Page 27 - ECOMMERCE COURSE MATERIALS
P. 27
selling dog food over the internet found that the shipping costs exceeded the cost of the dog food.
Customers were better off to drive to the store and purchase the dog food and not pay the shipping.
A couple of the biggest money makers on the internet today include: the sale of information and the sale of
advertising.
Research companies collect and sell information on the demographics of consumers and their purchasing
habits. Surveys and “cookies” are two tools used in this research. This information is helpful to companies
in supplying products and services to specific areas. This information is also collected through the use of
signing up for “discount cards”, Kmart, Alco and many grocery stores now use these. Completing
information for online giveaways or contests and even filling out warranty cards are methods of collecting
data about a consumer.
Some “Cookies” collect information on what web sites you click on. Before there were programs developed
that allowed for blocking or accepting of cookies, if you clicked on a web site about baskets, within a short
period of time, your email would be inundated with links to all kinds of sites that remotely included
something about a basket.
In the late 1990s, electronic commerce was still emerging as a new way to do business; at that time, most
companies were doing very little buying or selling online. They still were selling products in physical stores
or taking orders over the telephone and by mail. However, a few companies had established solid footholds
online. Amazon.com was a rapidly growing bookseller and eBay had taken the lead as a profitable auction
site. The business of providing search tools for finding information online was dominated by a few well-
established sites, including AltaVista, HotBot, Lycos, and Yahoo!. Most industry observers at that time
believed that any new search engine Web site would find it very difficult to compete against these
established operations.
In this chapter we will look at:
What electronic commerce is and how it has evolved into a second wave of growth
Why companies concentrate on revenue models and the analysis of business processes instead of
business models when they undertake electronic commerce initiatives
How economic forces have created a business environment that is fostering the continued growth of
electronic commerce
How businesses use value chains and SWOT analysis to identify electronic commerce opportunities
The international nature of electronic commerce and the challenges that arise in engaging in electronic
commerce on a global scale
Electronic Commerce: Into the Third Wave
This section, definse electronic commerce and describes its evolution from the first wave into the second
wave and outlines prospects for movement into a third wave of development.
Electronic Commerce and Electronic Business
There are some terms that you should know, electronic commerce (e-commerce), electronic business (e-
business), and dot-com/pure dot com.
There are five general electronic commerce categories: business-to-consumer, business-to-business, business
processes, consumer-to-consumer, and business-to-government. Figure 1-1on page 7 presents a rough
approximation of the relative sizes of the three main categories of electronic commerce.
Figure 1-20 on page 8 provides a summary of the five main categories of electronic commerce.
More terms you should know include: supply management/procurement, e-procurement, activity,
transaction, business processes, and telecommuting/telework.
The Internet has changed the way people buy, sell, hire, and organize business activities in more ways and
more rapidly than any other technology in the history of business.
There was a time in the not so long ago past when it was “rumored that eventually “paper” money would
become obsolete. That everyone would have a card instead. When you had money in an account, you could
buy things with the card, no money, no purchase. Pay would be automatically deposited. Many scoffed at
this possibility. Now this is pretty much a reality. Although paper money hasn’t disappeared all-together,
things are moving that way.
Customers were better off to drive to the store and purchase the dog food and not pay the shipping.
A couple of the biggest money makers on the internet today include: the sale of information and the sale of
advertising.
Research companies collect and sell information on the demographics of consumers and their purchasing
habits. Surveys and “cookies” are two tools used in this research. This information is helpful to companies
in supplying products and services to specific areas. This information is also collected through the use of
signing up for “discount cards”, Kmart, Alco and many grocery stores now use these. Completing
information for online giveaways or contests and even filling out warranty cards are methods of collecting
data about a consumer.
Some “Cookies” collect information on what web sites you click on. Before there were programs developed
that allowed for blocking or accepting of cookies, if you clicked on a web site about baskets, within a short
period of time, your email would be inundated with links to all kinds of sites that remotely included
something about a basket.
In the late 1990s, electronic commerce was still emerging as a new way to do business; at that time, most
companies were doing very little buying or selling online. They still were selling products in physical stores
or taking orders over the telephone and by mail. However, a few companies had established solid footholds
online. Amazon.com was a rapidly growing bookseller and eBay had taken the lead as a profitable auction
site. The business of providing search tools for finding information online was dominated by a few well-
established sites, including AltaVista, HotBot, Lycos, and Yahoo!. Most industry observers at that time
believed that any new search engine Web site would find it very difficult to compete against these
established operations.
In this chapter we will look at:
What electronic commerce is and how it has evolved into a second wave of growth
Why companies concentrate on revenue models and the analysis of business processes instead of
business models when they undertake electronic commerce initiatives
How economic forces have created a business environment that is fostering the continued growth of
electronic commerce
How businesses use value chains and SWOT analysis to identify electronic commerce opportunities
The international nature of electronic commerce and the challenges that arise in engaging in electronic
commerce on a global scale
Electronic Commerce: Into the Third Wave
This section, definse electronic commerce and describes its evolution from the first wave into the second
wave and outlines prospects for movement into a third wave of development.
Electronic Commerce and Electronic Business
There are some terms that you should know, electronic commerce (e-commerce), electronic business (e-
business), and dot-com/pure dot com.
There are five general electronic commerce categories: business-to-consumer, business-to-business, business
processes, consumer-to-consumer, and business-to-government. Figure 1-1on page 7 presents a rough
approximation of the relative sizes of the three main categories of electronic commerce.
Figure 1-20 on page 8 provides a summary of the five main categories of electronic commerce.
More terms you should know include: supply management/procurement, e-procurement, activity,
transaction, business processes, and telecommuting/telework.
The Internet has changed the way people buy, sell, hire, and organize business activities in more ways and
more rapidly than any other technology in the history of business.
There was a time in the not so long ago past when it was “rumored that eventually “paper” money would
become obsolete. That everyone would have a card instead. When you had money in an account, you could
buy things with the card, no money, no purchase. Pay would be automatically deposited. Many scoffed at
this possibility. Now this is pretty much a reality. Although paper money hasn’t disappeared all-together,
things are moving that way.
