E-Commerce:
Supporting External and Internal
Linkages
Part 1
MIS 320
Kraig Pencil
Summer 2014
PPT Slides by Dr. Craig Tyran & Kraig Pencil
Game Plan
• Introduction
• Supporting Internal Linkages
– Intranets
• Supporting External Linkages
– B2C: Business to Consumer
– C2C: Consumer to Consumer
– B2B: Business to Business (Part 2 Notes)
PPT Slides by Dr. Craig Tyran & Kraig Pencil
A. Introduction
1. E-Commerce
–
A very hot business topic!
2. Definition
–
–
Buying and selling of products, services, and
information which is enhanced via computer
networks
May also include
•
•
•
Internal business communications
Customer service
Info sharing with business partners
PPT Slides by Dr. Craig Tyran & Kraig Pencil
A. Introduction
3. Enables efficient value chain linkages and
relationships
•
e.g., External linkage from customer to supplier: Order
information
Supplier
Corporate
Customer
Order information
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B. History
1. E-commerce applications have existed
since the early 1970s
–
e.g., electronic funds transfer, electronic data
interchange EDI
2. But … There were significant limitations
in the “old days”
–
–
–
–
Network reliability
Compatibility
Lack of technical standards
Limited computing power
PPT Slides by Dr. Craig Tyran & Kraig Pencil
B. History (cont.)
3. Things changed in the 1990’s
– Commercialization of the Internet
– “Price/performance” of IT improved
(remember Moore’s Law?)
– Introduction of WWW
 E-commerce exploded !!!
PPT Slides by Dr. Craig Tyran & Kraig Pencil
C. Intranets
1. Defn:
–
Private network for one organization that uses
Internet software and protocols
•
•
“Private Internet”
Typically involves WWW-based applications
2. Key goal:
–
Support internal value chain linkages
3. Example
–
WWU Web4U
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Intranet: WWU
PPT Slides by Dr. Craig Tyran & Kraig Pencil
C. Intranets (cont.)
4. One key advantage: Save $$$ and time!!
–
Without intranet:
•
Large organizations
–
•
Time lag to share information
–
–
 Spend $50-$100/yr/person to distribute paper-based internal
documents
e.g., product inventory status to salespeople in the field
With intranet:
•
•
•
•
Intranet approach is much cheaper
Rapid information sharing
ROI on intranet projects can exceed 1000%
Payback can be 6-12 weeks
PPT Slides by Dr. Craig Tyran & Kraig Pencil
D. Business-to-Consumer Applications
(B2C)
1. B2C applications
–
–
–
Support external linkages with consumers
Foster trading between a business and a consumer
(“on-line retail”)
Examples?
2. E-commerce jargon
•
E-tailer
•
•
•
M-commerce
•
•
•
“Pure EC”
“Clicks and mortar”
Order
E.g., cell phone, PDA
Disintermediation
Channel conflict
PPT Slides by Dr. Craig Tyran & Kraig Pencil
Sales Info
Disintermediation
If distribution
channels get
bypassed, then
there can be
“channel conflict”
PPT Slides by Dr. Craig Tyran & Kraig Pencil
D. Business-to-Consumer Applications
(B2C) -- cont
3. B2C: What is a good fit?
–
Digital products
•
•
–
Commodity items
•
•
–
Can be described/delivered electronically
Examples??
Items with known/uniform features, rather than “high touch”
items
Would dentures be a good item to sell over the WWW?
In some cases … Effective to allow customer
to “shop online and buy in a store”
•
e.g., Automobiles, REI merchandise
PPT Slides by Dr. Craig Tyran & Kraig Pencil
E. WWW Advertising
1. WWW advertising: Interaction
–
Information/interaction matrix (see figure)
PPT Slides by Dr. Craig Tyran & Kraig Pencil
High
Low
Information Content
Advertising:
Information/Interaction Matrix
Catalogs,
Infomercials
Personal sales visit
Traditional ads
Phone sales
(e.g., newspaper)
Personal Interaction
Low
PPT Slides by Dr. Craig Tyran & Kraig Pencil
High
Where can
WWW sites
fit on this
matrix???
