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EBusiness and ECommerce

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Title: EBusiness and ECommerce


1
E-Business and E-Commerce
  • MIS 4133
  • Software Systems
  • Fall 2005

2
Outline
  • Internet and WWW
  • E-commerce and E-business
  • E-business patterns/models
  • E-business advantages/disadvantages and CSFs
  • Online industries

3
Internet and WWW
  • Internet
  • Public worldwide network of networks, connecting
    many small private networks
  • Protocol is TCP/IP
  • WWW
  • Documents that are linked

Napier, et al., 2001
4
Brief History of the Internet
  • Originated in the 1960s US DOD developed a
    network of military computers called the ARPANET
    (advanced research projects agency network)
    (Next, researchers at colleges/universities began
    using it to share data)
  • 1971 The first email message was sent from one
    computer to another.
  • 1980s the military portion became a separate
    network called the MILNET and the NSF began
    overseeing the remaining non-military portions
    (NSFnet)

Napier, et al., 2001 Oz, 2002
5
Brief History of the Internet
  • Thousands of other government, academic, and
    business computer networks began connecting to
    the NSFnet
  • Late 1980s the term Internet had become widely
    used to describe this huge worldwide network of
    networks and TCP/IP becomes the standard network
    protocol
  • 1987 Internet has 10,000 hosts
  • 1988 Internet has 60,000 hosts 6,000 of the
    hosts are disabled by the first computer virus
    (worm) to hit the Internet
  • 1989 Internet has 100,000 hosts

Napier, et al., 2001 Oz, 2002
6
Brief History of the Internet
  • 1990 Tim Berners-Lee develops HTML and the WWW.
  • 1991 NSF lifts ban on commercial traffic
    E-commerce on the Internet begins.
  • 1992 Internet has 1,000,000 hosts 50 of them
    use HTML to form the Web sites Jean Armour Polly
    coins the term surfing the Internet.
  • 1993 Internet has 10 million hosts Internet2
    project is announced.
  • 1998 Internet has 36.8 million hosts 4.2
    million of them are web sites.
  • 1999 Retail sales on the Internet are estimated
    at 7.8 billion.
  • 2003 Internet2 Abilene high-speed network
    achieves 8 Gbps speed in a transcontinental test
    (completed in Feb 2004)

Laudon Traver, 2004 Napier, et al., 2001 Oz,
2002 Zakon, 2005
7
Internet 2
  • 1996 created to recapture the original
    enthusiasm of the ARPANET (an advanced research
    network)
  • It is an experimental test bed for new networking
    technologies has achieved bandwidths of 10 Gbps
  • Also used by universities to conduct large
    collaborative research projects that require
    several supercomputers connected at very fast
    speeds

Schneider, 2002
8
Internet Domain Servers (Internet Hosts)
Laudon Traver, 2004 Oz, 2002 Schneider, 2002
Zakon, 2005
9
Types of Domains Oct. 2003
NetFactual.com, 2003
10
Growth of the WWW
Schneider, 2002 Zakon, 2005
11
(No Transcript)
12
Number of People Online
September 2000
Napier, et al., 2001
13
Active Internet Users
Jessup Valacich, 2006
14
Time on the Internet
Rayport and Jaworski, 2002
15
E-commerce vs. E-business
  • E-commerce
  • Buying and selling products/services
    electronically
  • E-business
  • Conducting of business electronically

16
E-Business Structural Patterns
Begins as a Channel, But Extends to Total
Transformation of Business
e-Channel
e-Portal (B2C)
Pure E
Click and Brick
e-Market-Makers (B2B)
  • Basic efficiency,
  • effectiveness enhancements
  • as the selling become
  • e-enabled
  • Selling goods/services
  • Payment/settlement
  • enhancements
  • Traditional business
  • transferred to the Net
  • Rise of new intermediaries
  • New forms of supply chain
  • integration
  • Consolidation/transformation
  • of intermediary industry
  • Customer expects E
  • everything
  • Fundamental redesign of
  • business
  • New structures to allow market
  • making, trading, and virtual
  • warehousing

