m-commerce basics script final version pdf -...

MODULEBasics

This project has been funded with support from the European Commission.

This publication [communication] reflects the views only of the author, and the Commission cannot be held responsible for any use which may be made of the information contained therein.

FHJOAN

NEUM

Project m-commerce module: „Basics“

2

Table of content 1. Summary.......................................................................................................................................4 2. Introduction..................................................................................................................................5 3. Objectivesofthemodule..............................................................................................................6 4. Theory...........................................................................................................................................7 4.1. TheEvolutionoftheInternet................................................................................................7 4.2. WhogovernstheInternet?...................................................................................................8 4.3. WhatisE-Commerce?.........................................................................................................10 4.4. OriginofE-Commerce.........................................................................................................10 4.5. ThePeriodsofDevelopmentofE-Commerce.....................................................................11 4.6. TheDifferencebetweenE-BusinessandE-Commerce.......................................................13 4.7. EightuniquefeaturesofE-Commercetechnology..............................................................14 4.8. MajortypesofE-Commerce................................................................................................17 4.9. SWOTanalysis.....................................................................................................................19 4.10. Fixedbroadbandpenetrationin2012.............................................................................20 4.11. Mobilebroadbandpenetrationin2012..........................................................................21 4.12. IndividualsaccessingtheInternetthroughamobilephonein2012..............................22 4.13. Searchenginesmarketshare..........................................................................................23 4.14. Grossdomesticproduct(GDP)........................................................................................24 4.15. GDPpercapita.................................................................................................................25 4.16. WhatisM-Commerce?....................................................................................................27 4.17. Websitevs.Webapp......................................................................................................28 4.17.1. Businessconsiderations..............................................................................................29 4.17.2. Developmentconsiderations......................................................................................30 4.17.3. Anat-a-glancecomparison..........................................................................................32

4.18. Onlineretail:advantagesandchallenges........................................................................34 4.19. TheLatestTrendsinE-CommerceandM-Commerce....................................................35 4.19.1. EmailhasmadetheswitchtoanM-Commercecommodity.......................................35 4.19.2. M-commercetotakemoreofpie...............................................................................36 4.19.3. WearabletechtostartmakinginroadsinM-Commerce...........................................36 4.19.4. FlatUIandmobileappstosynergizethisyear............................................................36 4.19.5. Data,dataandmoredata............................................................................................37

4.20. VariousCharts.................................................................................................................37 4.20.1. Individualswhohaveusedinternet............................................................................37 4.20.2. Individualsinteractingonlinewithpublicauthorities.................................................38 4.20.3. Computersforeducationalpurposes..........................................................................38


3

5. Application(examples,workingtasks,etc.)................................................................................40 5.1. Onlinepaymentmarketplace–PayPal,Verizon,Google,Apple,etc..................................40 5.2. eBay–Evolves.....................................................................................................................40 5.3. Inventory.............................................................................................................................41

6. Sourcedirectory..........................................................................................................................42 7. Internetlinks...............................................................................................................................43


4

1. Summary

• EvolutionoftheInternet

• DescribethepotentialcapabilitiesoftheInternetofthefuture

• DefineE-CommerceanddescribehowitdiffersfromE-Business

• UnderstandtheevolutionofE-Commercefromitsearlyyearstotoday

• DevelopmentofE-Commerce

• IdentifyanddescribetheuniquefeaturesofE-Commercetechnologyanddiscusstheirbusinesssignificance

• DescribethemajortypesofE-Commerce

• Understandthequestionyoumustaskandanswer,andthestepsyoushouldtake,indevelopinganE-Commerce(SWOT)

• Fixedandmobilebroadbandpenetrationin2012

• Definegrossdomesticproduct(GDP)anddescribehowitdiffersfromGDPpercapita

• WhatisM-Commerce

• BusinessanddevelopmentconsiderationsofWebsiteversusWebapp

• Understandtheadvantagesandchallengesofonlineretailfromphysicalgoods

• TheLatestTrendsinE-CommerceandM-Commerce

• VariouschartsabouthavingandusingtheInternet,searchingandsellinggoods,interactingonlinewithpublicauthorities,enterprisesusingsocialmedia,andcomputersforeducationalpurposes.


5

2. Introduction

The Internet has evolved from a collection of mainframe computers located on a

few U.S. college campuses to an interconnected network of thousands of networks

and millions of computers worldwide. One of the main structural elements of the

Internet are governing bodies, such as LAB, ICANN, IESG, IETF, ISOC, and W3C.

Although they do not control the Internet, they have influence over it and monitor

its operations.

The Development of E-Commerce has gone through three stages from its early

years to today. It is important to know the difference between E-Business and E-

Commerce. There are eight unique features of E-Commerce technology and five

major types of E-Commerce.

After analysed the strengths, opportunities, threats, and weakness of the business

you will be able to conduct a SWOT analysis and find ways to overcome your

weakness.

The international compare between fixed and mobile broadband leads to accessing

the Internet through a mobile phone. A chart about search engines show the

absolutely superior power of Google.

GDP, and thus GDP per capita, provides a measure of the total economic activity

in a region. It may be used to compare the degree of economic development of

regions. A very interesting statistic about regional GDP in the European Union can

be found here1.

M-Commerce is part of E-Commerce. Companies think about their mobile

strategy and the mobile experience that helps define their brand. These business

and development considerations about Web site versus Web app can help to make

a decision.

A few of the initial assumptions about the future of online retail were correct.

Online consumers are not primarily cost-driven. Online retailers have many

1(http://ec.europa.eu/eurostat/documents/2995521/6839731/1-21052015-AP-EN.pdf/c3f5f43b-397c-40fd-a0a4-7e68e3bea8cd)


6

advantages and challenges to save costs and ensure the Web as the dominant

market place.

Talking about some of the market predictions and concepts bringing up ideas and

produce latest trends in E-Commerce and M-Commerce with top tips to stay

ahead of the pack.

Finally, different charts shows the usage of the Internet for private reasons,

education, and enterprises.

3. Objectives of the module

This module introduces to the basics of business models and electronic commerce.

It focuses on the role of smart devices for planning and designing an electronic or

mobile business model. The aim of this module is teaching how to plan, organize

and calculate such models and how to integrate mobile solutions in hybrid

business models.

The learner should know principles and definitions of a value added chain, digital

markets, and digital business processes.

The learner should know different E-Commerce models.

The learner should work on a mobile business strategy for the own company.


7

4. Theory

4.1. The Evolution of the Internet

ThehistoryoftheInternetcanbesegmentedintothreephases(seefigure1).

In the first phase, the Innovation Phase, the fundamental building blocks of the Internet wereconceptualized and then realized in actual hardware and software. The basic building blocks arepacket-switchinghardware,acommunicationsprotocolcalledTCP/IP,andclient/servercomputing.Theoriginalpurposewastolinklargemainframecomputersondifferentcollegecampuses.Inthesecondphase,theInstitutionalizationPhase,largeinstitutionssuchastheU.S.DepartmentofDefencespentmuchmoneytofurtherdevelopthemintoarobustmilitarycommunicationssystemthat couldwithstand nuclear war. This effort createdwhat was then called ARPANET (AdvancedResearchProjectsAgencyNetwork).TheNationalScienceFoundationassumedresponsibilityforthedevelopment of a civilian Internet called NSFNET (in 1986) and began a 10-year-long expansionprogram.In the third phase, the Commercialization Phase, government agencies encouraged privatecorporationstotakeoverandexpandboththeInternetbackboneandlocalservicetoordinarycitizens–familiesandindividualsacrosstheworld.2

2(LaudonKennethC.,2014)p100.

