1. ELC 200 Day 2 Copyright © 2007 Pearson Education, Inc.

2. The Revolution Is Just Beginning Assignment 1 posted
Agenda
Questions?
The Revolution Is Just Beginning
Assignment 1 posted
Due Monday, January 9:35 AM
assignment1.pdf

3. E-commerce business. technology. society. Kenneth C. Laudon
Sixth Edition
Kenneth C. Laudon
Carol Guercio Traver
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4. The Revolution Is Just Beginning
Chapter 1
The Revolution Is Just Beginning
Copyright © 2007 Pearson Education, Inc.
Copyright © 2010 Pearson Education, Inc.

5. Objectives
Define e-commerce and describe how it differs from e-business.
Identify and describe the unique features of e-commerce technology and discuss their business significance.
Recognize and describe Web 2.0 applications.
Describe the major types of e-commerce.
Discuss the origins and growth of e-commerce.
Understand the evolution of e-commerce from its early years to today.
Identify the factors that will define the future of e-commerce.
Describe the major themes underlying the study of e-commerce.
Identify the major academic disciplines contributing to e-commerce.

6. E-commerce Trends 2010-2011 Social networking continues to grow
Social e-commerce platform emerges
Online consumer sales return to growth
Mobile computing begins to rival PC
Explosive growth in online video viewing
Continued privacy and security concerns
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7. US Census Bereau 2009 e-Stats report
Retail E-Commerce (Non-Travel) Growth Rates Excludes Auctions, Autos and Large Corporate Purchases Total U.S. – Home & Work Locations Source: comScore, Inc.
Quarter
E-Commerce Spending ($ Millions)
Y/Y Percent Change
Q1 2007
$27,970
17%
Q2 2007
$27,176
23%
Q3 2007
$28,441
Q4 2007
$39,132
19%
Q1 2008
$31,178
11%
Q2 2008
$30,581
13%
Q3 2008
$30,274 6%
Q4 2008
$38,071
-3%
Q1 2009
$31,031 0%
Q2 2009
$30,169
-1%
Q3 2009
$29,552
-2%
Q4 2009
$39,045 3%
Q1 2010
$33,984
10%
Q2 2010
$32,942 9%
Q3 2010
$32,133
Q4 2010
$43,432
Q1 2011
$38,002
12%
Q2 2011
$37,501
14%
US Census Bereau 2009 e-Stats report

8. First 16 years of e-commerce
The First 30 Seconds
First 16 years of e-commerce
Just the beginning
Rapid growth and change
Technologies continue to evolve at exponential rates
Disruptive business change
New opportunities
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9. Use of Internet and Web to transact business
What is E-commerce?
Use of Internet and Web to transact business
More formally:
Digitally enabled commercial transactions between and among organizations and individuals
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10. E-commerce vs. E-business
Digital enablement of transactions and processes within a firm, involving information systems under firm’s control
Does not include commercial transactions involving an exchange of value across organizational boundaries
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11. Copyright © 2010 Pearson Education, Inc.

