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E- Commerce Fundamentals
Introduction
Addresses the need of
•Organization
•Merchants
•Customers
In order to
•Reduce costs
•Increase the speed of service & delivery
•Search & retrieve information
09-05-00
Parts of E-Business
Institution Process
Network
E-Business
Institutions:
Government
Merchants
Manufacturers
Suppliers
Consumers
Process:
Marketing
Payment
Fulfillment
Support
Networks:
Corporate
Internet
Commercial
09-05-00
E-business Framework
E-Commerce Applications
Public
Proces
s and
Legal
issues
Technica
l
Standard
s of E
commerc
e
Business Infrastructure
Messaging And Information
Infrastructure
Multimedia and E commerce
Infrastructure
Information Super Highway (I-Way)09-05-00
E commerce Applications
Electronic Fund Transfer
Supply chain Management
Video on Demand
Remote Banking
Enterprise Integration
Procurement & Purchase
Home Shopping
Online Marketing
09-05-00
TECHNOLOGIES OF E-
COMMERCE
While many technologies can fit within the definition of "Electronic
commerce," the most important are:
•Electronic data interchange (EDI)
•Bar codes
•Electronic mail
•Internet
•World Wide Web
•Product data exchange
•Electronic forms
09-05-00
CONSUMER ORIENTED E-
COMMERCE APPLICATIONS
The wide range of applications for the consumer marketplace can
be broadly classified into
Entertainment: Movies on demand, Video cataloging, interactive
ads, multi-user games, on-line discussions
Financial services and information: Home banking, financial
services, financial news
Essential services: Home shopping, electronic catalogs,
telemedicine, remote diagnostics
Educational and training: Interactive education, video
conferencing, on-line databases
09-05-00
Business Models
B2C - E-Banking, E-Broking, etc
B2B - Catalog Model, Exchange Model
C2B - milkar.com, priceline.com
C2C - ebay.com, napster.com
eGovernence(Mponline, passport, etc)
09-05-00
E-Commerce Network
Infrastructure
Internet
Customer Merchant
C2B/B2C 09-05-00
E-Commerce Network
Infrastructure
Internet
Organization
X
Organization
Y
B2B 09-05-00
E-Commerce Network
Infrastructure
Internet
Customer Customer
C2C 09-05-00
E-Commerce Network
Infrastructure
Internet
Government Customer
eGovernance
09-05-00
The Scope of E-commerce
E-commerce encompasses a broad range of
activities. The core component includes
trading of physical goods and services. The
conventional activities include.
• Searching for product information
• Ordering product
• Paying for goods and services
• Customer service
09-05-00
The Scope of E-commerce
E-commerce also includes the business
activities:
• Pre-sales and post –sales support
• Internal electronic mail and massaging
• Online publishing of corporate documents and
forms
• Managing corporate finance and personal
systems
• Manufacturing logistic management
• Supply chain management for inventory
• Facilitation of contact between traders
• Tracking orders and shipments
09-05-00
History of E-Commerce
 Background
E-commerce actually began in the 1970s when
larger corporations started creating private
networks to share information with business
partners and suppliers.
 This process, called Electronic Data Interchange
(EDI), transmitted standardized data that
streamlined the procurement process between
businesses, so that paperwork and human
intervention were nearly eliminated.
 EDI is still in place, and is so effective at
reducing costs and improving efficiency that an
estimated 95% of Fortune 1,000 companies use
History of E-Commerce
 Prodigy was running text
ads and selling flowers
in the early '80s
 The first documented
Online sale in 1994 was
what?
 A CD
09-05-00
History of E-Commerce
 Online retailing began four years ago, and was
pioneered largely by Internet companies that didn't
(and some still don't) perform traditional retail, such
as Amazon.com and CDNow.
 More recently, brand names like Barnes and Noble,
the Gap, and Wal-Mart have set up shop on the Net,
and many experts believe that these and other brand
names will be able to establish long-lasting
presences on the Web.
 Today, all a person needs is a computer, a browser,
and Internet access, and he or she can buy flowers,
airline tickets, and even a car. Tomorrow. who knows.
The sky's the limit.
09-05-00
History of E-Commerce:
Amazon.com
 Early in 1994, working for D.E. Shaw in New York City,
Jeff Bezos, a restless, 30-year-old hedge fund
manager began researching the commercial
possibilities of the Net.
