Entrepreneurship and Commerce in IT - 07 - Introduction to E-Commerce I - e-commerce, e-business,...

Entrepreneurship & Commerce in IT

07

Sachintha Gunasena MBCShttp://lk.linkedin.com/in/sachinthadtg

recap so far…

Funding a Venture• Personal Finances• Friends & family• Angel Investors• Debt Financing

• Equity Financing

• Customer Financing• Government-Sponsored Programs

Expanding a Venture• Resource Optimisation

• Improve Entrepreneur Skills• Generate New Ideas

• Goal & Mission Setting• Penetration• Diversification• Five Forces Model

Ending a Venture• Just take it• Liquidation• Selling to a friendly buyer• Acquisition• IPO• Bankruptcy?

Today

Introduction to E-commerce

• The difference between e-commerce and e-business

• Unique features of e-commerce technology• Types of e-commerce• Growth of the Internet and the Web• Origins and Growth of E-commerce• E-commerce I and E-commerce II eras• Organizing themes of e-commerce

E-Commerce• trading in products or services using computer

networks• commonly used medium:

• internet• The buying and selling of products and services

by businesses and consumers through an electronic medium, without using any paper documents.

• e.g.: eBay

Technologies Used for E-Commerce

• mobile commerce• electronic funds transfer• supply chain management• Internet marketing• online transaction processing• electronic data interchange (EDI)• inventory management systems• automated data collection systems

E-Business• a company that does all or most of its

transactions through the Internet• “The transformation of an organization’s

processes to deliver additional customer value through the application of technologies, philosophies and computing paradigm of the new economy.”

Use of ICT to Enhance Company Processes

• Production Processes• Customer-focused Processes• Internal Management Processes

Production Processes• procurement• ordering and replenishment of stocks• processing of payments• electronic links with suppliers• production control processes

Customer-focused Processes

• promotional and marketing efforts• selling over the Internet• processing of customers’ purchase orders

and payments• customer support

Internal Management Processes

• employee services• training• internal information-sharing• video-conferencing• recruiting• Electronic applications enhance information flow between

production and sales forces to improve sales force productivity.

• Workgroup communications and electronic publishing of internal business information are likewise made more efficient.

Examples of E-Commerce

Examples of E-Commerce

• Online Shopping• Electronic Payments• Online Auctions• Internet Banking• Online Ticketing

Online Shopping• Buying and selling goods on the Internet is one

of the most popular examples of ecommerce.• Sellers create storefronts that are the online

equivalents of retail outlets.• Buyers browse and purchase products with

mouse clicks.• Though Amazon.com is not the pioneer of online

shopping, it is arguably the most famous online shopping destination.

Electronic Payments• When you are buying goods online, there

needs to be a mechanism to pay online too.• That is where payment processors and

payment gateways come into the picture.• Electronic payments reduce the inefficiency

associated with writing and mailing checks.• It also does away with many of the safety

issues that arise due to payment made in currency notes.

Online Auctions• When you think online auction, you think

eBay. Physical auctions predate online auctions, but the Internet made auctions accessible to a large number of buyers and sellers.

• Online auctions are an efficient mechanism for price discovery.

• Many buyers find the auction shopping mechanism much interesting than regular storefront shopping.

Internet Banking

• Today it is possible for you to perform the entire gamut of banking operations without visiting a physical bank branch.

• Interfacing of websites with bank accounts, and by extension credit cards, was the biggest driver of ecommerce.

Online Ticketing

• Air tickets, movie tickets, train tickets, play tickets, tickets to sporting events, and just about any kind of tickets can be booked online.

• Online ticketing does away with the need to queue up at ticket counters.

Types of E-Businesses

Types of E-Businesses

• online only• mail order• big bricks and clicks• boutique bricks and clicks• mainstream piggyback• niche piggyback• full multichannel

Types of E-Businesses

• Online Only• the only way to see the products is online• Examples: asos.com, lookfantastic.com, Made.com

• Mail Order• a transactional website plus a printed catalogue, and possibly one or

two physical stores• Examples: Boden, House of Bath, Lands End

• Big Bricks and Clicks• lots of physical stores and an eCommerce website• Example:Argos, Boots, Topshop

Types of E-Businesses Cont.d

• Boutique Bricks and Clicks• just one or two physical locations plus the eCommerce

website• Example: Boswells, Burford Needlecraft,

Brownsfashion.com• Mainstream PiggyBack

• using the likes of Amazon or eBay to market the products, with no website of their own

• Example: Amazon, eBay

Types of E-Businesses Cont.d

• Niche PiggyBack• where sellers of similar products come together to market

more easily, usually retaining their own blog or eCommerce site elsewhere too.

• Example: The craft world (Etsy, Folksy), Hotels (hotels.com, laterooms.com), jewellery (Boticca), and Books (abebooks.co.uk) are good examples.

• Full Multichannel• Using multiple shops, catalogues, and eCommerce – by far the

most complex and most difficult to achieve and run.• Example: Bravissimo, Crew Clothing, Next

Features of E-Commerce

Features of E-Commerce

• breaks geographical barrier• saves precious time• accurate information• ubiquity• impersonal interaction• customers are truly king• power of accessibility• cuts supply chain• ever changing nature of business• technology can equally be a barrier

Features of E-Commerce

• Breaks geographical barrier• Unlike traditional retail business, ecommerce is not

bounded by geographical barriers. Today an e commerce company can easily sell its products to consumers residing in any part of the country.

