Introduction to E-Business Covers Course Learning Outcome # 1 Unit 1 Introduction to E-Business and E-Commerce Handout # 1 Covers Course Learning Outcome # 1 Understand the grounded approach to e-business and knowledge needed for managing e-business. http://ect.ac.ae/elearn/

Learning Outcomes Define the meaning and scope of e-business and e-commerce and their different elements Summarize the main reasons for adoption of e-commerce and e-business and barriers that may restrict adoption Outline the ongoing business challenges of managing e-business and e-commerce in an organization. 2

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E-Business Innovation and Opportunity the majority of e-business opportunities fall into one of five categories: Selling goods online: E-commerce, or electronic commerce, is one subset of e-business. It involves buying and selling hard goods, electronic goods or services over the Internet. Service Companies: Companies are now moving toward service-oriented models, using the Internet as a delivery vehicle to provide services to consumers and to other businesses (e-banking, e-governement).. 4

E-Business Innovation and Opportunity- Cont. 3. Distance learning: In the old days, when a company wanted to train its employees, it had to send them to an off-site location, pay for accommodations, and lose a day or two of productivity for each employee. Now it's possible for employees to get training on demand, right at the desktop 4. Telecommunications: Internet telephony, a new type of technology that allows you to place long distance calls over the Internet at very low cost. 5. Information and content provider: Here's your chance to be a publisher

The Impact of the Internet on Business Andy Grove, Chairman of Intel, one of the early adopters of e-commerce, has made a meteorological analogy with the Internet. He says: “The Internet a typhoon force, a ten times force, or is it a bit of wind? Or is it a force that fundamentally alters our business?” (Grove, 1996). 6

The Impact of the Internet on Business- cont. The Internet is helping companies to lower costs dramatically across their supply and demand chains, take their customer service into a different league, enter new markets, create additional revenue streams and redefine their business relationships.              What Mr. Grove was really saying was that if in five years’ time a company is not using the Internet to do some or all of these things, it will be destroyed by competitors who are.

E-Business Opportunities Reach Over 1 billion users globally Connect to millions of products Richness Detailed product information on 20 billion + pages indexed by Google. Blogs, videos, feeds… Personalized messages for users Affiliation Partnerships are key in the networked economy. 8

Types of Digital Media Channels / Digital Marketing Place Figure 1.6 here Figure 1.6 Online and offline communications techniques for e-commerce Types of Digital Media Channels / Digital Marketing

Reasons for adoption of e-commerce and e-business: Profitability and Value through: Increased revenue arising from increased reach to a larger customer base and encouraging loyalty among existing customers (Competitiveness drivers) 2. Cost reductions (in Marketing, Sales, Administrative) achieved through delivering services electronically (Cost / efficiency drivers).

Internet Risks – What Can Go Wrong with a Transactional Site? A transactional website: is a website in which customers are able to buy, sell and order goods and/or services. Examples of poor online customer experience include: Websites that fail because of a spike in visitor traffic after a peak hour TV advertising campaign A company e-mails customers without receiving their permission so annoying customers and breaking privacy and data protection laws. Hackers stealing data and Information This slide left deliberately blank for student Q&A interaction. Potential answers:   Site downtime affecting whole site or some processes Security attack, e.g. denial of service, content hijacked Wrong content presented for site visitor 11

Internet Risks – What Can Go Wrong with a Transactional Site? cont. 4. Problems with orders fulfillment (missing or delayed). 5. Email customers’ enquiries from the website don’t reach the right person.

There is a more recent chart if required on page 40 at http://www Figure 1.13 Barriers to development of online technologies Source: DTI, 2002, from Business in the Information Age, International Benchmarking Study 2002 (2002), Crown Copyright material is reproduced with permission under the terms of the Click-Use Licence 13

Drivers of consumer internet adoption Six C’s: Customer value: Content: More detailed inf. To support the buying process. Customization: Building according to customers preferences. Community: Forums, chat rooms, blogs Convenience: Performing activities from anywhere at any time Choice: The richness of the available inf. Expands the available alternatives. Cost reduction: which is reflected at prices which was used in the early 1990s to shift from phone booking to online booking in airlines companies

Barriers to consumers’ Internet adoption: No perceived benefit Lack of trust Security problems Lack of skills Cost (Time, Effort)

What is The Relationship Between E-Commerce and E- Business? Figure 1.3 Three definitions of the relationship between e-commerce and e-business

What is E-Commerce and E-Business? E-Commerce: The process of buying, selling, or exchanging products, services, or information via electronic devices mainly computers. PDA’s, Mobiles E-Business: A broader definition of EC that includes not just the buying and selling of goods and services, but also servicing customers, collaborating with business partners, and conducting electronic transactions within an organization and with other organizations. 17

E-Commerce as a Subset of E-Business?

Buy side and Sell side of e-commerce Buy side e-commerce refers to transactions to procure resources needed by an organization from its suppliers. Sell side e-commerce refers to transactions involved with selling products to an organization’s customers.

How Companies Evaluate Their Capabilities to Adopt E-Business Figure 1.14 A simple stage model for buy-side and sell-side e-commerce 20

Intranet Vs Extranet Intranet: An internal corporate or government network that uses Internet tools, such as Web browsers, and Internet protocols (i.e. LAN to enable employees to access & share Inf.) Extranet: A network that uses the Internet to link multiple intranets, username and password are used for authentication and security (extending the company’s Info. systems to outsiders

Figure 1.4 The relationship between intranets, extranets and the Internet 22

Figure 1.2 The distinction between buy-side and sell-side e-commerce 23

E-business Models Figure 1.10 Summary and examples of transaction alternatives between businesses, consumers and governmental organizations 24

Terminology Cont. Social commerce: A subset of e-commerce which encourages participation & and interaction of customers in rating, selecting and buying products through group buying (collective buying). Group Buying (Collective Buying): offers products and services at significantly reduced prices on the condition that a minimum number of buyers would make the purchase. Social network: A site that facilitate peer to peer communication between individuals to develop user generated content (UGC).

Terminology Cont. Multi-channel marketing: marketing activities are supported by a combination of digital & traditional channels at different points in the buying cycle. Supply Chain Management (SCM): The coordination of all supply activities of an organization from its suppliers & partners to its customers.

Terminology Cont. Web2.0: Web services that facilitate interaction of web users with sites to create user generated content such as social networks, blogs, wikis, video sharing sites.