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Question

Give examples of B2C, B2B, C2C, and social, mobile, and local e-commerce.

Answer 1

B2B is when a business sells to other businesses, Alibaba or Salesforce are example of B2B businesses. B2B can be marketplace and industry networks. B2C is when businesses sell to customers and examples are Amazon. B2C can be an e-tailer, content creator, community provider, portal, transition, service provider and market creator. C2C is when customer can sell to other customers and rely on a platform to enable search, transactions and catalogues and an example is eBay. A social e-commerce is Facebook where an e-commerce is enable by social networks on online social relationships. Mobile e-commerce is e-commerce enables by the use of mobile devices such as phone or tablets which enable transactions. It can be done through iPhones, Androids and other OS. Local e-commerce is e-commerce focused on a customer geo location for example like Uber.

Answer 2

1995 – 2000: Innovation | 2001 – 2006: Consolidation | 2007 + : Re-Invention The innovation period is characterized by being technology driven where the goal was to place a new technology on the market and to accumulate a large market share. Consolidation period was more business driven where the companies that lasted through the innovation phase and had a big market share were focusing on keeping that market share and the Re-invention period came with the launch of the iPhone where e-commerce shifted rapidly to mobile platforms.

Answer 3

Disintermediation is removing the middle man between a business and a customer, businesses can sell to consumers directly in that way for example Apple and Dell.

Answer 4

Being a first mover means that you have a new technology unknown to the market. You place it on the market through a new distribution channel and generate a large user base and based on that have a winner takes all situation on the market but at the same time a first mover has the disadvantage of having high costs concerning the development and research of the product, marketing it on the market and has to spend a lot of money on retaining the customers it has. Over time they build high switching costs for the consumers in hopes to lock them in and prevent competitors from taking them over.

Answer 5

A network effect is the phenomena where a user generates value for the network without being paid. Every additional user increases the value of the said network this is also known as Metcalfe’s law. An Example can be mobile phones when they enter the market, a user benefits from having his friends, colleagues or family also having a phone and thus increasing its value.

Answer 6

Client/server computing is very flexible if there is a need for more computing power new server can be added to the network, also if one of the servers breaks down another one can easily continue the work until the first one gets fixed or replaced, furthermore processing load is split onto several machines unlike in a mainframe where all the workload is on one machine. Both software and hardware can be built economically and simply in a client/server.

Answer 7

Cloud types: - IaaS - PaaS - SaaS IaaS is infrastructure as a service, for example, Amazon web server where it is left up to a user to pick the middleware, the OS, runtime, data and application in his cloud, unlike PaaS, platform as a service where it is up to the user to pick the data and the application, example is ForceCom. Is SaaS, software as a service, the user cannot pick what they want but can use a software, example is Google Docs.

Answer 8

Packet switching is the process where a message sent from a user is broken down into smaller packets, placed on the network and then based on the IP address sent to a receiver through different routes. The message is reassembled before presented to the receiver. It is important because it increases the speed of messages, it also has multiple routes it can use to deliver the messages unlike before where it had to wait. Considering the large number of users and large number of packets it is important that there are more routes for them to be delivered in in cases where some routes are busy or don’t work.

Answer 9

1960-1974: Innovation 1975- 1995: Institutionalisation 1996 +: Commercialization The Internet was first designed to interconnect computers in a school in order to share documents followed by being adopted by the military and defence system and designing ARPANET, after the government realized the potential they encouraged users to start using the Internet and then came the commercialization era where users and businesses started using the internet.

Answer 10

Layer 1: Network technology Substrates Layer 2: Transport services and Representation Standards Layer 3: Middleware Layer 4: Applications Layer 1 or the network technology substrates level is responsible for the wires and telecommunications networks and includes fiber optic cables, broadband, satellite, wireless, DSL and Lan connections, on top of that is the Transport services and representation standards layer which has TCP/IP protocols, the third layer or the middleware layer is the “glue” that connects the communication and application layer and has authentication, file systems, storage and security in it. The forth layer or the application layer is the layer presented to most users where there are web browsers, e-mail clients, image servers and other applications.

