ECommerce Course

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E-Commerce Course
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Overview

• Goals Understandingbasic skills re
• Infrastructure of web business elements
• Definition Web Business Element an interaction
  context between a business and a client on the
  web
• Business drivers for web-commerce success
• Business Models
• Marketing
• Competitive edge potential from the Web
• The Internet for Operations
• Supply chain
• CRM

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Course Requirements

• A Bio page (HTML)
• A Collaboration site (per group post Groups
  Bios)
• A Group Project Business Plan and Plan Demo
  Site
• Site incorporates Bios and Collaboration
• Report once a week your contribution to Project
  Group
• Submit --
• Business Plan I (draft)
• Business Plan II (final)
• Demo -- Requirements Specification document
• Present Demo
• Details on all requirements see web-site
• Web-site http//gotlib gives clear instructions
  on all course requirements read frequently for
  updates.

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How to take this Course

• Dont take (a lot of) notes class is for
  listening, not writing
• All lecture/case studies/project material and
  instructions available on web-site
• Intranet http//gotlib
• Join a Group as soon as possible
• If you miss first lectures, no guarantee of
  joining a Project
• Dont wait for the last minute to start work on
  Project
• Learning HTML/ASP start right away
• Work on your Project start latest 3rd week
• Timetable for submitting see web-site

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Contents

• Commerce
• Net User Viewpoint (Sales)
• Enterprise Viewpoint (Operations)
• Technology Infrastructure

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Commerce (Part I)
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Net User Viewpoint

• Retail vs. Inter-organization
• Dimensions of Web Business Rationale
• Classes of Value-add
• Web-business models

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B2B Forecast
FromRayport Jaworski, E-Commerce, McGraw Hill
2001
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Estimated Savings from e-Commerce

FromRayport Jaworski, E-Commerce, McGraw Hill
2001
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Web Value-add

• Classes of Value-add
• Timely
• Customized
• Logistic
• Sensational

Dr. James K. Ho, A Global Study of Commercial
Sites, 1997
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Functional Classification

• The Purpose of a Site/Page
• Promotion of product and services
• Provision of data and information
• Processing of business transactions

Dr. James K. Ho, A Global Study of Commercial
Sites, 1997
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Value-Add Matrix
Dr. James K. Ho, A Global Study of Commercial
Sites, 1997
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Web Business Models

• Storefront
• Catalog
• Auction
• Exchange
• RFQ
• Custom Content/Service Provider
• package combinations of own and/or other's
  content/services service part is not yet well
  developed e.g. soap/uddi
• Subscription
• gives right to use site what's on site may or
  may not cost, but the service is not a
  beneficiary of any such pmts
• Community Forums (membership fees, advertising)
• Portal (catchall for any of above)

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Storefront

• Basic B2C retail
• Advantages
• Leverage brand, existing customer base
• Control of your site
• Disadvantages
• How to drive traffic to site
• All commerce resources are your problem
• Marketing, fullfillment, distribution etc.

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Catalog

• Variation of storefront
• Typically
• Forward Integrated Producer
• Producer controls large part of production and
  supply chain
• Comprehensive service of the segment
• Catalog offers consumer convenient access to
  variations/specifications/applications

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Auction

• Traditional Auction
• Very attractive to sellers
• Negligible start-up costs
• Host provides buyer traffic
• Inherently guarantees max sale price
• Buyers believe theyre getting a good deal
• Assume people wont bid up unless worth it
• Reverse auction
• Buyer takes bids to sell
• Bidding goes down in price
• Lowest bid takes the sale

Example e-bay.com
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Exchange (B2B B2C)

• Buyers and Sellers meet
• Buyers
• Post an interest (Proposal to buy)
• Post a market position (Offer to buy)
• Sellers
• Post an interest (Proposal to sell)
• Post a market position (Offer to Sell)
• Arbitrary goods/specs
• Two point Negotiation
• Partially emulate bidding, but bidders dont see
  each others bids no system guaranteed
  allocation
• Added Value Liquidity
• Main problem Trust traffic
• ? need liquidity to achieve liquidity

