The document outlines the fundamentals and evolution of e-commerce, defining it as digital transactions over the internet distinct from e-business. Key features of e-commerce technology include ubiquity, global reach, and interactivity, while various classifications such as B2C, B2B, and C2C are explored. Predictions for the future emphasize the integration of technology in commerce and anticipated changes in business practices and regulatory environments.

1. E-commerce
Kenneth C. Laudon
Carol Guercio Traver
business. technology. society.
Sixth Edition
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2. Copyright © 2007 Pearson Education, Inc. Slide 1-2
Chapter 1
The Revolution Is Just Beginning
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3. Learning Objectives
 After reading this chapter, you will be able to:
 Define e-commerce and describe how it differs from e-business.
 Identify and describe the unique features of e-commerce technology and discuss
their business significance.
 Describe the major types of e-commerce.
 Discuss the origins and growth of e-commerce
 Understand the vision and forces operating during the first five years of e-
commerce, and assess its successes, surprises and failures.
 Identify several factors that will define the next five years of e-commerce.
 Describe the major themes underlying the study of e-commerce.
 Identify the major academic disciplines contributing to e-commerce research.
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4. Slide 1-4
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5. E-commerce Trends 2009–2010
 New business models based on social technologies,
consumer-generated content, and services
 2009 a flat year, but growth expected to resume in
2010
 Broadband and wireless access continue to grow
 Mobile e-commerce begins to take off
 Traditional media losing subscribers
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6. What is E-commerce?
 Use of Internet and Web to transact
business
 More formally:
Digitally enabled commercial transactions
between and among organizations and
individuals
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7. E-commerce vs. E-business
 E-business:
Digital enablement of transactions and processes
within a firm, involving information systems under
firm’s control
Does not include commercial transactions
involving an exchange of value across
organizational boundaries
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8. Why Study E-commerce?
 E-commerce technology is different, more
powerful than previous technologies
 E-commerce bringing fundamental changes to
commerce
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9. Why Study E-commerce?
 Traditional commerce:
 Time consuming
 Wastage of resources
 Less informative
 Less comparative
 Information asymmetry (irregularity)
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10. Unique Features of E-commerce Technology
1. Ubiquity (It is available just about everywhere and at all times)
2. Global reach (The potential market size is roughly equal to the size of the
online population of the world.)
3. Universal standards (The technical standards of the Internet and
therefore of conducting e-commerce, are shared by all of the nations in
the world)
4. Information richness (Information that is complex and content-rich can
be delivered without sacrificing reach.)
5. Interactivity (E-commerce technologies allow two-way communication
between the merchant and the consumer).
6. Information density (The total amount and quality of information
available to all market participants is vastly increased and is cheaper to
deliver.
7. Personalization/customization
8. Social technology Slide 1-10
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11. Web 2.0
 Applications, technologies that allow
users to:
 Create and share content, preferences, bookmarks, and
online personas
 Participate in virtual lives
 Build online communities
 Examples
 YouTube, Photobucket, Flickr, Google, iPhone
 MySpace, Facebook, LinkedIn
 Second Life
 Wikipedia
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12. Types of E-commerce
 Classified by market relationship
 Business-to-Consumer (B2C)
 Business-to-Business (B2B)
 Consumer-to-Consumer (C2C)
 Classified by technology used
 Peer-to-Peer (P2P)
 Mobile commerce (M-commerce)
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13. The Internet
 Worldwide network of computer networks
built on common standards
 Created in late 1960s
 Services include the Web, e-mail, file
transfers, etc.
 Can measure growth by looking at number of
Internet hosts with domain names
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14. The Growth of
the Internet,
Measured by
Number of
Internet Hosts
with Domain
Names
Figure 1.3, Page 23
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SOURCE: Internet Systems Consortium,
Inc., 2009.
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15. The Web
 Most popular Internet service
 Developed in early 1990s
 Provides access to Web pages
HTML documents that may include text,
graphics, animations, music, videos
 Web content has grown exponentially
2 billion Web pages in 2000
 At least 40–50 billion pages today
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16. The Growth of B2C E-commerce
Figure 1.4, Page 25
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SOURCES: eMarketer, Inc., 2009a; U.S. Census Bureau, 2009b; authors’ estimates.
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17. The Growth of B2B E-commerce
Figure 1.5, Page 28
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SOURCES: U.S. Census Bureau, 2009a; authors’ estimates.
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18. Early Visions of E-commerce
 Computer scientists:
 Inexpensive, universal communications and computing
environment accessible by all
 Economists:
 Nearly perfect competitive market and friction-free
commerce
 Lowered search costs, disintermediation, price
transparency, elimination of unfair competitive advantage
 Entrepreneurs:
 Extraordinary opportunity to earn far above normal
returns on investment—first mover advantage
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19. Predictions for the Future
 Technology will propagate through all commercial activity
 Prices will rise to cover the real cost of doing business
 E-commerce margins and profits will rise to levels more
typical of all retailers
 Number of successful pure online stores will remain smaller
than integrated offline/online stores
 Growth of regulatory activity worldwide
 Influence of cost of energy
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20. Understanding E-commerce:
Organizing Themes
 Technology:
 Development and mastery of digital computing and
communications technology
 Business:
 New technologies present businesses with new ways of
organizing production and transacting business
 Society:
 Intellectual property, individual privacy, public welfare
policy
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21. The Internet
and the
Evolution
of Corporate
Computing
Figure 1.9, Page 44
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22. Academic Disciplines Concerned
with E-commerce
 Technical approach
 Computer science
 Management science
 Information systems
 Behavioral approach
 Information systems
 Economics
 Marketing
 Management
 Finance/accounting
 Sociology
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23. Slide 1-23
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mechanical, photocopying, recording, or otherwise, without the prior written
permission of the publisher. Printed in the United States of America.
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