 A year later, Bezos drove west, raising venture funds
for a new small online book shop (originally called
Cadabra.com), to be launched from his garage in
Bellevue, Wash.
 Running on a Website and a warehouse, by its third
year Bezos's precocious Amazon.com toppled $150
million in annual sales — a milestone that Wal-Mart
founder Sam Walton needed 12 years (and 78 stores)
to reach.
History of E-Commerce: Stocks
 Electronic stock trading debuted 30 years ago with
Instinet, Reuters' computer network that allowed
after-hours trading.
 True Web-based trading arrived in 1994 with
Chicago-based NET Investor, which offered 15-
minute delayed quotes and charged $35 per trade.
 Ameritrade, Datek Online, and others followed,
eventually driving commissions to as low as $8 per
trade, and forcing the implementation of free, real-
time stock quotes in 1998.
History of E-Commerce: Ads
 In 1994, the first national consumer brand site -
www.zima.com - was launched for the Coor's owned
beverage Zima.
 In October of that year, Wired magazine's HotWired
(now part of Lycos-owned Wired Digital), dished up
the first banner ads from 12 advertisers, including
AT&T, Club Med, and Volvo.
 Sales for the entire online ad industry were $1
million that year, and HotWired owned 40 percent of
it.
 In 1998, online ad revenues reached $2 billion,
topping the $1.6 billion spent on "outside" ads, such
as billboards. General Motors alone pumped in
$12.7 million. Online ad revenue is expected to
History of E-Commerce: Travel
 Booking a trip over the Web back in 1995
meant going to a travel site and requesting a
fare.
 In early 1997, Travelocity offered a paging
service to its Web customers that alerted them
if their flight was delayed.
 In the fall of 1997, Priceline.com launched its
innovative, bid-based market for discount
airfares.
 Today you can bid on empty seats, name your
price, choose a seat from a diagram, and know
What are private industrial
networks?
 Private industrial networks are web based
networks that manage the interactions
between definite companies in all belongings
of the whole supply chain – from suppliers
over the wholesaler to the retailers and finally
to the customer – from the manufacturer to the
end customer. The network is also named as a
collaborative system, because the network
improves the efficiency in all linked parts.
Characteristics of private
industrial networks
 There are several main characteristics of
private industrial networks:
 Increase in the buying and selling efficiency in
the supply chain
 Financial risk reduction, because of closer
linkage between the different parties in the
supply chain
 Capacity and resource planning throughout
the industry
 Better communication in the supply chain for
improving the relationship between buyers and
Industry-wide private
industrial networks
 Many large companies, regardless of which
industry, operate their own private industrial
networks. Examples of the different industries
are:
 Retail industry: WalMart
 Beverage Industry: Coca-Cola
 Computer industry: Hewlett-Packard , IBM ,
Dell
 Software industry: Microsoft , IBM
 Networking equipment: Cisco Systems
Implementation Barriers
 Suppliers do not want to get linked to the
network
 Do not know how to handle the platform
 Expensive to build up and implement it
through the whole supply chain
Factors affecting E-
Commerce
09-05-00
1.Political factors
 It includes the role of government legislation,
initiatives and funding to support the use and
development of e-commerce and information
technology. Several aspects of government
policy can affect e-commerce business. All
firms must follow the law.
 E-Commerce such as providing robust secure
on-line payment options, ensuring a solid ICT
infrastructure, providing educational programs
and building up awareness using different
means such as media and education
2.Economic factors
 It includes the general wealth and commercial
health of the nation and the elements that
contribute to it. Economic efficiency results in
the reduction of communications costs, low-
cost technological infrastructure, speedier and
more economic electronic transactions with
suppliers, lower global information sharing and
advertising costs, and cheaper customer
service alternatives.
09-05-00
3.Social factors
 Incorporating the level and advancement in IT
education and training which will enable both
potential buyers and the workforce to
understand and use the technology. Rising
standards of living and a burgeoning,upwardly
mobile middle class with high disposable
incomes,Busy lifestyles,urban traffic
congestion and lack of time for offline
shopping have given boost to e-commerce.
