Services Industry
(2007 - jmd)
1
Learning Objectives
Focus on major online broker-based services
Real estate
Travel & tourism
Job market & searching
Stock trading
Cyberbanking, financial services
Online Publishing, Knowledge Dissemination,
Distance Learning
 Concepts of disintermediation and
reintermediation

1.
2.
3.
4.
5.
6.
2
Broker-Based Services
 Brokers work as intermediaries
between buyers and sellers
 Agents basically make the markets
 Agents provide many services
 Many of the value-added tasks of
brokers can be automated
3
Broker-Based Services
(cont.)
 Real estate and Travel agents
 Viewing an online video clip or seeing photos of a
hotel or a house for sale
 Bank and brokerage houses
 Possible digitation of the entire process
4
1.Real Estate
 You can view many properties on the
screen
 You can sort and organize properties
 You can find detailed information
about the properties
 You can search, compare and apply
for loans
5
Real Estate (cont.)
 Real Estate Applications (You may not start
with the comprehensive sites, but go to a
general search engine and search for the
location of interest.)
 International Real Estate Directory and News is
the most comprehensive Web site
http://ired.com/
 US National listing of real estate properties
http://cyberhomes.com/
 Commercial real estate directory
http://comspace.com/
6
Real Estate (cont.)
 Mortgage comparisons, calculations, and other
financing information; mortgage application
 Searching residential real estate and property
listings in multiple databases
 Real estate related maps are available on
 Automating the closing of real estate
transactions, much paperwork (Mostly in person at
a Real Estate Agency in US or at a bank in Norway.)
 Consulting and Analyst: how much house you can
afford, consult
 Mortgage brokers can pass on loan applications
online and receive bids from lenders that want to
issue the mortgages
7
Real Estate http://www.savewright.org/
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Real Estate
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Real Estate http://www.recnj.com/
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Real Estate
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Real Estate
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Real Estate
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Real Estate
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2. Travel and Tourism Services
 Any experienced traveler knows that good
planning and shopping around can save money
 The Internet is an ideal place to plan, explore,
and arrange almost any trip
 Two types of sites:
 how to get there,
 what to do there
 Businesses have different needs (make contacts,
promote company image)
 Repeat customers
 Still interested in prices
15
Travel and Tourism Services
(cont.)
Services provided:
 Information and
booking of airlines,
hotels, cars, B&Bs, and
even golf courses,
special interest
vacations
 Fare comparisons,
frequent flier deals,
status of flights, fare
tracker, place locator
 360 degree video tours
of top destinations
 Converting 200
currencies
 Maps, attraction photos,
ticket purchasing, tips
from travelers, driving
directions, restaurant
reviews,
recommendations
 discount information
 travel accessories and
books, travel news
 Weather watch
 travel magazine, major
international news, chat
rooms, bboards
 Virtual tours
16
Travel http://www.mrjet.se/ OR
http://www.ebookers.no/?LANG=NO
Or http://www.sasbraathens.no/Default.aspx?epslanguage=NO
17
Travel
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Travel and Tourism Services
(cont.)
 The electronic agent is not-allinclusive: Mr. Jet might not include
the smaller airlines and less known
locations.
 Auctions, bids, and special sales
 American airlines (aa.com) auctions
tickets during low-volume seasons
 Cathay (cathaypacific.com) auctions
tickets on competitive routes
19
Travel and Tourism Services
(cont.)
Benefits
1. Much free information
2. Information is
accessible anytime
3. Substantial discounts
Limitations
1. Not all people use the
Internet
2. It may take a long time
to find what you want
20
Travel and Tourism Services
(cont.)
 Corporate Travel: New Business Model
 Focus:
 Environment
 Competitive responses
 Firm’s strategy
 Taking away some functions
traditionally performed by travel
agents
21
Travel and Tourism Services
(cont.)
 Impacts on the industry
 Multimedia helps customers understand the products
 Offering of lower-cost trips, personalized service,
convenience info at home
 Turban predicts
 Travel agencies, as we know them today, will
disappear
 Only their complex value-added activities will not be
automated
 These complex activities will be performed by a new
breed of intermediaries
 Survival strategy
 Minor improvements due to process changes
 BPR with significant improvements
 Organizational transformation
22
Figure 10-2
The Travel Industry Chain
Source: Block and Segev “The Impact of Electronic Commerce on the Travel Industry” Proceedings, HICSS 31, Hawaii
© 1997 IEEE.
23
Travel and Tourism Services
(cont.)
 Intelligent agents (But these do not always
integrate services: sa. flight with local
attractions.)
 Step 1: turn on PC and enter