Answer 11

Cloud computing is a model where application, software, and other services are pooled together and provided virtual on request. Cloud computing is self- service on demand where users can access services they need regardless on time and location, it has a broad network access meaning it can be accessed through various means like tablet, personal computers or phones, cloud service also uses resource pooling which means that users can obtain computing resources without knowing where those resources and physically present, cloud computing has a rapid elasticity meaning that computing resources can be easily increased or decreased based on consumer demand and lastly cloud services also are measured meaning you will pay for how much you actually use. Some of the advantages of cloud computing is that you or a business no longer has to pay for the physical hardware necessary for some computing processes, also you no longer have to hire a team of professionals to maintain those processes and you can instead spend the money focusing on the key features of your business. On the other hand cloud computing can lead to the lack of control since the data is no longer in your hands or there can be data breaches which can harm your business, furthermore you need to invest in your staff in order for them to be able to use the new service. A potential disadvantage is also that cloud computers are depended on Internet access and if the Internet is down or slower it can affect a business.

Answer 12

E-presence: value proposition (why) , revenue model (money) , market opportunity (marketplace) , competitive environment (competitors), organizational development (structure) , management team (people), competitive advantage (strong point), market strategy (attract). The first step in building an e-presence is defining a vision and a mission, you have to have the main idea why and what are you doing with your business and create a basic business plan. The new step is to determine where the money is coming from or/and how will you generate revenue. You can generate revenue through sales, transactions, advertising, subscription, affiliate or fermium. After determining the financial part you have to take a look and what is your marketspace/place and seethe market opportunity and the potential it has and analyse the competitive environment on a market by conducting a SWOT analysis and determine what your competitors are doing, which are their products and their prices also determine if the competitors are direct or indirect competitors. After that you focus on management team and organizational structure where you find the right people necessary to help you with your vision and mission and further develop the company. You have to analyse what is your compeititve advantage and if you have some, a competitive advantage can be an unique product, specific supplier, brand image and brand name, loyal customers, and others and you need a market strategy to find a way to attract customers.

