1. Laudon & Laudon: Canadian Edition
Chapter 13
Electronic Commerce

2. Outline
Electronic commerce (e- commerce) – concept, B2C, B2B, C2C types
Business models for B2C e-commerce
Business models for B2B e-commerce
Differences between e-commerce and traditional business models
Mobile commerce (m-commerce)
Electronic payment
E-Commerce

3. Laudon & Laudon: Canadian Edition
E-Commerce Concept
E-Commerce: Buying and selling goods and services electronically, via the Internet and other networks and systems:
Business-to-Consumer (B2C; Chapters.com)
Business-to-Business (B2B; Covisint) – larger, more stable part
Consumer-to-Consumer (C2C; eBay)
E-Commerce requires a new way of thinking about organizational processes (IT support critical), customers and delivery.
Challenges: sustainable e-commerce business models, growth, security and privacy.
2006:
U.S., 31.0% of sales b/w firms
Canada, 3.2%
B2C: 1.8% (U.S.), 0.2% (CA) of retail
E-Commerce

4. Business Models of B2C E-Commerce
Laudon & Laudon: Canadian Edition
Business Models of B2C E-Commerce
Business model:
What is the biz, Who is the customer, How money is made
Virtual Storefront
Sells goods/services online (Amazon - pure click, no physical stores)
Consumers with access to Internet around globe
Interactive Marketing and Personalization
Virtual storefront as addition to store (Chapters – click & mortar)
Visit these websites
E-Commerce

5. Business Models of B2C E-Commerce
Laudon & Laudon: Canadian Edition
Business Models of B2C E-Commerce
Portal : Initial point of entry to Web, provides Internet search service for free, sells specialized content and advertising space (Google, Yahoo)
Customer: Global Internet user
Revenue: Advertising
Information Broker: Provides integrated information (Wishabi)
Revenue: Referral fee (advertising)
E-Commerce

6. Business Models of B2B E-Commerce
Laudon & Laudon: Canadian Edition
Business Models of B2B E-Commerce
Direct linking of buyer-supplier (private networks, Electronic data Interchange)
Online Exchange (different names)
Buyer/Seller run
Within an industry (GHX)
Across industries (Covisint)
Revenue: Membership fee, Transaction charge, Services Product catalogue, purchasing/selling, order fulfillment
More information
E-Commerce

7. E-commerce and traditional business models
Biz content: mostly old stuff, some new info-related services.
Dependent on IT (Clickstream tracking, Collaborative filtering, Supply chain systems integration)
Customer: Global, Internet/IT capable
Attracted by some cost savings (transaction costs) and value offering (dynamic pricing, disintermediation – less of middlemen)
Revenue: Dependent on advertising and variable sources (volume of transactions).
E-Commerce

8. Mobile Commerce (M-commerce)
Commerce using mobile electronic devices (e.g., cell phone)
Biz content: financial services, advertising, entertainment
Services: business locator, banking, news, entertainment
Challenges: screen size, speed, privacy
E-Commerce

9. E-commerce Payment Systems
Laudon & Laudon: Canadian Edition
E-commerce Payment Systems
Important for closing trading cycle
Systems:
Credit card – you, your bank, payee, payee’s bank
Smart card – you, payee, your bank & Mondex; card reader needed
E-cash/digital cash/e-money - you, payee, bank where you have account; small payments supported; payee can accumulate e-cash and exchange for cash at will
Person-to-person payments – you, payee, your bank & PayPal site
Challenges : Security, Trust
Demo: sign up on passport system
E-Commerce