CHAPTER 2

Introduction to
E-marketplaces

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 Objectives

1. Define e-marketplaces
2. Describe functions of e-marketplaces
3. Explain components of e-marketplaces
4. List the major types of e-marketplaces and
describe their features.
5. Describe storefronts malls and information portals

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 2.1 E-MARKETPLACES

e-marketplace
An online market, usually B2B, in which buyers and sellers exchange
goods or services; the three types of e-marketplaces are private, public,
and consortia.

electronic retailing (e-tailing) - Retailing conducted online, over the

Internet

marketspace
A marketplace in which sellers and buyers exchange goods and services
for money (or for other goods and services), but do so electronically.

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What Sells Well On The Internet?

◦ Computer hardware and software

◦ Consumer electronics
◦ Office supplies
◦ Sporting goods
◦ Books and music
◦ Toys
◦ Health and beauty
◦ Apparel and clothing
◦ Jewellery
◦ Cars
◦ Services
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EC Activities

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Buying Process In An E-market

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EC Activities – Mechanism Connection

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 E-marketplaces

Three (3) functions of e-markets:

1. Matching of buyers and sellers

2. Facilitating of transactions

3. Providing an institutional infrastructure

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Functions of a Market

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 E-Marketplace Components

1. Customers
2. Sellers
3. Products – physical, digital
4. Infrastructure – software, hardware, network
5. Front-end – search engine, catalog, payment
6. Back-end – delivery, logistic, packaging, shipping
7. Intermediary – broker, e-distributor, infomediary
8. Other business partners – supply chain
9. Support services – banking, security, advertising,
logistic
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 E-Marketplace Components (cont.)

1) Customers - who is demand goods and services

2) Sellers - who is supply goods and services
3) Products and services
• physical product - merchandise, apparel and other
physical goods you sell and ship to customers.
• digital products - Goods that can be transformed to
digital format and delivered over the Internet.
Example: e-book, software, digital wallpaper,
music/song, online games

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E-Marketplace Components (cont.)

4) Infrastructure
• Hardware, software and network
5) front end
• The portion of an e-seller’s business processes through which
customers interact include seller’s portal, electronic catalogs, a
shopping cart, a search engine, and a payment gateway.
6) back end
• The activities that support online order fulfillment, inventory
management, purchasing from suppliers, payment processing,
packaging, and delivery.

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 E-Marketplace Components (cont.)

7) Intermediary - A third party that operates between sellers and

buyers. (ex: brokers, infomediary, e-distributor)

8) Other business partners - Collaborate on the Internet, mostly

along the supply chain

9) Support service - e.g logistic, payment, advertising, security

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Types of E-Marketplaces

Private e-
marketplaces Public, Exchanges
-sellside, buyside & Consortia

Types of e-
marketplaces
and services

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 Types of E-Marketplaces (cont.)

1. Private E-Marketplaces
- online markets owned by a single company

• sell-side e-marketplace (1 seller, many buyers)

A private e-marketplace in which one company sells either
standard and/or customized products to qualified companies.

• buy-side e-marketplace (many sellers, 1 buyer)

 A private e-marketplace in which one company makes
purchases from invited suppliers.

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 Types of E-Marketplaces (cont.)

2. Public E-Marketplaces (many sellers, many buyers)

- B2B markets, usually owned and/or managed by an independent 3rd
party that include many sellers and many buyers (exchanges)

3. Consortia
- e-marketplaces that deal with suppliers and buyers in a single industry
• Vertical: confined to one industry
• Horizontal: allow different industries trade there

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 E-Storefronts

Webstore (storefront)
- A single company’s Web site where products or services
are sold and usually has an online shopping cart associated
with it.
- Many Webstore target a specific industry and find their
own unique corner of the market.

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 E-MALLS

e-mall (online mall)

• An online shopping center where many online stores are
located.

Types Of Stores And Malls

1. General stores/malls
2. Specialized stores/malls
3. Regional versus global stores
4. Pure-play versus click-and-mortar stores
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 Types of Stores and Malls

1. General stores/malls
- large marketspace, that sell all kinds of products or
services,
eg. Amazon.com that sell many products or services

2. Specialized stores/malls
- sell one or a few kind of products or services,
eg. 1800flowers.com that sell flowers and related gifts
only.

