Electronic commerce and business

e-Commerce is …• Some interpretations:

– “focused around individual business transactions that use the Internet as medium of exchange, including business-to-business as well as business-to-consumer” (Hartman, 2000)

– “process of buying, exchanging products/services/information via computer networks” (Turban, 2002)

– “buying and selling using the Internet” (Chaffey, 2007)

– “doing business electronically” (Timmers, 1999)

e-Business is …• Some interpretations:

– “transforms business relationships, whether those relationships be business-to-consumer, business-to business, intra-business, or consumer-to-consumer” (Hartman, 2000)

– “” … not just buying and selling of goods and services, but also servicing customers, collaborating with business partners, and conducting electronic transactions within an organization” (Turban, 2002)– “transformation of key business processes through the use of Internet” (IBM)

Drivers for e-Business and e-Commerce

• Increased revenue due to larger customer base• Cost reductions:

– Economics of scale– Search & marketing costs– Disintermediation– Inventory/reduced cycle time– Optimizations in business processes

• Increase of competitive advantage– First mover advantage– New products & services (digital assets, electricity power, search engines, …)

Barriers for e-Business and e-Commerce

• Not sufficient Internet access (quantity & quality)

• No real benefits; explosion of .com bubble• Technology costs are too high• Technology is complex (XML, RDF/S, OWL,

ebXML, …: all W3C standards and their potential use)

• Fraud, Confidentiality, Privacy and Trust issues(including laws)

Why do all these *to* matter ?• Parties (businesses, government, individuals):

– Have different buying / selling behavior;– Have different decision processes;– Buy/sell in different volumes (single vs. bulk);– Buy/sell different kinds of products (standard vs commodity, different level of commodities);– Buy/sell different bundles;– Use different channels.

• And also… Different ICT is required

Business model

• Many definitions:– e.g. “An architecture for product, service and information flow, including a description of the potential benefits for the various business actors; and a description of the sources of revenue” (Timmers, 1999)

• What different kinds do exist? E-Shop, E-procurement, E-malls, E-auctions, … (Timmers, 1999)

Different kinds of business models• E-shops

– Normal shop, eg. Dell• E-procurement

– Acquisition of products/services, eg. AirFrance-KLM

• E-mall– Multiple e-shops, eg. Industry.net, Amazon?

• E-auction– Customer-to-customer, eg. ebay

Different kinds of business models

• Value chain service provider– Chain wide services, eg. banks

• Trust services– Certification authorities, legal stuff.

• Info brokers– Information services, eg. Google (ads).

• Virtual (business) communities– Online communities, eg. facebook, secondlife

Different kinds of business models

• Collaborative platform– Share knowledge, eg. research communities, Blu-ray

• Third party marketplace– Mixture of e-mall and e-auction, mainly business-2- business, eg. Tradezone

• Value chain integrator– Integrates value adding steps, eg. Dell