E-COMMERCE, STRATEGY & MANAGEMENT

(COM350)

E-COMMERCE MODELS

Week 4

• This Weeks Topics:

– E-COMMERCE MODELS

This Week

• E Commerce Models - strategic points

• DownloadIntroduction to Online Commerceand read for next week

• Read pp. 49-59 of ‘E-Business and E-Commerce Management’, Chaffey.

DEFINITION OF BUSINESS MODEL

• A business model is what allows a company to capture and deliver value to its customers

• Elements of a business model:– Organizational goals,– Strategies – Processes– Technologies – Structure

E-COMMERCE VERSUS TRADITIONAL MODELS

• Traditional Models– ICT / IS support the business systems

• E-business Models– ICT / IS are integral to the business model.

• The difference lies in the degree of integration.

ICT / IS INTEGRATION• Degree of integration is determined by the

degree of ‘virtuality’ of:

the product, the processes, the delivery agent (intermediary)

• In traditional business these elements are physical

• In pure e-commerce they are virtual• Virtual and physical elements can be

mixed

3 DIMENSIONS OF E-COMMERCE

(After Choi et al 1997)

Traditional Commerce

Pure E-commerce

Physical Agent

Physical Product

Virtual Product

Virtual P

roce

ss

Physical P

roces

s

Virtual Agent

• Business Models on the Web (Rappa)– http://ecommerce.ncsu.edu/business_models.html