13.1. compare e-commerce and e-business
13.2. compare the four types of e-business models
13.3. describe the benefits and challenges associated with e-business.
13.4. explain the differences among e-shop, e-malls and online auctions.
E- Business
- The internet is a powerful channel that presents new opportunities for an organization to :
- Touch customer
- Enrich products or services with information
- reduce costs.
- E-Commerce is the buying and selling the goods and services over the internet ( online transaction )
- E-Business is the conducting of business on the internet including, not only buying and selling, but also serving customers and collaborating with business partners ( online transaction, serving customers, and collaborating with business partners.)
industries using e-business
E-Business models
- E-Business model is an approach to conducting electronic business on the internet.
1. 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.
- Electronic marketplaces or e-marketplaces present structures for conducting commercial exchange, consolidating supply chains, and creating new sales channels.
- The primary goals is to increase market efficiency by tightening and automating the relationship between buyers and sellers.
- Existing e-marketplaces allow access to various mechanisms in which to buy and sell almost anything, from services to direct material.
2. 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 where it serves as a gateway through which visitor can access other e-shops.
- Business types :-
- Brick-and-Mortar business - operates in a physical store without an internet presence. for example Bata, which online sell their product in a shop.
- Pure-play business - A business that operates on the internet only without physical store. For example, Amazon.com and Expedia.com
- Click-and-Mortar business - A business that operates in a physical store and on the internet. For example, Hijabs by Hanami.
3. 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 price.
- For example, Rizalman sell his collection in Tesco especially during a festival season.( fashion designer)
4. Consumer-to-Consumer (C2C)
- usually being made in grouping.
- Online Auctions :-
- Electronic Auction (e-auction) - sellers and buyers solicit consecutives 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. (seller asking for a bidding)
- Reverse Auction - buyers use to purchase a product or service, selecting the seller with the lowest bid. (buyers itself bidding for the items)
- C2C communities include :-
- Communities of interest - People interact with each others 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 in imaginary environments, such as fantasy football teams and playing one-on-one with Michael Jordan.
- A search engine is website software that finds other pages based on key word matching similar to Google.
- Search engine ranking evaluates variables that search engines use to determine where a URL appears on the list of search results.
- Search engine optimization (SEO) combines arts along with science to determine how to make URLS more attractive to search engines resulting in higher search engine ranking.
- the better the SEO, the higher the ranking for a website in the list of search engine results.
- Website can generate revenue through :-
- Pay-per-click - generates revenue each time a user clicks on a link to a retailer's website.
- Pay-per-call - generates revenue each time a users click on a link that takes the user directly to an online agent waiting for a call.
- Pay-per-conversion - generates revenue each time a website visitor is converted to a customer.
E-business Revenue models.
E-Business Benefits
- High Accessible
- Business can operates 24 hours a day, 7 days a week, 365 days a year.
- Increased Customer Loyalty
- Additional channels to contact, respond to, and access customers help s contribute to customer loyalty.
- Meaning that, deal closely with the customer.
- Improved Information Content
- In the past, customer had to order catalogs or travel to a physical facility before they could compare price and product attributes.
- Electronic catalogs and web pages present customer 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 reached
- Business, both small and large, can reach new markets. meaning that, can commercialize their business or products and services worldwide.
- Decreased costs
- The costs of conducting business on the internet is substantially smaller than traditional forms of business communication.
E-Business Tools for Connecting and Communicating.
- E-Mail
- Email, short for electronic mail, is the exchange of digital messages over the internet.
- email is single-handedly increased the speed of business by allowing the transfer of documents with the same speed as the telephone.
- its chief business advantage is the ability to inform and communicate with many people simultaneously, immediately, and with ease.
- there are no time or place constraints , and user can check, send and view email whenever they are required.
- An Internet Service Provider (ISP) is a company that provides access to the internet for a monthly fees.
- Instant Messaging
- Real-time communication occurs when a system updates information at the same rate it receives.
- Instant messaging (IMing) is a service that enables instant or real-time communication between people.
- Business immediately saw what they could do :
-resolve question or problems immediately
- transmit messages as fast as naturally flowing conversation
- easy hold simultaneous IM session with multiple people
- eliminate long-distance phone charges
quickly identified which employees are at their computers.
- Podcasting
- Converts an audio broadcast to a digital music player
- podcast can increase marketing reach and build customer loyalty
- companies use podcast as marketing communication channels discussing everything from corporate strategies to detailed product views.
- Allows people at two or more locations to interact via two-way video and audio transmission simultaneously as well as share documents, data, computer displays, and white boards.
- Point-to-point videoconferences connect two people, and multipoint conferences connect more than two people at multiple location.
- It also can increase productivity because users participate without leaving their offices.
- For example, users also can improve their communication and relationships, because they can see each other's facial expression and body language.
- besides users also can reduce travel expenses, a big win for firms facing economic challenges.
- videoconference also offers a viable and cost-effective alternative.
- Web conferencing or a webinar, blends video conferencing with document sharing and allows the user to deliver a presentation over the web to a group of geographically dispersed participants.
- For example, school use web conferencing tools such as Illuminate Live to deliver lecturers to students, and business use tools such as WebEx to demonstrate product.
- professionals can accomplish more sitting at their desks than in an airport waiting to make travel connection.
- Content management system (CMS) help companies manage the creation, storage, editing, and publication of their web site content.
- CMSs are user-friendly; most include web-based publishing, search, navigation, and indexing to organize information, and they let users with little or no technical expertise make website changes.
- CMS play a crucial role in getting site visitors to view more than just the home page.
- If navigation choices are unclear, visitors may hit the 'back' button on their first (and final) visit to a website.
- Taxonomy is the scientific classification of organisms into groups based on similarities of structure origin.
- Taxonomy also used for indexing the content on the website into categories and subcategories of topics.
- For example, car is subtype of vehicle.
- Information architecture is the set of ideas about how all information in a given context should be organized.
- A well-planned taxonomy ensure search and navigation are easy and user-friendly.
E-Business Challenges.
- E-business challenges include :-
- Identifying Limited Market Segments
- The main challenge of e-business is the lack of growth in some sectors due product or service limitation.
- Managing Consumer Trust
- Internet marketers must develop a trustworthy relationships to make that initial sale and generate customer loyalty.
- Ensuring Customer Protection
- Implement internet security, to protect the database from misuse regarding the customer information.
- Adhere To Taxation Rules.
- Companies that operate online must obey a patchwork of rules about which customer are subject to sale tax on their purchases and which are not.
E-Business Benefits and Challenges.
- There are numerous advantages and limitation in e-business revenue models including :-
- Transaction fees
- License fees
- Subscription fees
- Value-added fees
- Advertising fees.
Mash-ups
- Web mash-ups - a website 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.
- Mash-ups Editor - WSYIWYGs ( what you see is what you get) for mash-ups.
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