History of E-Commerce
E-Commerce
• Electronic (E) commerce
• The buying and selling of products or services
over the Internet
History
• English entrepreneur Michael Aldrich invented
online shopping in 1979
• He connected a TV to a phone line
• This technology was called videotex
Videotex
• used to deliver information (usually pages of
text) to a user in computer-like format,
typically displayed on a television screen
History
• In March 1980 he went on to launch Redifon's
Office Revolution, which allowed consumers,
customers, agents, distributors, suppliers and
service companies to be connected on-line to
the corporate systems and allow business
transactions to be completed electronically in
real-time.
History
• During the 1980s he designed, manufactured,
sold, installed, maintained and supported
many online shopping systems, using videotex
technology
The World Wide Web
• First server and browser created by Tim
Berners-Lee in 1990
• Opened for commercial use in 1991
Technological Innovations
• 1994
– Online banking
– Online pizza shop by Pizza Hut
– Intershop’s first online shopping system
Shopping
• 1995
– Amazon.com
– Ebay
Amazon.com
• Founded in 1994 by Jeff Bezos, in his garage in
Bellevue, Washington
• After reading a report that internet commerce
was expected to grow by 2,300%
• Created a list of 20 products that could be
marketed online
Amazon.com
• Narrowed the list to 5 products he felt were
the most promising:
– Compact discs (CD’s)
– Computer hardware
– Computer software
– Videos
– Books
Amazon.com
• Decided his new business would sell books
online
• Why?
– Large world-wide demand for literature
– Low price-points for books (price point-the price
of a product set by the manufacturer)
– Huge number of titles available in print
Amazon.com
• In the first 2 months, Amazon did business in
all 50 states and 45 countries
• Sales were up $20,000 per week
• Most brick and mortar stores would carry
200,000 books
• Amazon could carry several times more in
their unlimited virtual warehouse
Company Name
• Bezos wanted a name that started with A so
that it would appear early in alphabetic order
• He settled on "Amazon" because it was a
place that was "exotic and different" just as he
planned for his store to be, and he believed it
was the biggest river in the world, and he
planned to make his store the biggest in the
world
Company Logo
• Since 2000, Amazon's logotype has featured a
curved arrow leading from A to Z,
representing that they carry every product
from A to Z, with the arrow shaped like a smile
Going Public
• When Amazon went public in 1997, shares of
its stock sold for $18.00
• Today, those shares are worth $312.75
• Amazon made its first profit in 2001,
$5 million
Online Shopping
• Customers must have access to the Internet
• Customers find products to purchase
Shopping Cart
• Software that allows online customers to
accumulate multiple items and adjust
quantities, like filling a physical shopping cart
or basket in a conventional store
• A “checkout” process follows in which
payment and delivery information collected
Payment
• Online shoppers commonly use a credit card
or a PayPal account in order to make
payments
• You may also pay with checking accounts, gift
cards and debit cards
PayPal
• Online money transfer system
• Customers create an account
• Allows customers to send, receive or hold
funds in 26 currencies
• Transaction fee is charged to the receiver of
money (this is how the company makes
money)
• You can transfer money to anyone, business or
personal, that has an account
Dot Com Bubble
• 1997-2000
• Height of dot com bubble March 10, 2000
• The period was marked by the founding (and,
in many cases, spectacular failure) of a group
of new Internet-based companies commonly
referred to as dot-coms
Dot Com Stocks
• Companies could cause their stock prices to
increase by simply adding an “e” – prefix to
their name or a “.com" to the end
• Most investors overlooked traditional statistics
on investing and based confidence in these
stocks on technological advancements
Collapse
• The collapse of the bubble took place from
1999-2001
• Some companies failed completely, others
survived
Mark Cuban
• Owned several different business all in the
media and broadcasting industry
• Got rich in the dot com bubble
Mark Cuban
• Owned a company, broadcast.com
• Radio broadcast from inside a sports venue to
a hand held radio outside
• Mark Cuban was smart, and able to foresee
that the dot com bubble, like any other
bubble, would burst
Mark Cuban
• Sold his company to Yahoo! in April 1999 for
$5.7 Billion
Mark Cuban
• Yahoo! Changed the name to Yahoo!
Broadcast Solutions
• As of August 6, 2013, the company no longer
exists
• In October 1999, he made the single largest
e-commerce transaction, purchasing a $40
million Gulfstream Jet
Dallas Mavericks
• On January 4, 2000, Cuban bought a majority
share (95%) of the Dallas Mavericks for $285
million
• Before he bought the team, they had only
won 40% of their games