This document provides an overview of electronic commerce (e-commerce) and defines its key concepts. E-commerce involves the buying and selling of goods and services over the Internet. It can take various forms depending on whether the product, transaction process, or delivery is fully digitized. The document outlines different models of e-commerce including business-to-consumer, business-to-business, and consumer-to-consumer. It also discusses the unique features of e-commerce technologies and frameworks like intranets and extranets that enable electronic transactions and information sharing.

1. E-commerce
Overview of Electronic Commerce

2. Learning
Objec-ves
1. Define
electronic
commerce
(EC)
and
describe
its
various
categories.
2. Describe
and
discuss
the
content
and
framework
of
EC.
3. Describe
the
major
types
of
EC
transac-ons.
4. Discuss
e-­‐commerce
2.0.
5. Describe
social
commerce
and
social
software.

3. Learning
Objec-ves
6. Understand
the
elements
of
the
digital
world.
7. Describe
the
drivers
of
EC
as
they
relate
to
business
pressures
and
organizational
responses.
8. Describe
some
EC
business
models.
9. Describe
the
benefits
of
EC
to
organizations,
consumers,
and
society.
10. List
and
describe
the
major
limitations
of
EC.

4. E-commerce Trends 2011-2012
n Social
networking
con-nues
to
grow
n Expansion
of
social
e-­‐commerce
plaIorm
n Mobile
compu-ng
begins
to
rival
PC
n Localiza-on
of
e-­‐commerce
(Groupon)
n Explosive
growth
in
online
video
viewing
n Con-nued
privacy
and
security
concerns

5. The First 30 Seconds
n First
16
years
of
e-­‐commerce
v Just
the
beginning
v Rapid
growth
and
change
n Technologies
con-nue
to
evolve
at
exponen-al
rates
v Disrup-ve
business
change
v New
opportuni-es

6. What is E-commerce?
n Use
of
Internet
and
Web
to
transact
business
n The
process
of
buying,
selling,
or
exchanging
products,
services,
or
informa-on
via
computer
networks
n More
formally:
v Digitally
enabled
commercial
transac-ons
between
and
among
organiza-ons
and
individuals

7. E-commerce vs. E-business
n E-­‐business:
v A
broader
defini-on
of
EC
that
includes
not
just
the
buying
and
selling
of
goods
and
services,
but
also
servicing
customers,
collabora-ng
with
business
partners,
and
conduc-ng
electronic
transac-ons
within
an
organiza-on
v Digital
enablement
of
transac-ons
and
processes
within
a
firm,
involving
informa-on
systems
under
firm’s
control
v Does
not
include
commercial
transac-ons
involving
an
exchange
of
value
across
organiza-onal
boundaries

8. Why Study E-commerce?
n E-­‐commerce
technology
is
different,
more
powerful
than
previous
technologies
n E-­‐commerce
bringing
fundamental
changes
to
commerce
n Tradi-onal
commerce:
v Passive
consumer
v Sales-­‐force
driven
v Fixed
prices
v Informa-on
asymmetry

9. Pure versus Partial EC
n EC
can
take
several
forms
depending
on
the
degree
of
digi-za-on
1. the
product
(service)
sold
2. the
process
(e.g.,
ordering,
payment,
fulfillment)
3. the
delivery
method
n brick-­‐and-­‐mortar
(old
economy)
organiza-ons
Old-­‐economy
organiza-ons
(corpora-ons)
that
perform
their
primary
business
off-­‐line,
selling
physical
products
by
means
of
physical
agents
n virtual
(pure-­‐play)
organiza-ons
Organiza-ons
that
conduct
their
business
ac-vi-es
solely
online
n click-­‐and-­‐mortar
(click-­‐and-­‐brick)
organiza-ons
Organiza-ons
that
conduct
some
e-­‐commerce
ac-vi-es,
usually
as
an
addi-onal
marke-ng
channel