• Saves precious time• Ecommerce helps in saving the most important thing in

today’s modern world: ‘Time’. Consumers from the comfort of their home, office and even café can buy any product they wish to buy. Thanks to e commerce, consumers save lot of precious time that is otherwise wasted if they opt for traditional shopping.

Features of E-Commerce Cont.d

• Accurate information• Today e commerce companies across the world are doling out

product information’s that are accurate & to the point, which eventually helps consumers to make better buying decision. These information’s are free from all the inaccuracy & hidden facts that are very much used by traditional retail models as their selling strategy. Besides, e commerce companies also provide accurate information to customers about billing payment & shipping.

• Ubiquity• Ubiquity means state of being everywhere at once. With

unprecedented growth in the sales of tablets & smart phones, laptops and other internet related gadgets, e commerce companies literally follow their consumers wherever they go. E commerce shopping can be done even when consumer is walking or jogging.

Features of E-Commerce Cont.d

• Impersonal interaction• Since e commerce technology completely depends on

internet & web to reach to its customers, the interaction with consumers will always be impersonal in nature; as in it is not face-to-face interaction.

• Customers are truly king in the e commerce world• Today every month literally hundreds of e commerce

companies are popping up in every corner of the world. This intense among E commerce companies is only befitting customers, who today have more choices to choose from and discount vouchers to avail – for instance Littlewoods Voucher Codes.

Features of E-Commerce Cont.d

• Power of accessibility• Since today e commerce is so easily accessible by the

virtue of power of internet, consumers can buy anything & everything as and when they desire for. In fact a mere impulsive desire or slight craving for a product can lead to expensive shopping, this is all thanks to accessibility to shopping that is possible only via e commerce technology.

• Cuts supply chain• E commerce technology has immensely helped in cutting

the cumbersome supply chain of wholesale & retail and also overreliance on sales force team. This only helps in reducing the cost of the product, which eventually benefits the customer.

Features of E-Commerce Cont.d

• Ever changing nature of business• Since today technology is changing at lightening speed by every

passing day, the nature of e commerce business will also change along with it. Who knows technology development in coming years will make e commerce more customer friendly, or there can be other fundamental changes to the e commerce business too.

• Technology can equally be a barrier• Technology has helped e commerce companies to break

geographical & other barriers. However overreliance on technology & complete absence of face to face interaction has created immense trust barrier between e commerce companies and customers. This is especially true in the case of conservative country like India where even today people don’t completely trust e commerce companies, especially when it comes to on line payment.

Types of E-Commerce

• B2B• B2C• C2B• C2C

B2B (Business-to-Business)

• Companies doing business with each other such as manufacturers selling to distributors and wholesalers selling to retailers. Pricing is based on quantity of order and is often negotiable.

B2C (Business-to-Consumer)

• Businesses selling to the general public typically through catalogs utilizing shopping cart software. By dollar volume, B2B takes the prize, however B2C is really what the average Joe has in mind with regards to ecommerce as a whole.

• Having a hard time finding a book? Need to purchase a custom, high-end computer system? How about a first class, all-inclusive trip to a tropical island? With the advent ecommerce, all three things can be purchased literally in minutes without human interaction. Oh how far we've come!

C2B (Consumer-to-Business)

• A consumer posts his project with a set budget online and within hours companies review the consumer's requirements and bid on the project. The consumer reviews the bids and selects the company that will complete the project. Elance empowers consumers around the world by providing the meeting ground and platform for such transactions.

C2C (Consumer-to-Consumer)

• There are many sites offering free classifieds, auctions, and forums where individuals can buy and sell thanks to online payment systems like PayPal where people can send and receive money online with ease.

• eBay’s auction service is a great example of where person-to-person transactions take place everyday since 1995.

Internet

• a global computer network providing a variety of information and communication facilities, consisting of interconnected networks using standardized communication protocols.

Web

• The World Wide Web (www, W3) is an information space where documents and other web resources are identified by URIs, interlinked by hypertext links, and can be accessed via the Internet.

• It has become known simply as the Web.

Growth of Internet/Web

• http://www.internetlivestats.com/internet-users/

Origins of E-Commerce

Growth of E-Commerce

E-Commerce I Era

E-Commerce II Era

Organising Themes of E-Commerce

References• http://www.investorwords.com/1637/e_commerce.html#ixzz3kOEvFLzi• http://www.investopedia.com/terms/e/ecommerce.asp• http://www.dynamicwebs.com.au/tutorials/e-commerce.htm• http://ecommerce.about.com/od/eCommerce-Basics/f/What-Is-Ecommerce.htm• http://www.businessnewsdaily.com/4872-what-is-e-commerce.html• https://en.wikipedia.org/wiki/E-commerce• https://en.wikipedia.org/wiki/Types_of_e-commerce• http://www.digitsmith.com/ecommerce-definition.html• http://www.b2bmarketing.net/blog/posts/2012/11/29/seven-types-ecommerce-business-%E2%80%93-and-

why-it%E2%80%99s-essential-know-which-type-you-ar• http://budiputra.com/10-unique-features-of-e-commerce-technology/• http://www.woothemes.com/2015/06/ecommerce-platform-features/• http://www.mountainmedia.com/c1/c91/ecommerce-features-overview-c118.html• http://www.internetlivestats.com/internet-users/

Next Up…

• E-commerce business models and concepts

Thank you.

Sachintha Gunasena MBCShttp://lk.linkedin.com/in/sachinthadtg