How the Internet has changed the way we do business.

1. Introduction to E-Commerce E-Commerce How the Internet has changed the way we do business.

2. Introduction to E-Commerce Four Benefits of Internet Technology Communication Information Entertainment E-Commerce

3. Introduction to E-Commerce Internet Technology Provides • Communication • Email • Chat rooms • Spam 

4. Introduction to E-Commerce Internet Technology Provides • Information • Newsgroups • Portals – AOL, Yahoo • Specialized Search Sites • Academic Information

5. Introduction to E-Commerce Internet Technology Provides • Entertainment • Webcasts • Gambling • Games • eBooks

6. Introduction to E-Commerce Internet Technology Provides the Vehicle for E-Commerce Electronic Commerce is the buying, selling, and trading of goods on the Internet.

7. Introduction to E-Commerce Benefits of E-Commerce

8. Introduction to E-Commerce Shop-at-home convenience Detailed product information Customer controls transaction Simplified ordering Open 24/7/365 Improved Customer Service

9. Introduction to E-Commerce Elimination of Boundaries Direct to customer (no middleman) Expanded Markets

10. Introduction to E-Commerce Streamlined order processing Fewer errors in order entry Increased speed Lower marketing costs Cost Cutting

11. Introduction to E-Commerce Additional sales channel User fee income Advertising Income Lower marketing costs Higher Profits

12. Introduction to E-Commerce Security & privacy Scams & Fraud Down time & poor service Awkward design & functionality Lack of retail experience E-Commerce Challenges

13. Introduction to E-Commerce Evolution of a Merchandise Catalog

14. Introduction to E-Commerce

15. Introduction to E-Commerce http://www.theintelstore.com

16. Maris Taylor Designs Introduction to E-Commerce E-Commerce for Small Business

17. Introduction to E-Commerce

18. Introduction to E-Commerce http://www.maristaylor.com/

19. Categories of Electronic Commerce • Five general e-commerce categories • Business-to-consumer (Nike) • Business-to-business (GraingerBD&A) • Business processes (Monster) • Consumer-to-consumer (ebay) • Business-to-government (Cal-buy) • Supply management or procurement • Departments devoted to negotiating purchase transactions with suppliers (Intel)

20. Elements of Electronic Commerce

21. Categories of Electronic Commerce (Continued) • Transaction • An exchange of value • Business processes • The group of logical, related, and sequential activities and transactions in which businesses engage • Telecommuting or telework • Employee logs in to company computer through Internet instead of traveling to office

22. Electronic Commerce Categories

23. Actual and Estimated Online Sales in B2C and B2B Categories

24. The Second Wave of Electronic Commerce • Defining characteristics of first wave • Dominant influence of U.S. businesses • Extensive use of the English language • Low bandwidth data transmission technologies • Unstructured use of e-mail • Over-reliance on advertising as a revenue source

25. The Second Wave of Electronic Commerce (Continued) • As second wave begins • Future of electronic commerce will be international in scope • Language translation and handling currency conversion problem will need to be solved • E-mail will be used as an integral part of marketing and customer contact strategies

26. Focus on Specific Business Processes • Merchandising • Combination of store design, layout, and product display knowledge • Commodity item • Hard to distinguish from the same products or services provided by other sellers • Features have become standardized and well known

27. Focus on Specific Business Processes (Continued) • Shipping profile • Collection of attributes that affect how easily a product can be packaged and delivered • High value-to-weight ratio • Can make overall shipping cost a small fraction of the selling price

28. Value Chain for a Strategic Business Unit

29. Industry Value Chain for a Wooden Chair

30. SWOT Analysis: Evaluating Business Unit Opportunities • SWOT analysis • Analyst first looks into the business unit to identify its strengths and weaknesses • Analyst then reviews operating environment and identifies opportunities and threats

31. SWOT Analysis Questions

32. Results of Dell’s SWOT Analysis

33. International Nature of Electronic Commerce • Companies with established reputations • Often create trust by ensuring that customers know who they are • Can rely on their established brand names to create trust on the Web • Customers’ inherent lack of trust in “strangers” on the Web • Logical and to be expected

34. This Cartoon from The New Yorker Illustrates Anonymity on the Web

35. Language Issues • To do business effectively in other cultures • Must adapt to culture • Researchers have found that • Customers are more likely to buy products and services from Web sites in their own language • Localization • Translation that considers multiple elements of local environment

36. Culture Issues • Important element of business trust • Anticipate how the other party to a transaction will act in specific circumstances • Culture • Combination of language and customs • Varies across national boundaries • Varies across regions within nations

37. Infrastructure Issues • Internet infrastructure includes • Computers and software connected to Internet • Communications networks over which message packets travel • Organization for Economic Cooperation and Development’s (OECD) • Statements on Information and Communications Policy • Deal with telecommunications infrastructure development issues

38. Infrastructure Issues (Continued) • Flat-rate access system • Consumer or business pays one monthly fee for unlimited telephone line usage • Contributed to rapid rise of U.S. electronic commerce • Targets for technological solutions • Paperwork and processes that accompany international transactions

39. Parties Involved in a Typical International Trade Transaction