Evolution of websites such as Flipkart,
Snapdeal, ebay etc. has become a market09-05-00
4.Technological factors
 The development of ICT is a key factor in the
growth of e-commerce. It has made
communication more efficient, faster, easier,
and more economical as the need to set up
separate networks for telephone services,
television broadcast, cable television, and
Internet access is eliminated. Due to
technological advances economic transactions
have become much easier and faster and this
has given boost to the development of e-
commerce. 09-05-00

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E business fundamentals

  • 1. E- Commerce Fundamentals Introduction Addresses the need of •Organization •Merchants •Customers In order to •Reduce costs •Increase the speed of service & delivery •Search & retrieve information 09-05-00
  • 2. Parts of E-Business Institution Process Network E-Business Institutions: Government Merchants Manufacturers Suppliers Consumers Process: Marketing Payment Fulfillment Support Networks: Corporate Internet Commercial 09-05-00
  • 3. E-business Framework E-Commerce Applications Public Proces s and Legal issues Technica l Standard s of E commerc e Business Infrastructure Messaging And Information Infrastructure Multimedia and E commerce Infrastructure Information Super Highway (I-Way)09-05-00
  • 4. E commerce Applications Electronic Fund Transfer Supply chain Management Video on Demand Remote Banking Enterprise Integration Procurement & Purchase Home Shopping Online Marketing 09-05-00
  • 5. TECHNOLOGIES OF E- COMMERCE While many technologies can fit within the definition of "Electronic commerce," the most important are: •Electronic data interchange (EDI) •Bar codes •Electronic mail •Internet •World Wide Web •Product data exchange •Electronic forms 09-05-00
  • 6. CONSUMER ORIENTED E- COMMERCE APPLICATIONS The wide range of applications for the consumer marketplace can be broadly classified into Entertainment: Movies on demand, Video cataloging, interactive ads, multi-user games, on-line discussions Financial services and information: Home banking, financial services, financial news Essential services: Home shopping, electronic catalogs, telemedicine, remote diagnostics Educational and training: Interactive education, video conferencing, on-line databases 09-05-00
  • 7. Business Models B2C - E-Banking, E-Broking, etc B2B - Catalog Model, Exchange Model C2B - milkar.com, priceline.com C2C - ebay.com, napster.com eGovernence(Mponline, passport, etc) 09-05-00
  • 12. The Scope of E-commerce E-commerce encompasses a broad range of activities. The core component includes trading of physical goods and services. The conventional activities include. • Searching for product information • Ordering product • Paying for goods and services • Customer service 09-05-00
  • 13. The Scope of E-commerce E-commerce also includes the business activities: • Pre-sales and post –sales support • Internal electronic mail and massaging • Online publishing of corporate documents and forms • Managing corporate finance and personal systems • Manufacturing logistic management • Supply chain management for inventory • Facilitation of contact between traders • Tracking orders and shipments 09-05-00
  • 14. History of E-Commerce  Background E-commerce actually began in the 1970s when larger corporations started creating private networks to share information with business partners and suppliers.  This process, called Electronic Data Interchange (EDI), transmitted standardized data that streamlined the procurement process between businesses, so that paperwork and human intervention were nearly eliminated.  EDI is still in place, and is so effective at reducing costs and improving efficiency that an estimated 95% of Fortune 1,000 companies use
  • 15. History of E-Commerce  Prodigy was running text ads and selling flowers in the early '80s  The first documented Online sale in 1994 was what?  A CD
  • 16. 09-05-00 History of E-Commerce  Online retailing began four years ago, and was pioneered largely by Internet companies that didn't (and some still don't) perform traditional retail, such as Amazon.com and CDNow.  More recently, brand names like Barnes and Noble, the Gap, and Wal-Mart have set up shop on the Net, and many experts believe that these and other brand names will be able to establish long-lasting presences on the Web.  Today, all a person needs is a computer, a browser, and Internet access, and he or she can buy flowers, airline tickets, and even a car. Tomorrow. who knows. The sky's the limit.
  • 17. 09-05-00 History of E-Commerce: Amazon.com  Early in 1994, working for D.E. Shaw in New York City, Jeff Bezos, a restless, 30-year-old hedge fund manager began researching the commercial possibilities of the Net.  A year later, Bezos drove west, raising venture funds for a new small online book shop (originally called Cadabra.com), to be launched from his garage in Bellevue, Wash.  Running on a Website and a warehouse, by its third year Bezos's precocious Amazon.com toppled $150 million in annual sales — a milestone that Wal-Mart founder Sam Walton needed 12 years (and 78 stores) to reach.