Figure1


8

4.2. Who governs the Internet?

InternetCorporationforAssignedNamesandNumbers ICANN

InternetAssignedNumbersAuthority IANA

InternetEngineeringTaskForce IETF

InternetResearchTaskForce IRTF

InternetEngineeringSteeringGroup IESG

InternetArchitectureBoard IAB

InternetSociety ISOC

InternetGovernanceForum IGF

WorldWideWebConsortium W3C

InternetNetworkOperationsGroups NOGsAficionadosandjournalistsoftenclaimthattheInternetisgovernedbynoone,andindeedcannotbegoverned,andthatitisinherentlyaboveandbeyondthelaw.WhatthesepeopleforgetisthattheInternetrunsoverprivateandpublictelecommunicationsfacilitiesthatarethemselvesgovernedbylaws,andsubjecttothesamepressuresasalltelecommunicationscarriers.Thereareanumberoforganizationsthatinfluencethesystemandmonitoritsoperations.Ø InternetCorporationforAssignedNamesandNumbers(ICANN):WhichcoordinatestheInternet’ssystemofuniqueidentifiers:IPaddresses,protocolparameterregistries,andthetop-leveldomainssystems.ICANNwascreatedin1998bytheU.S.DepartmentofCommerce.Ø InternetAssignedNumbersAuthority(IANA):isadepartmentofICANNresponsibleforcoordinatingsomeofthekeyelementsthatkeeptheInternetrunningsmoothly.

ü DomainNamesIANAmanagestheDNSRoot,the.intand.arpadomains,andanIDNpracticesresource.

ü NumberResourcesIANAcoordinatestheglobalpoolofIPandASnumbers,providingthemtoRegionalInternetRegistries.

ü ProtocolAssignmentsInternetprotocols’numberingsystemsaremanagedbyIANAinconjunctionwithstandardsbodies3.Ø InternetEngineeringTaskForce(IETF):

3(http://www.iana.org/about).


9

Whichisanopeninternationalcommunityofnetworkoperators,vendors,andresearchersconcernedwiththeevolutionoftheInternetarchitectureandoperationoftheInternet.TheIETFhasanumberofworkinggroups,organizedintoseveraldifferentareas,thatdevelopandpromoteInternetstandards,whichinfluencethewaypeopleuseandmanagetheInternetØ InternetResearchTaskForce(IRTF):WhichfocusesontheevolutionoftheInternet.TheIRTFhasanumberoflong-termresearchgroupsworkingonvarioustopicssuchasInternetprotocols,applications,andtechnology.Ø InternetEngineeringSteeringGroup(IESG):WhichisresponsiblefortechnicalmanagementofIETFactivitiesandtheInternetstandardsprocess.

Ø InternetArchitectureBoard(IAB): whichhelpsdefinetheoverallarchitectureoftheInternetandoverseestheIETFandIRTF.Ø InternetSociety(ISOC):Whichisaconsortiumofcorporations,governmentagencies,andnon-profitorganizationsthatmonitorstheInternetpoliciesandpractices.Ø InternetGovernanceForum(IGF):Whichisamulti-stakeholderopenforumfordebateonissuesrelatedtoInternetgovernanceØ WorldWideWebConsortium(W3C):WhichisalargelyacademicgroupthatsetsHTMLandotherprogrammingstandardsfortheWeb.Ø InternetNetworkOperationsGroups(NOGs):WhichareinformalgroupsthataremadeupofISPs(Internetserviceproviders),IXPs(Internetexchangepoints),andothersthatdiscussandattempttoinfluencemattersrelatedtoInternetoperationsandregulation.WhilenoneoftheseorganizationshasactualcontrolovertheInternetandhowitfunctions,theycananddoinfluencegovernmentagencies,majornetworkowners,ISPs,corporations,andsoftwaredeveloperswiththegoalofkeepingtheInternetoperatingasefficientlyaspossible.TheU.S.DepartmentofCommerceoriginallycreatedICANNwiththeintentthatittaketemporarycontroloftheDomainNameSystemandthe13rootserversthatareattheheartoftheInternetaddressingscheme.Inadditiontotheseprofessionalbodies,theInternetmustalsoconformtothelawsofthesovereignnation-statesinwhichitoperates,aswellasthetechnicalinfrastructuresthatexistwithineachnation-state.4

4(LaudonKennethC.,2014)p122f.


10

4.3. What is E-Commerce? E-CommerceistheuseofInternet,WorldWideWeb,andmobileappstotransactbusiness.Moreformally,digitallyenabledcommercialtransactionsbetweenandamongorganisationsandindividuals.Whyisitsoimportanttodefinetheterms?AlthoughthetermsofInternetandWeb(WWW)areoftenusedinterchangeably,theyareactuallytwoverydifferentthings.TheInternetisaworldwidenetworkofcomputernetworks.TheWebisoneoftheInternet´smostpopularservices,providingaccesstobillionsofWebpages.Anapp(short-handforapplication)isasoftwareapplicationtypicallyusedformobileapplications,althoughsometimesusedtorefertodesktopapplicationsaswell.5

4.4. Origin of E-Commerce ItisdifficulttopinpointjustwhenE-Commercebegan.• B2B:BaxterHealthcare

Inthelate1970’s,apharmaceuticalfirmnamedBaxterHealthcareinitiatedaprimitiveformofB2BE-Commercebyusingatelephone-basedmodemthatpermittedhospitalstoreordersuppliesfromBaxter.

• B2C:FranceTelecomThefirsttrulylarge-scaledigitallyenabledtransactionsystemintheB2CarenawasdeployedinFrancein1981.TheMinitelwasaFrenchvideotextsystemthatcombinedatelephonewithan8-inchscreen.Bythemid-1980s,morethan3millionMinitelsweredeployed,andmorethan13.000differentserviceswereavailable,includingticketagencies,travelservices,retailproducts,andonlinebanking.

NoneoftheseprecursorsystemshadthefunctionalityoftheInternet.• E-Commerce:firstbanneradvertisementsbyHotwired.com

WewillsayE-Commercebeginsin1995,followingtheappearanceofthefirstbanneradvertisementsplacedbyAT&T,Volvo,Sprint,andothersonHotwired.com,andthefirstsalesofbanneradspacebyNetscapeandinfoseekinearly1995.6

5(LaudonKennethC.,2014)p50.6(LaudonKennethC.,2014)p64.


11

4.5. The Periods of Development of E-Commerce

LiketheEvolutionoftheInternetthedevelopmentofE-Commerceconsistedalsoofthreeperiods(seefigure2).

Figure2source:Laudon,Traver:E-commerce2014,p.69

The first period, theperiodof Invention, characterizedof explosive growth and extraordinaryinnovation.E-Commercemeantadvertiseproducts, sellingquite simplegoodson the Internetbecause there simplywas not enough bandwidth formore complex products.MarketingwaslimitedtounsophisticatedstaticdisplayandlargefirmshadabasicstaticWebsitedepictingtheirbrands.ThisperiodofE-Commercecametoaclosein2000whenstockmarketvaluationsintheUSplunged,withthousandsofcompaniesdisappearing(„dotcomcrash“).7DuringthisperiodofConsolidation,E-Commercechangedtoincludemorecomplexservicessuchastravelandfinancialservices.Thiswasenabledbywidespreadadoptionofbroadbandnetworks.Marketingmeantusingsearchengineadvertisingtargetedtouserqueries,richmediaandvideoads.TheWebpresenceoffirmsexpandedtoincludenotjustWebsites,butalsoe-mail,display,multiple Web sites for each product, and the building of some limited community feedbackfacilities.Beginning in2007E-Commercehasbeentransformedyetagainby therapidgrowthofonlinesocial networks, widespread adoption of consumermobile devices such as smartphones andtablet computers, and the expansion of e-commerce to include local goods and services.Marketingistransformedbytheincreasinguseofsocialnetwork,word-of-mouth,viralmarketing,

7(LaudonKennethC.,2014)p69.


