E-Commerce, Web 2.0, and Social Networking Chapter 8 E-Commerce, Web 2.0, and Social Networking

Before the Internet… How did we do business? How did companies communicate with customers? Who controlled the relationship? E-commerce: buying and selling of goods and services over public and private computer networks

Evolution of Interorganizational Systems

How do companies use E-Commerce? E-Commerce is the buying and selling of goods and services over public and private computer networks Merchant companies – take title to the goods they sell. They buy and then resell them. Example? Nonmerchant companies – arrange for the purchase and sale of goods without ever owning or taking title

E-Commerce Merchant Companies Types – May use different IS Sell directly to customers B2C Sell to companies B2B Sell to government B2G Web storefronts – customers can manage orders

Example

Nonmerchant E-Commerce Most common Auctions Others can serve specific industries or interests Clearinghouses Provide goods and services at stated prices and arrange for delivery but never take title Electronic Exchange Matches buyers and sellers

How does E-commerce improve market efficiency? Disintermediation Elimination of middle layers in supply chain Distribution directly to buyer Eliminates carrying costs, shipping costs are reduced Improved flow of price information Customer can find best price for the value Seller can understand price elasticity Direct information from consumer Price experimentation

Web 2.0 Loose grouping of capabilities, technologies, business models, and philosophies First Example:

Comparing Web 2.0 with Traditional Processing

Group Exercise Each group look at one of the characteristics Compare and contrast the differences between Web 2.0 and Traditional Processing What do the terms mean? Can you find an example of the Web 2.0 characteristic?

Software as a Service Companies that don’t sell a product or license They provide software as a service (free) Thin client processing (no software installed) Example: Google Maps

Why is Web 2.0 important? Use increases value Participation and ownership differences “Do what you want, we’ll publish it.”

How can businesses benefit? Advertising Adwords – you pay to put your ad on sites or in search results Adsense – others pay you to put their ad on your site Social Networking Mashups

(Extra content, not in book) Internet Advertising (Extra content, not in book)

Advertising Targeted Advertising possible in Facebook Location Demographics Interests Send people to your site for information, to buy product, or to your Facebook page to become a fan – Applies to Facebook, Google, and many other tools

Facebook Advertising Designing the Ad Choose External URL or a page Title Body Picture

Facebook Advertising Target the Ad Location Demographics Likes/Interests Education Workplace Facebook Connections

Facebook Advertising Set the Budget

Some Terms to Know Total Impressions = How many times our ad is visible to users Total Clicks = How many times users click on our ad to visit our page Click Through Rate = Clicks/Impressions Average CPM = Cost per 1000 impressions

Tracking Clicks and $ on Facebook

Designing the Ad Choose type of ad Text Image Display Ad Mobile Ad

Text Ad

Display Ad

Ad Settings

Keywords Make your own list Use Keyword Tool to find other suggestions

Tracking Ad Performance

Comparing CPM to Evaluate Advertising Options Print Advertising $400 32,000 pieces CPM = 400/32 = $12.50 TV Advertising $1500 135,000 viewers CPM = $11.11 Facebook Advertising $2600 12 Million impressions CPM = $0.22

Extra Credit: The Mobile Movement Watch video How do you use your phone? Over a 3 day period, log your use. Summarize in a chart how you use your phone Messages (text or email) Information search Purchases Social Networking Did use of your phone impact purchasing decisions? How?

Social Capital Investment in social relations with the expectation of returns in the marketplace Adds Value by providing: Information Influence Social Credentials Personal Reinforcement Total Value of your Social Capital: # and strength of relationships and the resources controlled by those related

Over 100 million members Professional network of contacts Resume management/availability Find and be introduced to potential business partners and experts Interact in group settings Recruiting

Step One – Get Established Establish your Profile Contact information Experience Education Recommendations

Step Two – Get Connected Add connections Click on Contacts Add connections from your: Email addresses Colleagues Classmates LinkedIn’s recommendations See who others are connected with and send invitations Rule of Thumb: Connect with whom you know

Step Three – Get Involved Source: http://www.socialmediaexaminer.com/social-media-funnies-bikers-get-linkedin/

Extra Credit Create a profile on LinkedIn Connect with me and other professors Join a JMU group Post a discussion item on LinkedIn Advice: Review your Facebook and Twitter presence and be sure that if you connect them on LinkedIn that there is nothing embarassing or inappropriate for a professional If you don’t connect accounts, make sure your security settings are appropriately set on Facebook

How Social Networks Add Value to Businesses Number of relationships Strength of relationships Resources controlled by “friends” Traditional vs. Social Networking with Technology – How is it different?

Business Applications for Facebook Social Useful Expressive Engaging What apps on FB do you use?

Should We Have a Group or Page? Use for group interaction and communications Consider Facebook Groups Can be secret, open, or closed Use for promotion to current or prospective customers Consider Facebook Pages Post variety of information related to your business Profiles – for individuals

(Extra content, not in your book) Measuring Engagement (Extra content, not in your book)

Engagement Ratio Engagement Ratio = # of Interactions Fans Likes to your posts Comments on your post Wall posts by others Shares

Comparing Engagement Ratios

Beauty of Comparing Ratios Denominator is # Fans – puts you in comparable terms with those who are much larger or smaller Allows you to see what’s working Downside – It’s manual

Using Twitter

Twitter’s Uses Short updates (140 characters or less) Instantaneous Relationship builder with those you may not know…yet Research on variety of topics Research of candidates

An Analogy – Twitter is like a Party Can be as large as you want it to be Invite (Follow) people who tweet about things that interest you People you can learn from People you can help What do you say? What you would say when networking at a party Use manners, show kindness, have fun Source: http://www.inc.com/marla-tabaka/giving-up-on-twitter.html

Twitter Terms Following, Followers Tweet, Retweet, and DM Hashtags to know #anyterm – used to categorize tweets #hburg #jmu #fail #ff – Follow Friday – recommendations on who to follow

Business Application of Twitter Dialogue with stakeholders Public relations Relationship sales Market research

User Generated Content (UGC) Ratings and Surveys Opinions Customer Stories Discussions Wikis Blogs Videos

Crowdsourcing Users provide services to or on behalf of the vendor Combines social networking, viral marketing, and open source design Example: www.msdn.com

Empowering Customers Enterprise 2.0 – application of Web 2.0, collaboration systems, social networking to facilitate the cooperative work of people in organizations SLATES Search Link Authoring Tags Extensions Signals

SLATES

Risks of Social Networking Junk and crackpots Inappropriate content Unfavorable reviews Mutinous movements Dependency on social network vendor Example: www.facebook.com/progressive

Responding to Problems Leave it Respond to it Delete it

Fox Lake Story Continues Scenario Video