Chapter 14 Ebusiness

E BUSINESS

Ø  The internet is a powerful channel that presents new opportunities for organization to;

§  Touch customers

§  Enrich products and services with information

§  Reduce costs

Ø  How do ecommerce and e business differ?

§  Ecommerce – the buying and selling of goods and services over the internet

§  E business – the conducting of business on the internet including, not only buying and selling, but also serving customers and collaborating with business partners 

Ø  Industries Using E business

E BUSINESS MODELS

E business model – An approach to conducting electronic business on the Internet 

Business-to-Business (B2B)

Electronic marketplace (E market place) – interactive business communities providing a central market where multiple buyers and sellers can engage in e business activities. 

Business-to-Consumer (B2C)

Ø  Common B2C e business models include;

§  E shop – A version of retail store where customers can shop at any hour of the day without leaving their home or office

§  E mall – consists of a number of e shops; it serves as a gateway through which a visitor can access other e shops

Ø  Business types;

§  Brick-and-mortar business

§  Pure-play business

§  Click-and-mortar business

Consumer-to-Business (C2B)

Ø  Priceline.com is an example of a C2B e business model

Ø  The demand for C2B e business will increase over the next few years due to customer’s desire for greater convenience and lower prices

Consumer-to-Consumer (C2C)

Ø  Online auctions

§  Electronic auction (E auction) – Sellers and buyers solicit consecutive bids from each other and prices are determined dynamically

§  Forward auction – Sellers use as a selling channel to many buyers and the highest bid wins

§  Reverse auction – Buyers use to purchase a product or service, selecting the seller with the lowest bid

Ø  C2C communities include;

§  Communities of interest – People interact with each other on specific topics, such as golfing and stamps collecting

§  Communities of relations – People come together to share certain life experiences, such as cancer patients, senior citizens, and car enthusiasts

§  Communities of fantasy – People participate in imaginary environments, such as fantasy football teams and playing one-to-one with Michael Jordan

EBUSINESS BENEFITS AND CHALLENGES

Ø  E business benefits include;

§  Highly accessible

§  Increased customer loyalty

§  Improved information content

§  Increased convenience

§  Increased global reach

§  Decreased cost

Ø  E business challenges include;

§  Protecting consumers

§  Leveraging existing systems

§  Increased liability

§  Providing security

§  Adhering to taxation rules

Ø  There are numerous advantages and limitations in e business revenue models including;

§  Transaction fees

§  License fees

§  Subscription fees

§  Value-added fees

§  Advertising fees

MASHUPS

Ø  Web mash up – A Web site or Web application that uses content from more than one source to create a completely new services

§  Application programming interface (API) – A set of routines, protocols, and tools for building software applications

Mash up editor – WSYIWYGs (What You See Is What You Get) for mash ups