12

andmuchmorepowerfuldatarepositoriesandanalytictoolsfortrulypersonalmarketing.Firms´onlinepolicesexpandtoattempttobuildadigitalpresencethatsurroundstheonlineconsumerwithcoordinatedmarketingmessagesbasedontheirsocialnetworkmembership,useofsearchenginesandWebbrowsers,andeventheirpersonale-mail,messages,themobileplatform,andlocalcommerce.Thedefiningcharacteristicsofthisperiodoftencharacterizedasthe„social,mobile,local“onlineworld.8Table1summarizesE-Commerceineachofthisthreeperiods.9

Invention(1995–2000)

Consolidation(2001-2006) Re-Invention(2007–Present)

Technologydriven Businessdriven Mobiletechnologyenablessocial,local,andmobilecommerce

Revenuegrowthemphasis

Earningsandprofitsemphasis Audienceandsocialnetworkconnectionsemphasis

Venturecapitalfinancing

Traditionalfinancing SmallerVCinvestments;earlysmall-firmbuyoutsbylargeonlineplayers

Ungoverned Strongerregulationandgovernance

Extensivegovernmentsurveillance

Entrepreneurial Largetraditionalfirms Entrepreneurialsocialandlocalfirms

Disintermediation Strengtheningintermediaries Proliferationofsmallonlineintermediariesrentingbusinessprocessesoflargerfirms

Perfectmarkets Imperfectmarkets,brands,andnetworkeffects

Continuationofonlinemarketimperfections;commoditycompetitioninselectedmarkets

8(LaudonKennethC.,2014)p72.9(LaudonKennethC.,2014)p75.


13

Invention(1995–2000)

Consolidation(2001-2006) Re-Invention(2007–Present)

Pureonlinestrategies Mixed„bricks-and-clicks“strategies

Returnofpureonlinestrategiesinnewmarkets;extensionsofbricks-and-clicksintraditionalretailmarkets

First-moveradvantages Strategic-followerstrength;complementaryassets

First-moveradvantagesreturninnewmarketsastraditionalWebplayerscatchup

Low-complexityretailproducts

High-complexityretailproductsandservices

Retail,services,andcontent

Table1

4.6. The Difference between E-Business and E-Commerce

Itisimportanttomakeaworkingdistinctionbetweene-Commerceande-Businessbecausetheyrefertodifferentphenomens.E-CommerceisNOT“anythingdigital”thatafirmdoes.ThetermE-

Figure3 source:Laudon,Traver:E-commerce2014,Seite51


14

Businesswillusetoreferprimarilytothedigitalenablingoftransactionsandprocesseswithinafirm,involvinginformationsystemsunderthecontrolofthefirm.Forthemostpart,E-Businessdoesnotincludecommercialtransactionsinvolvinganexchangeofvalueacrossorganizationalboundaries.Forexample,acompany’sonlineinventorycontrolmechanismsareacomponentofE-Business,butsuchinternalprocessesdonotdirectlygeneraterevenueforthefirmfromoutsidebusinessesorconsumers,asE-Commerce,bydefinition,does.Itistrue,however,thatafirm’sE-BusinessinfrastructureprovidessupportforonlineE-Commerceexchanges;thesameinfrastructureandskillsetsareinvolvedinbothE-BusinessandE-Commerce.Theyblurtogetheratthebusinessfirmboundary,atthepointwhereinternalbusinesssystemslinkupwithsuppliersorcustomers(seefigure3).10

4.7. Eight unique features of E-Commerce technology

Figure4illustrateseightuniquefeaturesofE-Commercetechnologythatbothchallengetraditionalbusinessthinking


Figure4 Quelle:Laudon,Traver:E-commerce2014,Seite53


15

andexplainwhythereissomuchinterestinE-Commerce.ThisuniquedimensionsofE-Commercetechnologiessuggestmanynewpossibilitiesformarketingandselling–apowerfulsetofinteractive,personalized,andrichmessagesareavailablefordeliverytosegmented,targetedaudiences.E-Commercetechnologiesmakeitpossibleformerchantstoknowmuchmoreaboutconsumersandbeabletousethisinformationmoreeffectivelythanwasevertrueinthepast.Ø Ubiquity–marketplaceMarketplace:physicalspaceyouvisitinordertotransactUbiquity:availablejustabouteverywhere,atalltimes–resultiscalledamarketspaceMarketspace:marketplaceextendedbeyondtraditionalboundariesandremovedfromatemporalandgeographiclocationØ GlobalReachTheInternetmakesitmucheasierforstart-uponlinemerchantstoachieveanationalaudiencethanwaseverpossibleinthepast.ThetotalnumberofusersorcustomersanE-Commercebusinesscanobtainisameasureofitsreach.Ø UniversalstandardsOnestrikinglyunusualfeatureofE-CommercetechnologiesisthatthetechnicalstandardsoftheInternet,andthereforethetechnicalstandardsforconductingE-Commerce,areuniversalstandards–theyaresharedbyallnationsaroundtheworld.WithE-Commercetechnologiesitispossibletofindmanyofthesuppliers,prices,anddeliverytermsofaspecificproductanywhereintheworld,andtoviewtheminacoherentcomparativeenvironment.Althoughthisisnotnecessarilyrealistictodayforallorevenmanyproducts,itisapotentialthatwillbeexploitedinthefuture.Ø RichnessRichness:thecomplexityandcontentofamessageTherichnessenabledbytheInternetallowsretailandservicemerchantstomarketandsell“complex”goodsandservicesthatheretoforerequiredaface-to-facepresentationbyasalesforcetoamuchlargeraudience.Ø InteractivityInteractivity:technologythatallowsfortwo-waycommunicationbetweenmerchantandconsumerUnlikeanyofthecommercialtechnologiesofthetwentiethcentury,withthepossibleexceptionofthetelephone,E-Commercetechnologiesallowforinteractivity,meaningtheyenabletwo-waycommunicationbetweenmerchantandconsumerandamongconsumers.Thistechnologyallowsanonlinemerchanttoengageaconsumerinwayssimilartoaface-tofaceexperience.Ø Informationdensity


16

Informationdensity:thetotalamountandqualityofinformationavailabletoallmarketparticipantsE-Commercetechnologiesvastlyincreaseinformationdensity-thecurrency,accuracy,andtimelinessofinformation–makinginformationmoreusefulandimportantthanever.InE-Commercemarkets,pricesandcostsbecomemoretransparentforconsumers.Butonlinemerchantscandiscovermuchmoreaboutconsumers;thisallowsthemtosegmentthemarketintogroupsandpermitsthemtoengageinpricediscrimination–sellingthesamegoods,ornearlythesamegoods,todifferenttargetedgroupsatdifferentprices.Merchantsalsohaveenhancedabilitiestodifferentiatetheirproductsintermsofcosts,brand,andquality.Ø Personalization/CustomizationPersonalization:thetargetingofmarketingmessagestospecificindividualsbyadjustingthemessagetoaperson’sname,interests,andpastpurchases.Customization:changingthedeliveredproductorservicebasedonauser’spreferencesorpriorbehaviourGiventheinteractivenatureofE-Commercetechnology,muchinformationabouttheconsumercanbegatheredinthemarketplaceatthemomentofpurchase.Theresultisalevelofpersonalizationandcustomizationunthinkablewithtraditionalcommercetechnologies.Personalizationandcustomizationallowfirmstopreciselyidentifymarketsegmentsandadjusttheirmessagesaccordingly.Ø SocialtechnologySocialtechnology:allowinguserstocreateandsharecontentwithaworldwidecommunity.TheInternetandE-Commercetechnologieshavethepotentialtogivetheusersthepowertocreateanddistributecontentonalargescale,andpermituserstoprogramtheirowncontentconsumption.TheInternetprovidesaunique,many-to-manymodelofmasscommunication.11



17

4.8. Major types of E-Commerce

Ø Business-to-consumer(B2C)E-CommerceBusiness-to-consumer(B2C)E-Commerce:onlinebusinesssellingtoindividualconsumersThemostcommonlydiscussedtypeofE-Commerceisbusiness-to-consumer(B2C)E-Commerce,inwhichonlinebusinessesattempttoreachindividualconsumers.WithintheB2Ccategory,therearemanydifferenttypesofbusinessmodels:portals,onlineretailers,contentproviders,transactionbrokers,marketcreators,serviceproviders,andcommunityproviders.

