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E-Business Framework

Prof. Bhavana Bagherwal


Definition of E-Business
 E-business (electronic business) is the conduct of business processes on the internet.
 These e-business processes include,
• buying and selling products
• supplies and services
• servicing customers, processing payments
• managing production control
• collaborating with business partners
• sharing information
• running automated employee services
• recruiting, and more.
 Online Business or e-business is any kind of business or commercial transaction that
includes sharing information across the internet.
Origin of E-Business
 In 1994, IBM, with its agency Ogilvy & Mather, began to use its foundation in IT solutions and
expertise to market itself as a leader of conducting business on the Internet through the term
"e-business. "Then CEO Louis V. Gerstner, Jr. was prepared to invest $1 billion to market this
new brand.
 After conducting worldwide market research in October 1997, IBM began with an eight-
page piece in the Wall Street Journal that would introduce the concept of "e-business" and
advertise IBM's expertise in the new field. IBM decided not to trademark the term "e-business"
in the hopes that other companies would use the term and create an entire new industry.
However, this proved to be too successful and by 2000, to differentiate itself, IBM launched a
$300 million campaign about its "e-business infrastructure" capabilities. Since that time, the
terms, "e-business" and "e-commerce" have been loosely interchangeable and have
become a part of the common vernacular.
How is e-business different to a traditional
business?
 Traditional businesses usually grow organically and develop step by step. They
usually have clear definitions and deal with little change in the business
environment. On the other hand, the e-business journey is less predictable thanks to
ongoing change in the business and technology environment. Time to market and
speed are major competitive factors in e-business, which demands fast adaption. E-
business tools can be used:
 To trade goods and services online
 To conduct electronic retailing (e-tailing)
 To create intranets or extranets to conduct research and manage business activities
 For website marketing and online communications such as email
 As online training for staff (e-learning)
Types of E-Business:
 Business-to-Business (B2B)
 Transactions that take place between two organizations come under Business to
business. Producers and traditional commerce wholesalers typically operate with this
type of electronic commerce. Also. it greatly improves the efficiency of companies.

 Business-to-Consumer (B2C)
 When a consumer buys products from a seller then it is business to consumer
transaction. People shopping from Flipkart, Amazon, etc is an example of business to
consumer transaction. In such a transaction the final consumer himself is directly buying
from the seller.
 Consumer-to-Consumer (C2C)
 A consumer selling product or service to another consumer is a consumer to consumer
transaction. For example, people put up ads on OLX of the products that they want to
sell. C2C type of transactions generally occurs for second-hand products. The website
is only the facilitator not the provider of the goods or the service.

 Consumer-to-Business (C2B)
 In C2B there is a complete reversal of the traditional sense of exchanging goods. This
type of e-commerce is very common in crowdsourcing based projects. A large
number of individuals make their services or products available for purchase for
companies seeking precisely these types of services or products.
 Currently, e-business ranges from simple sites providing corporate information to sites
offering goods and services for sale online. Innovative uses for new voice and video
communication technologies include online language tutoring. Large commercial
information repositories are growing and use of the Internet for research is now
common. Online sales from web-based storefronts continue to grow. Sales of digital
information, in the form of eBooks and digital music files, are more recent offerings by
e-businesses like Apple, Amazon
INTERNET
 A means of connecting a computer to any other computer
anywhere in the world via dedicated routers and servers. When two
computers are connected over the Internet, they can send and
receive all kinds of information such as text, graphics, voice, video,
and computer programs.

 The Internet is generally defined as a global network connecting


millions of computers.
History of the Internet
 The Internet grew out of the Advanced Research Projects Agency's Wide Area
Network (then called ARPANET) established by the US Department Of Defense in
1960s for collaboration in military research among business and government-
laboratories.

