1C32– May 28, 2008

Business 54 - Introduction to eCommerce

Spring 2008

2C32– May 28, 2008

Class Game Plan

Remaining Presentations?

Class Re-Cap.

Additional Questions / Topic Follow-up.

Exam Discussion.

3C32– May 28, 2008 3

The union of Buyer Side benefits and Seller side benefits creates a new business paradigm; the truly first ‘new’ one since Ford’s Model T and Mass Production:

The Virtuous Circle.

Union of Buy and Sell Side

4C32– May 28, 2008

The union of Buyer Side benefits and Seller side benefits creates anew business paradigm; the truly first ‘new’ one since Ford’s Model T and Mass production:

• Convenience.

• Information Gathering.

• Anonymity.

• Price Comparison-Shopping.

• Walk Away Ability.

• Broader Reach.

• Lower Selling Costs.

• Supply Chain Management

& Expansion.

• Reduced or (even ) Virtual

Product inventories.

• Price Discrimination.

5C32– May 28, 2008

Business & Revenue Models

Business Models Business to Consumer. Business to Business. Business to Business to Consumer. Consumer to Business. Communities. Exchanges-Marketplaces. Governmental. Peer to Peer. Media.

Revenue Models Banner-Advertising. Subscription. Transactional. ‘Begging’-Donations. Middlemen. Taxation.

6C32– May 28, 2008 6

The Internet – a Network of Networks

7C32– May 28, 2008

The Web Computing Complex

The GUI

The Data Warehouse(s)

The Transaction Engine

Back-Office

8C32– May 28, 2008

The Basic Open Source Web Technologies

LAMP. Linux - Server Operating

System. Apache - Web Server Manager. MYSQL - Database Engine. PHP (/HTML) - Programming

Language(s).

9C32– May 28, 2008

Keys of eMarketing

Traditional Marketing focuses on the 4 P’s:• Product - What am I selling?• Price - What am I charging?• Placement - Where am I selling?• Promotion - How do I make prospective buyers aware?

All of these are also important in the Web space, but there are some differences:

• Product is the same regardless of whether it is sold online or offline.• Placement of the product is, by definition, on the Internet.

To the remaining 2 P’s we need to add 2 more to get to the 6 P’s of eMarketing:

• Personalization.• Persistence.• (Promotion).• (Price / Price Discrimination).

10C32– May 28, 2008

eMarketing Guiding Principles

6 P’s of eMarketing: • Product - What am I selling?• Price / Price Discrimination - What am I charging?• Placement - Where am I selling?• Promotion - How do I make

prospective buyers

aware of my product?

• Personalization - What do I know about the

Customer?• Persistence - Who is the

Customer?

11C32– May 28, 2008

The Web allows you to both Narrowcast and Broadcast at the same time.

Narrowcasting:• One-on-One marketing & selling.• Targeted audience(s).

Broadcasting:• Global Reach.• Large Product-Services Set.• Appear bigger than you really are.

Smaller, and ruthlessly focused can be better than being big.

Successfully identify a web niche and exploit it:• Meet an Unsatisfied Need.• Become a Niche Player-Company.• Compete on Emotion-image-brand.• Higher Profit Margins / ROI.• More Satisfying / Less Pressure.

Price

MassMarket

Gaining Strategic Advantage through Specialization

12C32– May 28, 2008

Three Waves of the Internet.

Information Gathering – Users were on their own.

Search Engines:• Editorial / Algorithm / Paid.

Introductions aka Lead Generation.

The Next Wave?:• Assisted Lead Generation.• Applying Web 2.0 to marketing.

The Future of eMarketing is Lead Generation

13C32– May 28, 2008

eMarketing and Search

Paid and Free.

How Free search works.

How ‘Paid” Search works.

Google. SEO. SEM.

14C32– May 28, 2008

Types of eGov: G2G. G2C. G2B. G2V.

Mission vs. Profitability / NPV.

Automation, and not Re-Engineering or Webification.

eGov

15C32– May 28, 2008

eLearning

Pseudo-Classrooms / Distance Learning.

Wiki’s.

Blogs and Chat Rooms.

Certification Programs.

Corporate Training.

Webcasts.

Podcasts.

