EC Applications

Learning Objectives Describe and discuss different EC Applications: 1. Direct Marketing 2. E-tailing 3. Online banking and personal finance 4. E-Auction 5. Knowledge Management 6. Mobile commerce 7. E-Government 8. Social commerce 9. Collaborative commerce Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-1

1. Direct Marketing Direct Marketing Broadly, marketing that takes place without intermediaries between manufacturers and buyers; so it is marketing done online between any seller and buyer Example: Dell Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-2

2. Electronic Retailing electronic retailing (e-tailing) Retailing conducted online, over the Internet e-tailers Retailers (sales intermediaries) who sell over the Internet Examples: Amazon, Wal-Mart, etc. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-3

Dis-intermediation The removal of organizations or business process layers responsible for certain intermediary steps in a given supply chain Re-intermediation The process whereby intermediaries (either new ones or those that had been dis-intermediated) take on new intermediary roles Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Electronic Retailing

Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-5

2. Electronic Retailing COMAPRISON BETWEEN RETAILERS AND E- TAILERS Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-6 RetailersE-tailers ExpansionIncrease number of stores and employees Increase servers Customer Relations More stable due non- anonymous contacts Less stable due anonymous contacts CompetitionLocal/ FewerGlobal/ More Customer base Local areaWide area

2. Electronic Retailing WHAT SELLS WELL ON THE INTERNET Products: cars, clothes, toys, etc. (e.g. Amazon, ebay, etc.) Services: hotel, tickets, real estates, etc. (e.g. Booking.com and TripAdvisor) Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-7

Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Electronic Retailing

CLASSIFICATION OF MODELS BY DISTRIBUTION CHANNEL Pure-play e-tailers A company buys from a business and sells to another business where all transactions are online (e.g. Amazon.com) Click-and-mortar retailers A business model where a company sells in multiple marketing channels simultaneously both physical and online stores (e.g. Wal-Mart) Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Electronic Retailing

Online Malls Referring Directories: directories are organized by product types (e.g. AliExpress.com) Malls with Shared Services: directories are organized by stores but have shared services like shipping (e.g. fashion.kadaza.com/) Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Electronic Retailing

3. Banking and Personal Finance Online electronic (online) banking or e-banking Various banking activities conducted from home or the road using an Internet connection; also known as cyber-banking, virtual banking, online banking, and home banking Bank processes can be fully or partially online. VIRTUAL BANKS are banks that physically do not exist. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-11

3. Banking and Personal Finance Online HOME BANKING CAPABILITIES INTERNATIONAL AND MULTIPLE-CURRENCY BANKING: such as the use of the credit cards Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-12 Online Banking Capabilities InformationalGeneral bank information and news AdministrativeAccount information and access TransactionalAccount transfer capabilities and pay bills PortalLinks to financial information OthersWireless capabilities and search function

3. Banking and Personal Finance Online IMPLEMENTATION ISSUES Online banking has to be very secure. Imaging Systems that allow clients to view incoming checks, invoices, etc. Some banks offers the online services for free; while others charge them. So, this strategy has to be very clear for the clients. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-13

Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Banking and Personal Finance Online

4. E-Auction Auction A competitive process in which a seller solicits consecutive bids from buyers (forward auctions) or a buyer solicits bids from sellers (backward auctions); prices are determined dynamically by the bids electronic auctions (e-auctions):Auctions conducted online Example: eBay Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-15

4. E-Auction TRADITIONAL AUCTIONS VERSUS E-AUCTIONS Traditional off-line auction lasts only a few minutes for each item sold. So, it has limited time to make decision. It may be difficult to move goods to the auction site. Auction site needs to be rented. Auction needs to be advertised. Bidders need to present at the site. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-16

4. E-Auction TYPES OF AUCTIONS One Buyer, One Seller: based on negotiation or bartering One Seller, Many Potential Buyers: forward auction One Buyer, Many Potential Sellers: based on reverse auction (tendering or request for quote system RFQ) or Name-Your-Price (priceline.com). Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-17

Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-18

4. E-Auction Limitations of E-Auctions Minimal Security because of unencrypted environment Possibility of Fraud as buyers cannot see the product before delivery Limited Participation especially for the auctions done by invitation only Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-19

5. Knowledge Management, Advisory Systems, and Electronic Commerce Automated question/answer (QA) system A system that locates, extracts, and provides specific answers to user questions expressed in natural language such as Live Chat with Experts Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-20

5. Knowledge Management, Advisory Systems, and Electronic Commerce ONLINE ADVICE AND CONSULTING Medical advice Management consulting Legal advice Gurus Financial advice Social networks Other advisory services Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-21

6. M-Commerce Mobile commerce (m-commerce; m-business) Any business activity conducted over a wireless telecommunications network or from mobile devices MOBILE DEVICES personal digital assistant (PDA): A stand-alone handheld computer principally used for personal information management Smartphone: A mobile phone with PC-like capabilities Tablets Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-22

