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4.1 ( week 8)
Electronic Commerce Systems
McGraw-Hill/Irwin
Learning Objectives
Identify the major categories and trends of e-commerce applications Identify the essential processes of an e-commerce system, and give examples of how they are implemented in e-commerce applications Identify and give examples of several key factors and Web store requirements need to succeed in e-commerce
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Learning Objectives
Identify and explain the business value of several types of ecommerce marketplaces Discuss the benefits and trade-offs of several e-commerce clicks and bricks alternatives
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Case Questions
1. Consider your own online shopping patterns. How much weight do you place on the presence of a name or logo or other trademark (such as the KitchenAid silhouette) on a Web site when purchasing goods or services? Do you ever stop to consider whether you may have been misled? How could you tell the difference? 2. Brian Maynard of KitchenAid notes that the development of the Internet changed the problem of brand policing. What are some of these changes? What new challenges can you think of that did not exist in the preonline world? Provide several examples.
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Case Questions
3. The companies mentioned in the case (e.g., Kitchen-Aid, RBC, Disney, and Coke) were well established and enjoyed strong brand recognition well before the advent of the Internet. Do you think online-only companies face the same problems as they do? Why or why not? Justify the rationale for your answer.
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Introduction to e-Commerce
Electronic commerce encompasses the entire online process of
Developing Marketing Selling Delivering Servicing Paying for products and services
It relies on the Internet and other information technologies to support every step of the process
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E-Commerce Technologies
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Categories of e-Commerce
Business-to-Consumer
Virtual storefronts, multimedia catalogs, interactive order processing, electronic payment, online customer support
Business-to-Business
Electronic business marketplaces, direct links between businesses, auctions and exchanges
Consumer-to-Consumer
Online auctions, posting to newspaper sites, personal websites, e-commerce portals
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Search Management Search processes help customers find the specific product or service they want
E-commerce software packages often include a website search engine A customized search engine may be acquired from companies like Google or Requisite Technology Searches are often on content or by parameters
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Catalog and content management software works with profiling tools to personalize content
Includes product configuration and mass customization
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Workflow Management
E-business and e-commerce workflow management depends on a workflow software engine
Contains software model of business processes
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Collaboration and Trading Processes that support vital collaboration arrangements and trading services
Needed by customers, suppliers, and other stakeholders
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Complex processes
Near-anonymous and electronic nature of transactions Many security issues Wide variety of debit and credit alternatives Financial institutions may be part of the process
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Differences in Marketing
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Operate 24 hours a day, seven day a week Protect transactions and customer records
Use security monitors and firewalls Use redundant systems and power sources Employ passwords and encryption Offer 24-hour tech support
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B2B E-Commerce B2B is the wholesale and supply side of the commercial process
Businesses buy, sell, or trade with other businesses
E-Commerce Marketplaces
One to Many
Sell-side marketplaces One supplier dictates product offerings and prices
Many to One
Buy-side marketplaces Many suppliers bid for the business of a buyer
Some to Many
Distribution marketplaces Unites suppliers who combine their product catalogs to attract a larger audience
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E-Commerce Marketplaces
Many to Some
Procurement marketplaces Unites major buyers who combine purchasing catalogs Attracts more competition and thus lower prices
Many to Many
Auction marketplaces Dynamically optimizes prices
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Success will go to those who can integrate Internet initiatives with traditional operations
Merging operations has trade-offs
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E-Commerce Integration The business case for merging ecommerce with traditional business operations
Move strategic capabilities in traditional operations to the e-commerce business Integrate e-commerce into the traditional business
Sharing of established brands Sharing of key business information Joint buying power and distribution efficiencies
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Complete separation
Spin-off of an independent e-commerce company
E-Commerce Channel Choices An e-commerce channel is the marketing or sales channel created by a company for its e-commerce activities
There is no universal strategy or e-commerce channel choice Both e-commerce integration and separation have major business benefits and shortcoming Most businesses are implementing some measure of clicks and bricks integration
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Case Study Questions 1. Do you agree with Google and Microsoft that eBay is now vulnerable to their assaults via Google Base and Windows Live Expo? Why or why not? 2. What are the major advantages and limitations of Google Base and Windows Live Expo? Which do you prefer, or would you use both? Why? Go to their Internet Web sites and read reviews at other sites to help you answer.
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Case Study Questions 3. Are eBays development of Kijiji, acquisition of Skype, alliance with Yahoo, and other acquisitions as noted in this case enough to ward off the competitive assaults of Google and Microsoft? Defend your position.
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Case Study Questions 1. Why has eBay become such a successful and diverse online marketplace? 2. What do you think of eBays playbook concept? Why do they call it a playbook? 3. Is eBays move into the international arena a good long-term strategy?
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