E-Business
- The Internet is a powerful channel that presents new opportunities for an organization to:
–Enrich products and services with information
–Reduce costs
- How do e-commerce and e-business differ?
–E-commerce –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
E-Business Models
- E-business model–an approach to conducting electronic business on the Internet
Business-to-Business (B2B)
Electronic marketplace (e-marketplace)–interactive business communities providing a central market where multiple buyers and sellers can engage in e-business activities
Business-to-Consumer (B2C)
- Common B2C e-business models include:
–e-shop–a version of a 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
- Business types:
–Brick-and-mortar business-operates in a physical store without an Internet presence.
–Pure-play business-a business that operates on the Internet only without a physical store. Eg. Amazon.com &Expedia.com.
–Click-and-mortar business–a business that operates in a physical store and on the Internet. Eg. Barnes and Noble.
Consumer-to-Business (C2B)
- Priceline.com is an example of a C2B e-business model
- 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)
- 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
- C2C communities include:
–Communities of interest -People interact with each other on specific topics, such as golfing and stamp 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 inimaginary environments, such as fantasy football teams and playing one-on-one with Michael Jordan
E-Business Benefits and Challenges
- E-Business benefits include:
–Highly accessible-Businesses can operate 24 hours a day, 7 days a week, 365 days a year
–Increased customer loyalty-Additional channels to contact, respond to, and access customers helps contribute to customer loyalty
–Improved information content-In the past, customers had to order catalogs or travel to a physical facility before they could compare price and product attributes. Electronic catalogs and Web pages present customers with updated information in real-time about goods, services, and prices
–Increased convenience-E-business automates and improves many of the activities that make up a buying experience
–Increased global reach-Businesses, both small and large, can reach new markets
–Decreased cost-The cost of conducting business on the Internet is substantially smaller than traditional forms of business communication
- E-business challenges include:
–Protecting consumers
–Leveraging existing systems
–Increasing liability
–Providing security
–Adhering to taxation rules
- There are numerous advantages and limitations in e-business revenue models including:
–Transaction fees
–License fees
–Subscription fees
–Value-added fees
–Advertising fees
Mashups
- Web mashup-a Web site or Web application that uses content from more than one source to create a completely new service
–Application programming interface (API) -a set of routines,protocols, and tools for building software applications
–Mashupeditor -WSYIWYGs (What You See IsWhat You Get) for mashups
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