12. Why Study E-commerce?
E-commerce technology is different, more powerful than previous technologies
E-commerce bringing fundamental changes to commerce
Traditional commerce:
Passive consumer
Sales-force driven
Fixed prices
Information asymmetry
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13. Unique Features of E-commerce Technology
Ubiquity
Global reach
Universal standards
Information richness
Interactivity
Information density
Personalization/customization
Social technology
See table 1.2 on page 14
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14. Technologies that allow users to:
Web 2.0
Technologies that allow users to:
Create and share content, preferences, bookmarks, and online personas
Participate in virtual lives
Build online communities
E.g. Twitter, YouTube, Facebook, Second Life, Wikipedia, Digg
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15. Classified by market relationship
Types of E-commerce
Classified by market relationship
Business-to-Consumer (B2C)
Business-to-Business (B2B)
Consumer-to-Consumer (C2C)
Classified by technology used
Peer-to-Peer (P2P)
Mobile commerce (M-commerce)
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16. The Internet
Worldwide network of computer networks built on common standards
Created in late 1960s
2002_0918_Internet_History_and_Growth.ppt
Services include the Web, , file transfers, etc.
Can measure growth by looking at number of Internet hosts with domain names
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17. The Growth of the Internet, Measured by Number of Internet Hosts with Domain Names Figure 1.3, Page 23
SOURCE: Internet Systems Consortium, Inc. , 2010.
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18. Most popular Internet service Developed in early 1990s
The Web
Most popular Internet service
Developed in early 1990s
Provides access to Web pages
HTML documents that may include text, graphics, animations, music, videos
Web content has grown exponentially
Google indexes between 75 – 100 billion pages
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19. Origins & Growth of E-commerce
Precursors:
Baxter Healthcare
Electronic Data Interchange (EDI)
French Minitel (1980s videotex system)
None had functionality of Internet
1995: Beginning of e-commerce
First sales of banner advertisements
E-commerce fastest growing form of commerce in United States
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20. The Growth of B2C E-commerce Figure 1.4, Page 25
SOURCES: Based on data from eMarketer, Inc., 2010; authors’ estimates.
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21. The Growth of B2B E-commerce Figure 1.5, Page 28
SOURCES: Based on data from U.S. Census Bureau, 2010; authors’ estimates.
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22. What is the “small world” theory of the Web?
Insight on Technology: Spider Webs, Bow Ties, Scale-Free Networks, and the Deep Web Class Discussion
What is the “small world” theory of the Web?
six degrees of separation for people
19 clicks for the web
What is the significance of the “bow-tie” form of the Web?
Why does Barabasi call the Web a “scale-free network” with “very connected super nodes”?
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23.
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24. Technology and E-commerce in Perspective
The Internet and Web: Just two of a long list of technologies that have greatly changed commerce
Automobiles
Radio
E-commerce growth will eventually cap as it confronts its own fundamental limitations.
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25. Potential Limitations on the Growth of B2C E-commerce
Expensive technology
Sophisticated skill set
Persistent cultural attraction of physical markets and traditional shopping experiences
Persistent global inequality limiting access to telephones and computers
Digital Divide
Saturation and ceiling effects
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26. E-commerce: A Brief History
: Innovation
Key concepts developed
Dot-coms; heavy venture capital investment
: Consolidation
Emphasis on business-driven approach
2006-Present: Reinvention
Extension of technologies
New models based on user-generated content, social networks, services
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27. Early Visions of E-commerce
Computer scientists:
Inexpensive, universal communications and computing environment accessible by all
Economists:
Nearly perfect competitive market and friction-free commerce
Lowered search costs, disintermediation, price transparency, elimination of unfair competitive advantage
Entrepreneurs:
Extraordinary opportunity to earn far above normal returns on investment – first mover advantage
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28. Many early visions not fulfilled
Assessing E-commerce
Many early visions not fulfilled
Friction-free commerce
Consumers less price sensitive
Considerable price dispersion
Perfect competition
Information asymmetries persist
Disintermediation
First mover advantage
Fast-followers often overtake first movers
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29. Predictions for the Future
Technology will propagate through all commercial activity.
Prices will rise to cover the real cost of doing business.
E-commerce margins and profits will rise to levels more typical of all retailers.
Cast of players will change.
Traditional Fortune 500 companies will play dominant role.
New startup ventures will emerge with new products, services.
Number of successful pure online stores will remain smaller than integrated offline/online stores.
Regulatory activity worldwide will grow.
Cost of energy will have an influence.
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30. Understanding E-commerce: Organizing Themes
Technology:
Development and mastery of digital computing and communications technology
Business:
New technologies present businesses with new ways of organizing production and transacting business
Society:
Intellectual property, individual privacy, public welfare policy
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31. The Internet and the Evolution of Corporate Computing Figure 1
The Internet and the Evolution of Corporate Computing Figure 1.9, Page 44
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32. Academic Disciplines Concerned with E-commerce
Technical approach
Computer science
Management science
Information systems
Behavioral approach
Information systems
Economics
Marketing
Management
Finance/accounting
Sociology
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33. What techniques of privacy invasion are described in the case?
Insight on Society Who Really Cares About Online Privacy? Class Discussion
What techniques of privacy invasion are described in the case?
Which of these techniques is the most privacy- invading? Why?
Is e-commerce any different than traditional markets with respect to privacy? Don’t merchants always want to know their customer?
How do you protect your privacy on the Web?
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