Ø Business-to-business(B2B)E-CommerceBusiness-to-business(B2B)E-Commerce:onlinebusinessessellingtootherbusinessesBusiness-to-businessE-Commerce,inwhichbusinessesfocusonsellingtootherbusinessesisthelargestformofE-Commerce.

TypeofE-Commerce

Example

B2C–business-to-consumerAmazonisageneralmerchandiserthatsellsconsumerproductstoretailconsumers.

B2B–business-to-businessGo2Paper.comisanindependentthird-partymarketplacethatservesthepaperindustry.

C2C–consumer-to-consumerOnalargenumberofauctionsitessuchaseBay,andlistingsitessuchasCraigslist,consumerscanauctionorsellgoodsdirectlytootherconsumers

SocialE-CommerceFacebookisboththeleadingsocialnetworkandsocialE-Commercesite

M-CommerceMobiledevicessuchastabletcomputersandsmartphonescanbeusedtoconductcommercialtransactions.

LocalE-CommerceGrouponofferssubscribersdailydealsfromlocalbusinessintheformof“Groupons”,discountcouponsthattakeeffectonceenoughsubscribershaveagreedtopurchase

Table2


18

ResearchandadvisoryfirmFrost&SullivanprojectsB2BandretailE-Commercewillhit$12trillionworldwideby2020,upfrom$5.5trillionin2012,foracompoundannualgrowthrateof8.11%12.TherearetwoprimarybusinessmodelsusedwithintheB2Barena:netmarketplaces,whichincludee-distributors,e-procurementcompanies,exchangesandindustryconsortia,andprivateindustrialnetworks.

Ø Consumer-to-consumer(C2C)E-CommerceConsumer-to-consumer(C2C)E-Commerce:consumerssellingtootherconsumersConsumer-to-consumer(C2C)E-Commerceprovidesawayforconsumerstoselltoeachother,withthehelpofanonlinemarketmakersuchaseBayorEtsy,ortheclassifiedsiteCraigslist.InC2CE-Commerce,theconsumerpreparestheproductformarket,placestheproductforauctionorsale,andreliesonthemarketmakertoprovidecatalogue,searchengine,andtransaction-clearingcapabilitiessothatproductscanbeeasilydisplayed,discovered,andpaidfor.

Ø SocialE-CommerceSocialE-Commerce:E-Commerceenabledbysocialnetworksandonlinesocialrelationships.ItissometimesalsoreferredtoasFacebookcommerce,butinactualityisamuchlargerphenomenonthatextendsbeyondjustFacebook.Thegrowthisbeingdrivenbyanumberoffactory,includingtheincreasingpopularityofsocialsign-on,networknotification,onlinecollaborativeshoppingtools,andsocialsearch.SocialE-Commerceisstillinitsinfancy,butisestimatedtogenerateabout$8billionworldwide13.

Ø MobileE-Commerce(M-Commerce)MobileE-Commerce(M-Commerce):useofmobiledevicestoenableonlinetransactions.M-Commercereferstotheuseofmobiledevicestoenableonlinetransactions.M-Commerceinvolvestheuseofcellularandwirelessnetworkstoconnectsmartphones,tablets,tablet-computers,andnetbookstotheInternet.InEuropaindividualsuseM-Commerceonly10%14ofE-Commercepurchasesbutitwillgrowrapidlyoverthenextyears.

Ø LocalE-CommerceLocalE-Commerce:E-CommercethatisfocusedanengagingtheconsumerbasedonhisorhercurrentgeographiclocationLocalmerchantsuseavarietyofonlinemarketingtechniquestodriveconsumerstotheirstores.LocalE-Commerceisthethirdprongofthesocial,mobile,localE-Commercewave,andisexpectedtogrow.

12(https://www.internetretailer.com/2014/12/08/b2b-e-commerce-tops-list-emerging-industries).13(eMarketer,Inc.,2012a).14statista(http://de.statista.com/statistik/daten/studie/412862/umfrage/verteilung-jaehrlicher-online-ausgaben-nach-endgeraeten-in-europa).


19

4.9. SWOT analysis

Figure5

ASWOTanalysisisasimplebutpowerfulmethodforstrategizingaboutyourbusinessandunderstandingwhereyoushouldfocusyourefforts.InaSWOTanalysisyoudescribeyourstrengths,weaknesses,opportunities,andthreats.IntheexampleSWOTanalysis(figure5)youwillseeaprofileofatypicalstart-upventurethatincludesauniqueapproachtoanexistingmarket,apromiseofaddressingunmetneedsinthismarket,andtheuseofnevertechnologies(socialandmobileplatforms)thatoldercompetitorsmayhaveoverlooked.OnceyouhaveconductedaSWOTanalysisyoucanconsiderwaystoovercomeyourweaknessesandbuildonyourstrengths.Forinstance,youcouldconsiderhiringorpartneringtoobtaintechnicalandmanagerialexpertise,andlookingforfinancingopportunities(includingfriendsandrelatives).15



20

4.10. Fixed broadband penetration in 2012

ThisdatafromtheInternationalTelecommunicationsUnionshowshowpopularfixedinternetaccessisaroundtheworld.Itshowsinternetaccessiswidespreadinmostpartsoftheworld,butisstillfairlyscarceinmuchofsub-SaharanAfricaandtheMiddleEast.Fixedinternetaccessallowsmultipledevicesinacustomer'shometoaccesstheinternet.Fixedconnectionsarealsoidealforstreaming-videoservicessuchasNetflixbecausetheytendtohavegreatercapacitythanwirelessnetworks.16

16(http://www.vox.com/a/internet-maps)–JeffOgden.

Figure6 http://www.vox.com/a/internet-maps


21

4.11. Mobile broadband penetration in 2012

Thismapshowsthepercentageofconsumersaroundtheworldwhohavemobileinternetaccess(notethatthecolorsonthismaparenotdirectlycomparabletothepreviousmap).Inthedevelopedworld,peopleusuallygotfixedinternetaccessfirstandobtainedmobileinternetdeviceslater.Butsomedevelopingcountriesareskippingtheconstructionoffixedbroadbandnetworksaltogether.Thisiscost-effectivebecauseasinglecellphonetowercanprovideservicetohundredsofcustomers.Forexample,2.7percentofEgyptianshavefixedbroadbandserviceathome,but10timesasmanyEgyptianshaveinternetaccessusingacellphone.ThestoryissimilarinGhana,Uzbekistan,Indonesia,SouthAfrica,andNigeria.Mobileinternetaccesscanhaveprofoundimplicationsforpeopleinisolatedareas.Farmerscanusemobilephonestolearnaboutrecentmarketdevelopments,increasingtheamounttheycangetfortheircrops.Somemobilephoneoperatorsalsooffersophisticatedpaymentcapabilities,allowingpeoplewhodon'thaveaccesstotheconventionalbankingsystemtomakeelectronicpayments.Afewwealthycountries,including

Figure7 http://www.vox.com/a/internet-maps


22

Japan,SouthKorea,andSweden,thathavemoremobileinternetsubscriptionsthanpeople.Somecustomershavetwomoreorsmartphones,tablets,orotherconnectedmobiledevices.17

4.12. Individuals accessing the Internet through a mobile phone in 2012

Indicator:IndividualsaccessingtheInternetthroughamobilephoneviaUMTS(3G)Definition:Individualsusingamobilephoneorsmartphone,viaUMTS,HSDPA(3Gor3G+)connections,toaccesstheinternet,inthelast3months.Since2011thequestionspecify"awayfromhomeorwork".2012datarelatetotheuseofthemobilephonenetworkwithanyhandhelddevice.Breakdown:AllIndividuals(aged16-74)Unitofmeasure:PercentageofindividualsDefinition:Individualsaged16-74

17(http://www.vox.com/a/internet-maps))–JeffOgden.