Answer 13

``` se SPG 38 e- presence: e-mail, web site, offline, social Type: Platform Activity E-Mail Internal List Purchased List Newsletters, Sales and Updates Web Site Traditional Tablet Mobile Sponsorship, Search, Display and Affiliate Offline Print TV & Radio Exposure, Education and Branding Social Twitter Facebook Pinterest Conversation, Sharing, Advice and Engagement ```

Answer 14

Phase 1: Planning: Mission statement Phase 2: Web Site development: Web site plan Phase 3: Implementation: A functional web site Phase 4: Social Media Plan: A social media plan Phase 5: Social Media Implementation: A functional social media presence Phase 6: Mobile Plan: A mobile Media Plan Phase 1 or planning focuses on the vision of an e-presence and to determine the personnel needed to ensure that vision, phase 2 focuses on web site development by acquiring the content, developing a web site design and arrange the hosting of the web site. The third phase is focused on implementing the web site and developing metatags and keywords to focus on search engine optimization and identify potential sponsors. The fourth stage is focused on developing a social media plan where the company needs to identify the proper social media platform and content continued by implementing a social media plan where a company develops a Facebook, Twitter and/or another social media service platform presence. The final sixth stage focuses on creating a mobile media plan where the web site should be also available on mobile platforms.

Answer 15

SDC: • System analysis/planning • System design • Building the system • Testing • Implementation In system analysis or planning you want to answer the question as to what do you want that an ecommerce site does? A business decision should drive the technology behind it not the other way around. A business objective should be identified together with the information needed and the system functionalities. Next step is to design the system where you determine the main components and the relationship between them. There are two components of a system design the local and the physical design. The local design focuses on flow of information on your e-commerce site, processing of those data and the databases that will be used, security is also included here. A physical design the logical design in a physical one. After determine the system design you need to build the system by either building it yourself or outsourcing it, when you build it yourself you can either use templates already available, build it from scratch or use packaged building tools. If you outsource it you can either outsource the entire system, outsource parts (hosting and build) or have everything in house. Before you implement a system you have to test it by using different methods like unit testing where you test one unit at a time, you can perform system testing where you test a site as a whole like a common user would use the site, you can also do acceptance testing where you have business personnel like managers, sales people, marketing and other use the site and ensure it matches with the business objective, you can also do the A/B testing where you have two versions of a web site displayed to different users and see which one performs better and you can do the multivariate testing where you identify specific elements, create several version of them and create a combination of them to test.

Answer 16

A firms value web is a network business ecosystem that uses e-commerce technology to coordinate the value chains of partners within an industry or at least at the first level.

Answer 17

A freemium strategy is a strategy of a business where it offers a free product and charges for extra features in it. For example Dropbox is a free service that you sign up for and it offers you a certain amount of storage but if you want extra storage and functionalities you have to upgrade to a premium account and pay for it.

Answer 18

A disruptive technology is a technology that changes the basic metric system amongst which firms compete. Unlike sustaining technology which existing companies use to deal with competitive pressure and extend the functionalities of their products a disruptive technology can use these improvements to create a new technology and place it on the market. Example is Netflix where is changed the metric system amongst which companies like Blockbuster competed. Blockbuster has a physical store where it generated revenue based on renting movies and when Netflix came on the market it offered movies regardless of the location, for a smaller price, a higher selection of movies and series. It didn’t only affect Blockbuster but also the sellers of DVD players.

Answer 19

B2B models: Marketplace and private industry networks net Marketplace: e-Distributor, e-procurement, exchange and industry consortium An e-distributor has the focus to sell goods and services to businesses like Amazon Supply and it generates revenue mostly on sales of goods. An e-procurement business model focusses on selling marketplace access to businesses and generates revenue on fees for market access, an example is Arriba Supplier, an exchange business models focuses on creating a marketplace where sellers and buyers can do transactions, the main idea is to increase the number of participants and that way reduce costs and time necessary to find either sellers or buyers it generates revenue through fees and commissions and lastly there is the industry consortium where the marketplace server a specific industry, example is SupplyOn.

Answer 20

Sources of capital: - Seed capital - Incubators - Angel investors - Venture capital - Crowdfunding Incubator firms offer small funding but more importantly offer infrastructure and know-how for businesses where they can for a limited period of time polish their skills and get information how to successfully run their businesses. Unlike traditional sources of capital where it is only capital that is offered/given to firms which is then up to them to use it in the most efficient way.

Answer 21

An unfair competitive advantage is an advantage obtained by a firm and there is no way for its competitors to obtain it as well. An example of an unfair advantage can be a brand name which cannot be purchased but also it can be that a firm has a special relationship with a supplier. example: patented tech, knowing more data than anyone else.

Answer 22

An industry structural analysis is an analysis of the industry structure meaning is uses Porter’s five forces: - Rivalry amongst existing competitors - Danger of a substitute product - Bargaining power of suppliers - Bargaining power of buyers - Barriers to market entry Rivalry amongst existing competitors expends the market but also it increases the price competition, danger of a substitute product means a new product can replace an existing one for example how Netflix replaced DVD’s, bargaining power can mean the suppliers can be removed as intermediaries but at the same time it gives them the chance to sell directly to consumers. Bargaining power of buyers means that buyers have a higher bargaining power since there are more sellers of the same products now and lastly barriers to market entry can either be increased by first movers or decreased by the need to have physical stores, sales force and others.

Answer 23

B2C models: - E-tailer - Content provider - Community creator - Portal - Transaction - Market creator - Service E- tailer generates money through a sales of goods and it can be a: - Virtual merchant: Amazon - Catalogue: Otto - Direct seller of manufactured goods: Dell, Apple - Bricks and clicks: Walmart Content provider generates revenue through advertising, subscription, sales of goods: Eurosport, CNN, CBSport. Community provider generates revenue through advertising, sales of goods, subscription or affiliate marketing: Facebook, Twitter, LinkedIn. Portal generates revenue through subscription, advertising, affiliate marketing: - Horizontal portal is a portal focused on packaged content and provides content search: Yahoo, MSN - Vertical portal is a portal type focused on a specific topic like sail boats or other: Sailnet. - Search portal is a portal that is focused on providing search services: Google Transaction model generates revenue based on transactions: Expedia Service model generates services based on providing a service and selling it to a customer: Visa Now Market creator is a model that generates revenue through transaction fees, access fees and selling goods - Digital market creator: eBay, Amazon - Sharing: Uber

Answer 24

Content providers can use a subscription revenue model, advertising or sales of digital goods. For example Eurosport is a content provider where it provides sports competition watching via a subscription and uses advertising to offer advertising space to companies before, or during a sports video. The key to being a successful content provider is owning the content but that is a difficult thing to obtain for companies that just started as content providers.

Answer 25

E-Commerce enables are firms that enable e-commerce, firms like Amazon, Dell, Apple, Squarespace and others these firms enable OS, hardware, software, communication networks and other means necessary for companies to do business.

Answer 26

- Business strategy: - Differentiation - Cost competition - Customer intimacy - Focus/market niche - Scope By differentiating its products a business wants to create a unique product and service different from its competition and the opposite is commoditization where there are no differences between products and services and the basis on which will be picked is its price. Cost competition is when a firm has discovered new way to improve its processes and save money and time unlike its competitors. By providing customer intimacy like Netflix a business focuses on developing strong connections with its user and that way increasing switching costs. A focus/market niche means that a business competes on a narrow market or product segment, for example L.L Bean uses this strategy to compete on the outdoor sports apparel. The scope allows a business to complete no longer just on a local or national market but expends to global levels.

Answer 27

