Defining e-Business e-Business (electronic business)—The organized effort of individuals to produce and sell, for a profit, the products and services that satisfy society’s needs through the facilities available on the Internet e-Commerce—Buying/selling activities conducted online—Identifying suppliers, selecting products or services, making purchase commitments, completing financial transactions, and obtaining service Outsourcing—The process of finding outside vendors and suppliers that provide professional help, parts, or materials at a lower cost. Copyright © Cengage Learning. All rights reserved.

Combining e-Business Resources Copyright © Cengage Learning. All rights reserved.

Satisfying Needs Online The Internet has created new customer needs E-business can satisfy those needs as well as traditional ones Global access to information and entertainment Virtually unlimited selections of products Opportunities for interaction Individually custom-tailored content Copyright © Cengage Learning. All rights reserved.

Creating e-Business Profit Revenue growth Revenue stream Source of revenue flowing into a firm Sales of merchandise online Intelligent information systems to suggest purchases to repeat online customers Increased sales in physical stores because of product information available online Advertising on web pages Subscription fees charged for access to online services and content Copyright © Cengage Learning. All rights reserved.

Creating e-Business Profit (cont’d) Expense reduction Offering services that Reduce transaction costs Provide information Provide customer assistance Reduces the costs of dealing with customers Reduces the need for as many physical store locations Copyright © Cengage Learning. All rights reserved.