E-commerce Technology and Business Models Overview

Posted on May 6, 2024 in Technology

Chapter 1

Eight Unique Features of E-commerce Technology

Ubiquity//Global reach//Universal standards//Information richness//Interactivity//Information density//Personalization//customization//Social technology

Web 2.0

User-centered applications and social media technologies
User-generated content and communication
Highly interactive, social communities
Large audiences; yet mostly unproven business models
Examples: Twitter, YouTube, Instagram, Wikipedia, Tum

Chapter 2

Eight Key Elements of a Business Model

Value proposition//Revenue model//Market opportunity//Competitive environment//Competitive advantage//Market strategy//Organizational development//Management team
Value Proposition

Personalization/customization//Reduction of product search, price discovery costs//Facilitation of transactions by managing product delivery

Market Opportunity

What marketspace do you intend to serve and what is its size?”
Marketspace: Area of actual or potential commercial value in which company intends to operate
Realistic market opportunity: Defined by revenue potential in each market niche in which company hopes to compete
Market opportunity typically divided into smaller niches

Difference between E-commerce and E-business

*E-commerce is “any transaction completed over a computer-mediated network that involves the transfer of ownership or rights to use goods and services,” defines the U.S. Census Bureau. Transactions aren’t required to have a price and include both sales and items like free downloads. E-commerce includes transactions made on the internet, Intranet, Extranet, World Wide Web, by email and even by fax.
*E-business is broader than e-commerce; including the transaction based e-commerce businesses and those who run traditionally but cater to online activities as well. An e-business can run any portion of its internal processes online, including inventory management, risk management, finance, human resources. For a business to be e-commerce and e-business, it must both sell products online and handle other company activities or additional sales offline.
Types of E-commerce Transactions

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 e-commerce as a whole.
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 every day since 1995.

Chapter 3

TCP/IP

Transmission Control Protocol (TCP)
Establishes connections among sending and receiving Web computers
Handles assembly of packets at point of transmission, and reassembly at receiving end
Internet Protocol (IP)
Provides the Internet’s addressing scheme
Four TCP/IP layers
Network interface layer
Internet layer
Transport layer
Application layer
Client/Server Computing

Powerful personal computers (clients) connected in network with one or more servers
Servers perform common functions for the clients
Storing files
Software applications
Access to printers, and so on
The Internet and Web: Features

*Features on which the foundations of e-commerce are built:
E-mail : Uses series of protocols for transferring messages with text and attachments from one Internet user to another
Instant messaging : Displays words typed on a computer almost instantly, and recipients can respond immediately in the same way
Search engines : Identify Web pages that match queries based on one or more techniques
Online forums and chat : Web application that enables Internet users to communicate with one another, although not in real time
Streaming media : Enables music, video, and other large files to be sent to users in chunks so that when received and played, file comes through uninterrupted
Cookies : Small text files deposited by Web site on user’s computer to store information about user, accessed when user next visits Web site

Chapter 4 : Factors in Web Site Optimization

Simple vs. Multi-tiered Web Site Architecture

System architecture
Arrangement of software, machinery, and tasks in an information system needed to achieve a specific functionality
Two-tier
Web server and database server
Multi-tier
Web application servers
Backend, legacy databases

Chapter 6

Traditional Online Marketing and Advertising Tools

Search engine marketing and advertising
Display ad marketing
E-mail marketing
Affiliate marketing
Viral marketing
Lead generation marketing
Social, mobile, and local marketing and advertising
Display Ad Marketing

Banner ads
Rich media ads
Video ads
Sponsorships
Advertising networks
Advertising exchanges and real-time bidding
Other Types of Traditional Online Marketing

Affiliate marketing
Commission fee paid to other Web sites for sending customers to their Web site
Viral marketing
Marketing designed to inspire customers to pass message to others
Online Marketing Metrics: Lexicon
*Audience size or market share
Impressions//Click-through rate (CTR) //View-through rate (VTR)//Hits//Page views//Stickiness (duration)//Unique visitors//Loyalty//Reach//Recency
*Conversion to customer
Acquisition rate//Conversion rate//Browse-to-buy ratio//View-to-cart ratio//Cart conversion rate//Checkout conversion rate//Abandonment rate//Retention rate//Attrition rate
*Social marketing
Conversation ratio//Applause ratio//Amplification//Sentiment ratio
*E-mail metrics
Open rate//Delivery rate//Click-through rate (e-mail)//Bounce-back rate