10. Electronic Commerce:
Definitions and Concepts
n electronic
market
(e-­‐marketplace)
An
online
marketplace
where
buyers
and
sellers
meet
to
exchange
goods,
services,
money,
or
informa-on
n interorganiza3onal
informa3on
systems
(IOSs)
Communica-ons
systems
that
allow
rou-ne
transac-on
processing
and
informa-on
flow
between
two
or
more
organiza-ons
n intraorganiza3onal
informa3on
systems
Communica-on
systems
that
enable
e-­‐commerce
ac-vi-es
to
go
on
within
individual
organiza-ons

11. Unique Features of E-commerce
Technology
1. Ubiquity
2. Global
reach
3. Universal
standards
4. Informa-on
richness
5. Interac-vity
6. Informa-on
density
7. Personaliza-on/customiza-on
8. Social
technology

12. The EC Framework, Classification,
and Content
n intranet
An
internal
corporate
or
government
network
that
uses
Internet
tools,
such
as
Web
browsers,
and
Internet
protocols
n extranet
A
network
that
uses
the
Internet
to
link
mul-ple
intranets

13. Types of E-commerce
n Classified
by
market
rela-onship
v Business-­‐to-­‐Consumer
(B2C)
v E-­‐commerce
model
in
which
businesses
sell
to
individual
shoppers
v Business-­‐to-­‐Business
(B2B)
v E-­‐commerce
model
in
which
all
of
the
par-cipants
are
businesses
or
other
organiza-ons
v Consumer-­‐to-­‐Consumer
(C2C)
v E-­‐commerce
model
in
which
individuals
use
the
Internet
to
sell
products
or
services
to
organiza-ons
or
individuals
who
seek
sellers
to
bid
on
products
or
services
they
need
n Classified
by
technology
used
v Peer-­‐to-­‐Peer
(P2P)
v Mobile
commerce
(M-­‐commerce)

14. Other Types
n loca3on-­‐based
commerce
(l-­‐commerce)
* targeted
to
individuals
in
specific
loca-ons,
at
specific
-mes
n intrabusiness
EC
* internal
organiza-onal
ac-vi-es
n business-­‐to-­‐employees
(B2E)
* organiza-on
delivers
services,
informa-on,
or
products
to
its
individual
employees
n collabora3ve
commerce
(c-­‐commerce)
* individuals
or
groups
communicate
or
collaborate
online
n e-­‐learning
* The
online
delivery
of
informa-on
for
purposes
of
training
or
educa-on
n e-­‐government
* a
government
en-ty
buys
or
provides
goods,
services,
or
informa-on
from
or
to
businesses
or
individual
ci-zens
n Exchange
* A
public
electronic
market
with
many
buyers
and
sellers

15. • The Future of EC
– Web 2.0
The second-generation of Internet-based
services that let people collaborate and
share information online in perceived new
ways—such as social networking sites,
wikis, communication tools, and
folksonomies

16. The Internet
n Worldwide
network
of
computer
networks
built
on
common
standards
n Created
in
late
1960s
n Services
include
the
Web,
e-­‐mail,
file
transfers,
etc.
n Can
measure
growth
by
looking
at
number
of
Internet
hosts
with
domain
names

17. The Web
n Most
popular
Internet
service
n Developed
in
early
1990s
n Provides
access
to
Web
pages
v HTML
documents
that
may
include
text,
graphics,
anima-ons,
music,
videos
n Web
content
has
grown
exponen-ally
v
Google
indexes
between
75
–
100
billion
pages

18. Origins & Growth of E-commerce
n Precursors:
v Baxter
Healthcare
v Electronic
Data
Interchange
(EDI)
n 1995:
Beginning
of
e-­‐commerce
v First
sales
of
banner
adver-sements
n E-­‐commerce
fastest
growing
form
of
commerce
in
United
States

19. Technology and E-commerce in
Perspective
n The
Internet
and
Web:
Just
two
of
a
long
list
of
technologies
that
have
greatly
changed
commerce
v Automobiles
v Radio
n E-­‐commerce
growth
will
eventually
cap
as
it
confronts
its
own
fundamental
limita-ons.

