Download Business Plug-In B11

Business Plug-In B11
E-Business
McGraw-Hill/Irwin
© 2008 The McGraw-Hill Companies, All Rights Reserved
LEARNING OUTCOMES
1. Describe the four common tools an
organization can use to access Internet
information
2. Compare ISPs, OSPs, and ASPs. Be sure to
include an overview of common services
provided by each
3. Describe how marketing, sales, financial
services, and customer service departments
can use e-business to increase revenues or
reduce costs
B11-2
LEARNING OUTCOMES
4. Explain why an organization would use metrics
to determine a Web site’s success
5. Identify the different types of e-government
business models
6. Define m-commerce and explain how an egovernment could use it to increase its efficiency
and effectiveness
B11-3
INTRODUCTION
•
Pure play – an Internet retailer that has no physical
store, such as Expedia.com and Amazon.com
•
E-business – conducting business on the Internet, not
only buying and selling, but also serving customers and
collaborating with business partners
•
E-business model – an approach to conducting
electronic business through which a company can
become a profitable business on the Internet
B11-4
Accessing Internet Information
•
Four tools for accessing Internet
information
1. Intranet – internalized portion of the Internet,
protected from outside access, for employees
2. Extranet – an intranet that is available to
strategic allies
3. Portal – Web site that offers a broad array of
resources and services
4. Kiosk – publicly accessible computer system
that allows interactive information browsing B11-5
Providing Internet Information
•
Three common forms of service
providers
1. Internet service provider (ISP) –provides
individuals and other companies access to
the Internet
2. Online service provider (OSP) – offers an
extensive array of unique Web services
3. Application service provider (ASP) –
offers access over the Internet to systems
and related services that would otherwise
have to be located in organizational
B11-6
computers
Providing Internet Information
• Common ISP services include:
– Web hosting
– Hard-disk storage space
– Availability
– Support
B11-7
Providing Internet Information
Wireless Internet service provider (WISP)
B11-8
Providing Internet Information
• ISPs, OSPs, and ASPs use service level
agreements (SLA) which define the
specific responsibilities of the service
provider and set the customer
expectations
• Review Figure B11.3 for a listing of the
top ISPs, OSPs, and ASPs
B11-9
Organizational Strategies for
E-Business
• Primary business areas taking advantage
of e-business include:
– Marketing/sales
– Financial services
– Procurement
– Customer service
– Intermediaries
B11-10
MARKETING/SALES
• Generating revenue on the Internet:
– Online ad (banner ad) - box running across a Web
page that contains advertisements
– Pop-up ad - a small Web page containing an
advertisement
– Associate programs (affiliate programs) - businesses
generate commissions or royalties
– Viral marketing - a technique that induces Web sites or
users to pass on a marketing message
– Mass customization - gives customers the opportunity
to tailor products or services
B11-11
MARKETING/SALES
• Generating revenue on the Internet:
– Personalization - occurs when a Web site can fashion
offers that are more likely to appeal to that person
– Blog - Web site in which items are posted on a regular
basis and displayed in reverse chronological order
– Real simple syndications (RSS) - a Web feed format
used for Web syndication of content
– Podcasting - the distribution of audio or video files,
such as radio programs or music videos, over the
Internet to play on mobile devices
B11-12
MARKETING/SALES
• Generating revenue on the Internet:
– Search engine optimization (SEO) - a set of
methods aimed at improving the ranking of a Web
site in search engine listings
– Spamdexing - uses a variety of deceptive
techniques in an attempt to manipulate search
engine rankings, whereas legitimate SEO focuses on
building better sites and using honest methods of
promotion
B11-13
FINANCIAL SERVICES
• Online consumer payments include:
– Financial cybermediary
– Electronic check
– Electronic bill presentment and payment (EBPP)
– Digital wallet
B11-14
FINANCIAL SERVICES
• Online business payments include:
– Electronic data interchange (EDI)
• Value-added network (VAN)
– Financial EDI (financial electronic data
interchange)
B11-15
FINANCIAL SERVICES
Electronic Trading Network
B11-16
PROCURMENT
• Maintenance, repair, and operations (MRO)
