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E business and

  1. 1. By: Vikram.G.BLecturer, P.G Dept. of Commerce Vivekananda Degree College Bangalore
  2. 2. Meaning & Definitions:- Electronic business, commonly referred to as "e- business", or an internet business, may be defined as the application of information and communication technologies in support of all the activities of business. e-business may be defined as the conduct of industry, trade, and commerce using the computer networks. The term "e-business" was coined by IBMs marketing and Internet teams in 1996.
  3. 3.  Electronic business methods enable companies to link their internal and external data processing systems more efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy the needs and expectations of their customers. The internet is a public through way. Firms use more private and hence more secure networks for more effective and efficient management of their internal functions. In practice, e-business is more than just e-commerce. While e-business refers to more strategic focus with an emphasis on the functions that occur using electronic capabilities, e- commerce is a subset of an overall e-business strategy. E- commerce seeks to add revenue streams using the World Wide Web or the Internet to build and enhance relationships with clients and partners and to improve efficiency using the Empty Vessel strategy. Often, e-commerce involves the application of knowledge management systems.
  4. 4.  E-Commerce refers to buying and selling of products and services by business and consumer through an electronic medium, without using any paper documents. E-commerce is widely considered the buying and selling of products over the internet, but any transaction that is completed solely through electronic measures can be considered e-commerce. E-commerce is subdivided into three categories: business to business or B2B (Cisco), business to consumer or B2C (Amazon), and consumer to consumer or C2C (eBay). also called electronic commerce.
  5. 5. Differences between E-business and E-commerce E-business is broader in scope and e-commerce is just an aspect or a subset of it. E-business involves marketing, product design, consumer service evaluation, and more. E-commerce only covers business transactions such as buying and selling of goods and services over the internet. E-commerce essentially involves monetary trade while in e- business, money transactions are not necessary.
  6. 6.  Electronic business methods enable companies to link their internal and external data processing systems more efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy the needs and expectations of their customers. In practice, e-business is more than just e-commerce. While e- business refers to more strategic focus with an emphasis on the functions that occur using electronic capabilities, e-commerce is a subset of an overall e-business strategy. E-commerce seeks to add revenue streams using the World Wide Web or the Internet to build and enhance relationships with clients and partners and to improve efficiency using the Empty Vessel strategy. Often, e-commerce involves the application of knowledge management systems.
  7. 7.  E-business involves business processes spanning the entire value chain: electronic purchasing and supply chain management, processing orders electronically, handling customer service, and cooperating with business partners. Special technical standards for e-business facilitate the exchange of data between companies. E-business software solutions allow the integration of intra and inter firm business processes. E-business can be conducted using the Web, the Internet, intranets, extranets, or some combination of these.
  8. 8. Differences b/n Traditional business and E-business Locations requirements:- In traditional business the location should be in proximity to the source of raw materials or the market for products. Whereas there is no such specific location is required for e-business. Operating cost:- Operating cost is high in traditional business due to fixed charges associated with the investment in procurement and storage, production, marketing and distribution facilities. But on the other hand operating cost is low as a result of reliance on network of relationship rather than ownership of resources. Nature of contact with suppliers and customers:- In traditional business contact is through the intermediaries and there is no direct contact with customers. But in e- business there is a direct relation with customers.
  9. 9.  Response Time:- In traditional business it will take long time to get a response from the customer. But the business man gets instant response in e-business. Shape of organizational structure:- Traditional business structure is vertical/tall due to hierarchy of chain of command. But structure of e-business is horizontal/flat due to directness of command and communication. Opportunity for interpersonal touch:- Traditional business has fewer opportunities to have international touch. But at the same time e-business have much more opportunities to go international.
  10. 10. Virtual Communities:- A virtual community is a social network of individuals who interact through specific social media, potentially crossing geographical and political boundaries in order to pursue mutual interests or goals. One of the most pervasive types of virtual community operate under social networking services consisting of various online communities. A virtual community is a community of people sharing common interests, ideas, and feelings over the Internet or other collaborative networks. The term virtual community is attributed to the book of the same title by Howard Rheingold, published in 1993. The books discussion ranges from Rheingolds adventures on The WELL, computer-mediated communication and social groups and information science.
  11. 11.  Virtual Community is a collective group of entities, individuals or organizations that come together either temporarily or permanently through an electronic medium to interact in a common problem or interest space. Examples of Virtual Communities VW Vortex.com is an automobile enthusiast community who’s common interests are engine, suspension and body repairs, modifications, upgrades and enhancements of all models of Volkswagen automobiles. Here one can seek advice for anything from how to change their oil, to upgrading your engine to a VR6 Turbo with nitrous. This website was created by VW enthusiasts for VW enthusiasts for informational purposes.