Desired destination
Dates
Available budget
Special requirements
Desired entertainment
 Step 2: intelligent agent “shops around”
 Step 3: agent attempts to match your
requirements with what is available, negotiates
with vendors
 Step 4: agent returns within minutes with
suitable alternatives, modifies as per your
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wishes, books the vacation
3. Employment Placement
 Job markets
 Matching Employers jobs with
employees skills
 Volatile market, many
announcements are on the Internet,
but not all types of jobs
 Job location and type is also an
important factor with jobs
availability.
25
The Employment Placement
 E-ads for jobs as opposed to classified
ads
 Cost—classified ads are expensive
 Life cycle—life of the ads is only days or weeks
 Place—most ads are local; nationwide and
international ads are more expensive
 Minimum information—because of the high
cost, the information provided is minimal
 Search—Time consuming for individuals to find
all relevant newspapers
26
The Employment Placement
 The Internet Job Market
 The Internet offers a perfect
environment; it is especially effective for
technology-oriented jobs




Job seekers
Job offerers
Recruiting firms
Government agencies and institutions
27
The Employment Placement
The Advantage of the Electronic Job Market
For job seekers
 detailed and timely
information on a
many jobs worldwide
 Quickly communicate
with potential
employers
 Post resumes for
large-volume
distribution (For
those seeking first
jobs.)
 Search for jobs quickly
from any place at any
time
 Obtain several support
services at no cost
 Find employer profile &
industry guides
(valuereports.Com)
28
The Employment Placement
The Advantage of the Electronic Job Market
For employers
 Advertise to a large
number of job
seekers
 Save on
advertisement costs
 Lower the cost of
processing (using
electronic
application forms)
 Provide greater
(‘equal opportunity’)
for job seekers
 Find highly skilled
employees
 Conduct tests
quickly, online
 Change and update
ads quickly
 Fill up positions
rapidly
 Interviewing from
distance
29
The Employment Placement
 The Limitations of Electronic Job Markets





Many people do not use the Internet
Security & privacy
Maybe not a comprehensive listing
Lack of face-to-face contact
Intelligent agents for job seekers (jobsleuth.com),
few listings, difficult to use.
 Examples of online job services




Locating jobs
Writing and posting resumes
Career planning
Newsgroups
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Employment Placement http://jobb.jobbnorge.no/
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Employment Placement http://www1.tu.no/jobb/
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Employment Placement
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Employment Placement http://www.stepstone.no/home_fs.cfm
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Job Announcements – in education are listed at
each school.
35
Job announcements
– are on the top menu at UiB
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4. Investing and Trading Stocks Online
 Online stock trading
 Costs between $7 and $29 per transaction (vs. $10 $35 in traditional brokerage)
 No waiting on busy telephone lines
 No oral communication, less chance for errors
 Place orders from anywhere, any time, day or night
 No biased broker to push you
 Considerable amount of free information
37
Figure 10-4
The Process of Electronic Stock Trading
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Trading Stocks Online
(cont.)
 Investment Information (General
Information)
 For current financial news:
cnn.com, hoovers.com, and bloomberg.com
 For municipal bond pricing:
bloomberg.com
 For overall market information and many links:
cyberinvest.com
 For free Guru advice see:
upside.com
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Trading Stocks Online







(cont.)
Investment Information (Personal Brokers)
Charles Schwab (http://www.charlesschwab.com )
Fidelity Investments (http://www.fidelity.com)
Datek Online (http://www.datek.com)
CSFBdirect (http://www.csfbdirect.com)
Citibank (http://www.citibank.com/domain/index1.htm )
And many many more…
40
Citibank –Online trading and Banking
41
Trading Stocks Online
(cont.)
 Investment Information Services (cont.)
 For stock screening and evaluation:
http://www.reuters.com/investing and
http://money.cnn.com
 For articles from the Journal of the American
Association of Individual Investors: http://aaii.com/
For reports the latest findings and pricing of IPOs
http://www.hoovers.com/global/ipoc/
 For chart lovers http://bigcharts.marketwatch.com/
 For mutual funds evaluation and other interesting
investment information http://www.morningstar.com/
 For earning estimates and much more
http://money.cnn.com/data/earnings/
42
Trading Stocks Online
 Initial public offerings
(IPOs)
 Spring Street Brewing
 Offers initial and
secondary securities
trading over the
Internet
 See ipo.com
 Global stock
exchanges—aroundthe-clock global
trading
(cont.)
 Related markets
 Financial derivatives
 Commodities
 Mutual funds
 Individual investors
and day trading
 Electronic trading of
interest rate
derivatives
 Swapswire.com
 Forbes.com
43
On-line banking and Personal
Finance – now the banks can do
everything..
 Electronic banking  Capabilities of home
 Saves time and
banking
money for users
 Offers an
inexpensive
alternative to
branch banking
 Multi-currency,
retail purchasing
by credit card or
international
banking
 Get current account
balances any time
 Obtain charge and
credit card statements
 Pay bills
 Download account
transactions
 Transfer money
between accounts
44
On-line banking and Personal Finance
 Using the extranet
 Banks provide large business customers with
personalized service by allowing them access
to the bank’s intranet
 Access accounts
 Historical transactions
 Intranet-based decision-support applications
45
On-line banking and Personal Finance
 Imaging systems—allow customers to
view images of all:
 Incoming checks
 Invoices
 Other related online correspondence
 Pricing online vs. off-line services
 Some banks offer free services (fee per
check or transfer)
 Some banks charge $5 to $10
 Risks—especially in international banking
46
On-line banking and Personal Finance
(cont.)
 Banking: 4 scenarios
1. Building alliances quickly with banks,
software vendors, and information
providers
2. Effective outsourcing without
neglecting to build in-house skills
(customer information systems)
3. Focusing on the profitable customers to
provide broad channels for services
and products
4. Keeping a central role in the payment
environment
47
The Future of Online Banking
 Three core strategies to pursue
1. Customers Agents—banks unable to
achieve economies of scale
 Offer customers the widest possible choices
 Include products from multiple sources
 Provide the customers with integrated
information services
48
The Future of Online Banking
(cont.)
 Three core strategies to pursue
(cont.)
2. Product Manufacturers—banks able to
achieve economies of scale
 Strengthen a trend that can already be
seen in a number of product segments
 In core processing services for small and
medium-sized institutions
49
The Future of Online Banking
(cont.)
 Three core strategies to pursue (cont.)
3. Integrated Players—banks with a strong
brand and position from manufacturing to
delivery
 Many banks will adopt a hybrid strategy
 Every player needs to make crucial decisions
about which areas are strategically too risky:
 To outsource
 Which capabilities need to be built up in-house
50
The Future of Online Banking
(cont.)
 Personal finance online

