1. ELECTRONIC COMMERCE, STRATEGY & MANAGEMENT (COM350) WEEK 3

2. Week 3 This Weeks Topics –E-COMMERCE CLASSIFICATION –FUTURE WHEEL FEEDBACK ASIGNMENT HANDOUT

3. E-COMMERCE CLASSIFICATION

4. Last week: –How intranets, extranets and the Internet can be used to connect the trading partners that make up the VALUE SYSTEM. This week systems of classification are examined: –Phases of online presence –Classification by transaction

5. E-COMMERCE CLASSIFICATION By phase of online presence –Reflects the level development of on line presence and use of Internet technology By transaction –Reflects the parties between which online transactions can occur

6. CLASSIFICATION BY PHASE OF ONLINE PRESENCE Phase 1: “Hello, I’m online too” Phase 2: “Structured web site” Phase 3: “Trying E-Commerce” Phase 4: “Doing E-Business” Phase 5: “Pervasive E-Business” Phase 6: “One World - one computer” –See Introduction to Online Commerce

7. CLASSIFICATION BY TRANSACTION B2B - business to business B2C - business to consumer C2C - consumer to consumer C2B - consumer to business Non-business EC Intra-business EC

8. B2B Uses Extranets and the Internet. Extranet = two or more Intranets connected via Internet, Only enough information made available to allow business, Often security attained using virtual private n/works (VPN). Cost of deploying networks has dramatically fallen - by-product of Internet. Transaction costs have been cut dramatically - a driving force behind B2B adoption.

9. Key to B2B is SCM Supply Chain Management (SCM) ‘Supply Chain’ means the network of alliances that a company forms with suppliers and distributors to source manufacture and deliver goods and services. Alliances can be just as effective as a single company. SCM= ‘the co-ordination of materials, information and financial flows between all the partners in the alliance’.

10. B2B Requires SCM Supply Chain Management (SCM) Companies that exploit their supply chain properly gain the competitive advantage. Competition becomes competing supply chains - - pressure on prices, quality, responsiveness, - ever increasing customer expectations.

11. Examples of B2B Supplier Orientated Marketplace –www.cisco.com Buyer Orientated Marketplace –http://www.shoppoint.co.kr Intermediary Orientated Marketplace –http://www.procurenet.com

12. B2C E-tailing: ManufacturerWholesalerDistributorRetailerCustomer ManufacturerCustomer ManufacturerCustomerElectronic Intermediary Direct Marketing – Dis-intermediation Marketing with e-intermediaries – Re-intermediation

13. Key to B2C is CRM 1. Only 10% of companies can support e-commerce! 2. Sell to existing customers rather than new customers 3. Dissatisfied customers = BAD NEWS. 4. Minimal increases in customer retention = maximal company profits 5. The odds of selling a product or service to an existing customer are three times as high as to a new customer 6. Customers will do business with you again if you deal with complaints swiftly (Sybase Customer Asset Management Solutions: http://www.sybase.com)

14. Examples of B2C Electronic stores –www.amazon.com –www.dell.com Electronic Malls –http://www.evvmall.com/ –http://www.mall.com/

15. C2C Auctions and classified advertising Examples – www.hubuh.com –www.trader.com

16. C2B This is buying and selling where the consumer takes the initiative to contact the business establishmentt Example –www.Priceline.com.

17. Non-business EC Government, educational, not for profit organisations Examples –www.e-global.es/libros.html –www.europa.eu.int –www.dti.gov.uk

18. Intra-business EC Includes all internal organisational activities (via intranets) A range of case studies is available from: www.dacs.dtic.mil/databases/url/key.hts?keyc ode=178:193&islowerlevel=1

19. Limitations of Classification Classification is an attempt to provide structure, however: WWW evolves rapidly and classifications can be quickly outdated. It is the flexibility of the WWW that makes it a powerful strategic weapon for business