Transcript Document

INTT 125
Information Systems for Trade
E-Commerce/E-Business
What is E-Commerce / E-Business
 Commerce is the exchange or buying and
selling of goods and services
 E-commerce is the exchange or buying
and selling of goods and services by
electronic means

E.g. ordering food over the internet, buying a
game online, etc.
 E-business is the use of information and
communication technologies to perform
business functions.

E-business occurs when buyers and sellers
interact electronically
E-Commerce
 E-commerce is the use of the Internet and Web to
transact business; digitally enabled transactions
 Began in 1995 and grew exponentially; still
growing at an annual rate of 25 percent
The Growth of E-Commerce
Source: Essentials of Business Information Systems, 8E Laudon & Laudon
Unique Features of E-commerce
Technology
 Ubiquity

Internet/Web technology available
everywhere: work, home, etc., anytime.

Effect: Marketplace removed from temporal, geographic
locations to become “marketspace”. Enhanced
customer convenience and reduced shopping costs.
 Global reach

The technology reaches across national
boundaries, around Earth

Effect: Commerce enabled across cultural and national
boundaries seamlessly and without modification.
Marketspace includes, potentially, billions of consumers
and millions of businesses worldwide.
Unique Features of E-commerce
Technology
cont.
 Universal standards

One set of technology standards: Internet
standards

Effect: Disparate computer systems easily communicate
with each other. Lower market entry costs—costs
merchants must pay to bring goods to market. Lower
consumers’ search costs—effort required to find suitable
products.
 Richness

Supports video, audio, and text messages

Effect: Possible to deliver rich messages with text, audio,
and video simultaneously to large numbers of people.
Video, audio, and text marketing messages can be
integrated into single marketing message and consumer
experience.
Unique Features of E-commerce
Technology
cont.
 Interactivity

The technology works through interaction
with the user

Effect: Consumers engaged in dialog that dynamically
adjusts experience to the individual. Consumer becomes
co-participant in process of delivering goods to market.
 Information density

Large increases in information density—the
total amount and quality of information
available to all market participants

Effect: Greater price transparency. Greater cost
transparency. Enables merchants to engage in price
discrimination.
Unique Features of E-commerce
Technology
cont.
 Personalization/Customization

Technology permits modification of
messages, goods
 Effect: Personalized messages can be sent to individuals as
well as groups. Products and services can be customized to
individual preferences.
 Social technology

The technology promotes user content
generation and social networking
 Effect: New Internet social and business models enable user
content creation and distribution, and support social
networks.
Benefits of doing business electronically
• Digital markets reduce
•
Information asymmetry
•
Search costs
•
Transaction costs
•
Menu costs
• Digital markets enable
•
Price discrimination
•
Dynamic pricing
•
Disintermediation
Electronic Business Models
 B-to-C – Business-to-Consumer

Targets sales and services primarily to consumers
 B-to-B – Business-to-Business

Targets sales and services primarily to other businesses
 C-to-C – Consumer-to-Consumer

Sites that primarily offer goods and services to assist
consumers to interact
 Mobile commerce (m-commerce)

Use of handheld wireless devices for purchasing of goods
and services from any location
 B-to-E – Business-to-Employee

Companies that provide services other companies can use
to interface with employees
 B-to-G – Business-to-Government

Companies who sell most of their goods and services to
local and national governments
E-Commerce Implementation Issues
 E-commerce technologies




EDI – Electronic Data Interchange
Web Forms
XML - eXtensible Markup Language
Web Services
 Resolving channel conflicts
 Doing business internationally
 Security management
E-Commerce Legal Issues
During the first years of e-commerce, there were numerous
cases of fraud and similar crimes. These ranged from
creating a virtual bank to manipulating stock prices on
the Internet.
 Fraud on the Internet
Stocks, selling bogus investments, setting up phantom business
opportunities
 Domain Names
Domain names are assigned by central nonprofit organizations that
check for conflicts and possible infringement of trademarks
(Nic.tr Administration has been registering ".tr" internet names
since 1991 in the Computer Center of Middle East Technical
University) /
Cybersquatting
 Taxes and Other Fees
Sales taxes, business license taxes, tax collection issues
 Copyright
Protecting intellectual property
E-Learning
 E-Learning is using the internet to enable
learning




Distance learning: Any type of educational
situation in which the instructor and students are
separated by location
Online learning: Courses presented on a computer
that is connected to a network
Web-based instruction: Courses available on the
Internet which typically have links to other webbased resources
On-demand learning: Learning broken up into
knowledge chunks and delivered as demanded
within a business process