Chapter 14 : E-Business
E BUSINESS
The internet is a powerful channel that presents new opportunities for organization to;
§ Touch customers
§ Enrich products and services with information
§ Reduce costs
How do ecommerce and ebusiness 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
INDUSTRIES USING EBUSINESS
E BUSINESS MODELS
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)
- 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
Business types;
§ Brick-and-mortar business
§ Pure-play business
§ Click-and-mortar business
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 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
E business benefits include;
§ Highly accessible
§ Increased customer loyalty
§ Improved information content
§ Increased convenience
§ Increased global reach
§ Decreased cost
E business challenges include;
§ Protecting consumers
§ Leveraging existing systems
§ Increased 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 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
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