``` Se spg 52 Offline Consumer Psychological Cultural Social Firm capabilities Brand image Market stimuli In store behavior Purchase Online Consumer Psychological Social Background demographics Market stimuli Brand Web page Firm capabilities Consumer skills Purchase attitude Product characteristics Clickstream behavior Purchase ```

Answer 28

Web analytics are set of tools used to monitor how a web site behaves. It can be used by ecommerce firms to determine how well their web site is performing. An online purchasing process can be broken down into 5 steps: awareness, engagement, interaction, purchase and post purchase service loyalty. Awareness can be determine by using the number of unique visitors Engagement is measured through number of page views, stickiness or duration of the page view and content view Interaction can be analysed by establishing how many times a post has been seen, number of likes, pins, tweets and comments Purchase is analysed through purchasing, number of times the purchase has been abandoned, number of user that have been registered and the number of times a cart page has been entered Post purchase service loyalty is the number of customers that come back, social site activities and service requests

Answer 29

Comprehensive multi-channel marketing plan: - Web site - Traditional: ad targeting, SEM and display ads - Social - Mobile - Offline A web site can have a traditional web site platform used as an anchor for a brand or product for example apple.com. Traditional online marketing can be SEM (search engine marketing) and display advertising where the idea is to target specific groups with a marketing message, sites such as Google, Yahoo and MSN, Social marketing is e-mail, affiliate marketing, social networks, blogs and forums and has the function to extend the brand, start conversation, share information, create communities, expand the brand, example are Facebook, twitter, Amazon, major retailers. Mobile marketing has quick access, news and updates through apps and mobile sites, lastly offline marketing is TV & Radio and Print where the major idea is to create more brand awareness and educate and expose.

Answer 30

Search Engine Advertising Types: - Keywords - Sponsored links: organic and paid inclusion - Search engine optimization - Context advertising

Answer 31

Issues: - Link farms - Content farms - Click fraud Link farms are websites which link to other websites this way they boost their ranking and are placed higher on search results. Content farms are companies that create a large amount of text based content and that way attract customer and views this way affecting search engine results and click fraud is the situation where an user/competitor clicks on an add but doesn’t get anything out of it yet the advertiser still has to pay for the click.

Answer 32

Methods: - Search engine quarries - Individual browsing data history (clickstream) - Data from social sites - Offline data – income, gender, education, credit records, driving records etc.

Answer 33

CTR is click through rate which shows how many time an add is clicked measuring it effectiveness the higher the VTR the higher the performance on the other hand VTR is view through rate which shows how many people were exposed to an ad in 30 days. CPM is click per thousand which measures impressions based on 1000 units it is cheap and used to create brand awareness, CPC is click per costs which measures the costs of a click on an advertisement used to increase the traffic and lastly CPA is click per action which is the most expensive and measures only when an user performs a specific action it is the also used to measure a concrete financial return.

Answer 34

Steps: - Fan acquisition - Engagement - Amplification - Community - Brand strength The first step is fan acquisition which focusses on attracting people to your marketing message through using social sites, News feed or pop ups, after you acquire fans you engage them in interacting with your content and brand, you want the fans to talk about your brand, you can encourage that through using pictures, videos and other means. After you engage them it is time to amplify meaning its time for them to share your brand and comment on. A community is a loyal base of fans engaged in your brand where they communicate and engaged your brand over a period of time.

Answer 35

Fan acquisition: establish a brand Facebook page and provide interesting and original content used to attract people. Engagement: engage your visitors with your brand through comments, you can encourage third parties to link or build content for your Facebook page Amplification: Encourage your fans through games or prices to share your content, you can create different ads on Facebook and on search engines leading to your brand page. Use the like button feature. Community: by having a community encourage them to talk about your product to recommend it to other and comment on it.

Answer 36

Social ads are ads display on a social site which encourage visitors to interact and do something social such as participate in contests, obtain coupons or free services for attracting friends.

