Copyright © 2010 Pearson Education, Inc.Copyright © 2007 Pearson Education, Inc. Slide 1-1 ELC 200...

Copyright © 2010 Pearson Education, Inc.Copyright © 2007 Pearson Education, Inc. Slide 1-1

ELC 200Day 2

Agenda Questions? Blackboard overview Textbook rental

http://www.chegg.com/details/e-commerce-2010/0136100570/?omre_ir=1&omre_sp=laudon&omre_rn=2

The Revolution Is Just Beginning Assignment 1 posted

Due Monday, September 10 @11:05 PM assignment1.pdf

Copyright © 2010 Pearson Education, Inc.

E-commerce

Kenneth C. LaudonCarol Guercio Traver

business. technology. society.Sixth Edition

Copyright © 2010 Pearson Education, Inc.Copyright © 2007 Pearson Education, Inc. Slide 1-4

Chapter 1The Revolution Is Just Beginning

Teaching objectives Define e-commerce and describe how it differs from e-business. Identify and describe the unique features of e-commerce technology and

discuss their business significance. Recognize and describe Web 2.0 applications. Describe the major types of e-commerce. Discuss the origins and growth of e-commerce. Explain the evolution of e-commerce from its early years to today. Identify the factors that will define the next five years of e-commerce. Describe the major themes underlying the study of e-commerce. Identify the major academic disciplines contributing to e-commerce.

Copyright © 2010 Pearson Education, Inc. Slide 1-5


E-commerce Trends 2009–2010

New business models based on social technologies, consumer-generated content, and services

2009 a flat year, but growth expected to resume in 2010

Broadband and wireless access continue to grow

Mobile e-commerce begins to take off

Traditional media losing subscribers

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The First 30 Seconds First 15 years of e-commerce

Just the beginningRapid growth and change

Technologies continue to evolve at exponential ratesDisruptive business change

Discontinuous innovationNew opportunities

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What is E-commerce? Use of Internet and Web to transact

business More formally:

Digitally enabled commercial transactions between and among organizations and individuals

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E-commerce vs. E-business E-business:

Digital enablement of transactions and processes within a firm, involving information systems under firm’s control

Does not include commercial transactions involving an exchange of value across organizational boundaries

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Why Study E-commerce? E-commerce technology is different, more powerful

than previous technologies

E-commerce bringing fundamental changes to commerce

Traditional commerce: Passive consumer Sales-force driven Fixed prices Information asymmetry Example: buying cars in the 1990’s

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Unique Features of E-commerce Technology

1. Ubiquity 2. Global reach (except interior Africa and parts of Asia)3. Universal standards 4. Information richness 5. Interactivity 6. Information density7. Personalization/customization8. Social technology

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Web 2.0 Applications, technologies that allow users

to: Create and share content, preferences, bookmarks, and

online personas Participate in virtual lives Build online communities

Examples YouTube, Photobucket, Flickr, Google, iPhone MySpace, Facebook, LinkedIn Second Life Wikipedia

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Types of E-commerce Classified by market relationship

Business-to-Consumer (B2C) Business-to-Business (B2B) Consumer-to-Consumer (C2C)

Classified by technology used Peer-to-Peer (P2P) Mobile commerce (M-commerce)

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The Web Most popular Internet service Developed in early 1990s

http://www.w3.org/History.html

Provides access to Web pages HTML documents that may include text, graphics,

animations, music, videos Web content has grown exponentially

2 billion Web pages in 2000 At least 40–50 billion pages today

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The Internet Worldwide network of computer networks built

on common standards

Created in late 1960s

Services include the Web, e-mail, file transfers, etc.

Can measure growth by looking at number of Internet hosts with domain names

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The Growth of the Internet, Measured by Number of Internet Hosts with Domain Names

Figure 1.3, Page 23

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SOURCE: Internet Systems Consortium, Inc., 2009.


Insight on Technology: Spider Webs, Bow Ties, Scale-Free

Networks, and the Deep WebClass Discussion

What is the “small world” theory of the Web?

six degrees of separation

What is the significance of the “bow-tie” form of the Web?

Why does Barabasi call the Web a “scale-free network” with “very connected super nodes”?