  12. 12.  FreeAdvice.com is an informational website where one can go to seek any kind of law, legal, or insurance questions or information. It is maintained by nationally renown specialists at dozens of leading American law firms, and by other capable attorneys and legal professionals. This website was created for the sole purpose of helping people understand legal situations better, and to help them handle all sorts of legal issues. FreeAdvice.com has been online for over 10 years now and has over 600,000 topics and answers in their law forums. Overclock.net is a website is geared toward the pursuit of computer performance. Overclocking a computer is a technique that, when applied properly, can yield amazing computer performance improvements. If applied improperly, it can lead to one heck of a headache, or at worst, It’s a great informational hotspot for novice and advanced overclockers alike.
  13. 13. Web Portal:- Portal is a major visiting center for internet users. Portal is a single, web based interface to content data, aggregated and customized, based on the user’s profile, subscription and access. an Internet portal is a Web site that acts as a starting point for browsing the Web. Portals typically include search engines and large directories of websites. Some popular portals are Yahoo, Excite, Lycos,Netscape, AltaVista, MSN, and AOL.com. There are also many smaller portals, known as "niche portals," for specific interests.
  14. 14. Portal v/s Website:- A portal is generally a vehicle by which to gain access to a multitude of services. A web site is a destination in itself. As such the term website refers to a location on the Internet that is unique and can be accessed through a URL. By that definition a web portal is in fact also a website.A website is also a web portal if, It transmits information from several independent sources that can be, but not necessarily are, connected in subject; thus offering a public service function for the visitor which is not restricted to presenting the view(s) of one author.
  15. 15.  Customization : Portal: You will select and organize the materials you want to access. Organized with the materials you want to access. Website: Searchable, but not customizable. All content is there for every visitor. e.g. you can navigate to yahoo mail, yahoo shopping, geo cities, yahoo group. If you wish to use any of these services you will either have to authenticate yourself and see things personalized to you or you can simply visit sections that are for everyone like yahoo news were if you are not signed in then the default sign in is guest. Best way can say that web portal is all about the high featured and site is just with information. Another good difference forum is come with lot of pages(more than 100k pages even) where site have few pages.
  16. 16.  The Portal and website can be differentiated as :Authentication: Portal: It provides facility of Logging-In. Provides you with information based on who you are. e.g. mail.yahoo.com, gmail.com, rediffmail.com Website: No log-in. e.g. www.yahoo.com Personalization: Portal: Limited, focused content. Eliminates the need to visit many different sites. e.g. You type in your user name and password and see your yahoo mail only. Website: Extensive, unfocused content written to accommodate anonymous users needs.
  17. 17. Web Auctions:- In an auction, a seller offers an item or items for sale, but does not establish a price. This is called “putting an item up for bid” or “putting an item on the (auction) block.” Potential buyers are given information about the item or some opportunity to examine it; they then offer bids, which are the prices they are willing to pay for the item. The potential buyers, or bidders, each have developed private valuations, or amounts they are willing to pay for the item. The whole auction process is managed by an auctioneer.
  18. 18.  Online auctions are popular places for trading goods. Individuals registered as users can buy and sale almost anything online. Online auctions companies are, for instances, eBay and Amazon. The price is normally cheaper than market price; with "past history" functions, users can evaluate sale’s honesty and trustworthy before buying; more information is also provided online, or could be answered in Q&A section. However some vendors refuse to ship overseas and risks are that vendors are registered but are not official businesses, the credibility is unknown.
  19. 19. Types of auction:- Dutch auctions: A form of open auction in which bidding starts at a high price and drops until a bidder accepts the price. Because the price drops until a bidder claims the item, Dutch auctions are also called descending-price auctions. First-Price Sealed-Bid Auctions: In sealed-bid auctions, bidders submit their bids independently and are usually prohibited from sharing information with each other. In a first-price sealed-bid auction, the highest bidder wins. Second-price sealed-bid auction: The same as the first- price sealed bid auction except that the highest bidder is awarded the item at the price bid by the second-highest bidder.
