It for decision makers commerce overview


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It for decision makers commerce overview

  1. 1. IT for Decision Makers e Commerce Overview
  2. 2. What is e Commerce? e commerce is enabling or achieving your business objectives by using information technology to enhance or transform your business processes. Kami, 2000
  3. 3. e commerce Business to business (B2B)  automating supply increasing business efficiency Business to Consumer (B2C) Retail Sales Customer Support Consumer to Consumer (C2C) Online Auctions
  4. 4. eCommerce ecommerce is more then just an online shop selling goods…. Businesses make huge savings by more efficient interaction with their suppliers or buyers. A local pharmacist orders 60% of his supplies from an overseas pharmaceutical suppliers website and saves 5% in his purchases - is this ecommerce? A remote Fiji resort attracts guests from the USA after several exchanges of email. Is this ecommerce?
  5. 5. Global 400 million users of Internet worldwide 1999 US online retail sales - US$20bn. Forrester Research 2000 US online retail sales - US$30bn+ Forrester Research US Online buying will reach US$6.9 trillion 2004. Forrester Research electronic payment of bills and banking will cost US Postal Service $17bn over 10 years.
  6. 6. Interpretation ? Consumers are willing to spend money on online transactions. Despite the recent drop in investment - consumers continue to use the Internet in growing numbers. The US figures are only part of the global picture.
  7. 7. What is working? Pornography Travel / Tourism  Retail - items that don’t need personal touch - objectivity in product quality and performance music, books, gifts, Computers, electronic items Auctions Real Estate - houses and investment properties. Customer support services  More efficient and effective processes between businesses (B 2 B)
  8. 8. What is not working? Items which require “touch and trial” Luxury goods Clothes - beyond Tshirts Groceries - it works for some people but market is restricted Note: Many OFF line factors determine success of Online service. Eg. Transport network, customer profiles,
  9. 9. e commerce and the Pacific Traditional Barriers Isolation – distance from market Small local markets Limited human capacity Opportunity Internet provides “instant” access to global market
  10. 10. ecommerce adoption in Pacific Tourism small operators and multi nationals expatriate owned businesses due to better awareness of communications possibilities. Online retailers - often overseas based, some Pacific based exporters. Generally for the Pacific it has been ad hoc entry with ecommerce/
  11. 11. Lessons from experience Popular Sites Not = Revenue Online Advertising Market is immature especially in the Pacific. What visitors do on a website is more important then inflated “hits” figures Income models based on advertising must be supported by online sales. Start with a strategy know your market and how to reach them Traditional Off line issues determine profitability management, product, operations and financing.
  12. 12. e Commerce and Pacific The challenge is identify market niches for products unique to the Pacific (core competencies) EcoTourism, trade niches, island goods Identify skill industries where local capacity can be developed and product transferred electronically. (insurance, banking, drafting etc) Avoid entry in IT labor market - call centers, credit card processing without an exit plan because these IT niches will be the world’s most MOBILE industries and governed by cost of labor.
  13. 13. Demonstrations - Tourism Tourism: Sailing Safaris - Tonga One boat operation in 1996 from small island base  Competing with 2 multinational yacht companies with global marketing network Since 1997 - 80% of business from web site. This statistic 60-80% of bookings from web inquiries is common to Tourism operators in the Pacific.
  14. 14. Example 2 - Tourism  - Travel Portal One stop shop for travel info and bookings. 9 Pacific Island Countries Travel Information and Bookings Sticky Items - bring people back to site message boards for comments News Postcards
  15. 15. Example 3 - Retail - Portal  Popular site and daily local news.  immature advertising market – difficult to get local advertisers.  Sticky Features News Numerous in-house websites  sells through  uses credit card transactions with manual batch processing  Kava, music, Jewelry, etc.
  16. 16. Example 4 - Retail Artifacts - Papua New Guinea  - PNG Portal Sticky Features Forums, News, Chat, Postcards, Info pages Sells PNG artifacts. Transactions via email and bank transfers Great product but management and operation issues and no online transactions.
  17. 17. Remember The Internet is the best opportunity for Pacific Island business since the Jet Plane however: traditional business principles still matter online. Value to the customer comes first. Be realistic about revenues and costs For the Pacific the initial market is overseas Initiative and creativity are premium.
  18. 18. PART II An ecommerce strategy for a Small Pacific Island Business By Taholo Kami for UNESCO
  19. 19. Objectives? Why get online? Promote awareness of your Organization Sell a product Customer support Information and contact page Networking Everyone else has a web page
  20. 20. Plan What is your product? Electronic, Services or physical Portable and inexpensive to deliver Tourism Who is your market? Overseas Fish buyers Upper income art collectors Budget travellers / Up market Obstacles, Implementation and deadlines.
  21. 21. Getting Online Hosting Your Website Fast Access Cost, Support, Space and Services Choosing a Domain Name (web address)  / .nu / .to / .tv / .fj / Calling Card Choose name that relates to product Reflects on organization Easy to remember
  22. 22. Design Issues Often Simple Is Better E.g. National PNG, Yahoo Complexity depends on your website objectives Planning content How do you keep content fresh and relevant  Who Develops your website? Professional Services Do it Yourself
  23. 23. Web Site Software Web-site Creation Common Software Tools. Image Editing  Adobe Photoshop  Web Page Development Paintshop Microsoft Front page - $150 Dream Weaver - $150 – 200 Netscape Communicator-Free Note: There are a lot of cheaper software online.
  24. 24. Managing your Web Site Managing your website can take TIME! Adapting Business processes Good Samaritan Inn example Look at employee time Customer expectations Limitations of the medium (non face to face)
  25. 25. Transactions 1. Getting paid online is very difficult in the Pacific. Many banks will need a large deposit or a strong relationship to allow a SME to open a merchant / credit card processing account at a bank. Alternatives include:  Bank transfer / wire  Credit Cards  Merchant account  Manual / Automated processing  Third party processing 
  26. 26. Delivery Delivering an artifact after online purchase or attracting visitors to an eco tourism resort - managing expectations is essential People are used to guaranteed delivery but more importantly, communicate reality so expectations are realistic. E.g. Implement a 2 week guarantee for goods Ensure online advertisement meets expectations Use a reliable delivery service (TNT, FedEx)
  27. 27. Marketing Web site How do people find your website? ONLINE Strategy Links from related and / or popular web sites Search Engines Online Advertisements Informed by other users
  28. 28. Marketing Your Website OFFLINE Strategy - Show Your URL  Stationary Advertising on conventional media Trade shows
  29. 29. Conclusion Despite infrastructure limitations in the Pacific, the target market in developed countries are likely to be Internet users. If unsure, start small. An existing website helps develop your capacity to interact with customers and measure web potential. Lobby Government for effective IT Strategy that develops infrastructure and builds local capacity.