Advertising:
Information/Interaction Matrix
Many Web pages
High
Low
Information Content
Dynamic product database
Many links
Static – same for everyone
Personal login or cookies
Product and personal history databases
Key-word searches
Analyzes individual history/preferences
Infinitely personalized pages
Shopping cart / Online purchases /
Wish lists
Amazon.com
Few Web pages
Key-word searches
Static product lists / catalog
Product listings / catalog
Static – same for everyone
www.christiansonsnursery.com
Low
Online purchase
DonPencil.com
Personal Interaction
PPT Slides by Dr. Craig Tyran & Kraig Pencil
High
E. WWW Advertising
2. WWW advertising: Interaction (cont.)
– Lower interaction sites (e.g., local plant nursery
www.christiansonsnursery.com
http://www.donpencil.com/ )
– Higher interaction sites (e.g., www.amazon.com)
•
Customized suggestions, e-mail messages
3. Personalization
– Track individual consumer behavior
– Use information technology to customize the
interactions
• E.g., Provide information of relevance to customer;
Target the ads, promotions, recommendations
PPT Slides by Dr. Craig Tyran & Kraig Pencil
Personalization Examples: Amazon.Com
PPT Slides by Dr. Craig Tyran & Kraig Pencil
E. WWW Advertising
4. Learning from a WWW site: WWW Analytics
– It is possible to capture web browsing activity at site
– Lots of marketing information!!!
– Info can be used to analyze behavior of visitors
• e.g., data mining
• Can be useful for personalization, market research
– Google Analytics (www.google.com/analytics )
– Sample report for www.fourthcornerquilts.com
• e.g., visits, page views, referring sites, visits by
location, length of visit, conversion rates (% that go
to check out/make order), etc.
PPT Slides by Dr. Craig Tyran & Kraig Pencil
PPT Slides by Dr. Craig Tyran & Kraig Pencil
PPT Slides by Dr. Craig Tyran & Kraig Pencil
What do Google Analytics Look Like for
a Class Website?
PPT Slides by Dr. Craig Tyran & Kraig Pencil
PPT Slides by Dr. Craig Tyran & Kraig Pencil
E. WWW Advertising
5. Viral marketing
–
–
–
–
“Word of mouth” advertising on the WWW
Create something that people may pass along to others
Generate awareness at minimal cost
Examples
• E-mail ads
– Hotmail (Attracted 150,000 subscribers in first week … with a limited
advertising budget)
• Videos
– Blendtec -- “Will it blend” (Made Blendtec famous)
– Ford Sportka -- Bird: (A bit edgy …)
– Ford Sportka – Cat (Too edgy?)
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Viral Marketing: Hotmail
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Viral Marketing: Videos
PPT Slides by Dr. Craig Tyran & Kraig Pencil
F. Consumer-to-Consumer Applications
(C2C)
1. C2C applications
–
Foster trading between consumers
(and/or non-business entities)
2. Examples
–
–
e.g., Purchase goods: www.ebay.com ,
www.sfgiants.com (“Double Play Ticket
Window”), seattle.mariners.mlb.com (“Ticket
Market”)
e.g., Share/trade information:
www.experts-exchange.com
PPT Slides by Dr. Craig Tyran & Kraig Pencil
C2C Example: Season Ticket Holders Can
Sell Spare Baseball Tickets
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C2C Example: IT-related Information from Experts
PPT Slides by Dr. Craig Tyran & Kraig Pencil
References: Figures
• Figures used on Matrix slide:
– http://www.eslkidstuff.com/images/newspaper.gif
– http://www.lionking.org/sequels/TLK2/Catalog.jpg
– http://nordictrack.speedera.net/www.nordictrack.com/nt/v5/
images/NTL1494dtl-main.jpg
– http://www.brusselaar.blogger.com.br/telemarketing.jpg
– http://www.uvater.de/Salesperson.gif
PPT Slides by Dr. Craig Tyran & Kraig Pencil