E - BUSINESS

Amazon.com: Before and

After
 Most well-known e-commerce company
 considered by Jeff Bezos in 1994
 Opened in July 1995
 Four compelling reasons to shop
 Selection (1.1 million titles)
 Convenience (anytime, anywhere)
 Price (high discounts on bestsellers)
 Service (automated order confirmation,
tracking, and shipping information)
 E-Business

 Electronic business is defined as the

utilization of information and communication
technologies in support of all the activities of
business.
Three Definitions of an E-Business (EB):

• “Using Internet technologies to

transform key business processes.”
(IBM)

4
• “E-business is the application of new
technologies and processes to enhance,
develop and often replace traditional ways
of doing business.”
• “The transformation of key business
processes through the use of Internet
technologies.” (Oracle)
Electronic Commerce (narrow
definition)
“Conducting business transactions through
‘market-facing systems’.”

C
U
Order-to-Cash S
Delivering services
on-line T
O
Selling products on- M
line
E
R
S
SUPPLIERS
5
 E - COMMERCE
• E-commerce refers to a wide range of online
business activities for products and services.

• “Any form of business transaction in which the

parties interact electronically rather than by
physical exchanges or direct physical
contact”.
  U

sually associated with buying and selling over the

Internet.

 C

onducting any transaction involving the transfer of

ownership or rights to use goods or services through a

computer-mediated network.
 e-Business vs e-Commerce

E-Business:
Improving business
performance through low cost and
open connectivity:
E-Commerce:
E-Commerce
• Use of New technologies
• marketing
• selling in order to :
• buying of
• Improve service/reduce costs
products and • Open new channels
services on the
Internet

e-Business is more than selling and marketing online!

E-commerce vs. E-business
E-commerce involves
 Digitally enabled commercial transactions
between organizations and individuals.
 Digitally enabled transactions include all
transactions mediated by digital technology
 Commercial transactions involve the exchange
of value across organizational or individual
boundaries in return for products or services
E-commerce vs. E-business
E-business involves
 Digital enablement of transactions and
processes within a firm, involving information
systems under the control of the firm

 E-business does not involve commercial

transactions across organizational boundaries
where value is exchanged
 WHY TO DO E - BUSINESS?
 Enables Companies to link their internal and
external data processing systems more
efficiently and flexibly.
 Helps to work more closely with suppliers
and partners, and to better satisfy the needs
and expectations of their customers.
 Benefits of E-Commerce
• Benefits to organizations
– Makes national and international
markets more accessible
– Lowering costs of processing,
distributing, and retrieving information
• Benefits to customers
– Access a vast number of products and
services around the clock (24/7/365)
 Benefits of E-Commerce
(continued)

• Benefits to Society
– Ability to easily and conveniently deliver
information, services and products to
people in cities, rural areas and
developing countries.
 Limitations of E-Commerce
• Technological Limitations
– Insufficient telecommunications
bandwidth
– Expensive accessibility
• Non-technological Limitations
– Perception that EC is unsecure
– Unresolved legal issues
– Lacks a critical mass of sellers and
buyers
The Dimensions of Electronic
Business
The core of

Virtual product
Electronic electronic business
business areas

Digital
Product Virtual process

Physical Digital process

Product Physical process
Virtual delivery agent
Traditional Physical Digital
commerce agent agent
 Three Dimensions of E-
business
• Are the following physical or digital?
– Product
– Process
– Delivery method
• Traditional business
– All three are physical
• Pure E-business
– All three are digital
• Partial E-business
– Mix of physical and digital
 Overview
(continued)
• Pure versus Partial Electronic
Commerce depends on the degree of
digitization involved.
• Pure vs. Partial EC
• --The product can be physical or digital.
• --The process can be physical or digital.
• --The delivery agent can be physical or digital.
• Brick-and-mortar : organizations are purely physical
organizations.
• Virtual organizations are companies that are engaged only in EC.
(Also called pure play)
• Click-and-mortar organizations are those that conduct some e-
commerce activities, yet their business is primarily done in the physical
world. i.e. partial EC.
Bricks and Mortar, Partial EC, and Pure
EC

Order physical
book from
Amazon:
partial EC

Order and
Buy books at university download book
bookstore: from Amazon:
bricks and mortar pure EC
 Example – Amazon.com
• Product – Physical
– Books
– CDs
– DVDs
• Process – Digital
– Web site
– Credit card processing
• Delivery – Physical
– UPS
– FedEx
 Ethical and Legal Issues
Ethical Issues
Privacy: ecommerce provides opportunities for businesses and employers to
track individual activities on the WWW using cookies or special spyware. This
allows private/personal information to be tracked, compiled, and stored as an
individual profile. This profile can be used or sold to other businesses for target
marketing or by employees to aide in personnel management decisions (i.e.,
promotions, raises, layoffs).

Disintermediation:
middlemen or intermediaries (1) provide information, and (2) perform value-added
services such as consulting. The first function can be fully automated, and the
second can be partially automated through e-marketplaces and portals for free
thereby causing job loss among intermediaries.
 Legal Issues Specific to E-
Fraud on the Internet
Commerce
investments, business opportunities, auctions.
Domain Names
problems with competition.
Domain Tasting
is a practice of registrants using the five-day "grace period" at the beginning of a
domain registration to profit from pay-per-click advertising.
Cybersquatting
refers to the practice of registering domain names solely for the purpose of
selling them later at a higher price.
Taxes and other Fees
when and where (and in some cases whether) electronic sellers should pay
business license taxes, franchise fees, gross-receipts taxes, excise tax
Copyright:
protecting intellectual propety in e-commerce and enforcing copyright laws is
extremely difficult.
 Home Work

• Find the five E-Business and five E-

Commerce websites.
• Three examples of each
Traditional Business
Partial E-Business
Pure E-Business
 commonly accepted types
of Web sites (Assignment
1. Portal
for 4 th
feb)
2. Search engine
3. Browse or search and buy
4. sales support
5. information service
6. Auction
7. Travel
8. Special interest or services
(games,News,Whether,Comunities,entertainment)
 MODELS

 When organizations go on line, they have to

decide which e-business models best suit
their goals.
 A business model is defined as the
organization of product, service and
information flows, and the source of
revenues and benefits for suppliers and
customers.
 The concept of e-business model is the same
LIST OF THE CURRENTLY MOST
ADOPTED E-BUSINESS MODELS:

 E-Commerce

 M-Commerce

 E-Banking

 E-Shopping

 E-Auctions
CLASSIFICATION BY PROVIDER AND
CONSUMER

Roughly dividing the world into

providers/producers and consumers/clients
one can classify e-businesses into the
following categories:
 business-to-business (B2B)
 business-to-consumer (B2C)
 business-to-employee (B2E)
 business-to-government (B2G)
 government-to-business (G2B)
 government-to-government (G2G)
 government-to-citizen (G2C)
 consumer-to-consumer (C2C)
 consumer-to-business (C2B)