Kalakota, et al., 2001
17
E-Channel Pattern
Transaction Enhancement
Consumer
Manufacturer
E-Channel Compression
Consumer
X
Manufacturer
E-Channel Expansion
Consumer
Manufacturer
E-Channel Innovation
Kalakota, et al., 2001
18
Click-and-Brick Pattern
  • Brick Mortar
  • Localized inventory
  • In-store shopping
  • experience
  • Immediacy (try, buy,
  • take home)
  • Service (returns,
  • repairs, exchanges)
  • Click
  • Infomediation
  • Speed
  • Direct, one-to-one
  • experience
  • Personalized content
  • Automation
  • (assistants, alerts)

Click Brick
Kalakota, et al., 2001
19
E-Portal Pattern
  • Intermediary/middleman offering an aggregated set
    of services for a specific well-defined group
  • Superportals AOL, Yahoo!, Amazon.com
  • Auction portals eBay, Amazon.com, Yahoo!
    Auctions
  • Megatransaction portals Travelocity

Kalakota, et al., 2001
20
E-Market Maker Pattern
  • Exchanges
  • Buyers and suppliers negotiate prices
  • Virtual distributors
  • Takes control of accounts receivable but not
    physical inventory
  • Lead generation
  • Derive revenue from ads, commissions, or fees for
    leads to suppliers
  • Catalog aggregators
  • Helps normalize info coming from diverse sources
  • Auctions
  • Reverse auctions

Kalakota, et al., 2001
21
Pure E Digital Products Pattern
Kalakota, et al., 2001
22
E-Business Models
  • Brick-and-Mortar
  • A traditional business with no online presence
  • Click-and-Mortar / Click-and-Brick /
    Brick-and-Click
  • A traditional businesses online presence that is
    used to enhance its brick-and-mortar operations
  • Dot Com
  • Only an online presence no physical store

Deitel, et al., 2001 Oz, 2002
23
E-Business Models
  • B2C sells products/services directly to
    consumers
  • Amazon.com, Autobytel.com, Pets.com
  • B2B sells products/services to other businesses
    or brings multiple buyers and sellers together in
    a central marketplace
  • VerticalNet, HoustonStreet.com, CATEX
  • B2G businesses selling to local, state, and
    federal agencies
  • eFederal, iGov.com
  • C2C consumers sell directly to other consumers
  • eBay, InfoRocket, American Boat Listing
  • C2B consumers name own price, which businesses
    accept or decline
  • Priceline.com, ReverseAuction.com
  • P2P enables Internet users to share files and
    computer resources directly without having to go
    through a central Web server
  • Napster.com
  • M-commerce use of wireless digital devices to
    enable transactions on the Web

Laudon Traver, 2004 Napier, et al., 2001 Oz,
2002
24
B2B
  • Intranet
  • Allows employees to view and use internal Web
    sites that are not accessible to the outside
    world
  • Extranet
  • Two or more Intranets connected via the Internet,
    where participating companies can view each
    others data and complete business transactions
    such as purchasing

Napier, et al., 2001 Schneider, 2002
25
B2B
  • Storefronts
  • Provide businesses with purchase, order
    fulfillment, and other value-added services
  • Staples, Office Depot
  • Vertical markets
  • Provide a trading community for a specific
    industry
  • MediSpeciality.com, HotelResource.com,
    NetPossibilities
  • Aggregators
  • Provide a single marketspace for business
    purchasing from multiple suppliers
  • Chemdex, MetalSite, VIPAR

Krishnamurthy, 2003 Napier, et al., 2001 Oz,
2002
26
B2B
  • Trading hubs
  • Provide a marketspace for multiple vertical
    markets
  • VerticalNet
  • Post and browse markets
  • Provide a marketspace where participants post buy
    and sell opportunities
  • CATEX, CreditTrade, TechEx

Laudon Traver, 2004 Napier, et al., 2001
27
B2B
  • Auction markets
  • Provide a marketspace for buyers and sellers to
    enter competitive bids on contracts
  • e-Steel, HoustonStreet.com, Altra, FreeMarkets
  • Fully automated exchanges
  • Provide a marketspace for the automatic matching
    of standardized buy and sell contracts
  • PaperExchange.com