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Example Seller Side (Pentium Exchange)Created
for e.g. Converge
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market name
sequences
Entering proposal / offer
login name
Entering proposal / offer
product name
defined units
defined attributes
legal user actions
Email overrides Admin def
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Browser Output View Market
market name
visibility-enabled fields
response optionbuttons
output records
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Exchanges

• Verticals
• http//216.52.77.50/verticalnetmarketplaces/buyers
  .htm (50 markets)
• http//www.converge.com/eWebApp/jsp/pricetrends/Ca
  tegoryDescDetail.jsp (Electronics)
• B2C
• http//www.used-car-parts-exchange.com

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Request for Quote (RFQ)

• Hybrid of Auction/Exchange for multi-part
  purchase
• Post Bill of Materials/Goods
• Sellers bid on any subset of the list
• Requester selects a cover of the RFQ
• Examples
• Utilities/Carriers post RFQ for new switch/
  channel infrastructure
• Municipality posts RFQ for park construction
• Government posts RFQ for armaments supply
• Any corporation posts RFQ for large custom
  software system with multiple components

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RFQ sites

• Relatively new capability
• Not sophisticated
• Tools for Requester to compare/analyze/select
  bids
• Tools for bidders to view market activity
• Most RFQ provided as a trade service on exchanges
• Verticalnet
• Converge
• Etc.

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Content/Service Provider

• Package a combination of content or service
• Customize for individual users
• Content/service may be your own or syndicated
  from other providers
• Added Value
• Quality of content/service
• Level of customization

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Content Provider

• Example of content quality
• NY Times
• Wall Street Journal
• Reuters
• Examples of customization
• WiredStart.com (customize the Home site)
• WorldFlash (http//www.scroller.com/)
• Custom News, stock ticker other services
• Wall Street Journal (personalize Home page)

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Subscription

• Subscription operator takes a flat membership fee
• Operator is on the users side, I.e. has no
  interest in which vendor they buy from
• May be community oriented, e.g. Napster
• Added Value
• Range of choice
• Vendor neutral representation
• Price advantage from scale (similar to liquidity)

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Subcription Examples

• Napster (still pending)
• PressPlay (music service)
• Netmarket (CUC sells everything)

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Community Forums

• Often not directly for profit
• But may provide incentive for profit related
  activity
• Examples
• Software user groups
• Support groups
• Consumer information forums
• Example http//consumerinterests.org/
• Also many subscription sites (the info is worth
  )
• But, see consumeraffairs.com for different twist
• Safety/health/medical forums (lots of these)
• Hobby/sport enthusiast sites (as above)

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Portal

• Intended to attract users home click
• Usually targeted to a specific community
• A few portals try to be everything to everybody
  (Yahoo, MSN)
• Provides a range of services used frequently by
  the community
• May include any of the above models
• Lots of links to related services

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Two Axes of B. Model
SOURCES OF CONTENT ORIGINATION
FOCUS OF STRATEGY
FromRayport Jaworski, E-Commerce, McGraw Hill
2001
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Demand Aggregation

• Analogy to leverage of large producer/large
  market share
• Means large share of Supply
• Customers get together to leverage their combined
  buying power
• Means large share of Demand
• Better price
• Better service/support
• (Demand) Streamlined logistics of distribution,
  delivery,support for buyer group benefit

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Demand Aggregation Sites

• http//www.webbuyingguide.com/group_buying.htm
• http//www.onlinechoice.com/US/Home/default.asp
• Accompany.com
• Mercata.com
• http//www.shopmates.com/faq.htm

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Two Axes (Analysis)
FromRayport Jaworski, E-Commerce, McGraw Hill
2001
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Alternative Models
FromRayport Jaworski, E-Commerce, McGraw Hill
2001
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More Alternative Models
FromRayport Jaworski, E-Commerce, McGraw Hill
2001
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A Framework for Electronic Commerce
e-COMMERCE STRATEGY
Customer Interface
Branding Implementation
Market Opportunity Assessment
Business Model
Evaluation
FromRayport Jaworski, E-Commerce, McGraw Hill
2001
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Our Emphasis

• Lecture/Lab Material
• Business Model
• Implementation
• Case studies include Opportunity/Marketing
• Project Research/Production
• Framing the Opportunity
• Marketing
• Customer Interface
• Another Course
• Emphasis on Customer Interface
• Emphasis on Marketing
• Evaluation and Metrics