2. E-commerce entities
• There are several types of e-commerce entities:
• E-tailers
• Manufacturers
• Existing retailers
• Consumer-led entities
• Informative entities
• Service providers
• Financial entities
3. E-tailers
• E-tailers are businesses that source products from suppliers
and sell them purely online (e.g. Amazon and ebuyer)
• Some of these organisations wouldn’t have existed without
e-commerce
• There is a minimal need for warehousing (orders shipped
directly from supplier to customer)
• Overheads are lower but prices must be relentlessly
competitive (and profit margins can be low) so the business
must operate at maximum cost-effectiveness
• A recent development in online selling has been the inclusion
of second-hand products. (e.g. Amazon and eBay)
4. Manufacturers
• Some businesses manufacture products themselves and
sell them purely online (e.g. Dell)
• Manufacturers also buy through e-commerce as well as
sell
• Manufacturers often use direct marketing online (e.g. Dell
email adverts at least once a week to existing customers)
• Manufacturers like Dell can afford to sell their products at
lower prices and have more dramatic special offers as
they do not need to pay for retail premises or lots of staff
• Products can also be personalised (e.g. computers made
to a required specification)
5. Existing retailers
• Some traditional marketplace businesses have converted to
selling online as well
• This ‘bricks and clicks’ approach allows companies to enjoy
the best of both worlds however, it is expensive as both the
traditional store and the online store need to be financed
• If done proficiently, the profit from the e-commerce branch
should offset the costs and therefore the companies profits
should increase
• Moving from ‘bricks’ to ‘bricks and clicks’ can often only be
done by larger stable businesses (or small businesses with a
niche market) as it is very risky.
6. Consumer-led entities
• One interesting development of the Internet is the emergence
of consumer-led sites, such as eBay where the public can:
• buy goods
• sell goods
• often done through an auctioning system
7. Informative entities
• These are sites that provide a wealth of information for
visitor
• Selling is not the prime directive here although there are
opportunities for the visitor to make a purchase.
For example:
• The National Rail Enquiries web site helps visitors plan a
journey and offers details of services but also offers tickets
for sale.
• The BBC & newspapers have websites that are a rich source
of information on current affairs as well as providing
learning opportunities and the option to buy products
8. Service providers
Not all organisations have a product that can be sent to you
through the post. Some provide a service rather than selling
a product. Examples are Easyjet and Lastminute.com
• Both specialise in the leisure and transport industry
• Easyjet provide low-cost air travel
• Lastminute.com specialises in selling services at very short
notice (flights and holidays close to the time of departure)
9. Financial entities
Some service providers focus on financial services online.
For example, Esure sells insurance, and Egg is a purely
online bank.
• Online insurance has helped a new business develop
• Users can search a number of businesses for the best deal
(For example, Confused.com)
• Online banking services can offer especially competitive
rates due to lower overheads and running costs
• However, online banking is an area which has had a huge
hurdle to surmount - trust!
• Trust is much more of an issue with a service such as a bank
rather than a retail business.
10. Further reading
• Textbooks:
• Chaffey D – E-business and E-Commerce management, Second
Edition (FT Prentice Hall, 2003) ISBN 0273683780
• Lawson J – Information Technology Practitioners (Book1), Second
Edition. (Heinemann, 2007) ISBN 9780435465490
• Malmsten E, Leander K, Portanger E and Drazin C – Boo Hoo: A
Dot.com Story from Concept to Catastrophe (Arrow Books Ltd,
2002) ISBN 0099418371
• Vise D – The Google Story (Macmillan, 2005) ISBN 1405053712
• Websites
• www.ico.gov.uk International Commissioners Office
• www.w3.org World Wide Web Consortium