Answer 37

Convergence has been applied on: - technological - Content - Industry structure Technological convergence is developing a hybrid device that can use several types of existing media platforms. For example iPhones, Android phones. Content convergence where design, production and distribution merge. These were separate at time and as technology progressed they merged together into a single channel where now you can acquire a book directly online. For example a book was initially written and launched as a paper back with the idea to be viewable on an IPad or Kindle, as time goes by and as the book reaches its media maturity it will only be available in digital format with added visual and aural content displayed on many different devices.

Answer 38

It is an area online where people that share common interests can interact with one another.

Answer 39

Social networks are a place where users with common interest can meet and communicate or share content unlike portals that have the main goal to help people find the information they need and to expose people to information they were not looking for but is still interesting and entertaining. Both of them provide users with content like images, videos, information, and education.

Answer 40

Types of social networks: - Interest based Community - Sponsored - General community - Affinity community - Practice networks Interest based communities are communities that have a common interest and generate revenue through advertising. For example an interest community can be a tennis or sailing community. An affinity community is a community that is focused on people that have the same affinities for example it can be based on religion, gender or sexual orientation. Practice networks are networks where members are focused on discussion groups, and share their knowledge and expertise. Sponsored networks are usually non-profit or governmental networks which are used for specific organizational goals. For example Cisco, Tide.com and others.

Answer 41

Characteristics: - Navigation of the Web - Content - Commerce

Answer 42

Vertical portals: - Affinity groups: Facebook, law.com, sina.com - Focused content: ESPN, away, sailnet.com

Answer 43

Retail merchants can integrate their online and offline sales channels by having an online order and offline pick up option where customers can order their product online and later go to the physical store to pick up their item. Another way is to use gift cards, loyalty programs where customers receives these and are encouraged to visit the store and use them there, by using online catalogues the company can show its products online and show customers sales and other information which attracts them to go to the store.

Answer 44

Industries that already use EDI and have large investments in IT and Internet infrastructure are expected to move faster to a B2B e-commerce. It also depends on what types of industries therefore industries such as space, computer and industrial industries tend to move faster.

Answer 45

Stage 1: Document Automation (Transaction) Stage 2: Document Elimination (Coordination) Stage 3: Continues Replenishment (Collaboration) Document automation is the process where orders were sent electronically, followed by payments, invoices and other documents. These processes replaced postal system for document transmission, reduced errors, increased delivery speed and lowered costs. Document elimination was characterized by JIT production and continuous production. EDI eliminated purchase orders and documents entirely replacing them with production schedules and inventory balance. Finally suppliers were given online access to selected parts of a firm’s production that uses them to purchase parts.

Answer 46

Today’s EDI is not suited for net marketplaces where thousands of suppliers and buyers meet to negotiate prices. It does not permit a dynamic relationship, price transparency, it does not scale to include new participants and is not a real time communication environment.

Answer 47

Steps: - search - quality - negotiate - purchase order - in voice - shipping - payment The procurement process start with search by using the internet, catalogs, sales persons or telephone and research about suppliers or specific products, after finding the desired suppliers a quality check is performed using research, their credit history and competitors. The third step is to negotiate a price, cred terms, timing, quality and other necessary terms. After these steps a purchase order is issued and the buyer sent an invoice after which the goods are shipped and the buyer pays for them. All of these step can benefit from automation and e-commerce technologies because all these steps should be recorder in an information system to reduce costs and time and ensure transparency.

Answer 48

A supply chain is a chain that links different parts in a supply chain with the goal to coordinate production. SCM systems are supply chain management system that have the goal to coordinate key players in a company’s procurement strategy. A supply chain simplification involves reducing the size of a supply chain and streamline the supply chain by working closely with a small group of strategic suppliers to reduce product costs and administrative costs while improving quality.

Answer 49

Se spg 74 A vertical market offers direct supplies and focuses on spot purchasing unlike horizontal market where distributors serve several different industries with product from different suppliers. What business buy How business buy Indirect Direct Spot purchase E-Distributor Independent Exchange Lon-term Sourcing E-procurement Industry Consortium Vertical Horizontal

Answer 50

Indirect god are goods used to support production while direct goods are goods used in the production. A company might need indirect goods at some point to for example repair the building it operates on, or maintain machinery and other goods that are needed at a specific time for a specific purpose. Unlike direct goods which are used in a production at all time and thus have contracts bound to them.

Answer 51

Just in time is used to eliminate excess inventory while a lean production is a set of production and tools focused on the elimination of waste through the entire value chain. It is an extension of JIT beyond inventory management to the full range of activities that create customer value.

Answer 52

B2B collaboration: - Collaborative resource planning - Forecasting - replenishment

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