  • 18. History of E-Commerce: Stocks  Electronic stock trading debuted 30 years ago with Instinet, Reuters' computer network that allowed after-hours trading.  True Web-based trading arrived in 1994 with Chicago-based NET Investor, which offered 15- minute delayed quotes and charged $35 per trade.  Ameritrade, Datek Online, and others followed, eventually driving commissions to as low as $8 per trade, and forcing the implementation of free, real- time stock quotes in 1998.
  • 19. History of E-Commerce: Ads  In 1994, the first national consumer brand site - www.zima.com - was launched for the Coor's owned beverage Zima.  In October of that year, Wired magazine's HotWired (now part of Lycos-owned Wired Digital), dished up the first banner ads from 12 advertisers, including AT&T, Club Med, and Volvo.  Sales for the entire online ad industry were $1 million that year, and HotWired owned 40 percent of it.  In 1998, online ad revenues reached $2 billion, topping the $1.6 billion spent on "outside" ads, such as billboards. General Motors alone pumped in $12.7 million. Online ad revenue is expected to
  • 20. History of E-Commerce: Travel  Booking a trip over the Web back in 1995 meant going to a travel site and requesting a fare.  In early 1997, Travelocity offered a paging service to its Web customers that alerted them if their flight was delayed.  In the fall of 1997, Priceline.com launched its innovative, bid-based market for discount airfares.  Today you can bid on empty seats, name your price, choose a seat from a diagram, and know
  • 21. What are private industrial networks?  Private industrial networks are web based networks that manage the interactions between definite companies in all belongings of the whole supply chain – from suppliers over the wholesaler to the retailers and finally to the customer – from the manufacturer to the end customer. The network is also named as a collaborative system, because the network improves the efficiency in all linked parts.
  • 22. Characteristics of private industrial networks  There are several main characteristics of private industrial networks:  Increase in the buying and selling efficiency in the supply chain  Financial risk reduction, because of closer linkage between the different parties in the supply chain  Capacity and resource planning throughout the industry  Better communication in the supply chain for improving the relationship between buyers and
  • 23. Industry-wide private industrial networks  Many large companies, regardless of which industry, operate their own private industrial networks. Examples of the different industries are:  Retail industry: WalMart  Beverage Industry: Coca-Cola  Computer industry: Hewlett-Packard , IBM , Dell  Software industry: Microsoft , IBM  Networking equipment: Cisco Systems
  • 24. Implementation Barriers  Suppliers do not want to get linked to the network  Do not know how to handle the platform  Expensive to build up and implement it through the whole supply chain
  • 26. 1.Political factors  It includes the role of government legislation, initiatives and funding to support the use and development of e-commerce and information technology. Several aspects of government policy can affect e-commerce business. All firms must follow the law.  E-Commerce such as providing robust secure on-line payment options, ensuring a solid ICT infrastructure, providing educational programs and building up awareness using different means such as media and education
  • 27. 2.Economic factors  It includes the general wealth and commercial health of the nation and the elements that contribute to it. Economic efficiency results in the reduction of communications costs, low- cost technological infrastructure, speedier and more economic electronic transactions with suppliers, lower global information sharing and advertising costs, and cheaper customer service alternatives. 09-05-00
  • 28. 3.Social factors  Incorporating the level and advancement in IT education and training which will enable both potential buyers and the workforce to understand and use the technology. Rising standards of living and a burgeoning,upwardly mobile middle class with high disposable incomes,Busy lifestyles,urban traffic congestion and lack of time for offline shopping have given boost to e-commerce. Evolution of websites such as Flipkart, Snapdeal, ebay etc. has become a market09-05-00
  • 29. 4.Technological factors  The development of ICT is a key factor in the growth of e-commerce. It has made communication more efficient, faster, easier, and more economical as the need to set up separate networks for telephone services, television broadcast, cable television, and Internet access is eliminated. Due to technological advances economic transactions have become much easier and faster and this has given boost to the development of e- commerce. 09-05-00

Editor's Notes

  1. It includes the general wealth and commercial health of the nation and the elements that contribute to it. Economic efficiency results in the reduction of communications costs, low-cost technological infrastructure, speedier and more economic electronic transactions with suppliers, lower global information sharing and advertising costs, and cheaper customer service alternatives.