E commerce

Adventure Works: The ultimate source for outdoor equipment

BYJUNAID ASHRAF

E-Commerce

Introduction To E-Commerce Electronic commerce has existed for over 40

years, originating from the electronic transmission of messages. Then electronic data interchange (EDI) was the next stage of e-commerce development. EDI is the electronic transfer of a standardized business transaction between a sender and receiver computer, over some kind of private network.

electronic commerce has been re defined by the dynamics of the Internet and traditional e-commerce is rapidly moving to the Internet.

Now What About E-business?

E-business is the conduct of business on the Internet

E-business includes customer service (e-service) and intra-business tasks

The development of intranet and extranet is part of e-business

E-business is everything to do with back-end systems in an organization.

In practice, e-commerce and e-business are often used interchangeably.

What Are The Key Drivers Of E-Commerce

Technological factor Political factor Social factor Economic factor

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Key Drivers Of E-Commerce

Technological factors:

The degree of advancement of the telecommunications infrastructure which provides access to the new technology for business and consumers.

Political factors:

It including the role of government in creating government, legislation, initiatives and funding to support the use and development of e-commerce and information technology.

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Key Drivers Of E-Commerce

Social factors:

Incorporating the level of advancement in IT education and training which will enable both potential buyers and the workforce to understand and use the new technology.

Economic factors:

The general wealth and commercial health of the nation is also an important driver. Economic factors are influenced by:

Organizational cultureCommercial benefitsSkilled and committed workforce

Elements Of E-commerce Business Model

Customer value proposition Revenue model Market opportunity Competitive environment Competitive advantage Market strategy Organizational development Management team

1- Business-To-Consumer Business Model

In this form business must develop attractive electronic marketplaces to entice and sell product and services to consumer

Portal E-Tailers Content provider Transaction broker Market creator Service provider Community provider

Portal: such as yahoo, MSN, and AOL offer user powerful web

search tools as well as integrated package of content and services.

E-Tailer: customers connect to the internet to check their inventory

and place an order. Example: Amazon,BlueNile.com,Drugstore.com

Content Provider: distribute information contents such as digital video, music,

photos, text and artwork over the web.

Continued

Market Creator: Build a digital environment in which buyers and

sellers meet, display products, search for product and establish prices. Examples: EBay, Priceline.

Service Provider: Offer services online such as photo sharing, video

sharing. Examples: Google Maps, Google Docs and Gmail.

Community Provider: Create digital online environment where people with

similar interest interact. Examples: MySpace, Face book, Google buzz.

Continued

2- Business-To-Business Business Model

This category involves both electronic business marketplace and direct market links between businesses

E-Distributors E-Procurement Exchange Industry Consortium Private Industrial

Provider

E-Distributor: supply product and services to individual businesses. Example: Grainger. E-Procurement: firms create and sell access to digital electronic market.

Example: Exchange: is an independent digital electronic marketplace where

hundred of suppliers meet a smaller number of very large commercial purchasers.

Industry Consortium: owned vertical marketplaces that serve specific industries,

such as automobile, chemical, floral and logging industries. Private Industrial Network: designed to coordinate the flow of communication among

firms engaged in business together. Example: Wal-Mart, Procter and Gamble.

Continuedt

Benefits Of E-Commerce

Benefits of e-commerce to organizations

• International market place• Operational cost savings• Mass customization• Lower telecommunication

costs

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Benefits of e-commerce(cont.)

Benefits to consumers•24/7 access•More choice•Price comparisons

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Benefits of e-commerce(cont.)Benefits to society

•Flexible working practices•Connects people•Facilitate delivery of public• services

WHAT ABOUT THE LIMITATIONS OF E-COMMERCE?

Limitations of e-commerce to organizations

Limitations of e-commerce to consumers

Cost of access to the Internet Lack of security and privacy of

personal data Physical contact and relationships are

replaced by electronic processes A lack of trust

WHAT ABOUT THE LIMITATIONS OF E-COMMERCE? (continued)

Limitations of e-commerce to society

Breakdown in human interaction

Reliance on telecommunications infrastructure, power and IT skill

Wasted resources Facilitates Just-In-Time

manufacturing

ESSENTIAL E-COMMERCE PROCESSES

Access Control & Security E-commerce process must

establish mutual trust and secure access between parties.

User names & passwords Encryption key Digital certificates & signatures Restricted access areas Other people’s accounts Restricted company data Webmaster administration areas

Profiling & Personalization Profiling gathers data on you &

your website behavior and choice User registration Cookie files and tracking software User feedback Profiling is used for Personalized one2one marketing Authenticating identity Customer relationship

management Marketing planning Website management

Search Management Search processes help customers

find the specific product and service they want

E-commerce software packages include a web search engine

A customized search engine may be acquired from companies like Google etc.

Searches are often on content or by parameters

Content & Catalog Management

Content management software Helps develop, generate ,

deliver ,update and archive text and multimedia information at e-commerce websites

Catalog management software Helps generate and manage catalog

content Catalog and content management

software works with profiling tools to personalize content

Includes product configuration and mass communication

Work Flow Management E-business and e-commerce

workflow management depends on a workflow software engine

Contains software and model of business

Workflow model express: Set of business rules Role of stakeholders Databases used Task sequences Routing alternatives

Event Notification Most e-commerce applications

are event driven Responds to such things as

customer’s first website visit and payments

Monitors all e-commerce processes

Records all relevant events, including problem situations

Notifies all involved stakeholders Works in conjunction with user

profiling software

Collaboration and Trading

Processes that support vital collaboration arrangements and trading services

Need customers , suppliers , and other stakeholders

Online communities E-mail , chat , discussion

groups Enhances customer service Builds loyalty

ELECTRONIC PAYMENT PROCESS

An electronic payment is any kind of non-cash payment that doesn't involve a paper check. Methods of electronic payments include credit cards, debit cards and the ACH (Automated Clearing House) network

three main types of transactions: one-time customer-to-vendor

payment recurring customer-to-vendor

payment automatic bank-to-vendor

payment

Benefits of electronic payment

Electronic payment is very convenient for the consumer.

Electronic payment lowers costs for businesses

Offering electronic payment can also help businesses improve customer retention

A customer is more likely to return to the same e-commerce site where his or her information has already been entered and stored

DRAWBACKS OF ELECTRONIC PAYMENTS

concerns over privacy and the possibility of identity theft

defend yourself against identity theft by using virus protection software and a firewall on your computer

Some find the setup too time-consuming and don't want more logons and passwords to remember so they simply prefer the familiarity of writing checks and postage mail.

ANY QUESTIONS ?