Napier, et al., 2001 Schneider, 2002
28
E-Business Advantages
  • Sellers
  • Increased sales opportunities
  • Decreased transaction costs
  • Operate 24-7
  • Reach narrow market segments that may be widely
    distributed geographically
  • Access to global markets
  • Increased speed and accuracy of info exchange
  • Bring multiple buyers and sellers together
  • Buyers
  • Wider product availability
  • Customized/personalized info and buying options
  • Shop 24-7
  • Easy comparison shopping and one-stop shopping
  • Access to global markets
  • Quick delivery of digital products and of info
  • Participate in auctions, reverse auctions,
    knowledge exchanges

Napier, et al., 2001
29
E-Business Disadvantages
  • Sellers
  • Rapidly changing technology
  • Insufficient telecommunications
    capacity/bandwidth
  • Difficulty integrating existing systems with
    e-business software
  • Problems maintaining system security and
    reliability
  • Global market issues language, political
    environment, currency conversions
  • Conflicted legal environment
  • Shortage of skilled technical employees
  • Buyers
  • Concern over transaction security and privacy
  • Lack of trust when dealing with unfamiliar
    sellers
  • Desire to touch and feel products before purchase
  • Resistance to unfamiliar buying processes,
    paperless transactions, and electronic money

Napier, et al., 2001
30
E-Commerce CSFs
  • Add value to products/service
  • Convenience, info value, disintermediation,
    reintermediation, price, choice
  • Focus on a niche and then expand
  • Maintain flexibility
  • Segment geographically
  • Get the technology right
  • Manage critical perceptions
  • Presence, brand, trust
  • Provide exceptional service
  • Create effective connectedness
  • Understand Internet culture
  • Spam
  • Requiring registration before browsing site
  • Many graphics
  • Secondary browser windows
  • Lack of FAQ page

Huff, et al., 2000
31
Online Industries
  • Art Dealers
  • Showcase work Art.com, Guild.com
  • Automotive
  • Research and purchase new and used cars
  • Dealers can search online databases for cars
  • Communicate between departments responsible for
    automobile production and therefore improve the
    way cars are manufactured
  • Form partnerships with competitors
  • Autobytel.com, Autoparts.com, Autoweb.com
  • Banking
  • Access account info, pay bills and write checks
    online
  • Wellsfargo.com, Directbanking.com,
    Claritybank.com
  • Career Services
  • Job seekers Monster.com
  • Employers HotJobs.com, CareerPath.com
  • Career JobsOnline.com, HotJobs.com,
    Monster.com, HeadHunter.net
  • Contracting Guru.com

Deitel, et al., 2001 Laudon Traver, 2004
Schneider, 2002
32
Online Industries
  • Children
  • Sesamestreet.com, Educationplanet.com
  • Education
  • Elementary, high school, college and adult
    students
  • Gen.com, Ecollege.com, Tutor.com,
    Varsitybooks.com
  • Energy
  • Standard way for energy businesses to communicate
  • EnronOnline.com (former site), Altranet.com
  • Entertainment
  • MP3 MP3.com, Napster.com
  • Independent artist Farmclub.com
  • Interactive Web TV Mtv.com, CNN.com, Webtv.com
  • Web Radio Spinner.com, Real.com, Npr.com
  • Sports Espn.com, Nfl.com, Nba.com,
    Sportingnews.com
  • Comedy Laugh.com, Comcentral.com
  • Games Mplayer.com, Flipside.com
  • Hollywood iFilm.com, Inside.com

Deitel, et al., 2001 Schneider, 2002
33
Online Industries
  • Event Tickets
  • TicketWeb.com, Pollstar.com, TicketCity.com,
    Tickets.com
  • Genealogy
  • Trace lineage Genealogy.com, Ancestry.com
  • Government
  • Interact with local and national politicians
  • Email, newsgroups, and discussion boards are
    effective means of communicating about political
    issues
  • US government offers documentation, news and
    reports on the Web
  • Whitehouse.gov, FBI.com, Gsa.gov
  • Grocery Stores
  • Peapod.com, Homegrocer.com
  • Insurance
  • Inform potential customers about the insurance
    options
  • Prudential.com, Getmet.com

