LEARNING OBJECTIVES:1. Define globalization2. Describe and discuss activities involved inglobalization3. Discuss the three important drivers of globalizationincluding its good and bad sides4. Define E-commerce and describe its variousclassification by the nature of transaction.5. Describe the E-Commerce Facts for current trendsand future prospects6. Discuss the pros and cons of E-Commerce7. Describe and discuss the effects of globalization toE-Commerce.
OUTLINE:1. What is Globalization?2. Activities involved in Globalization3. The drivers of Globalization4. Good sides and bad sides of Globalization5. What is E-Commerce?6. Classification of E-Commerce by the nature of thetransactions7. E-Commerce Facts: Current trends and futureprospects8. Pros and Cons of E-Commerce9. Effects of Globalization to E-Commerce10. Synthesis (Insights)
What is GLOBALIZATION?GLOBALIZATION-is a process of interaction and integration amongthe people, companies, and governments ofdifferent nations, a process driven byinternational trade and investment and aided byinformation technology. This process has effectson the environment, on culture, on politicalsystems, on economic development andprosperity, and on human physical well-being insocieties around the world.
Activities involved in GlobalizationTravelAbroadShoesmade inKoreaBig Mac fromMoscowInternetUS BrandUS –ChinaBusinessPartnersCellphonesSatellite TVOnline Bus.CD Player-Madein JapanT-Shirt Madein Mexico
The Drivers of Globalization1.The Rapid spread of IT andcommunications across theworld2. The massive investment inbroadband technologies orenablers like fiber optic cablesand undersea cables in the wakeof the dotcom bubble3.The adoption of English as themedium of instruction in manycountries across the world.
Good sides and Bad sides of globalizationGOOD SIDES1. Easier to communicatethroughout the boundaries2. Easier to travel3. Cultural interchange4. International Trade5. Better and cheaper products6. Improvement of newtechnologies7. The cheaper productsincreases the purchase power8. The transport of the productsis easier and faster9. Globalization creates apolitical and an economicalunion, which facilitates theagreement between thecountriesBAD SIDES1. Delocalization createsunemployment in developedcountries2. Non-controlled circulation of money(free market) – no ethics3. The businessmen and the bigcompanies are the only winners inglobalization4. Exploitation of the workers in thedeveloping countries – incl. children5. Money problems can easily bespread6. The mix of cultures can lead toracism, xenophobia, intolerance andloss of national identity7. Small companies have to go out ofbusiness because they cantcompete with the multinationals8. As a result the gap between thepoor and the rich people increases
What is E-Commerce?E-Commerce-is defined as the use of electroniccommunications and digital informationprocessing technology in businesstransactions to create, transform, andredefine relationships for value creationbetween or among organizations, andbetween organizations and individuals.
Classification of EC by the Nature of theTransaction• Business-to-business (B2B) : EC model inwhich all of the participants are businesses orother organizations• Business-to-consumer (B2C): EC model inwhich businesses sell to individual shoppers• Business-to-business-to-consumer (B2B2C):EC model in which a business provides someproduct or service to a client business; the clientbusiness maintains its own customers, to whomthe product or service is provided
• Consumer-to-business(C2B): individualswho use the Internet to sell products orservices to organizations and /or seeksellers to bid on products or services theyneed• Consumer-to-consumer (C2C) :consumers sell directly to otherconsumers• Mobile commerce (m-commerce)—ECtransactions and activities conducted in awireless environment
• Location-commerce—(l-commerce)m-commerce transactions targeted toindividuals in specific locations, at specifictimesIntrabusiness (organizational) EC: ECcategory that includes all internalorganizational activities that involve theexchange of goods, services, orinformation among various units andindividuals in an organization
• Exchange (electronic): a public e-marketwith many buyers and sellers• Exchange-to-exchange (E2E): EC modelin which electronic exchanges formallyconnect to one another for the purpose ofexchanging information
E-COMMERCE FACTS: CURRENT TRENDS ANDFUTURE PROSPECTSINVENTION ONONLINE SHOPPINGE-Commerce Facts
TOP E-COMMERCESTORE IN USACONSUMERONLINE SHOPPINGBEHAVIORS
PAYMENT MODESUSED IN E-COMMERCEGLOBALECOMMERCE SALES
E-COMMERCESALES BY 2015E-COMMERCETO M-COMMERCE
PROS AND CONS OF E-COMMERCEPROS• No Standing in Queues orBeing Placed on HoldForever• Easier to Compare Prices• Access to Stores LocatedRemotely• No Need for a PhysicalStore• Common Availability ofCoupons and DealsCONS• Lack of Personal Touch• Easier to ComparePrices• Inability to Experiencethe Product BeforePurchase• Need for an InternetAccess Device• Need for an InternetConnection
• Lots of Choices• Stores Are Open All theTime• Ability to Buy and Sell toOther Consumers• Instantaneous Purchaseof Digital Goods• Ability to Have VendorsBid for Your Business• Not About "LocationLocation Location“• Ability to Scale UpRapidly• Common Availability ofCoupons and Deals• Credit Card Fraud• Security Issues• Delay in ReceivingGoods• Inability to IdentifyScams• Extraordinarily HighReliance on the Website• Multiplicity ofRegulations andTaxation
• Unlimited Shelf Space• Ease of Communication• Superior Customization• No Need to Handle CurrencyNotes• Efficient Procurement• Delivery of Each Individual Item• Superior Inventory Management• Reduced Employee Costs• Gain Search Engine Traffic• Ability to Sell Low Volume GoodsToo• Ability to Track Logistics• Chargebacks• Delivery of EachIndividual Item• Expense and ExpertiseNeeded for EcommerceInfrastructure• Need for ExpandedReverse Logistics
EFFECTS OF GLOBALIZATION TOE-COMMERCEE-COMMERCEGLOBALIZATIONLife’sstandardincreased:EducationSocialIndustrialFinancialEconomicPoliticalInformationalCompetitionEcologicalCulturalTechnicalLegal/Ethical
SYNTHESIS(INSIGHTS)• Globalization and E-Commerce which is part of the evolution ofInformation Technology had great impact in all aspects of thesociety that brought a lot of changes and affect human lifeeither good or bad.• This refers also to Digital Revolution because the economy isbased on digital technologies including:– Digital communication networks, Computers, Software,Other related information technologies• Also called:– Internet economy, New economy, Web economy
• Through this new economy, where e-commerce is greatlyinvolved, it actually expands the marketplace to national andinternational markets because of the challenges in theglobalization.• It enables people to shop or do other transactions 24 hours aday, all year round from almost any location• Provides consumers with less expensive products andservices by allowing them to shop in many places and conductquick comparisons.• Provides consumers with more choices and enables them towork at home, and to do less traveling for shopping, resultingin less traffic on the roads, and lower air pollution.• Thus, these few activities mentioned, simply change the wayhow people live and to make the country progressive and theworld a better place to live with.
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