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8/2/2019 James E-commerce
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DIFINITION OF
COMMERCEThe exchange of goods and services formoney
Consists of:Buyers - these are people with money who
want to purchase a good or service.
Sellers - these are the people who offergoods and services to buyers.
Producers - these are the people whocreate the products and services that sellers
offer to buyers.
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ELEMENTS OFCOMMERCEYou need a Product or service to sellYou need a Place from which to sell the
products
You need to figure out a way to get people to
come to your place.You need a way to accept orders.
You also need a way to accept money.
You need a way to deliver the product orservice, often known as fulfillment.
Sometimes customers do not like what theybuy, so you need a way to accept returns.
You need a customer service and technicalsupport department to assist customers with
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ELEMENTS OF E-COMMERCE
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HISTORY OF E-COMMERCE
EFTElectronic funds transferE-Commerce refers to the buying and selling of products or
services over electronic systems such as the Internet andother computer networks.
1. E-Commerce applications first developed in
the early 1970s
- Electronic funds transfer (EFT)
v.Limited to:
- Large corporations
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2. Electronic data interchange (EDI)electronictransfer of documents:
- Purchase orders
- Invoices
- E-payments between firms doing business
v.Enlarged pool of participants to include:
- Manufacturers
- Retailers
- Service providers
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Key Drivers of E-
commerceTechnological degree of advancement of
telecommunications infrastructure
Political role of government, creatinglegislation, funding and support
Social IT skills, education and training ofusers
Economic general wealth and commercialhealth of the nation
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ADVANTAGES OF E-COMMERCE
Consumers can easily search through a largedatabase of products and services. They cansee actual prices, build an order over severaldays and email it as a wish list hoping that
someone will pay for their selected goods.
Customers can compare prices with a click ofthe mouse and buy the selected product at
best prices.
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Reduced advertising costs for online Vendors.The web and its search engines provide a
way to be found by customers.
Small online shops can reach global markets.
Web technology also allows to track customerpreferences and to deliver individually-tailoredmarketing.
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Four Categories of E-Commerce
B2B
B2C
C2B
C2CConsumers
Business
And sellingto...
Business originating from...
Business Consumers
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Four Categories of E-Commerce(contd)
l Business to Business (B2B) refers to the fullspectrum of e-commerce that can occurbetween two organizations.This includes purchasing and procurement,supplier management, inventory management,channel management, sales activities, paymentmanagement &service and support.Examples: FreeMarkets, Dell and GeneralElectric
l Business to Consumer(B2C) refers to
exchanges between business and consumers,activities tracked are consumer search,
frequently asked questions and service andsupport.
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Four Categories of E-Commerce(contd)
l Peer to Peer(C2C) exchanges involvetransactions between and amongconsumers. These can include third partyinvolvement, as in the case of the auction
website Ebay.Examples: Owners.com, Craiglist, Monster
l Consumer to Business (C2B) involves
when consumers band together to presentthemselves as a buyer in group.Example: www.planetfeedback.com
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Limitations of E-
commerceTo organizations: lack of security, reliability,
standards, changing technology, pressure toinnovate, competition, old vs. new technology
To consumers: equipment costs, access costs,knowledge, lack of privacy for personal data,relationship replacement
To society: less human interaction, socialdivision, reliance on technology, wastedresources
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Technical limitations
There is a lack of universally acceptedstandards for quality, security, andreliability
The telecommunications bandwidth isinsufficient
Software development tools are stillevolving
There are difficulties in integrating theInternet and EC software with someexisting (especially legacy) applicationsand databases.
Special Web servers in addition to thenetwork servers are needed (added
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Benefits of E-commerce
To consumers: 24/7 access, more choices, pricecomparisons, improved delivery, competition
To organizations: International marketplace
(global reach), cost savings, customization,reduced inventories, digitization ofproducts/services
To society: flexible working practices, connectspeople, delivery of public services
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Benefits to Consumers
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Convenience
Buying is easy and private
Provides greater product access and selection
Provides access to comparative information
Buying is interactive and immediate
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Benefits to Organizations
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Powerful tool for building customer relationships
Can reduce costs
Can increase speed and efficiency
Offers greater flexibility in offers and programs
Is a truly global medium
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Benefits to Society
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More individuals can work from home
Benefits less affluent people
Third world countries gain access
Facilitates delivery of public services
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E-Marketing in theDigital Age
The marketing side of e-commerce.
Includes efforts to communicate about,
promote, and sell products and services overthe Internet.