20. Potential Limitations on the
Growth of B2C E-commerce
n Expensive
technology
n Sophis-cated
skill
set
n Persistent
cultural
agrac-on
of
physical
markets
and
tradi-onal
shopping
experiences
n Persistent
global
inequality
limi-ng
access
to
telephones
and
computers
n Satura-on
and
ceiling
effects

21. E-commerce: A Brief History
n 1995-­‐2000:
Innova-on
v Key
concepts
developed
v Dot-­‐coms;
heavy
venture
capital
investment
n 2001-­‐2006:
Consolida-on
v Emphasis
on
business-­‐driven
approach
n 2006-­‐Present:
Reinven-on
v Extension
of
technologies
v New
models
based
on
user-­‐generated
content,
social
networks,
services

22. EC Business Models
n business
model
A
method
of
doing
business
by
which
a
company
can
generate
revenue
to
sustain
itself

23. EC Business Models
n Six
elements
of
a
business
model
include
descrip-ons
of:
1. Customers
to
be
served
and
the
company’s
rela-onships
with
these
customers
including
customers’
value
proposi2on
2. All
products
and
services
the
business
will
offer
3. The
business
process
required
to
make
and
deliver
the
products
and
services
4. The
resources
required
and
the
iden-fica-on
of
which
ones
are
available,
which
will
be
developed
in
house,
and
which
will
need
to
be
acquired
5. The
organiza-on’s
supply
chain,
including
suppliers
and
other
business
partners
6. The
revenues
expected
(revenue
model),
an-cipated
costs,
sources
of
financing,
and
es-mated
profitability
(financial
viability)

24. EC Business Models
n revenue
model
Descrip-on
of
how
the
company
or
an
EC
project
will
earn
revenue
n The
major
revenue
models
are:
* Sales
* Transac-on
fees
* Subscrip-on
fees
* Adver-sing
fees
* Affiliate
fees
* Other
revenue
sources
n value
proposi3on
The
benefits
a
company
can
derive
from
using
EC

25. EC
Business
Models
• Online
direct
marke-ng
• Electronic
tendering
systems.
• Name
your
own
price
• Find
the
best
price
• Affiliate
marke-ng
• Viral
marke-ng
• Group
purchasing
• Online
auc-ons
• Product
and
service
customiza-on
• Electronic
marketplaces
and
exchanges
• Informa-on
brokers
(informediaries)
• Bartering
• Deep
discoun-ng
• Membership
• Value-­‐chain
integrators
• Value-­‐chain
service
providers
• Supply
chain
improvers
• Social
networks,
communi-es,
and
blogging
• Direct
sale
by
manufacturers
• Nego-a-on
Typical EC Business Models

26. EC
Business
Models
n tendering
(bidding)
system
Model
in
which
a
buyer
requests
would-­‐be
sellers
to
submit
bids;
the
lowest
bidder
wins
n name-­‐your-­‐own-­‐price
model
Model
in
which
a
buyer
sets
the
price
he
or
she
is
willing
to
pay
and
invites
sellers
to
supply
the
good
or
service
at
that
price

27. EC
Business
Models
n affiliate
marke3ng
An
arrangement
whereby
a
marke-ng
partner
(a
business,
an
organiza-on,
or
even
an
individual)
refers
consumers
to
the
selling
company’s
Web
site
n viral
marke3ng
Word-­‐of-­‐mouth
marke-ng
in
which
customers
promote
a
product
or
service
to
friends
or
other
people

28. EC
Business
Models
n SMEs
Small-­‐to-­‐medium
enterprises
n group
purchasing
Quan-ty
(aggregated)
purchasing
that
enables
groups
of
purchasers
to
obtain
a
discount
price
on
the
products
purchased

29. EC
Business
Models
n e-­‐co-­‐ops
Another
name
for
online
group
purchasing
organiza-ons
n customiza3on
Crea-on
of
a
product
or
service
according
to
the
buyer’s
specifica-ons

30. Social
and
Business
Networks
n social
networks
Web
sites
that
connect
people
with
specified
interests
by
providing
free
services
such
as
photo
presenta-on,
e-­‐mail,
blogging,
etc.
n Business-­‐oriented
networks
are
social
networks
whose
primary
objec-ve
is
to
facilitate
business

31. The
Digital
Enterprise
n corporate
portal
A
major
gateway
through
which
employees,
business
partners,
and
the
public
can
enter
a
corporate
Web
site