  20. 20.  Open-outry double auctions: Buy and sell offers are shouted by traders standing in a small area on the exchange floor called a trading pit. Double auction: Buyers and sellers each submit combined price quantity bids to an auctioneer. The auctioneer matches the sellers’ offers (starting with the lowest price and then going up) to the buyers’ offers (starting with the highest price and then going down) until all the quantities offered for sale are sold to buyers. Reverse auction: Multiple sellers submit price bids to an auctioneer who represents a single buyer. The bids are for a given amount of a specific item that the buyer wants to purchase. The prices go down as the bidding continues until no seller is willing to bid lower.
  21. 21. Types of online auction:- Online auctions are one of the fastest growing segments of online business today. Millions of people buy and sell all types of goods on consumer auction sites each year. Although the online auction business is changing rapidly as it grows, websites like eBay provides real time bidding, three broad categories of auction web sites have emerged: General consumer auction. Specialty consumer auction. Business-to-business auction.
  22. 22. General consumer auction: In this type of auction, bidders are listed, but the bid amounts are not disclosed until after the auction is over. The most successful consumer auction Web sites is eBay and the most common format used is a computerized version of the English auction. Note that in the eBay English auction sellers are allowed to set a reserve price. In this type of auction, bidders are listed, but the bid amounts are not disclosed until after the auction is over. The main difference between eBay and a live English auction is that bidders do not know who placed which bid until the auction is over. The eBay English auction also allows sellers to specify that an auction be made private.
  23. 23. Specialty consumer auction: It is very hard to compete with a well-established rival such as eBay in the general consumer auction market, a number of firms have decided to identify special-interest market targets and create specialized Web auction sites that meet the needs of those market segments. Several early Web auction sites started by featuring technology items such as computers, computer parts, photographic equipment, and consumer electronics. pottery auctio.com and justbeads.com are best examples of auction sites that cater to buyer and sellers who are geographically dispersed but share highly focused interests.
  24. 24. Business-to-business auction: Unlike consumer online auctions, business-to –business online auction evolved to meet a specific existing need. Two of three emerging business-to-business web auction are direct descendants of these two traditional methods for handling excess inventory. In the large company model the business creates its own auction site that sells excess inventory. In the small company model, a third party web auction site takes the place of the liquidation broker and auction excess inventory listed on the site by a number of smaller sellers. The third business to business web auction model resembles consumer online auction.
  25. 25. Revenue Models:- Revenue model describes how the firm will earn revenue, generate profits, and produce a superior return on invested capital. The terms revenue model and financial model are used interchangeably. The function of business organizations is both to generate profits and to produce returns on invested capital that exceed alternative investments. Profits alone are not sufficient to make a company “successful”. So, in order to be considered successful, a firm must produce returns greater than alternative investments. Firms that fail this test go out of existence.
  26. 26. Different Revenue Models: Although there are many different e-commerce revenue models that have been developed, most companies rely on one, or some combination, of the following major revenue models: the advertising model, the subscription model, the transaction fee model, the sales model, and the affiliate model.
  27. 27.  Advertising revenue model, a Web site that offers its users content, services, and/or products also provides a forum for advertisements and receives fees from advertisers. Those Web sites that are able to attract the greatest viewership or that have a highly specialized, differentiated viewership and are able to retain user attention (“stickiness”) are able to charge higher advertising rates. In the subscription revenue model, a Web site that offers its users content or services charges a subscription fee for access to some or all of its offerings. Experience with the subscription revenue model indicates that to successfully overcome the disinclination of users to pay for content on the Web, the content offered must be perceived as a high-value-added, premium offering that is not readily available elsewhere nor easily replicated.
  28. 28.  Transaction fee revenue model, a company receives a fee for enabling or executing a transaction. For example, eBay provides an online auction marketplace and receives a small transaction fee from a seller if the seller is successful in selling the item. Sales revenue model, companies derive revenue by selling goods, information, or services to customers. Companies such as Amazon (which sells books, music, and other products), LLBean.com, and Gap.com, all have sales revenue models. Affiliate revenue model, sites that steer business to an “affiliate” receive a referral fee or percentage of the revenue from any resulting sales. For example, MyPoints makes money by connecting companies with potential customers by offering special deals to its members. When they take advantage of an offer and make a purchase, members earn “points” they can redeem for freebies, and MyPoints receives a fee.
  29. 29. REVENUEMODEL E XA M P L E S REVENUESOURCEAdvertising Yahoo Fees from advertisers in exchange for advertisementsSubscription WSJ.com Fees from subscribers in Consumerreports.org exchange for access to content or servicesTransaction Fee eBay Fees (commissions) for E-Trade enabling or executing a TransactionSales Amazon Sales of goods, information, or LLBean services Gap JCPenny.comAffiliate MyPoints Fees for business referrals