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15.561A: Information Systems:From Technology Infrastructureto the Networked Corporation
15.566: Information Technology as anIntegrating Force in Manufacturing
Yannis BakosE53-329Tel. (617) 253-7097; Fax (617) 258-7579Email: [email protected]: http://web.mit.edu/bakos
Class #14: THE INTERNETAND ELECTRONICCOMMERCE #2Spring 1998Sloan School of ManagementMassachusetts Institute of Technology
Spring 1998, Class #14
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Copyright © 1998 b y Yannis Bako s
Electronic Commerce on theInternet
■ The First Wave of Web Use: Information Exchange– Publishing, customer feedback
■ The Current Wave: Transactions– Product Delivery– Create a Marketplace– New types of Intermediaries
■ Emerging Waves:– Business Information Sharing & Partnerships– Customization & Communities of Interest
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Publishing (Both Internally andExternally)
■ Product Brochures
■ Catalogs
■ Technical Specs
■ News/ResearchDocuments
■ FAQ’S
■ Software Demos
■ Annual Reports
■ Press Releases
■ Telephone Directories
■ Schedules
■ Price Lists
■ Order Status
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Examples of Web Publishing
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More Examples of Web Publishing
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Internet Present: Product deliveryExample: Grocery Shopping
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Internet Present: Product deliveryExample: Electronic Newspapers
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Internet Present: An EmergingElectronic Marketplace
■ The Internet Is Becoming a Place Where Buyersand Sellers Meet to Exchange Information,Goods, Services, and Money—That Is, AMarketplace
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Internet Present: the Glue forElectronic Integration
■ Link the value chains of a customer and asupplier
■ Main benefits– reduced costs (e.g., lower inventories)– increased speed and accuracy– integration of the value chains
■ EDI has been around for a long time, but theInternet will dramatically lower the cost of entry
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GIVE YOUR CUSTOMERS ACCESS TOYOUR SYSTEMS
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source: P. Gudonis, BBN Planet
Provide Access to CorporateDatabases Internally and Externally
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81.70%
63% 60.90% 60.00%
PurchaseOrders
Transfer ofPayments
Sales/usagedata
Invoices
% of those respondents whoconduct e-commerce with suppliers
Business processes handledin e-commerce systems
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GE’s TRANSACTION PROCESSINGNETWORK (TPN)
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The Internet Future: CollaborativeFiltering and Communities of Interest
■ Create a community of interest
■ Each user specifies preferences– Active (explicit) ratings– Passive (implicit) ratings
■ Correlate rating information across users– Create individualized, “virtual” shopping agent
■ Find and Recommend products– Before you even ask!
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Community ofInterest A
New User?
??
Recommendations
Firefly Network becomes a market intermediary andcaptures marketing data
Communityof Interest B
Community ofInterest C
Firefly Network
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EXPLICIT RATINGS
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The Internet Future: Customization
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CUSTOMIZE!!!
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CUSTOMIZATION: Amazon.comPersonal Notification Service
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2001: A CYBERSPACE ODYSSEY?
Good to see you again Dave.Since you were here last:
■ I have an update for your software
■ It’s time for some fashionable new shirts
■And some matching ties
■ I’ve selected a humorous video for tonight
■And found a nice young lady to chat with
■We received your last payment .
Thank you so much!
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CONCLUSIONS
■ From Mass Marketing to Individual Tailoring– Create more value
– Dampen price competition
■ Business-to-Business– A big win (and where most of the action is)
– Beyond cost reduction: redefine relationships
■ Publishing, Transactions & Customization– Communities of Interest
– Individualized collaborative filtering