Figure8


23

Linktogetfigure8:http://digital-agenda-data.eu/charts/analyse-one-indicator-and-compare-countries#chart={%22indicator-group%22:%22mobile%22,%22indicator%22:%22i_iu3g%22,%22breakdown%22:%22IND_TOTAL%22,%22unit-measure%22:%22pc_ind%22,%22ref-area%22:[%22AT%22,%22EU27%22,%22MK%22,%22IT%22,%22RO%22,%22SI%22,%22ES%22,%22SE%22]}

4.13. Search engines market share

StatCountercollectsdatausingmorethan15billionhitspermonthonmorethan3millionmemberwebsitesworldwide.Thisstatistic(figure8)showstheglobalmarketshareofleadinginternetsearchengines.InJuly2015,3.37percentofworldwideinternetuserssearchedthewebwithonlinesearchengineBing.Duringthesamemonth,ChinesesearchengineBaiduhadamarketshareof0.79percent.18

18(http://www.statista.com/statistics/216573/worldwide-market-share-of-search-engines/).

Figure9


24

4.14. Gross domestic product (GDP)

Figure10

Figure11 source:©Statista2015

Macedonia:2014 11600

http://www.focus-economics.com/countries/macedonia14


25

DomesticproductcoversdifferentindicatorsofnationalaccountswithafocusonGrossDomesticProduct(GDP).GDPisthestandardmeasureofthevalueoffinalgoodsandservicesproducedbyacountryduringaperiodminusthevalueofimports.WhileGDPisthesinglemostimportantindicatortocapturetheseeconomicactivities,itisnotagoodmeasureofsocieties'well-beingandonlyalimitedmeasureofpeople'smateriallivingstandards.(https://data.oecd.org/gdp/gross-domestic-product-gdp.htm)ChangesinthefinalusesofGDP,ordemandofusetheeconomists’term,determinethegrowthofrealGDPintheshortterm.Therearethreetargetvariablesthatgovernmentstrytoinfluenceinordertomaintaingrowthataratethatkeepsinflationandemploymentatthedesiredlevels:1demandfromhouseholds(households’consumptionexpenditure)2publicconsumption(generalgovernmentconsumptionexpenditure3investment(grossfixedcapitalformationToinfluencethesevariables,governmentusefiscalandmonetarypolicyinstruments.Thetotalofthesethreevariablesisknownasdomesticdemand.Exportsarealsoamajorcomponentoffinaldemand,butinthiscaseexternaldemand.Itisconventionaltoshowexternaldemandasbeingequaltoexportsminusimports,theresultbeingknownasnetexports.Thesearethevariablesthateconomistslookatwhentryingtopredictfutureeconomicdevelopments.19

4.15. GDP per capita

19(OECD2014)p130.

Figure12

Macedonia:20 5625

http://www.focus-economics.com/countries/macedonia14


26

Figure13 source:©Statista2015

1.INDICATOR(figure12)(a)Name:Grossdomesticproduct(GDP)percapita.(b)BriefDefinition:LevelsofGDPpercapitaareobtainedbydividingGDPatcurrentmarketpricesbythepopulation.AvariationoftheindicatorcouldbethegrowthinrealGDPpercapita,whichisderivedasthepercentagechangeinrealGDPdividedbythepopulation.(c)UnitofMeasurement:$US.(d)PlacementintheCSDIndicatorSet:Economicdevelopment/Macroeconomicperformance.20Thisisthevalueofallfinalgoodsandservicesproducedwithinanationinagivenyear,convertedatmarketexchangeratestocurrentU.S.dollars,dividedbytheaverage(ormid-year)populationforthesameyear.21GrossDomesticProduct(GDP)percapitaisacoreindicatorofeconomicperformanceandcommonlyusedasabroadmeasureofaveragelivingstandardsoreconomicwell-being;despitesomerecognizedshortcomings.ForexampleaverageGDPpercapitagivesnoindicationofhowGDPisdistributedbetweencitizens.AverageGDPpercapitamayriseforexamplebutmorepeoplemaybeworseoffifincomeinequalitiesalsoincrease.

20(http://www.un.org/esa/sustdev/natlinfo/indicators/methodology_sheets/econ_development/gdp_percapita.pdf).21(https://data.oecd.org/gdp/gross-domestic-product-gdp.htm).


27

Equally,insomecountries,theremaybeasignificantnumberofnon-residentborderorseasonalworkersorindeedinflowsandoutflowsofpropertyincomeandbothphenomenaimplythatthevalueofproductiondiffersfromtheincomeofresidents,therebyoverorunderstatingtheirlivingstandards.22

4.16. What is M-Commerce?

M-CommerceispartofE-Commerce.Mobiledevicessuchastabletcomputersandsmartphonescanbeusedtoconductcommercialtransactions..M-Commerceinvolvestheuseofcellularandwirelessnetworkstoconnectsmartphones,tablets,tablet-computers,andnetbookstotheInternet.InEuropaindividualsuseM-Commerceonly10%23ofE-Commercepurchasesin2014,butitwillgrowrapidlyoverthenextyears.

Figure1424

22(OECDiLibrary2009)p6.23statista,(http://de.statista.com/statistik/daten/studie/412862/umfrage/verteilung-jaehrlicher-online-ausgaben-nach-endgeraeten-in-europa).24(http://de.statista.com/infografik/3059/anteil-der-mobilen-ecommerce-transaktionen/).


28

34percentofalle-commercetransactionsareconductedviatabletorsmartphoneworld.ThisemergesfromastudybyCriteo,atechnologycompanyofferingperformancemarketing.InGermany,themobilefractionthusamountsto30percentofonlinepurchases.ApopularmobileshoppingisapparentlyinAsiancountries.SoinJapan,morethanhalfofallonlinetransactionsarehandledwithmobiledevices.Thestudyisbasedontransactionsvaluedatmorethan160billionUSdollarsinmorethan3,000onlineretailersinthefirstquarter2015th.25

4.17. Web site vs. Web app

Amobile-optimizedWebsiteisaWebsitethatisintendedtobeviewedusingamobilebrowseronthevariousdisplaysizesofphones,tablets,andothermobiledevices.MobileWebsitesaretypicallysimplifiedversionsofastandardWebsitethatprovideabettermobileuserexperiencethrough

25(http://de.statista.com/infografik/3059/anteil-der-mobilen-ecommerce-transaktionen/).


29

improvedusability,fasterpageloads,andsometimesreorganizationofcontenttobringmobile-specificfeaturestotheforefrontoftheexperience.AtrendinthedevelopmentofmobileWebsitesistheuseofresponsiveWebdesigntoolsanddesigntechniques,whichmakeitpossibletodesignaWebsitethatautomaticallyadjustsitslayoutanddisplayaccordingtotheuser’sscreenresolution,whetheradesktop,tablet,orsmartphone.AmobileWebapplicationisanapplicationbuilttorunonthemobileWebbrowserbuiltintoasmartphoneortabletcomputer.Generallyitisbuilttomimicthequalitiesofanativeapp.AnativeAppisanapplicationdesignedspecificallytooperateusingthemobiledevice’shardwareandoperatingsystem.Thesestand-aloneprogramscanconnecttotheInternettodownloadanduploaddata,andcanoperateonthisdataevenwhennotconnectedwiththeInternet.NativeAppsarebuiltusingdifferentprogramminglanguagesdependingonthedeviceforwhichtheyareintended.26

