This document discusses e-commerce strategies and challenges. It begins by defining e-commerce and outlining its scope. It then discusses the role of e-commerce managers in setting vision, goals, and strategy. The document outlines some key e-commerce challenges such as understanding customer needs, integrating online and offline activities, and identifying competitive advantages. It also discusses different approaches to developing e-commerce strategies such as strategic planning, sense and respond, position, resources, and using simple rules.

1. Scope of e-commerce

2. Learning objectives
• What is e-commerce?
• What are the e-challenges?
• What are the strategies for e-commerce?

3. Learning objectives
• What is e-commerce?
• What are the e-challenges?
• What are the strategies for e-commerce?

4. E-commerce definition
Technology-enabled transactions and technology-
mediated exchanges of digitized information
between parties (individuals or organizations) as
well as the electronically based intra-organizational
or inter-organizational activities that facilitate such
exchanges

5. E-commerce definition
Scope of e-commerce:
1. Exchange of digitized information
2. Technology-enabled transactions
3. Technology-mediated relationships
4. Intra- & inter-organizational activities

6. E-commerce definition
B2B C2B
B2C P2P
Business Consumers
Business originating from . . .
BusinessConsumers
Andsellingto...

7. E-commerce categories
Publishers order paper
supplies from paper
companies
Amazon orders from
publishers
Consumers aggregate to
bulk purchase from Amazon
Consumers buy thousands
of Harry Potter books from
Amazon
Business Consumers
Business originating from . . .
BusinessConsumers
Andsellingto...
Consumers resell
copies on eBay
Single chain (or converging categories) of e-commerce

9. E-commerce definition

10. E-commerce definition
1995-2000
Innovation
2001-2006 Consolidation 2006-future Reinvention
Technology-driven Business-driven Audience, customer,
community-driven
Revenue growth focus Earnings & profits focus Audience & social network
growth focus
Venture capital financing Traditional financing Merger & acquisition
Entrepreneurial Traditional/old economy Large pure Web-based
firms
Disintermediation Strengthening
intermediaries
Proliferation of small
online intermediaries
Perfect markets Imperfect markets, brands,
network effects
Online market
imperfections
Pure-play Bricks & clicks New market (pure play);
Retail (bricks & clicks)
First-mover advantages Strategic follower New market (1st
mover)

11. Learning objectives
• What is e-commerce?
• What are the e-challenges?
• What are the strategies for e-commerce?

12. Role of e-commerce managers
Entrepreneurship
Strategic
Management
Technology New Media
Accounting
Operations
and Logistics
Finance Marketing

13. Role of e-commerce managers
Set Vision
Establish Goals
Formulate
Strategy
Drive
Implementation
Be Accountable
for Performance

14. Role of e-commerce managers
Vision: higher-order societal effects
Goals: performance targets that are measurable
and in line with the company’s strategy &
business life cycle (process vs outcome)
Strategy: tradeoffs
Implementation: technology & media knowledge
Accountability: performance & results

15. E-commerce challenges
Understanding customer evolution
– Invest ahead of customer needs
Charting changing technology
– Match technology choices to consumer tastes
Weathering the storm
– Reassure stakeholders with clear vision, sensible business
model, and profitable venture
Integrating offline & online activities
– Align offline & online business activities, esp. advertising,
branding, retail & online store design, service, warranties, returns
(customer-facing activities)
Identifying key levers of competitive advantage
– Reallocate resources as competitive advantage levers evolve
Expanding globally
– Deal with complex internationalization issues

17. Learning objectives
• What is e-commerce?
• What are the e-challenges?
• What are the strategies for e-commerce?

18. E-commerce strategies
Implementation
Internal
(Company)
Analysis
External
Analysis
Control
and
Monitoring
Strategy
Formulation
● Corporate
● Business Unit
● Functional
● Operating
Objectives
Mission
Classical Strategic Planning

19. E-commerce strategies
Sense and respond
• Experimenting with intuitive, actionable,
easy to implement ideas
• Proactively soliciting feedback from
customers

20. Type Purpose Example
How-to rules They spell out key features of how a
process is executed - "What makes
our process unique?"
Akamai's rules for the customer service
process: staff must consist of technical gurus,
every question must be answered on the first
call or e-mail, and R&D staff must rotate
through customer service.
Boundary rules They focus managers on which
opportunities can be pursued and
which are outside the pale.
Cisco's early acquisitions rule: companies to be
acquired must have no more than 75
employees, 75% of whom are engineers.
Priority rules They help managers rank the
accepted opportunities.
Intel's rule for allocating manufacturing
capacity: allocation is based on a product's
gross margin.
Timing rules They synchronize managers with
the pace of emerging opportunities
and other parts of the company.
Nortel's rules for product development: project
teams must know when a product has to be
delivered to the leading customer to win, and
product development time must be less than 18
months.
Exit rules They help managers decide when to
pull out of yesterday’s opportunities.
Oticon's rule for pulling the plug on projects in
development: if a key team member-manager
chooses to leave the project for another within
the company, the project is killed.
Simple rules

21. E-commerce strategies
Position approach
Where should we be?
Resources approach
What should we be?
Simple rules approach
How to get there?

22. E-commerce strategies

23. E-commerce strategies
Framing the
Market
Opportunity
Business
Model
Customer
Interface
Market
Communication
and Branding
Implementation Metrics
E-commerce strategy formulation process