Defining Your E-Business Idea Chapter 2

The Entrepreneur Someone who assumes the risks of starting and running their own business An entrepreneur needs Leadership abilities High energy personality Self-confidence High levels of organizational skills Ability to act Will working for yourself allow you to work less?

The Entrepreneurial Process

E-Business Success Factors The network effect Scalability Innovative Web marketing ideas Ease of entry into (electronic) markets Adaptability to change

The Network Effect The greater the number of nodes (participants) the greater the value of the network Telephone example Internet example Metcalf law of network power Power of the network = number of nodes2 or N2 NetMind, NetZero, ThirdVoice

Scalability The ability of your idea to continue to function regardless of size Big problem, both technically and general business Can refer to the ability of a server or Internet service to support increased loads AllAdvantage

Innovative Web Marketing Ideas Use the power of the Web and Internet to leverage new ideas. Hotmail gave away free e-mail accounts that used a Web interface and was linked to a site. (p. 46) Viral Marketing

Hotmail

Ease of Entry Into Markets The Internet opened up access to markets by lowering barriers to entry. Good ideas can be cloned. Advantage frequently goes to first mover (first to market). Ebay was a “first mover.”

Ebay Auction Site

Adaptability to Change Internet and Web Technologies facilitate rapid change in business models. New products or services New features Amazon.com started in books, added other products and more recently added auctions to their product/service mix

Amazon.com

Exploiting E-Business Advantages Expand the market Acquire greater business visibility Maximize customer relationships and improve responsiveness Create new services Reduce costs

Expand the Market Reach more customers Lower location and time barrier Ticketmaster Does your idea take advantage of the Internet to expand your market?

Acquire Greater Visibility Early days, simply an online brochure The Internet allows companies to get their name, products, or services exposed to more customers than ever before. Use or outsource distribution to others. Find distributors for eToys and Pier1 Half.com – what did they do? How your e-business idea could use the Internet to gain greater business visibility?

Maximize Customer Relationships Build one-on-one relationships with customers. What are your regular sites? Why? Use technology to build and sustain links with customers. Southwest Airlines

Improve Responsiveness Use technology to respond more quickly or effectively to customer needs and inquiries. Use services such as parcel tracking and delivery confirmation Allow for on-line purchases

Create New Services The Web allows for expansion and refinement of traditional business Add new products quickly TrailBreaker – gone! Does your business idea provide a new, unique or revamped product/service suited to the Internet environment?

Reduce Costs The Internet can lower costs of doing business by lowering… Distribution costs Marketing costs Reduce info gathering costs - $1 to 1 cent Thoughts on info gathering (phone #, please?) Tech support online

Foodlocker.com

Grocery Works.com