DIFINITION OF COMMERCE

money
Consists of:

The exchange of goods and services for

Buyers - these are people with money who want to purchase a good or service. Sellers - these are the people who offer goods and services to buyers. Producers - these are the people who create the products and services that sellers offer to buyers. 4/17/12

ELEMENTS OF COMMERCE

You need a Product or service to sell You need a Place from which to sell the

products You need to figure out a way to get people to come to your place. You need a way to accept orders. You also need a way to accept money. You need a way to deliver the product or service, often known as fulfillment. Sometimes customers do not like what they buy, so you need a way to accept returns. You need a customer service and technical 4/17/12 support department to assist customers with

ELEMENTS OF ECOMMERCE

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HISTORY OF ECOMMERCE

EFT
the early 1970s

Electronic funds transfer

E-Commerce refers to the buying and selling of products or services over electronic systems such as the Internet and other computer networks.

1. E-Commerce applications first developed in

- Electronic funds transfer (EFT)

v.Limited to:
-4/17/12 corporations Large

2. Electronic data interchange (EDI)electronic

transfer of documents:

- Purchase orders - Invoices

- E-payments between firms doing business

v.Enlarged pool of participants to include:

- Manufacturers - Retailers - Service providers

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Key Drivers of Ecommerce

Technological degree of advancement of

telecommunications infrastructure legislation, funding and support

Political role of government, creating Social IT skills, education and training of

users

Economic general wealth and commercial

health of the nation

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ADVANTAGES OF E-COMMERCE
Consumers can easily search through a large

database of products and services. They can see actual prices, build an order over several days and email it as a wish list hoping that someone will pay for their selected goods.
Customers can compare prices with a click of

the mouse and buy the selected product at best prices.

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Reduced advertising costs for online Vendors.

The web and its search engines provide a way to be found by customers.
Small online shops can reach global markets. Web technology also allows to track customer

preferences and to deliver individually-tailored marketing.

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Four Categories of E-Commerce

Business originating from... Business Consumers

Business B2B And selling to...

C2B

Consumers

B2C

C2C

Four Categories of E-Commerce

(contd)
l

Business to Business (B2B) refers to the full spectrum of e-commerce that can occur between two organizations. This includes purchasing and procurement, supplier management, inventory management, channel management, sales activities, payment management &service and support. Examples: FreeMarkets, Dell and General Electric Business to Consumer (B2C) refers to exchanges between business and consumers, activities tracked are consumer search, frequently asked questions and service and 4/17/12 support.

Four Categories of E-Commerce

(contd)
l

Peer to Peer (C2C) exchanges involve transactions between and among consumers. These can include third party involvement, as in the case of the auction website Ebay. Examples: Owners.com, Craiglist, Monster Consumer to Business (C2B) involves when consumers band together to present themselves as a buyer in group. Example: www.planetfeedback.com

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Limitations of Ecommerce

To organizations: lack of security, reliability,

standards, changing technology, pressure to innovate, competition, old vs. new technology knowledge, lack of privacy for personal data, relationship replacement division, reliance on technology, wasted resources

To consumers: equipment costs, access costs,

To society: less human interaction, social

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Technical limitations
standards for quality, security, and reliability The telecommunications bandwidth is insufficient Software development tools are still evolving There are difficulties in integrating the Internet and EC software with some existing (especially legacy) applications and databases. Special Web servers in addition to the 4/17/12 network servers are needed (added
There is a lack of universally accepted

Benefits of Ecommerce
To consumers: 24/7 access, more choices, price

comparisons, improved delivery, competition (global reach), cost savings, customization, reduced inventories, digitization of products/services

To organizations: International marketplace

To society: flexible working practices, connects

people, delivery of public services

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Benefits to Consumers
Convenience Buying is easy and private Provides greater product access and selection Provides access to comparative information Buying is interactive and immediate
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Benefits to Organizations
Powerful tool for building customer relationships Can reduce costs Can increase speed and efficiency Offers greater flexibility in offers and programs Is a truly global medium
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Benefits to Society
More individuals can work from home Benefits less affluent people Third world countries gain access Facilitates delivery of public services

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E-Marketing in the Digital Age

The marketing side of e-commerce. Includes efforts to communicate about,

promote, and sell products and services over the Internet.