E-purchasing is the buying side of e-commerce.
It consists of companies purchasing goods,services, and information from online18
T f
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Types of e-Marketers
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Cli k O l
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Click-OnlyCompanies
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E-tailers
Search
Engines andPortals
InternetService
ProvidersTransaction
Sites
ContentSites
Enabler Sites
Types ofSites
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Reasons for dot.comFailures
Poor research or planning.
Relied on spin and hype instead of marketing
strategies.Spent too heavily on brand identities.
Devoted too much effort to acquiring newcustomers instead of building loyalty.
21
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c -an - or arCompanies
Most established companies resisted
adding Web sites because of the potentialfor channel conflict and cannibalization.
Many are now doing better than click-only
companies.Reasons:
Trusted brand names and more resources
Large customer basesMore knowledge and experience
Good relationships with suppliers
Can offer customers more options22
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Setting Up for E-MarketingOnline Marketing
23
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Setting up for E-Marketing
Creating websites
Creating or using Webcommunities
Using E-mail
Corporate websites
Build goodwill andrelationships; generate
excitement
Marketing websites
Engage consumersand attempt to
influence purchase
Website design
7 Cs of effectivewebsite design
24
Options
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Context
Content
Community
Communication
Connection
Commerce
25
Seven Cs of Website Design
lCustomization
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The 7Cs of Website design
26
Context
Sites layout and design
Commerce
Sites capabilities to enablecommercial transactions
Connection
Degree site is linked to other sites
Communication
The ways sites enable site-to-
user communication or two-waycommunication
Customization
Sites ability to self-tailor todifferent users or to allow users to
personalize the site
Community
The ways sites enable user-to-user communication
Content
Text, pictures, sound and videothat web pages contain
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Setting up for E-Marketing
Creating websitesPlacing onlineads and
promotionsCreating or usingWeb communities
Using E-mail
Online forms of ads
and promotionsBanner ads/tickers
Skyscrapers
InterstitialsContent
sponsorships
Microsites
Viral marketing 27
Options
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Web AdvertisingBanner ads: allows for more targeted
advertising
Pop-up ads: pop-under ads are displayed in aseparate browser window beneath your mainbrowser window
and remain there until you close them
Skyscrapers: An advertisement on a Web sitethat is vertically oriented on the page and larger 28
This is a pop-up ad
Click here to close me
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Interstitials: are usually full-page adsdisplayed while a user is in transit from onepage to another, triggered by code included inthe link
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7 Critical Success Factors
in E-C0mmerce1) Site-Wide Search Engine
Visitors can't buy products that they cannotfind. Obviously, it's critical that your
ecommerce site helps them to easily find whatthey want, and a good site search function iscritical for this. Visitors should be able to enterdescriptive words or item numbers and get
accurate, helpful results. This will create alandscape where your visitors wouldremember your site and would talk about itwith others.
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2) Simple CheckoutIf you want to lose customers to yourecommerce site, one of the best ways to doit is to make the checkout process long andcomplicated. The shorter and easier yourcheckout process is, the less abandoned
carts you will have. Work to streamline thecheckout process so it involves as few stepsas possible.
3) AccessibleIt's a simple concept, if someone cannotaccess a website they will not be able tobuy anything from it. Take the time to testyour ecommerce site in all browsers andoperating systems and test in a wide
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4) VisitedThis is kind of obvious, but in order to make
sales your site will need traffic/visitors. Youmay have a great design and the coolestproducts out there, but if no one is seeingthem it really doesn't matter. Make sure
that you have a marketing plan orsomeone who is dedicated to promotingthe site because simply putting it up willnot draw enough visitors.
4) TrustworthyThere are a lot of scammers out there and
unfortunately that means that those whoare trustworth need to be able to rove it.
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6) Optimized for Search EnginesOnline searches provide some of thehighest quality of traffic that you can get toyour site. People who find your site througha search are looking for what you have tooffer, so they are pretty likely to buy if your
site does a good job. Many ecommercesites suffer from poor search engineoptimization. This is a huge topic thatcannot be covered here, but if you are not
familiar with SEO make sure that youconsult with a professional.
7) Quality DesignThe looks of an ecommerce site are not asimportant as the functionality and the
Di i
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DiscussionQuestionsWhat features do you look foron a Web site that you feel
make the site appealing?What are your major concernsabout making online purchases?
What types of things can anonline retailer do to create amore secure buying
i t? 34