materials (also called indirect materials) –
materials necessary for running an organization
but do not relate to the company’s primary
business activities
– E-procurement - the B2B purchase and sale of
supplies and services over the Internet
– Electronic catalog - presents customers with
information about goods and services offered for
sale, bid, or auction on the Internet
B11-17
CUSTOMER SERVICE
• Customer service is the business process
where the most human contact occurs between
a buyer and a seller
• e-business strategists are finding that customer
service via the Web is one of the most
challenging and potentially lucrative areas of ebusiness
• The primary issue facing customer service
departments using e-business is consumer
protection
B11-18
Consumer Protection
B11-19
Consumer Protection
• E-business security
– Encryption
– Secure socket layer (SSL)
– Secure electronic transaction (SET)
B11-20
INTERMEDIARIES
• Intermediaries – agents, software, or
businesses that bring buyers and sellers
together that provide a trading
infrastructure to enhance e-business
• Reintermediation – using the Internet to
reassemble buyers, sellers, and other
partners in a traditional supply chain in
new ways
B11-21
Measuring E-Business Success
• Most companies measure the traffic on a Web
site as the primary determinant of the Web site’s
success
• However, a large amount of Web site traffic
does not necessarily equate to large sales
• Many organizations with high Web site traffic
have low sales volumes
B11-22
Measuring E-Business Success
• Web site traffic analysis can include:
– Cookie
– Click-through
– Banner ad
– Interactivity
B11-23
Behavioral Metrics
• Clickstream data tracks the exact pattern of a
consumer’s navigation through a Web site
• Clickstream data can reveal:
–
–
–
–
–
–
Number of pageviews
Pattern of Web sites visited
Length of stay on a Web site
Date and time visited
Number of customers with shopping carts
Number of abandoned shopping carts
B11-24
Behavioral Metrics
• Web site metrics include
– Visitor metrics
– Exposure metrics
– Visit metrics
– Hit metrics
B11-25
New Trends in E-Business:
E-Government and M-Commerce
• E-government - involves the use of
strategies and technologies to transform
government(s) by improving the delivery
of services and enhancing the quality of
interaction between the citizen-consumer
within all branches of government
B11-26
New Trends in E-Business:
E-Government and M-Commerce
B11-27
New Trends in E-Business:
E-Government and M-Commerce
• Mobile commerce the ability to purchase
goods and services
through a wireless
Internet-enabled
device.
B11-28
Closing Case One
Mail with PostalOne
• United States Postal Service’s (USPS)
productivity has grown by only 11 percent
over the past three decades
• USPS is pursuing several e-business
projects to help increase growth including:
– NetPost Mailing Online
– Post Electronic Courier Service
– NetPost.Certified
– EBillPay
B11-29
Closing Case One Questions
1. Do you think the USPS’s steps are farreaching enough to ensure its relevance in ebusiness?
2. What other strategic alliances, akin to its
partnership with CheckFree, can the Postal
Service develop to stay competitive?
3. Why would the USPS compete in a market
that private companies already serve well?
B11-30
Closing Case One Questions
4. How can the USPS use portals to help grow
its business?
5. How can the USPS use e-business sales and
marketing techniques such as blogs,
podcasts, and SEO to improve its business?
6. How can the USPS use ASPs to improve its
business?
B11-31
CLOSING CASE TWO
Made-To-Order Businesses
•
Mass customization is a new trend in the retail
business
•
Lands’ End, Nike, and Stamps.com are a few
of the companies using mass customization to
enhance the way they do business
B11-32
Closing Case Two Questions
1. What role does e-business play in a
mass customization business strategy?
2. How can Lands’ End use additional
sales and marketing e-business
techniques to improve its business?
3. How can Nike use e-business financial
services to improve its business?
B11-33
Closing Case Two Questions
4. How can Stamps.com use ASPs and electronic
bill payment to improve its business?
5. Choose one of the examples above and analyze
its e-business approach. Would you invest
$20,000 in the company?
6. Choose one of the examples above and explain
how the company is attempting to gain a
competitive advantage with mass customization
and personalization. How could this company
use podcasts, blogs, and SEO to improve its
business?
B11-34