4.17.1. Business considerations Everymobileprojectpresentsuniquechallengesandconsiderations,butregardlessofyourcircumstances,decidingwhethertocreateamobileapporamobilewebsitedoesnothavetobedifficult.Definethepurposeofyourapplicationandprioritizeallofyourbusinessandmarketingconsiderationsfirst.Thendeterminethesolutionthatwillbestaddressthoseneedsnowandintothefuture.PurposeandgoalsWhatisthepurposeorgoalofthemobileinitiativeyouareconsidering?Takeeverythingelseoutoftheequationandanswerthisquestionfirst.Thereshouldbeabusinessdecisionthatisdrivingtheprocess.Itcouldbethatyourregularwebsitedoesn'tworkwellfortheincreasingtrafficfrommobiledevices.Ormaybeyourmarketingdepartmentwantsamobileapplicationthathelpspeoplecustomizeawidgetthattheycanthenorderonline.Whateveryourgoal,defineitfirstandthinkaboutthedevelopmentanddistributionsecond.I'veheardsomeprettyexcitedpeopletalkaboutcreatinganiPhoneappfortheirbusinesswithnoclearideaofwhatexactlyitwoulddo.AudienceDefinethelikelyaudiencethatisgoingtousethismobileapplicationandtheclassicusecasesthatwouldinspirethemtouseit.Alsothinkabouthowfrequentlythesepeopleengagewithyourbrandorbusiness.Anapprequiressomeonetodiscoveritandthendownloadit,soconsiderwhetherthesearestepsyouraudiencewilltakethetimetodo.Peopletendtodownloadappsforthingstheydoregularlyorforthingsthattieintotheirlifestyle.That'swhysomanysmartphoneusersdownloadtheFacebookappinsteadofusingthemobile



30

versionofthewebsite.Itoffersabetterexperienceforfrequentactivity,whichmakesthesmalltimeinvestmentofsearchingforanddownloadingtheappworthwhile.Italsoaddsvaluebytyingintothephone'smobilecapabilities,suchasmakingiteasytotakeaphotoandinstantlyshareitwithfriends.Alongthosesamelines,whenusersdownloadanappthattheylike,theyuseitmorefrequentlyandforlongerperiodsoftimethantheyusethemobileweb.Ifyoubelieveyoucancreateamobileapplicationwithenoughvaluetomakeitago-toappforyourmobilecustomers,youmaybenefitgreatlyfromthebrandengagementthatanappcandeliver.UserexperienceImaginehowuserswillinteractwithyourapplication.Thismaybethesinglebiggestthingthatdetermineswhetheramobileapporamobilewebsiteisappropriate.Determinewhetheryouwantthisapplicationtodeliverahighlygraphicalandrobustuserexperienceorwhetherit'sprimarilyfordeliveringserver-basedinformation.Maybeyouwanttodoboth;ifso,that'sfine.Youdon'thavetocreatebothimmediatelybutyouwillneedtodecidewhichwillcomefirstaspartofyouroverallmobilestrategy.BudgetFormostsmalltomid-sizedbusinesses,budgetisaseriousconsideration.Developingindividualmobileappsformultipleoperatingsystemsordevicescanbeexpensiveandresource-intensive.Reachingabroaderaudiencewithamobilewebsiteisaneasierandmoreeconomicalventure.Asageneralrule,ifyou'reworkingonasmallbudgetandyou'renotgoingtotapintonativedevicefunctionalityorcreatesomethingthatrequiresseriouscomputingandgraphics,considerstartingyourmobileinitiativewithamobilewebsite.

4.17.2. Development considerations Afteryouhavethoughtthroughthebusinesscasefordevelopingyourmobileapplication,it'stimetostartthinkingaboutdevelopmenttodeterminewhatmakesthemostsenseforyoursituation.EaseandspeedofimplementationDesign,development,anddeploymentofamobilewebsiteissimilartoastandardwebsite.Onceit'slive,it'simmediatelyviewablebyanyonewhovisitstheURLwithamobilebrowser.Creatingamobilewebsitemaytakemoreorlesstimethancreatingasinglemobileapp,dependingonthecomplexityoftheprojectandtheproficiencyofthedevelopers.Mobilewebdevelopmentiscertainlynotwithoutitsownsetofchallenges,duetothevaryingscreenssizes.However,amajorconsiderationiswhethertheappwillbedevelopedformorethanonemobileoperatingsystemordevice.Ifitis,youcanplanonadditionaldevelopmenttimeandresources.Thereisgenerallyno


31

easyandreliablewaytobuildamobileappforoneoperatingsystemandportittoalltheothers,particularlyifitisgraphic-intensiveandfeature-rich.Mobileappsmayalsorequireasubmissionapprovalprocesstobefeaturedinappstores.Mostnotably,theAppleAppStorerequiressubmissionapprovalaswellasanannualmembershipwithanassociatedfee.AudiencereachMobilewebsitesareviewablebyeveryonewithamobilebrowser,regardlessoftheirchoiceofhardwareoroperatingsystem.Thesedays,mostbusinessesshouldconsidertheirbroadmobilepresencebeforeconsideringhowpeopleexperiencetheirbusinessinappform.Youmaydisagree,butifyouhaven'tlookedatyourcompany'swebsiteanalyticslately,youmaynotbeawareofhowquicklyyourmobileviewershipisgrowing.Dependingonyourbusiness,asubstantialpercentageofyouraudiencecouldbecomingtoyoursiteviamobiledevices,ormobiletrafficmayonlymakeupasmallpercentageofyouraudience.Ifyouhavethedata,gobackandcomparewhateverthosepercentagesarenowtopreviousyears.Youmaybesurprisedbyhowquicklyyouraudiencetrendschange,andmobiletrafficisonlygoingtoincreaseinthefuture.Alsoconsiderthatlowmobilebrowsertrafficmayindicatethatyourwebsitesimplydoesn'tperformwellonsmallerscreens.Appstendtocompartmentalizetheaudiencethatisengagingwithyourbrand,whichisnotnecessarilyabadthing.ThedemographicofaniPadappusermaybeverydifferentfromtheaverageuserthatvisitsyourmobilewebsite,andyoucanleveragethosedifferencesifyouunderstandthemandmakethempartofyourmobilestrategy.PerformanceconsiderationsMobilewebtechnologiescontinuetoimprove,providingmobilewebsitevisitorswithmoreapp-likeexperiences.However,awell-designedmobileapptypicallydeliversasuperiorexperienceforseveralreasons.Appsaremuchlikeyourdesktopsoftwareinthattheycanstoreresourceslocallyandutilizethecomputingpowerandmemoryofthedevicetoperformoperationsinstantaneously.Theycanalsotieintothefunctionalityofthedevice,whichisnotpossiblewithamobilewebsite.Interfacecontrolsaremoreintuitiveandoperatewithoutthesamelagtimeofmobilewebsites,whichtransferdatabackandforthbetweenserveranduser.Lastly,anappisdevelopedforasinglescreensizeorasmallerrangeofsizes,makingiteasiertodesignanoutstandinginterfaceandcontrols.UpdatesandmaintenanceUpdatingamobile-optimizedwebsiteinvolvesthesamestepsrequiredtoupdateyourtraditionalwebsite.Appupdatesmayrequiresubmissionapprovalsbeforebeingupdatedintheirmarketplace.Unlikeamobilewebsite,whereupdatesareimmediate,mobileappsrequireuserstodownloadsoftwareupdates.Keepinmindthatifyou'redevelopingappsformultipleplatforms,evenasimpleupdatemayrequiresignificantdevelopmentresourcesandtime.


