Agenda
1. 2. 3. 4. E-marketplaces and their components. The role of intermediaries. The major types of e-marketplaces. Electronic catalogs, search engines, and shopping carts. 5. Types of auctions and their characteristics.
Agenda
6. The benefits and limitations of auctions. 7. Bartering and negotiating. 8. The role of m-commerce. 9. Competition in the digital economy. 10. The impact of e-markets on organizations.
E-Marketplaces
Markets (electronic or otherwise) have three main functions:
1. Matching buyers and sellers; 2. Facilitating the exchange of information, goods, services, and payments associated with market transactions; and 3. Providing an institutional infrastructure, such as a legal and regulatory framework, which enables the efficient functioning of the market.
E-Marketplaces
Electronic marketplaces (e-marketplaces or marketspaces), changed several of the processes used in trading and supply chains
Greater information richness Lower information search costs for buyers Diminished information asymmetry between sellers and buyers Ability of buyers and sellers to be in different locations
E-Marketplaces
e-marketspace
A marketplace in which sellers and buyers exchange goods and services for money (or for other goods and services), but do so electronically
infomediaries
Electronic intermediaries that control information flow in cyberspace, often aggregating information and selling it to others E.g., http://www.abebooks.com
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E-Marketplaces
Marketspace components
Customers Sellers Products and services digital products Goods that can be transformed into digital format and delivered over the Internet Infrastructure
E-Marketplaces
Marketspace components
front end The portion of an e-sellers business processes through which customers interact, including the sellers portal, electronic catalogs, a shopping cart, a search engine, and a payment gateway back end The activities that support online order-taking. It includes fulfillment, inventory management, purchasing from suppliers, payment processing, packaging, and delivery
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Types of E-Marketplaces
Electronic Storefronts
storefront A single companys Web site where products or services are sold
Types of E-Marketplaces
e-mall (online mall)
An online shopping center where many online stores are located
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Intermediation in EC
infomediaries
Electronic intermediaries that control information flow in cyberspace, often aggregating information and selling it to others
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Intermediation in EC
disintermediation
Elimination of intermediaries between sellers and buyers
reintermediation
Establishment of new intermediary roles for traditional intermediaries that have been disintermediated
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Intermediation in EC
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Market Mechanisms
Electronic catalogs Search engines Software (intelligent) agents Electronic shopping cart Auctions
Forward Backward
Issues to consider:
1. 2. 3. 4. 5. Interactivity The degree of customization Integration with business processes Search capabilities Ease of updating
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Let the customers identify the parts of interest to them from the total catalog Let the system automatically identify customer characteristics based on the customers transaction records
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auction
A competitive process in which a seller solicits consecutive bids from buyers (forward auctions) or a buyer solicits bids from sellers (backward auctions). Prices are determined dynamically by the bids
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dynamic pricing
Prices that change based on supply and demand relationships at any given time
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bartering exchange
A marketplace in which an intermediary arranges barter transactions
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m-business
The broadest definition of m-commerce, in which e-business is conducted in a wireless environment
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Redefining Organizations
New and improved product capabilities New business models Improving the supply chain Impacts on Manufacturing
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Managerial Issues
1. What about intermediaries?
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Managerial Issues
1. What about intermediaries?
Their role will be changed Some old ones will disappear and new ones emerge In most cases, distributors will have to change their roles Market and industry trends analysis is required
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Managerial Issues
2. Should my company auction?
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Managerial Issues
2. Should my company auction? Pros
an extra channel
Cons
Fraud New pricing models New technologies New procedures Other support services
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Managerial Issues
3. How do we compete in the digital economy?
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Managerial Issues
3. How do we compete in the digital economy? The basic principles of competition theories are the same The competition rules are different Compete with both old- and new-economy companies Fast pace of changes and the impact of new business models developed by competitors may be devastating The competition of business models not businesses
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Managerial Issues
4. What organizational changes will be needed?
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Managerial Issues
4. What organizational changes will be needed? System integration ERP systems even for SMEs The role of networking Organizational change e-culture
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Class 2
Retailing in Electronic Commerce: Products and Services
Agenda
1. 2. 3. 4. 5. 6. 7. 8. 9. The scope of e-tailing. E-tailing business models. How online travel/tourism services operate. The online job market and its benefits. The electronic real estate market. Online trading of stocks and bonds. Cyberbanking and personal finance. Critical success factors. Disintermediation and reintermediation.
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Amazon and the U.S. Patent and Trade Office were often criticized by independent software designers for issuing this patent
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Sellers can understand their markets better because of the direct connection to consumers Consumers gain greater information about the products through their direct connection to the manufacturers
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click-and-mortar retailers
Brick-and-mortar retailers that offer a transactional Web site from which to conduct business
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Benefits to providers
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grocerygateway.com
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Managerial Issues
1. What should our e-tailing strategic position be?
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Managerial Issues
1. What should our e-tailing strategic position be? Overall strategic position What niche are we in? What business functions can we execute internally and what should we outsource? Partners? Fixed and marginal costs? Channel cannibalization
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Managerial Issues
2. How will intermediaries act in cyberspace?
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Managerial Issues
2. How will infomediaries act in cyberspace? Still hard to say The role of the Internet and eBusiness will stabilize over time Look at researchers predictions
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