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
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
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Bill paying and e-checks
Tracking bank accounts etc.
Portfolio management
Investment tracking
Quotes and prices (past and current)
Budget organization
Record keeping
Tax computations
Retirement goals, planning and budgeting
51
5. Online Publishing
 electronic delivery and creation
 Online Publishing Today and Tomorrow
 Today— mainly used for disseminating or
distribution of information and for
conducting sales transactions interactively
 Tomorrow— include more customized
material that the reader will receive free, or
will pay for
 Also tomorrow – more on-line in the
creation of information products (reviews,
editing).
 More on-line in the consumption or use of
the product (reading).
52
Online Publishing (cont.)
 Publishing Modes



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



Newspapers
Magazines
News
Textbooks
Music
Artwork
Video clips
Movies
53
Online Publishing (cont.)
 Publishing Methods
 Online archive: digital archive (library
catalogs, bibliographic databases)
 New medium: extra comprehensiveness to
issue or topic
 Publishing intermediation: online
directory for news services
 Dynamic or just-in-time: create content
in real-time and transmit on the fly
54
Online Publishing (cont.)
 Content providers and distributors
 Issues of intellectual property is a
consideration
 Akamai.com
 Digisle.com
 Edgix.com
 Publishing music, videos, and games
 Major issue is payment of intellectual
property fees
55
Online Publishing
(cont.)
 Edutainment—combination of:
Education
Entertainment
Games
Goal: encourage students to become
active learners
 Managerial issues




 Educational games delivered as CD-ROMs
 Distance-learning format
56
Online Publishing
(cont.)
 Electronic books
 Frequent updates possible
 Contain up-to-the-minute information
 Special eBook device necessary to
view books
 See:
 Wizap.com
 Ebookconnections.com
 Netlibrary.com
57
6. Knowledge Dissemination
 Virtual teaching and online
universities
 Distance learning and virtual
universities
 Many universities offer limited courses
and degrees, but use innovative
teaching methods and multimedia
support
58
Knowledge Dissemination
(cont.)
 Virtual teaching and online universities
(cont.) http://www.nettitaliensk.uib.no/innlogging.php
 MBA program in Hong Kong (2004)
 Lectures delivered on interactive TV (iTV), now on
the Web
 Students decide what and when they “attend”
 Lecture, support material exercises, etc., provided
on the Web
 Second Life
http://www.youtube.com/watch?v=ZUNAhzwZkdU
 http://www.slideshare.net/iconolith/second-lifefor-education
59
Education as EC Forces Drive the Transition
Source: Hamalainen et al., “Electronic Marketing for Learning: Education Brokerages on the Internet,”
Communications of the ACM, June 1996. Hamalainen et al. © 1996 ACM, Inc. Reprinted with permission.
60
Knowledge Dissemination
(cont.)
 Online advice and consulting
 Medical advice— provide consultation
with top experts
 Management consulting—provide
accumulated expertise from knowledge
bases
 Legal advice— delivery of legal
consultation services to business has
considerable prospects
61
Knowledge Dissemination
(cont.)
 Online advice and consulting (cont.)
 Financial advice— offer extensive
financial advice
 Other service online
 Healthcare
 Matchmaking
 Electronic stamps
62
Disintermediation and
Reintermediation
 Change the role of agents to:
 Assists in comparison from multiple sources
 Providing total solutions by combining
services from several vendors
 Providing certifications and trusted third
party control and evaluation systems
63
Disintermediation and
Reintermediation (cont.)
 New roles of electronic marketing
intermediaries
 Extend familiar physical markets to the
virtual world (e.g., search services and
electronic malls)
 Extend payment clearing functions into the
Internet (e.g., electronic cash and digital
credit card services)
 Disintermediation in B2B
 Must Reengineer marketing and sales
organizations
64