Order Fulfillment
6.6 e-Business Ethics and Legal Issues
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6.1 e-Business Challenges and Strategies
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Mix of online channels & media gives consumers strong control
over where and how they interact with a business or brand.
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Managers need to know how to respond to changing consumer
behavior & needs of business customers –
and how to deal with IT software vendors and consulting firms.
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Companies may outsource development or hosting of e-business
systems w/ software as a service (SaaS) or cloud computing
…but developing an effective e-business model and competitive
strategy is done in-house.
 If the business model and strategy are wrong,
then implementation wouldn’t matter in the long-run.
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Types of E-Business Transactions
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Business-to-business (B2B). Over 85% of EC volume is B2B.
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Business-to-consumers (B2C). Also called e-tailing.
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Consumers-to-business (C2B). Consumers make known a particular
need for a product or service, and then suppliers compete to
provide that product or service at the requested price;
e.g., Priceline.com
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Government-to-citizens (G2C) and to others. A government agency
provides services to its citizens via EC technologies.
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Mobile commerce (m-commerce). Transactions and activities are
conducted via wireless networks.
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E-Business Web Site Requirements
and Challenges
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Availability relates to the server-side of e-business. An always on
facility is needed to maintain the business critical apps.
Accuracy and Quick Response. Web software must be capable of
searching, sorting, processing promotions and payments, verifying
that the credit card number belongs to the person trying to use it,
confirming the purchase in real-time, etc. In time-sensitive B2B,
errors that delay delivery are intolerable.
Security and PCI DSS Compliance. PCI DSS (Payment Card Industry
Data Security Standard) is a set of infosec requirements to help
prevent credit card fraud.
Integrating EC systems with enterprise systems. Need better
integration across all customer points of interactions.
Web analytics. Learning from Web traffic and log data.
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PCI Compliance
http://www.pcisecuritystandards.org/popups/pcirocks.php
PCI Compliance is a complex process that requires every
business that deals with payment card numbers in any way
to strictly follow a detailed list of regulations.
PCI Data Security Standard (PCI DSS): All EC and brick-andmortar merchants must be PCI DSS compliant to accept,
hold, process, or exchange credit cardholder data of major
credit cards. http://pcisecuritystandards.org
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E-Business Model
Figure 6.6 E-commerce model
Objective of e-business: streamline and automate processes
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E-business Models
Comparison shopping engines
 Affiliate marketing
 Electronic marketplaces and exchanges
 Information brokers and matching services
 Memberships
 Forward auctions
 Reverse auctions
 Name-your-own-price
 Online auctions
 Online direct marketing.
 Viral marketing
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6.2 B2C e-Commerce
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Most well-known B2C site is Amazon.com,
whose patented IT developments
provide a competitive edge
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ING Direct, largest online bank with high rates,
high-volume, low-margins, and high profits
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Online job market. Most companies and
government agencies advertise job openings,
accept résumés, and take applications via the Internet.
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Despite B2C ongoing growth, many e-tailers still face challenges
that interfere with the growth of its e-tailing efforts
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6.3 B2B e-Commerce & e-Procurement
B2B
 comprises about 85% of e-commerce dollar volume.
 covers apps that enable an enterprise to form electronic
relationships with its distributors, resellers, suppliers,
customers, and other partners.
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By using B2B, organizations can restructure their supply chains
and partner relationships. – case on Wal*Mart
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B2B Business Models
Sell-side:
• Seller can be either a manufacturer (IBM.com), a distributor
(Avnet.com), or a retailer (Walmart.com)
• Primary methods are forward auctions and online catalogs, which can
be customized for each buyer
Buy-side or e-sourcing:
• E-sourcing refers to the many procurement methods.
• Primary methods are auctions, RFQ processing, and private exchanges
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6.4 E-Government
E-commerce models apply to government & the public sector
E-government is the use of Internet technology to deliver
information and public services to citizens, business partners
and suppliers of government entities
Benefits
 Improves the efficiency and effectiveness of govn’t functions,
including the delivery of public services
 Increases transparency by giving access to govn’t information
 Citizens can provide feedback and more actively participate in
democratic institutions and processes
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E-Government in the Cloud
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Budget pressures are a leading factor moving governments
into cloud computing solutions
45% of local governments are using some form of cloud
computing for applications or services
2 iPhone Apps to Curb Drunk Driving
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R-U-Buzzed was released by the Colorado DOT to estimate
blood-alcohol content
Mashup program Stumble Safely gives Washington, D.C.,
pedestrians a safe route home after a night at the bar.
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6.5 E-Commerce Support Services:
Payment and Order Fulfillment
B2B and B2C requires support services, e.g., payment and order fulfillment
Major e-commerce support services:
 e-infrastructure: technology consultants, system developers,
integrators, hosting, security, wireless, and networks
 e-processes: payments and logistics
 e-markets: marketing and advertising
 e-communities: citizens, audiences and business partners
 e-services: CRM, PRM, and directory services
 e-content: supplied by content providers
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Advertising Strategies and Revenue Models
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Affiliate marketing and advertising: an
organization refers consumers to other
companies’ Web sites.
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Viral marketing: word-of-mouth marketing;
customers promote a product or service by
telling many others about it, often via tweets or
texts.
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Customizing ads: marketing managers can
customize display ads based on users’ profiles.
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E-payment systems
Electronic funds transfer (EFT)
 Electronic checks
 Electronic credit cards
 Purchasing e-cards
 e-Cash—smart cards
 e-Cash—person-to-person
 Electronic bill presentment and payments
 Pay at ATMs
 Micropayments
 B2B special methods
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IT at Work 6.6
E-Money: The Future Currency
The growing e-money lifestyle in Japan is
making life more convenient for
consumers by allowing transactions via
mobiles.
The Mobile Suica system was debuted by
NTT DoCoMo in 2006.
Mobile Suica is a phone-based smartcard
that can be used for buying rail tickets or
accessing buildings.
E-money example: Bitcoin is an innovative
payment network and a new kind of money.
Figure 6.11 Contactless
Mobile Suica on mobile
phone; based on RFID
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6.6 E-Business Ethics and Legal Issues
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Privacy: Most e-payment systems know who the buyers are;
therefore, it’s necessary to protect the buyers’ identities.
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Web tracking: By using tracking software and log files,
companies can track individuals’ movements on the Internet.
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Job loss: EC may eliminate jobs.
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Disintermediation: Technology eliminates the need for
intermediaries, such as travel and insurance agents.
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