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E-commerce Introduction

Wahab khan
MCS 3rd
SARHAD UNIVERSITY PESHAWER,

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Course Newsgroup:
• http://sites.google.com/site/maimoonasaleem/
• Textbook:
Introduction to E-Business (6th ed.)
By: Rayport, Whiteley, Jaworski
E-business & E-commerce
How to program
By: Deitel, Deitel & Nieto

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A Success Story: eBay
A Success Story: eBay
 In 1995 Pierre Omidyar decided to use the
Web pages that came as a part of his USD 30-
a-month Internet service
 The idea was to improve upon the online
classifieds for selling personal items
 With a little code, he developed a simple
auction mechanism that would spare the seller
from having to choose among multiple
interested buyers

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A Success Story: eBay
 In mid 1996, Omidyar left his day time job and
founded the eBay company
 In the fall of 1996 eBay's revenues were USD
400,000 per month where its expenses were
USD 200,000
 In 1997, the venture capital firm Benchmark
invested USD 6.7 Million in eBay when eBay's
valuation was put at USD 20 Million
 In September 1998, after the first day of public
trading, eBay's capitalization was USD 2
Billion

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A Success Story: eBay
 Three months later the stock has gained more than
1300 percent value
 In June 1999, the company has valued at more than
USD 21 Billion
 eBay, one of the most successful examples of
ecommerce, has been flourishing ever since
 During December 2001 quarter, revenue jumped 64%
to USD 219.4 million and net income to 8%
 Furthermore, eBay appears to be in a better shape
operationally and it is expected to grow by 52% a year
over the next five years

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E-COMMERCE DEFINED
 E-commerce:
 The use of Electronic Media (telecommunications) to engage in the
exchange, including buying and selling, of products and services,
requiring transportation, either physically or digitally from location to
location.

 E-Business:
 E-Business also includes the exchange of information not directly related
to the actual buying and selling of goods- e.g. distributing information
and customer support. These activities are not ‘commerce’ but business
activities, hence e-business is a broader term.

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E-commerce Definition

 E-commerce is usually associated with

buying and selling over the Internet, or
conducting any transaction involving the
transfer of ownership or rights to use
goods or services through a computer-
mediated network.
(Not comprehensive)

Anita Rosen, The E-commerce Question and Answer Book. 9

E-commerce definition
 Technology-enabled transactions and
technology-mediated exchanges of
digitized information between parties
(individuals or organizations) as well as
the electronically based intra-
organizational or inter-organizational
activities that facilitate such exchanges

Source: Introduction to E-Business By Rayport, Whiteley et al 10

E-commerce definition

Scope of e-commerce:
1. Exchange of digitized information
2. Technology-enabled transactions
3. Technology-mediated relationships
4. Intra- & inter-organizational activities

Source: Introduction to E-Business By Rayport, Whiteley et al 11

E-commerce definition
Key elements E-commerce Traditional commerce

Value Creation Information Product/Service

Payment Mode Credit card, EFT (Electronic Funds Cash or Check (cheque)
Transfer

Customer interface Screen-to-face Face-to-face

Communication Technology-mediated channels Personal
Accessibility 24 x 7 Limited time
Customer interaction Self-service Seller influenced

Consumer behavior Personalization Standardization

One-to-one marketing Mass/one-way marketing

Promotion Word of mouth Merchandising

Product Virtual presence of commodity Feel & touch
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http://www.thecontentwrangler.com 13
Business Value of the Internet
 Overcome geographic barriers
 Capture information about business transactions
from remote locations
 Overcome time barriers
 Provide information to remote locations
immediately after it is requested.
 Overcome cost barriers
 Reduce the cost of more traditional means of
communication
 Overcome structural barriers
 Support linkages for competitive advantage
 A place where you can’t establish you business!!

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Types of Electronic Commerce
 Inter Organizational Electronic Commerce (B2B)
 Supplier Management (How Goods come into and out of store)
 Inventory management
 Distribution management (Supplier to distributor or customer etc)
 Channel management (Airway, trucks, ships, courier etc)
 Payment management
 Intra Organizational electronic commerce
 Workgroup communications (Easy Communication)
 Electronic publishing (Electronic Notification)
 Sales force productivity (All employees have updated info about
company)
 Consumer to business e-commerce (B2C)
 Social interaction (Not that much when compared to normal business)
 Personal finance management (Smartcards etc, payment move
directly..)
 Purchasing products and information

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 Internet for Business
Inventory
Management
System

Head Quarters
Internet Web sites enable interactive
marketing and electronic commerce
and collaboration with customers,
prospects and business partners
Suppliers
Extranets for e-commerce enable
suppliers to assess inventory,
The Internet
o replenish stock, and send documents
via EDI over secure Internet links

Business Partners Customers Remote offices

Business Partners can use the Internet
for E-mail, file transfer, discussion
forums, and external access to
internet resources.
Customers can view
multimedia Web site
catalogues and purchase
products and services with
interactive service and
Internet links with remote employee
sites connect virtual teams for
interactive communications,
collaboration, and computing.
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Potential Benefits of E-Commerce
 Attractingnew customers via marketing and
advertising
 Serving existing customers via customer
service and support function
 Developing new markets and distribution
channels for existing products
 Developing new information-based products
accessible on the web

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Significant Issues in Implementing
E-commerce
 Cost
 Value
 Security
 Leverage existing Systems (Old
Business usable)
 Interoperability (Co-operative System)

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Obstacles in Adopting E-Commerce

 Difficulty in re-engineering the business

processes
 Difficulty in using complex electronic
information systems
 Lack of security on existing networks

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ASSIGNMENT No1
 For each of the following items, locate two web sites that sell them:
 Airline tickets
 Personal computers
 Compact disks
 Clothes
 Mention how you located each site. If you used a search engine. Mention
the search engine and the search terms you used.
 For each item, record the site’s URL and company name. Compare the
amount of information given and the relative prices
 Mention which site you preferred and why. Would you like to return to the
site or would you continue to look for a better site. Why?

 What is E-Wallet and Smartcard?

 Due Date: Next Monday (11-May-09)

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