Slide 1-19


http://onlinepress.us/seo-landing-pages/

http://www.eoearth.org/article/Complex_systems

http://www.estudiolivre.org/tiki-index.php?page=SistemaVizster

http://bigpicture.typepad.com/writing/2006/11/what_does_the_i.html


Origins & Growth of E-commerce Precursors:

Baxter Healthcare Electronic Data Interchange (EDI) French Minitel (1980s videotext system) None had functionality of Internet

1995: Beginning of e-commerce First sales of banner advertisements

Since then, e-commerce fastest growing form of commerce in the United States

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The Growth of B2C E-commerceFigure 1.4, Page 25

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SOURCES: eMarketer, Inc., 2009a; U.S. Census Bureau, 2009b; authors’ estimates.


The Growth of B2B E-commerceFigure 1.5, Page 28

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SOURCES: U.S. Census Bureau, 2009a; authors’ estimates.


Technology and E-commerce in Perspective

The Internet and Web: Just two of a long list of technologies that have greatly changed commerce Automobiles Radio

TV

E-commerce growth will eventually cap as it confronts its own fundamental limitations.

Slide 1-24


Potential Limitations on the Growth of B2C E-commerce

Expensive technology

Sophisticated skill set

Persistent cultural attraction of physical markets and traditional shopping experiences

Persistent global inequality limiting access to telephones and computers Digital Divide

Saturation and ceiling effects

Slide 1-25


E-commerce: A Brief History 1995–2000: Innovation

Key concepts developed Dot-coms; heavy venture capital investment

2001–2006: Consolidation Emphasis on business-driven approach

2006–Present: Reinvention Extension of technologies New models based on user-generated content, social

networking, services

Slide 1-26


Early Visions of E-commerce Computer scientists:

Inexpensive, universal communications and computing environment accessible by all

Economists: Nearly perfect competitive market and friction-free

commerce Lowered search costs, disintermediation, price

transparency, elimination of unfair competitive advantage Entrepreneurs:

Extraordinary opportunity to earn far above normal returns on investment—first mover advantage

Slide 1-27


Insight on BusinessThe Internet Investment Rollercoaster

Class Discussion What explains the rapid growth in private investment in

e-commerce firms in the period 1998–2000? Was this investment irrational?

What was the effect of the big bust of March 2000 on e-commerce investment?

What is the value to investors of a company such as YouTube which has yet to show profitability?

Why do you think investors today would be interested in investing in or purchasing e-commerce companies? Would you invest in an e-commerce company today?

Slide 1-28


Assessing E-commerce Many early visions not fulfilled

Friction-free commerce Consumers less price sensitive Considerable price dispersion

Perfect competition Information asymmetries persist

DisintermediationFirst mover advantage

Fast-followers often overtake first movers

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Predictions for the Future Technology will propagate through all commercial activity Prices will rise to cover the real cost of doing business E-commerce margins and profits will rise to levels more

typical of all retailers Cast of players will change

Traditional Fortune 500 companies will play dominant role New startup ventures will emerge with new products, services

Number of successful pure online stores will remain smaller than integrated offline/online stores

Growth of regulatory activity worldwide Influence of cost of energy

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Understanding E-commerce: Organizing Themes

Technology: Development and mastery of digital computing and

communications technology

Business: New technologies present businesses with new ways of

organizing production and transacting business

Society: Intellectual property, individual privacy, public welfare

policy

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The Internet and the Evolution of Corporate

Computing

Figure 1.9, Page 44

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Insight on SocietyPrivacy Online: Does Anybody

Care?Class Discussion

What techniques of privacy invasion are described in the case?

Which of these techniques is the most privacy-invading? Why?

Is e-commerce any different than traditional markets with respect to privacy? Don’t merchants always want to know their customer?

How do you protect your privacy on the Web?

Slide 1-33


Academic Disciplines Concerned with E-commerce

Technical approach Computer science Management science Information systems

Behavioral approach Information systems Economics Marketing Management Finance/accounting Sociology

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Copyright © 2010 Pearson Education, Inc.Copyright © 2007 Pearson Education, Inc. Slide 1-1 ELC 200...

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