 Later universities and other US institutions connected to it. This resulted in


ARPANET growing beyond everyone's expectations and acquiring the name
'Internet.‘ The development of hypertext based technology (called World Wide
web, WWW, or just the Web) provided means of displaying text, graphics, and
animations, and easy search and navigation tools that triggered Internet's
explosive-worldwide-growth.
E-Business opportunities for Businesses

1. BUILD AN INTERESTING AND CAPTIVATING BRAND:


Differing from the previous method, building a brand means also building an audience. A brand
building approach involves developing a superior understanding of your potential customers,
crafting a unique brand and carving out a unique place in your customer's mind. This approach
to building an online business can be particularly effective at differentiating yourself from
competitors in the market if there is heavy competition.
2. IDENTIFY AND SOLVE A CUSTOMER PAIN POINT:
 One of the best ways to build a strong business is by solving a customer
pain point. Products that solve pain points can be lucrative because
customers are actively seeking out solutions to these problems. You'll want
to keep in mind that pain points don't always mean physical pain, it can
also can include frustrating, time consuming, or poor experiences.
3. CATER TO CONSUMER PASSIONS:
 It's a fact. Consumers tend to spend significantly more money to support
their passions and habits. Just consider golfers. Golfers are notorious for
spending thousands of dollars on gear and gadgets with the hopes and
dreams of lowering their score, even by the slightest.
 Catering to passions has additional benefits as well including deeper
interaction with your brand, brand loyalty and increased word of mouth
marketing.
4. FOLLOW YOUR OWN PASSION:
 Some people consider choosing a product or niche based on your own personal
passion to be a recipe for disaster. However, that's not always the case, and can
actually prove to be extremely profitable.
 One of the biggest benefits to building a business around your passion is having
the tenacity to keep going when you run into difficult times. This one point
shouldn't be underestimated as staying motivated is a major key to building a
successful online business.
5. LOOK FOR AN OPPORTUNITY GAP:
 Capitalizing on an opportunity or feature gap can be lucrative. This opportunity
type involves uncovering problems or deficiencies in a product or the marketing
for a product that can be capitalized on. An opportunity gap may exist in the form
of an improved or additional product feature, an unrealized market by the current
competitors, or it may even come in the form of your own marketing capability.
6. UTILIZE YOUR OWN EXPERIENCE AND EXPERTISE:
 Utilizing your own experience and expertise is a strong competitive advantage.
Turning your expertise into an online business is a great way to enter the market
with a leg up and a barrier to entry for others.

7. CAPITALIZE ON TRENDS EARLY:


 Capitalizing on a trend early enough can have a massive impact on a new
business. It allows you to carve out a place in consumers minds and establish
yourself as a leader before others have a chance to. Capitalizing on a trend
early can also have big impact on your SEO (Search Engine Optimization) since
you'll be one of the first websites talking about and being indexed by search
engines like Google and Bing for the new trending search terms. This can help
you climb to the top of search rankings fast.
8. SOCIAL NETWORKS WILL DRAMATICALLY INCREASE THEIR PRODUCT ADVERTISING
CAPABILITIES:
 Google, Bing, and comparison shopping engines have shaped the direct return
advertising arena for e-commerce retailers over the past 10 years. Now, most of the
major social media players are part of the equation — and their voices are getting
louder.
 Facebook, Twitter, Pinterest, YouTube, Instagram, and soon Snapchat will increase
their investments in product advertising formats. We’ll see social networks grow and
refine their product advertising options, including improving targeting capabilities
and developing new ads formats.
Working of E-Business
E-Business v/s Traditional Business Mechanism