E-purchasing is the buying side of e-

commerce.
It consists of companies purchasing goods,
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services, and information from online

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Types of eMarketers

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Click-Only Companies
E-tailers Enabler Sites Search Engines and Portals Internet Service Providers

Content Sites

Types of Sites
Transaction Sites

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Reasons for dot.com Failures

Poor research or planning. Relied on spin and hype instead of marketing

strategies.

Spent too heavily on brand identities. Devoted too much effort to acquiring new

customers instead of building loyalty.

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Click-and-Mortar Companies Most established companies resisted

adding Web sites because of the potential for channel conflict and cannibalization.
Many are now doing better than click-only

companies.

Reasons:
Trusted brand names and more resources Large customer bases More knowledge and experience Good relationships with suppliers
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Can offer customers more options

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Setting Up for E-Marketing Online Marketing

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Setting up for E-Marketing Options

Creating websites

Corporate websites
Build goodwill and

relationships; generate excitement

Marketing websites
Creating or using Web

communities

Engage consumers

Using E-mail

and attempt to influence purchase

Website design
7 Cs of effective

website design
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Seven Cs of Website Design

Context Content Community

Communication Connection Commerce

lCustomization

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The 7Cs of Website design

Context
Sites layout and design

Content
Text, pictures, sound and video that web pages contain

Commerce
Sites capabilities to enable commercial transactions

Community
The ways sites enable user-touser communication

Connection
Degree site is linked to other sites

Customization
Sites ability to self-tailor to different users or to allow users to personalize the site

Communication
The ways sites enable site-touser communication or two-way communication

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Setting up for E-Marketing Options

Creating websites Placing online
Online forms of ads

and promotions
Banner ads/tickers Skyscrapers Interstitials Content

ads and promotions

Creating or using

Web communities
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sponsorships
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Using E-mail

Microsites Viral marketing

Web Advertising
Banner ads: allows for more targeted

advertising

Pop-up ads: pop-under ads are displayed in a

separate browser window beneath your main browser window This is a popand remain thereup ad until you close them
Click here to close me

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Skyscrapers: An advertisement on a Web site

that is vertically oriented on the page and larger

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 Interstitials: are usually full-page ads

displayed while a user is in transit from one page to another, triggered by code included in the link

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7 Critical Success Factors in E-C0mmerce

1) Site-Wide Search Engine

Visitors can't buy products that they cannot find. Obviously, it's critical that your ecommerce site helps them to easily find what they want, and a good site search function is critical for this. Visitors should be able to enter descriptive words or item numbers and get accurate, helpful results. This will create a landscape where your visitors would remember your site and would talk about it with others.

2) Simple Checkout

If you want to lose customers to your ecommerce site, one of the best ways to do it is to make the checkout process long and complicated. The shorter and easier your checkout process is, the less abandoned carts you will have. Work to streamline the checkout process so it involves as few steps as possible.
3) Accessible

It's a simple concept, if someone cannot access a website they will not be able to buy anything from it. Take the time to test your ecommerce site in all browsers and operating systems and test in a wide

4) Visited

This is kind of obvious, but in order to make sales your site will need traffic/visitors. You may have a great design and the coolest products out there, but if no one is seeing them it really doesn't matter. Make sure that you have a marketing plan or someone who is dedicated to promoting the site because simply putting it up will not draw enough visitors.

4) Trustworthy

There are a lot of scammers out there and unfortunately that means that those who are trustworthy need to be able to prove it.

6) Optimized for Search Engines

Online searches provide some of the highest quality of traffic that you can get to your site. People who find your site through a search are looking for what you have to offer, so they are pretty likely to buy if your site does a good job. Many ecommerce sites suffer from poor search engine optimization. This is a huge topic that cannot be covered here, but if you are not familiar with SEO make sure that you consult with a professional.
7) Quality Design

The looks of an ecommerce site are not as important as the functionality and the

Discussion Questions
What features do you look for

on a Web site that you feel make the site appealing?

What are your major concerns

about making online purchases?

What types of things can an

online retailer do to create a more secure buying 4/17/12 environment?

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