32

SearchengineoptimizationWhileagoodportionofmobilewebsitevisitsaredestination-driven,mobilesearchcontinuestogrowrapidly,andlocalsearchisevenmoreimportantconsideringthenatureofmobilesearches.Amobile-optimizedwebsitecanbefoundandvisitedfromastandardsearch,andyoucanevenexpandyourpaidsearchcampaignstotargetmobiledevices.Ifyoudoofferamobileapp,it'sagoodideatoprovidealinktoitfromyourmobilewebsite.EvolvingwebtechnologiesHTML5andCSS3arehottopicsthesedaysinwebdevelopmentcircles.Themobilewebwillbethemajorbeneficiaryasthesetechnologiesevolveandbecomemorecommonplace.Whencombinedwithimprovingdatatransferratesandbetterconnectivity,thedividebetweenwebandmobileappexperienceswillcontinuetonarrow.DataconnectivityandofflineuseResourcesanddatacanbestoredlocallyinamobileapp,andtheuserinterfaceoperatesindependentlyofweb-deliveredinterfaceelements,sosomeorallofyourappmaybeusedwhenInternetorWi-Fiisnotavailable.(Ofcourse,youcanstoredatafromthemobilebrowser,sonetworkconnectivityisnotabsolutelyrequiredtointeractwithamobilewebsite.)Paidvs.freeAnothertechnologydecisionyou'llneedtomakeaboutyourappiswhethertochargeforitandhow.Inmanycases,companyappsareanextensionofothercustomer-facingeffortsandareofferedforfreetoattractasmanyusersaspossible.Ifyourmobileapplicationisintendedtogeneraterevenue,theappmarketplacesmakeiteasytosell.27

4.17.3. An at-a-glance comparison

MobileWebsite MobileAppAudiencereach Viewablebyanyonewithamobile

BrowserViewablebyindividualswiththeappropriatedevice

Userexperience Limitedbybandwidth,technologies,andsiteperformancebutimproving

Capableofveryrobustuserexperiences

Graphicsandeffects

Limitedbybandwidthandtechnology,butimproving

Superior.Graphicsmaybestoredlocally.Effectsandanimationsarelimitedonlybydevicecomputingpowerandmemory

27(http://www.adobe.com/inspire/2012/02/mobile-websites-vs-mobile-apps.html).


33

MobileWebsite MobileAppAccesstohardwarefunctionality

Limited.Devicegeolocationcanbeutilized

Unlimitedaccess.Camera,accelerometer,microphone,GPS,NFC,etc.

Easeofdevelopment

DevelopedwithstandardWebdevelopmenttoolsandtechnologies

Whenbuiltfordistinctoperatingsystemsanddevices(nativecode),uniqueprogramminglanguagesandsoftwaredevelopmentkitsarerequired.Cross-platformsolutionsareavailablefordeployingtovariousappstores

Developmentresources

Builtonceanddeployforalldevices

Builtforindividualdevicesandoperatingsystems.Mayrequiremultipledeveloperswithdifferentproficiencies

Developmentcost

Typically,butnotalways,lessexpensivethanappdevelopment

Typically,butnotalways,moreexpensive,especiallywhenmultipledevicesoroperatingsystemsaretarged

Easeandspeedofimplementation

PublishasaWebsite.Immediateavailable

Mayrequireasubmissionprocess.Usermustdownloadandinstallpriortouse

Distribution Viewablewithanymobilebrowser.Nodistributionrequired

Downloadandinstallationrequired

Installation Web-based–noinstallation DownloadandinstallationfromWebsiteormarketplace

Updatesandmaintenance

Easilyupdatedandchangesareimmediatewithabrowserrefresh

iTunesrequiresaresubmissionprocess.Mayrequiremultipledevelopmentresourcesifupdatesarerequiredformultipledevicesandoperatingsystems

Paidvs.freeApp Difficult. Easytochargeforapps,usingtheavailableappmarketplace

Searchoptimization

Canbefoundthroughastandardsearch–canberedirectedtoamobile-optimizedversion

TypicallyfoundthroughanappstoresearchorlinkedtofromaWebsite

Internetordataconnectivity

Required Canbeusedoffline

Table3


34

4.18. Online retail: advantages and challenges Advantages ChallengesLowersupplychaincostsbyaggregatingdemandatasinglesiteandincreasingpurchasingpower

Consumerconcernsaboutthesecurityoftransaction

LowercostsofdistributionusingWebsitesratherthanphysicalstores

ConsumerconcernsabouttheprivacyofpersonalinformationgiventoWebsites

Abilitytoreachandserveamuchlargergeographicallydistributedgroupofcostumer

Delaysindeliveryofgoodswhencomparedtostoreshopping

Abilitytoreactquicklytocostumertastesanddemand

Inconvenienceassociatedwithreturnofdamagedorexchangegoods

Abilitytochangepricesnearlyinstantly Overcominglackofconsumertrustinonlinebrandnames

Abilitytorapidlychangevisualpresentationofgoods

Addedexpensesforonlinephotography,video,andanimatedpresentations

Avoidanceofdirectmarketingcostsofcataloguesandphysicalmail

Onlinemarketingcostsforsearch,e-mail,anddisplays

Increasedopportunitiesforpersonalizationcustomization

Addedcomplexitytoproductofferingsandcustomerservice

Abilitytogreatlyimproveinformationandknowledgedeliveredtoconsumer

Greatercustomerinformationcantranslateintopricecompetitionandlowerprofits

Abilitytolowerconsumers’overallmarkettransactioncosts

Table428

Thistable4willnotincludeonlineservicesrevenuessuchastravel,jobhunting,orthepurchaseofdigitaldownloadssuchassoftwareapplicationsandmusic.OnlineretailreferssolelytosalesofphysicalgoodsovertheInternet.TheInternetprovidesanumberofuniqueadvantagesandchallengestoonlineretailers.Table4summarizestheseadvantagesandchallenges.29Despitethehighfailurerateofonlineretailersintheearlyyears,morecomsumersthaneverareshoppingonline.(seefigure14:Individualsorderingphysicalgoodsonline)

28(LaudonKennethC.,2014)p730.29(LaudonKennethC.,2014)p728ff.


35

Figure14:Indicator:IndividualsorderingphysicalgoodsonlineDefinition:Individualsthathaveorderedonlineanyofthefollowingphysicalgoods:food/groceries,householdgoods,medicine,clothes/sports,computerhardware,electronicequipment.Breakdown:AllIndividuals(aged16-74)Unitofmeasure:PercentageofindividualswhousedInternetwithinthelastyear

4.19. The Latest Trends in E-Commerce and M-Commerce

4.19.1. Email has made the switch to an M-Commerce commodity

Foralongtimeemailmarketinghassufferedanidentitycrisis,exacerbatedbyapublicimageofscamartists.Thisyearitseemsthatatlastemailiscatchingup,adaptingtobepartofaholisticapproachtomarketing.Thetrendisshowingslowlyincreasingclick-throughrate(CTR)fromemailsopenedonmobile,butstillrelativelylowoptimization.Theclearparallelisthatthereisapositiveconsumerbaseresponsetoemailsreceivedonmobileplatforms,andslowlygrowingresponsefrombusinesstomeetthisneed.

Figure15


36

4.19.2. M-commerce to take more of pie

Continuingontheabovepoint,itseemsthatmobileistheFuturewithacapitalF.Theindustryfinallywillgoingonboardwiththispredictionthisyearwithmobilecentereddesign.MagentoisbackedbyeBayandbreakingdownthewallsbetweeneandm-commercedesign.Theruleshavealreadybeensetout,andthemarketisclearlyreadyandwillingtomakemorepurchasesonmobileplatforms.Thequestionremains:willbusinessrespondfastenoughandsmartenoughtocapitalize?

4.19.3. Wearable tech to start making inroads in M-Commerce

NowthattheinitialhubbubhasdieddownabouttheGoogleGlassseemstohavetailedoffintoobscurity,youmightbethinkingthatwearabletechhasgonewithit–thisisnotthecase.GoogleGlassmayberepurposedtobeaB2Bgadget,andAppleWatchhasalreadysoldmorethan1millionunitsjustinpre-saleandfigurestobecomeanothermajorm-commerceplatform.M-commerceappsforAppleWatcharecomingoutsoonfrommajorplayerslikeeBay,Fandango,OpenTableandTarget.Thiswillkickoffanewwaveofwearableappdevelopmentforonlinemerchants.TheknockoneffectonmarketsofgadgetsliketheAppleWatchthatblendm-commerceandrealityintoonecouldbetrulystaggering.

