Management 265Introduction to E-Commerce Nicholas A. Davis Session One 06/02/2010
Course Objectives• Differentiate e-commerce from e-business• Discuss history of, and developments in e- commerce• Apply business concepts and strategies to an e-commerce strategy• Explain the major business models across the various types of e-commerce• Discuss trends in Internet technology
Who Is This Person?• Nicholas Davis - Instructor• MBA, Information Systems• Motorola, Berbee, Rayovac, American Family Insurance, University of Wisconsin-Madison• Cryptography, Digital Identity, Security• Teaching experience – UW-Madison, MATC, Cardinal Stritch• Member FBI Infragard• Favorite fruit = oranges
Snickers• A candy bar made by Mars,Incorporated. It consists of peanutnougat topped with roasted peanutsand caramel covered with milkchocolate.• Snickers is the best selling chocolatebar of all time and has annual globalsales of 2 billion dollars• Was named after the Mars familysfavorite horse.
Student Introductions• Your name• Your professional background• Something unique about yourself• Why you chose this class• What you hope to learn• What your favorite fruit is
Course Requirements• Participation 10% (individual)• Types of e-commerce paper 10% (individual)• Case study analysis 10% (individual)• Ethical implications paper 20% (individual)• ISP analysis 10% (team)• Case study analysis 10% (team)• E-commerce function paper 20% (team)• E-commerce function presentation 10% (team)• Total = 100%
Assignments Due Today• Read Chapters 1-3 in the textbook• Skim chapters 9-12 in the textbook• Submit paper on types of e-commerce• Discuss article about a company’s innovative use of e-commerce
Your Experience With E-Commerce• What are your personal and professional experiences with e- commerce?• Do you shop online? Why or why not?• Does your company conduct Internet sales? If so, what types? B2B, B2C
Class Exercise• Split up into teams• Make a list of the ways in which you believe e-commerce has changed over the course of the past 10 years (10 minutes)• Step up to the front of the class, go over your lists• What do these changes mean for the consumer and the business?• Put your changes on a timeline, discuss the changes and effects of these changes
E-Commerce vs. E-Business• E-commerce and E-business are not the same.• E-commerce relates to the process of selling goods and services online• E-business relates to using the Internet and other online technologies to increase operating efficiencies• E-commerce is externally facing, while e- business can be both internally and externally facing
Benefits of E-commerce• Expands markets from local to global• Reduces costs with telecommunications and physical maintenance• Minimizes resources used for storing physical receipts• Instant product updates, including descriptions and pricing• 24-hour store visibility to anyone with an Internet connection• Search utilities far surpasses the speed used to find products through catalogs• Encourages competition between small and large online retailers
Limitations of E-Commerce• Credit Card security is a serious issue if vulnerable• Costs involved with bandwidth and other computer and server costs• Extensive database and technical knowledge and experience required• Customer apprehension about online Credit Card orders• Constantly changing technology may leave slow businesses behind• Some customers need instant gratification, and shipment times interrupt that• Search utilities far surpasses the speed used to find products through catalogs• Encourages competition between small and large online retailers
Unique Features of E-Commerce• Ubiquity• Global reach• Universal standards• Richness• Interactivity• Information density• Personalization/Customization• Social technology
Class Exercise• Identify the factors influencing the evolution of e-commerce, as outlined in the textbook• Hint, think about Innovation, Consolidation, Re-invention
E-Commerce Trivia• 1990: Tim Berners- Lee writes the first web browser, WorldWideWeb, using a NeXT computer.
E-Commerce Enabling Technologies• The history of the Internet• The key technologies enabling the Internet• Future directions of the Internet• The relationship between technology advances and e-commerce evolution
Future Directions of Technology• Mobile, always on, more push, less pull• Smart and environmentally aware appliances• Increased throughput• Standardized authentication, authorization, access and payment systems• Behavioral customization• The end of network anonymity• What does this mean for e- commerce evolution?
Class Activity• Divide into two groups• Develop a timeline for the Internet• Which elements of the Internet revolution have impacted the e-commerce revolution and vice versa?• Discuss any differences between the two teams interpretations. Each team will then explain their reasoning
E-Commerce Articles• Come to the front of the classroom• Take a couple of minutes to:• Give a summary of the article to the class• How is the company in the article using e- commerce in an innovative fashion?• Describe why you chose that article and what you found most interesting in the article• Answer any questions the class may have
E-Commerce Innovations• Video solutions• Customer service• Real world guided selling• Multi store retailing• User interface design• Navigation tools• Effective merchandising• Social shopping• Customer loyalty
B2C Business Models Class Exercise - Portal• Portal• Offers an integrated package of content and content search, services, news, email, chat, video streaming, calendars, etc. Seeks to be the user’s home base• Examples are:• Yahoo, AOL, MSN, Bing, Google• In the future, maybe mystritch.edu ???
B2C Business Models Class Exercise – Content Provider• Content provider• Information and entertainment providers, such as newspapers, sports sites and other online sources that offer customers up to date news and special interest “how to” guidance and tips and/or information sales• Some examples are:• WSJ.com, cnn.com, espn.com, Rhapsody, iTunes, Youtube
B2C Business Models Class Exercise – Transaction Broker• Transaction Broker• Processors of online sales transactions, such as stockbrokers and travel agents, that increase customers’ productivity by helping them get things done faster and more cheaply• Examples:• E-Trade, Expedia, Monster, Travelocity, Hotels.com, Orbitz
B2C Business Models Class Exercise – Market Creator• Market Creator• Web based business that uses Internet technology to create markets which bring buyers and sellers together• Examples:• Ebay, Priceline
B2C Business Models Class Exercise – Service Provider• Service provider• Companies that make money by selling users a service, rather than a product• Examples:• Carbonite, Mosi, Xdrive, 1.FM
B2C Business Models Class Exercise – Community Provider• Community provider• Sites where individuals with particular interests, hobbies, common experiences, or social networks, where people can come together and “meet” online• Examples:• Friendster, iVillage, Myspace, Facebook
Class Exercise• Pick one on these models• Describe:• The model’s history• Some examples of the model• The benefits and challenges of the model• Try to include visuals in your presentation
Business Concepts and Strategies Discussion• How can you relate the following business concepts and strategies to e-commerce?• Marketing and sales• Inventory management• Logistics• Accounting• Loss prevention• Other?
Questions and Discussion of Today’s Class• Was everything clear?• What did you like?• What didn’t you like?• On a scale of 1-10, how would you rate the class so far?• Remember, next time, read chapters 4 and 5 in the textbook, submit the case study analysis, discuss article you select which is related to leading edge e-commerce technology and what impact it will have
Project Teams• Form two teams• Determine when and where you will meet for your weekly meetings• Identify three potential companies for e- commerce function paper and presentation