6. M-Commerce Other Mobile Devices Smartbooks Wearable devices Screen Camera Touch-panel display Keyboard Speech translator Watch-like device RFID (radio frequency identification) Scanners mobile browser (microbrowser) Web browser designed for use on a mobile device optimized to display Web content most effectively for small screens on portable devices Dashtop mobile Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-23

6. M-Commerce THE ATTRIBUTES OF M-COMMERCE Ubiquity Convenience Interactivity Personalization Localization Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-24

6. M-Commerce DRIVERS OF M-COMMERCE Widespread availability of more powerful mobile devices The handset culture The service economy Vendor’s push The mobile workforce and mobile enterprise Improved price/performance Improving bandwidth Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-25

6. M-Commerce SOME MOBILE APPLICATIONS Mobile banking Mobile Stock Trading Real Estate Mobile CRM (e-CRM) and PRM Mobile entertainment (music, videos, games, etc.) Tracking People and Vehicles using location-based m-commerce technology to identify a Web user’s physical location without that user having to provide any information global positioning system (GPS): A worldwide satellite-based tracking system that enables users to determine their position anywhere on the earth Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-26

Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-27

6. M-Commerce BARRIERS TO LOCATION-BASED M-COMMERCE Lack of GPS in mobile phones Accuracy of devices The cost–benefit justification Limited network bandwidth Invasion of privacy Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-28

7. E-Government e-government E-commerce model in which a government entity buys or provides goods, services, or information to businesses or individual citizens government-to-citizens (G2C) E-government category that includes all the interactions between a government and its citizens Electronic Voting Electronic Benefits Transfer Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-29

7. E-Government government-to-business (G2B) E-government category that includes interactions between governments and businesses (government selling to businesses and providing them with services and businesses selling products and services to the government) Government E-Procurement Group Purchasing Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-30

7. E-Government government-to-government (G2G) E-government category that includes activities within government units and those between governments government-to-employees (G2E) E-government category that includes activities and services between government units and their employees Internal Efficiency and Effectiveness (IEE) Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-31

7. E-Government mobile government (m-government) The wireless implementation of e-government mostly to citizens but also to businesses The Benefits of M-Government Some Implementation Issues Applications Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-32

8. Social Commerce social media The online platforms and tools that people use to share opinions, experiences, insights, perceptions, and various media, including photos, videos, and music, with each other Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-33

8. Social Commerce Social Media Marketing (SMM) A term that describes use of social media platforms such as networks, online communities, blogs, wikis, or any other online collaborative media for marketing, market research, sales, CRM, and customer service; it may incorporate ideas and concepts from social capital, Web 2.0, social media, and social marketing Web 2.0 the second stage of development of the Internet (introduced in 2004), characterized especially by the change from static web pages to dynamic or user-generated content and the growth of social media. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-34

8. Social Commerce Social Commerce (SC) The delivery of e-commerce activities and transactions through social networks and/or via Web 2.0 software Social Shopping A method of e-commerce where shoppers’ friends become involved in the shopping experience; social shopping attempts to use technology to mimic the social interactions found in physical malls and stores Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-35

8. Social Commerce THE MAJOR MODELS OF SOCIAL SHOPPING Ratings and Reviews Customer ratings and reviews Expert ratings and reviews Sponsored reviews Conversational marketing Video product review Customer testimonials Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-36

8. Social Commerce Social Recommendations and Referrals Share with your network (social bookmarking) Referral programs Social recommendations Innovative methods Others Group buying and shopping together Deal purchases (flash sales), such as daily deals Location-based shopping F-commerce; shopping at Facebook Shopping with Twitter Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-37

8. Social Commerce THE POTENTIAL BENEFITS OF SOCIAL COMMERCE Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-38

Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-39

8. Social Commerce The Major Categories of Virtual World Applications 1. Storefronts and online sales 2. Front offices or help desks 3. Advertising and product demonstrations 4. Content creation and distribution 5. Meetings, seminars, and conferences 6. Training 7. Education 8. Recruiting 9. Tourism promotion 10. Museums and art galleries 10. Information points 11. Data visualization and manipulation 12. Entertainment (games) 13. Platform for social science research 14. Market research 15. Platform for design 16. Providing CRM to employees 17. Commercial gaming 18. Virtual trade shows Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall 2-40

9. Collaborative Commerce Collaborative Commerce (c-commerce) The use of digital technologies that enable companies to collaboratively plan, design, develop, manage, and research products, services, and innovative EC applications Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-41

Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-42

9. Collaborative Commerce Benefits of C-COMMERCE Reducing Transportation and Inventory Costs Reduction of Design Cycle Time Reduction of Product Development Time Elimination of Channel Conflict: Collaboration with Dealers and Retailers Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall2-43