4.19.4. Flat UI and mobile apps to synergize this year M-Commerceisbooming.Ifwelookattheimprovementsthatcanandarebeingmadetowebsitestomakethemmobilefriendly,weseethatmanywebsitesareincorporatingappdesigntechniquesintotheironlinepresences.Forexample,flatUI/UXimprovesuserexperienceandkeepscustomersonplatformsforlongerperiodsoftimewhich,inmostcases,translatesintomoremoneyforyou.Formanyyears,themarkethasbeenfloodedwithappsthatquitefranklyaresubstandard.Withcompetitioncomesexcellence,andtheappcompanieswhoseekgreatadviceandguidancefortheirqualityproductswillsucceed.


37

4.19.5. Data, data and more data Bigdataisalreadyhereandischanginghowsmartcompaniesmarketthemselves.Withthevolumeofdataavailabletocompaniesaboutourcustomersstillincreasingwhileadheringtoprivacyregulations,marketsegmentationwillonlyincrease.30

4.20. Various Charts

4.20.1. Individuals who have used internet

Figure16

Indicator:Individualswhohaveusedinternetinthelast12monthsBreakdown:AllIndividuals(aged16-74)Unitofmeasure:PercentageofindividualsDefinition:Individualsaged16-74

30(http://ventureaviator.com/2015/04/27/the-latest-trends-in-e-commerce-and-m-commerce-our-top-tips-for-2015/).


38

4.20.2. Individuals interacting online with public authorities

Figure17

Indicator:Individualsinteractingonlinewithpublicauthorities,last12monthsDefinition:IndividualshaveusedInternet,inthelast12months,forinteractionwithpublicauthorities.Itincludesobtaininginformationfrompublicauthoritieswebsites,downloadingofficialformsandsendingfilledinforms.Breakdown:AllIndividuals(aged16-74)Unitofmeasure:PercentageofindividualsDefinition:Individualsaged16-74

4.20.3. Computers for educational purposes


39

Figure18

Eleventhgrade(calledGrade11insomeregions)istheeleventh,andforsomecountriesfinal,gradeofsecondaryschools.Studentsaretypically16or17yearsofage,dependingonthecountryandthestudents'birthdays.Indicator:ComputersforeducationalpurposesDefinition:Computersusedforeducationalpurposesincludedesktop,laptop,netbookortabletcomputer,whetherornotconnectedtotheinternetSource:TheESSIESurveyaboutICTinEducation-SMART2010/0039-isbasedonover190,000filledquestionnairesfromstudents,teachersandheadteachersin27countries,collectedduringschool-year2011-12(mainlybetweenSeptemberandDecember2011),withthepurposeofbenchmarkingaccess,useandattitudestoICTechnologiesinEurope'sschools(Primary;Lowersecondary;Uppersecondary,bothgeneralandvocational).Breakdown:Grade11(Uppersecondary,general)Definition:Studentsenrolledareattheeleventhyearofschooling,countingfromthefirstyearofPrimary-ISCEDlevel1.MeanageofstudentsinGrade11isatleast16,5years.Unitofmeasure:Numberper100students


40

5. Application (examples, working tasks, etc.)

5.1. Online payment marketplace – PayPal, Verizon, Google, Apple, etc.

CaseStudyQuestions

Ø WhatisthevaluepropositionthatSquareoffersconsumers?Howaboutmerchants?WhataresomeoftheweaknessesofSquare’ssystem?

Ø WhywouldtelecommunicationscarrierslikeAT&TandVerizonwanttomoveintothepaymentbusiness?WhatchancedotheyhavetocompeteagainstGoogle?What’stheiradvantage?

Ø WhatadvantagesdoesPayPalhaveinthamobilepaymentmarket?Whatareitsweakness?

Ø WhatstrategieswouldyourecommendthatPayPalpurseinordertotranslateitsdominance

inalternativeonlinepaymentsintoastrongpositionintheemergingmobilepaymentmarket,especiallyinon-premisepayments?

5.2. eBay – Evolves

CaseStudyQuestions

Ø ContrasteBay’soriginalbusinessmodelwithitslatestproposedbusinessmodel

Ø WhataretheproblemsthateBayiscurrentlyfacing?HowiseBaytryingtosolvetheseproblems?

Ø ArethesolutionseBayisseekingtoimplementgoodsolutions?Whyorwhynot?Arethere

anyothersolutionsthateBayshouldconsider?

Ø WhoareeBay’stopthreecompetitorsonline,andhowwilleBay’snewstrategyhelpitcompete?WilleBaybeprovidingadifferentiatedservicetocustomers?


41

5.3. Inventory Case Study Questions

Ø Findasiteonthewebwhichofferssimilarservices.Comparethissitetohttps://kmu.fh-

joanneum.at/component/inventory.

Ø WhyistheFHJOANNEUMpursuingtheInventory-Project?MakealistofbenefitstoSMEs.


42

6. Source directory LaudonKennethC.,TraverCarolGuercio.2014.E-commerce2014.10th.EdinburghGate:Pearson,2014.OECDiLibrary2009.NationalAccountsataGlance2009.Home/GDPpercapita.[Online]OECDiLibrary,OECDiLibrary2009.[Cited:12082015.]http://www.oecd-ilibrary.org/sites/9789264067981-en/01/03/index.html?itemId=/content/chapter/9789264075108-5-en.OECD2014.UnderstandingNationalAccounts:SecondEdition.DefiningfinalusesofGDP.[Online]OECDpublishing,OECD2014.[Cited:12082015.]http://www.keepeek.com/Digital-Asset-Management/oecd/economics/understanding-national-accounts/defining-final-uses-of-gdp_9789264214637-6-en#page1.DOI:10.1787/9789264214637-6-en.


43

7. Internet links

https://data.oecd.org/gdp/gross-domestic-product-gdp.htm

http://www.keepeek.com/Digital-Asset-

Management/oecd/economics/understanding-national-accounts/defining-final-

uses-of-gdp_9789264214637-6-en#page1

http://www.oecd-ilibrary.org/sites/9789264067981-en/01/03/index.html?itemId=/content/chapter/9789264075108-5-en http://ec.europa.eu/eurostat/documents/2995521/6839731/1-21052015-AP-

EN.pdf/c3f5f43b-397c-40fd-a0a4-7e68e3bea8cd

http://ec.europa.eu/eurostat/documents/2995521/6839731/1-21052015-AP-

EN.pdf/c3f5f43b-397c-40fd-a0a4-7e68e3bea8cd

http://www.iana.org/about

https://www.internetretailer.com/2014/12/08/b2b-e-commerce-tops-list-

emerging-industries

http://de.statista.com/statistik/daten/studie/412862/umfrage/verteilung-

jaehrlicher-online-ausgaben-nach-endgeraeten-in-europa

http://www.vox.com/a/internet-maps

http://www.statista.com/statistics/216573/worldwide-market-share-of-search-

engines


44

http://www.un.org/esa/sustdev/natlinfo/indicators/methodology_sheets/econ_d

evelopment/g

dp_percapita.pdf

https://data.oecd.org/gdp/gross-domestic-product-gdp.htm

http://de.statista.com/statistik/daten/studie/412862/umfrage/verteilung-

jaehrlicher-online-ausgaben-nach-endgeraeten-in-europa

http://de.statista.com/infografik/3059/anteil-der-mobilen-ecommerce-

transaktionen

http://www.adobe.com/inspire/2012/02/mobile-websites-vs-mobile-apps.html

m-commerce basics script final version pdf -...

Documents

Transcript of m-commerce basics script final version pdf -...