Electronic Commerce

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Chapter 13 Electronic Commerce
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Outline

• Electronic commerce (e- commerce) concept, B2C,
  B2B, C2C types
• Business models for B2C e-commerce
• Business models for B2B e-commerce
• Differences between e-commerce and traditional
  business models
• Mobile commerce (m-commerce)
• Electronic payment

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E-Commerce Concept

• E-Commerce Buying and selling goods and services
  electronically, via the Internet and other
  networks and systems
• Business-to-Consumer (B2C Chapters.com)
• Business-to-Business (B2B Covisint) larger,
  more stable part
• Consumer-to-Consumer (C2C eBay)
• E-Commerce requires a new way of thinking about
  organizational processes (IT support critical),
  customers and delivery.
• Challenges sustainable e-commerce business
  models, growth, security and privacy.

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Business Models of B2C E-Commerce

• Business model
• What is the biz, Who is the customer, How money
  is made
• Virtual Storefront
• Sells goods/services online (Amazon - pure click,
  no physical stores)
• Consumers with access to Internet around globe
• Interactive Marketing and Personalization
• Virtual storefront as addition to store (Chapters
  click mortar)

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Business Models of B2C E-Commerce

• Portal Initial point of entry to Web, provides
  Internet search service for free, sells
  specialized content and advertising space
  (Google, Yahoo)
• Customer Global Internet user
• Revenue Advertising
• Information Broker Provides integrated
  information (Wishabi)
• Customer Global Internet user
• Revenue Referral fee (advertising)

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Business Models of B2B E-Commerce

• Direct linking of buyer-supplier (private
  networks, Electronic data Interchange)
• Online Exchange (different names)
• Buyer/Seller run
• Within an industry (GHX)
• Across industries (Covisint)
• Revenue Membership fee, Transaction charge,
  Services Product catalogue, purchasing/selling,
  order fulfillment
• More information

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E-commerce and traditional business models

• Biz content mostly old stuff, some new
  info-related services.
• Dependent on IT (Clickstream tracking,
  Collaborative filtering, Supply chain systems
  integration)
• Customer Global, Internet/IT capable
• Attracted by some cost savings (transaction
  costs) and value offering (dynamic pricing,
  disintermediation less of middlemen)
• Revenue Dependent on advertising and variable
  sources (volume of transactions).

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Mobile Commerce (M-commerce)

• Commerce using mobile electronic devices (e.g.,
  cell phone)
• Biz content financial services, advertising,
  entertainment
• Services business locator, banking, news,
  entertainment
• Challenges screen size, speed, privacy

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E-commerce Payment Systems

• Important for closing trading cycle
• Systems
• Credit card you, your bank, payee, payees bank
• Smart card you, payee, your bank Mondex card
  reader needed
• E-cash/digital cash/e-money - you, payee, bank
  where you have account small payments supported
  payee can accumulate e-cash and exchange for cash
  at will
• Person-to-person payments you, payee, your bank
  PayPal site
• Challenges Security, Trust