1. Importance of Consumer Convenience


 The growth of online retailers such as Amazon has made it difficult for traditional stores to
compete with consumers who seek a convenient shopping experience. However, there is
still a group of consumers who prefer the process of a live shopping experience and the
opportunity to physically examine products or try on clothing. There are others who enjoy
the personal interaction provided by brick-and-mortar businesses.
 Not all businesses are adaptable for strict e-business models. Attorneys, doctors and
dentists can't provide services exclusively online.
2. Reputation to Consumers
 Brick-and-mortar stores tend to give consumers greater confidence that the business is
legitimate. Being able to walk in, see the inventory and walk out with immediate service is
a big factor in keeping consumers going to traditional businesses.
 New e-business models take time to develop a solid reputation online. It takes consistent
and targeted marketing to keep the target market engaged.
3. Time and Accessibility:
E-commerce businesses are always open, and consumers can usually complete a
transaction in minutes. Driving to and from a traditional business, viewing the
merchandise and talking with salespeople — even the possibility of standing in line
waiting to check out — all take up valuable time. E-commerce businesses can sell
products and services 24 hours a day every day of the week.
Few traditional businesses are open 24 hours a day, although some are. Most brick-
and-mortar businesses close on holidays, and many are open only five or six days in a
week.

4. Paperwork and Costs:


 Both traditional businesses and e-businesses require a fair amount of paperwork,
including a business license, tax ID number, and insurance. However, when looking
at the costs of setting up a small business, a traditional business comes with higher
costs which translate into the rent or purchase price of a physical location,
renovation and repair costs, security costs, and staff costs. In terms of initial costs, an
online business is far less demanding and requires only website-related costs. Both
businesses need a software inventory management solution, accounting software,
and office productivity suite to run effectively.
5. Demographics and Convenience
 In a brick-and-mortar shop, customers can see, touch, and try products, but only during
open hours. An e-business, on the other hand, is open 24/7 through its website, saving
customers energy and appealing to those people who lead busy lives and don’t want
to waste time shopping. Men seem to buy as much online as women, but research
shows that online shopping is driven by young consumers, more specifically, those
aged 18 to 34.
6. The Danger of the Home-Run Business
 E-businesses, since they can be set up and run from home, can really blur the line
between home and work, making serious demands on the owners’ time, who often
must have very flexible schedules and be very involved in their business. Software
inventory management, such as the online inventory system Data Qlicks, simplifies
inventory management and acts as an inventory planning tool. Features such as a 2-
tab inventory management view and control, enhanced with sales forecasting and
order management, makes stock control easier, saving you time and money.
7. Customer Convenience:
 If the weather is bad, the parking is a challenge or the hour is late when inspiration
strikes to buy something, an e-business that is open 24/7 often has more appeal to
customers than a brick-and-mortar shop located across town and only open five
days a week from 10 to 4. Shopping for goods electronically doesn't just save
customers time and energy; it can also save them from paying sales taxes, provide
them with more outlets to comparison-shop and eliminate the feeling of being
pressured or followed around by a salesperson. Many customers, however, prefer
the ability to personally inspect the merchandise, ask for advice and assistance and
be able to take their purchases home immediately rather than having to pay
shipping costs and wait for delivery. A traditional business satisfies those needs in
addition to fostering an environment of trust through personal conversation and
face-time.
8. Needs Assessment:
 The nature of your small business and the type and amount of customer interaction
it requires to be successful dictate whether you need a physical address or a virtual
one. If, for example, you're providing writing, copy-editing, consulting, accounting
or billing services, the primary interface with your clients is by phone, email and fax,
negating the need for work space beyond a home office. Conversely, a small
business in which you sell apparel, cosmetics, jewelry, art, furniture or home
accessories will likely require display space, dressing rooms and appropriate storage.
Activities using e-Business tools include:
 Trading of goods or services online, such as e-Procurement, primarily through the web-sites;
 Electronic retailing (e-Tailing);
 Use of the internet, intranets or extranets to conduct research and manage business
activities;
 Web-site marketing;
 Online communications, such as e-mail; and
 Online training for staff (e-Learning).
E-Business tools include:
 Mobile phones;
 Personal digital assistants (PDA);
 Electronic Data Interchange;
 File transfer;
 Facsimile;
 Video conferencing, internet, intranets and extranets.
Main Goals of E-Business
Advantages of E-Business
Disadvantages of E-Business