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Types of Stores and Malls

3. Regional versus global stores

- Some stores, such as e-grocers or sellers of heavy furniture
serve customers that live nearby.
- Some local stores will sell to customers in the other countries if
the customer will pay shipping, insurance or other costs.

4. Pure-play versus click-and-mortar stores

- Stores can be purely online such as Amazon.com that has no
physical store, but some other stores are physical stores that
also sell online such as Walmart.com

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 Example

http://www.amazon.com/ http://www.lazada.com/

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 Example

http://www.tudung-bawal.com/ http://www.bazaraya.com/v2/

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 Information Portals

Web Portal
A personalized, a single point of access
through a Web browser to critical business
information located inside and outside (via
Internet) an organization

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 Information Portals (cont.)

1. Publishing portals- provide extensive online

search features, specific interests and some
interactive capabilities.

2. Commercial portals - most popular portals, broad

audiences and offer fairly routine contents.

3. Personal portals- Target specific filtered

information for individuals.
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 Information Portals (cont.)

4. Corporate portals - Provide organized access to

rich content within relatively narrow corporate
and partner’s communities

5. Mobile portals - A portal accessible via a mobile

device

6. Voice Portal -A portal accessed by telephone or

cell phone
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How a Portal Works?

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 Customer Interaction Mechanisms:
STOREFRONT,MALLS AND PORTALS
Electronic catalogs

Payment gateway

Search engine

Shipment court

Customer services

Electronic cart

E-auction facilities

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 Customer Interaction
Mechanisms: STOREFRONT,MALLS
AND PORTALS
Mechanisms for conducting sales in storefront
Electronic catalogs - presentation of product information in an
electronic form; the backbone of most e-selling sites
Search engine – helps the consumer find products in the catalog
Payment gateway – where payment arrangements can be made
Shipment court – where shipping arrangements are made
Customer services – include product and warranty information
Electronic cart – holding items until checkout
E-auction facilities – where auctions take place

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 E-Catalog

• electronic catalogs (e-catalogs)

The presentation of product information in
an electronic form; the backbone of most
e- selling sites.

2-
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22
 Paper Catalog
Advantage Disadvantage

• Easy to create without • Difficult to update changed product

high technology
• Reader is able to look at
the catalog without
computer system
• More portable than
electronic
information promptly
• Only a limited number of products can be
displayed
• Limited information through photographs
and textual description is available
• No possibility for advanced multimedia
such as animation and voice

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 Online Catalog
Advantages Disadvantages
• Easy to update product information • Difficult to develop
• Able to integrate with the purchasing process catalog, large fixed
• Good search and comparison capabilities cost
• Able to provide timely, up to date product • Need for customer
information skill to deal with
• Provision for globally broad range of product computers and
information browsers
• Possibility of adding on voice and animated
pictures
• Long term cost savings
• Easy to customize
• More comparative shopping
• Ease of connecting order processing, inventory
processing and payment processing to the system

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 Shopping Carts

Electronic Shopping Carts

- An order processing technology that allows customers to
accumulate items they wish to buy while they continue to shop

Product Configuration / Product Customization

- An activity of customising a product to meet the needs of a
particular customer.
- The product in question may consist of mechanical parts, services,
and software.

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 Search Engine

Search Engine
◦ A computer program that can access databases of Internet resources,
search for specific information or key words, and report the results.

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 Social Networking

A social networking service is an online platform that people use to build social
networks or social relations with other people who share similar personal or
career interests, activities, backgrounds or real-life connections.

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 IMPACTS OF E-MARKETS

1. Impacts of e-markets on B2C direct marketing

 Product promotion, New sales channel, Direct savings, Reduced cycle
time, Customer service, Market operations, Brand or corporate image,
Customization, Advertising, Ordering systems, Market operations

2. Transforming Organization
 Technology and organizational learning, the changing nature of work

3. Redefining organization
 New / improve product capabilities, new business model, supply chain
improvement, manufacturing impacts, finance & accounting impacts, HR
management and training impact.

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