Deitel, et al., 2001 Schneider, 2002
34
Online Industries
  • Legal Services
  • Legal representation, law students improving
    studies
  • Cybersettle.com, Lexis.com, Nexis.com
  • Loans
  • Fill out documents quickly and return loan
    approvals within minutes
  • Eloan.com, Ditech.com
  • Medical
  • Case studies, medical journal articles, doctors
    answering questions
  • Webmd.com, Sickbay.com
  • Publishing
  • Digital creation and distribution of electronic
    content
  • Pearson.com, Atrandom.com, Fictionworks.com,
    ESPN.com, Usnews.com
  • Real Estate
  • Post listings Consumers can buy, sell, and
    mortgage property
  • Homes.com, Apartments.com, eRealty, zipRealty.com

Deitel, et al., 2001 Laudon Traver, 2004
Schneider, 2002
35
Online Industries
  • Retailer
  • Communicate easily with suppliers, shipping
    companies and customers Bill customers and
    accept payment EDI
  • Compusa.com, Victoriasecret.com, WalMart.com
  • Trading
  • Etrade.com, Ameritrade.com
  • Travel
  • Helps commercial airline industry to fill more
    seats and reduce costs
  • Travelocity.com, Cheaptickets.com, Orbitz.com
  • Transportation and Shipping
  • Track shipments Ups.com, Fedex.com
  • Keep trucks fully loaded and ensure timely
    delivery Trucking.net

Deitel, et al., 2001 Schneider, 2002
36
References
  • Christensen, C. (2000). The Innovators Dilemna,
    Harvard Business School Press, Boston, MA.
  • Deitel, H.M., Deitel, P.J. and Steinbuhler, K.
    (2001). e-Business and e-Commerce for Managers,
    Prentice Hall, Upper Saddle River, New Jersey.
  • Eisenmann, T.R. (2002). Internet Business
    Models Text and Cases, McGraw-Hill Companies,
    Inc. New York.
  • Huff, S.L., Wade, M., Parent, M., Schneberger, S.
    and Newson, P. (2000). Cases in Electronic
    Commerce, Irwin McGraw-Hill Co., Inc.
  • Jessup, L. and Valacich, J. (2006). Information
    Systems Today, 2nd edition, Pearson Education,
    Inc., Upper Saddle River, NJ.
  • Kalakota, R., Robinson, M. and Tapscott, D.
    (2001). E-Business Roadmap for Success 2.0,
    Addison Wesley Longman, Inc.
  • Krishnamurthy, S. (2003). E-Commerce Management
    Text and Cases, Thomson Learning.
  • Laudon, K.C. and Traver, C.G. (2004).
    E-commerce Business. Technology. Society.,
    Addison Wesley.

37
References
  • Napier, H.A., Judd, P.J., Rivers, O.N. and
    Wagner, S.W. (2001). Creating a Winning
    E-Business, Course Technology, Thomson Learning,
    Inc.
  • NetFactual.com (2003), accessed 17 February
    2005.
  • Oz, E. (2002). Foundations of e-Commerce,
    Pearson Education, Inc., Upper Saddle River, New
    Jersey.
  • Poirier, C. C. and Bauer, M. J. (2000). E-Supply
    Chain Using the Internet to Revolutionize Your
    Business, Berrett-Koehler Publishers, Inc.
  • Rayport, J.F. and Jaworski, B.J. (2002).
    Introduction to E-Commerce, McGraw-Hill
    Companies, Inc. New York.
  • Schneider, G.P. (2002). Electronic Commerce, 3rd
    edition, Course Technology Thomson Learning,
    Inc.
  • Treacy, M. and Wiersema, F. (1995). The
    Discipline of Market Leaders Choose Your
    Customers, Narrow Your Focus, Dominate Your
    Market, Perseus Books, Cambridge, Massachusetts.
  • Zakon, R.H. (2005). Hobbes Internet Timeline
    v8.0, http//www.zakon.org/robert/internet/timeli
    ne/, accessed 17 February 2005.
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