16C32– May 28, 2008

eAuctions

Dynamic Pricing / Selling of Goods and Services.

Regular Auctions.

Dutch Auctions / Reverse Auctions.

Silent Auctions.

Sealed Bid Auctions.

C2C Auctions

B2B Auctions.

B2C Auctions.

17C32– May 28, 2008

Internet Security

Con

fiden

tialit

y Availability

Integrity

Authentication Authorization

Non-Repudiation

18C32– May 28, 2008

Four Waves of Flattening / Globalization.

The Romans:• 100BC – 800AD

Columbus and The Age of Exploration:• 1492 – 1800.

Western Europe and The Age of Colonialism:• 1800-1989.• Sun never sets on the British Empire.

Jim Barksdale and The Age of the Internet:• 1989 to Today.

Globalization

19C32– May 28, 2008

Modifying the site to met specific needs of a target DEMOGRAPHIC or GEOGRAPHIC group: Content = Needs. Linguistic. Navigation. Graphics vs. Text. Cultural / Social. Legal / Regularity. Others?

Globalization vs. Localization

20C32– May 28, 2008

The defining document for your eCommerce business.

Also applicable for corporate eCommerce initiatives.

Usually averages about 40 pages in length with tables-charts.

Consolidates-unifies your Business Strategy, Business Model and Revenue Model.

Your calling card for investors and corporate decision-makers / approvers.

Key Sections of the Business Plan include:• Executive Summary• Market Demographics• Marketing and Product Strategy• Staffing-Management Team• Historical and Prospective Financial Statements and Investment Returns

The Business Plan

21C32– May 28, 2008

Raising the Money Also called the Money Chase.

Will consume the company and senior management until you achieve cash neutrality.

The single, most important job for Founder/CEO at this stage of company development.

The Money Chase has a number of progression steps and funding levels:• Sweat Equity• Friends and Family• Dumb Money• Angels• Smart Money / Strategic Partners• Venture Capitalists• IPO

May not pass thru all levels. May skip some steps-levels.

Need to balance debt and equity fundraising.

22C32– May 28, 2008

Valuation Valuation Models:

• Comparison.• Financial:

Revenue-based Cash Flow-based.

• Replicative.

Multiplier Effect.

Other Value Considerations.

The Validation Tension / Battle.

23C32– May 28, 2008

Communities

Collection of like-minded people who share attributes or hobbies-interests.

Think your local church group or alumni organizations or AOL.

Size / number of active community members is THE critical success factor.

24C32– May 28, 2008

Web 1.0   Web 2.0

DoubleClick --> Google AdSense

Ofoto --> Flickr

Akamai --> BitTorrent

mp3.com --> Napster

Britannica Online --> Wikipedia

personal websites --> blogging

evite --> upcoming.org and EVDB

domain name speculation --> search engine optimization

page views --> cost per click

screen scraping --> web services

publishing --> participation

content management systems --> wikis

directories (taxonomy) --> tagging ("folksonomy")

stickiness --> syndication

Web 2.0

25C32– May 28, 2008

Internet 2.0

Not-for-profit advanced networking consortium comprising more than: 200 U.S. universities; 70 leading corporations; 45 government agencies / laboratories; and 50+ international partner organizations.

Mission is: providing increased network capacity and actively develop new

technologies, including middleware, security, network research and performance measurement capabilities which are critical to the progress of the Internet.

26C32– May 28, 2008

EnterTech

Movies: Games.

27C32– May 28, 2008

Online Games Types of games:

RPG. Sports. Shooter. Strategy. Sports. Massively Multiplayer Online Games (MMOGs aka The Micro-verse).

Most often played online games: 52% Puzzles, Board games, Game Shows, Trivia, Cards. 22% Action, Sports games, Strategy/Role-playing games. 9% Shockwave/Flash Browser-based mini games. 6% Persistent Multiplayer universe. 11% Other.

28C32– May 28, 2008

Non-Lloyd Class Questions……

29C32– May 28, 2008

Lloyd Class Questions……

(and maybe some) Answers

30C32– May 28, 2008

Additional Topics / Follow Up?

31C32– May 28, 2008

Exam Questions?

32C32– May 28, 2008

Thanks for taking the Class!

Have a great Summer Vacation!