business models in e-commerce
TRANSCRIPT
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ebusinessBusinessModels Lecture3
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BusinessModel
AsetofplannedactivitiesdesignedtoresultinaprofitinamarketplaceAsetofplannedactivitiesdesignedtoresultinaprofitinamarketplace
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eCommerce BusinessModel
AbusinessmodelthataimstouseandleveragetheuniquequalitiesoftheInternetandtheWorldWideWeb
AbusinessmodelthataimstouseandleveragetheuniquequalitiesoftheInternetandtheWorldWideWeb
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ComponentsofeBusinessModels
BusinessModel Scope
Price
- Customer value Resources
Capabilities
Implementations
Environment
Internet Performance
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PHASESOFeBUSINESS DEVELOPMENT
Four stage model in eBusiness maturity relates business value to e
Business leverage
Four stage model in eBusiness maturity relates business value to e
Business leverage
Brochurewareand buying / selling
Integrate withcustomers and suppliers
Industry transformation,achieve competitive advantage
Cross IndustrySupplier/Customer Convergence
Channel
Integration
Transformation
Convergence
Busine
ssValue
E- Business Leverage
Over 50% are in the channel phaseof E- Business development with a
web presence but noinfrastructure tie in.
Just under 15%are in theintegration phase. Connectionsto suppliers and customers arefully E- Business enabled.
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EightKeyIngredientsofaBusinessModel
KeyQuestionsBusinessModel
Components
ValueProposition Why
should
the
customer
buy
from
you?
Revenuemodel Howwillyouearnmoney?
Marketopportunity Whatmarketspacedoyouintenttoserve,andwhatisitssize?
Competitiveenvironment Whoelseoccupiesyourintendedmarketspace?
Competitiveadvantage Whatspecialadvantagesdoesyourfirmbringtothemarketspace?
Marketstrategy Howdoyouplantopromoteyourproductstoattractcustomer?
Organizational
development
Whattypesoforganizationalstructureswithinthefirmare
necessarytocarryoutthebusinessplan?
Managementteam What
kinds
of
experiences
and
background
are
important
for
thecompanysleaderstohave?
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ValuePosition
Defineshowacompanysproductorservicefulfillstheneedsofcustomers.
Questions
Whywillcustomerschoosetodobusinesswithyourfirminsteadofanothercompany? Whatwillyourfirmprovidethatotherfirmsdonot
andcannot?
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RevenueModel
Describeshowthefirmwillearnrevenue,produceprofits,andproduceasuperiorreturnoninvestedcapital.
Ecommercerevenuemodelsinclude:
advertisingmodel
subscriptionmodel transactionfeemodel salesmodel affiliatemodel
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RevenueModel
Advertisingrevenuemodel
acompanyprovidesaforumforadvertisementsandreceivesfeesfromadvertisers(Yahoo)
Subscriptionrevenuemodel
acompanyoffersituserscontentorservicesandchargesasubscriptionfeeforaccesstosomeorallofitofferings(ConsumerReports orEquityMaster)
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Transactionfeerevenuemodel acompanyreceivesafeeforenablingorexecutinga
transaction(eBay)
Salesrevenuemodel acompanyderivesrevenuebysellinggoods,
information,orservices(Amazon) Affiliaterevenuemodel
acompanysteersbusinesstoanaffiliateandreceivesareferralfeeorpercentageoftherevenuefromanyresulting
sales (MyPoints)
RevenueModel
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MarketOpportunity
Marketopportunity referstothecompanys intendedmarketspaceandthe
overallpotentialfinancialopportunitiesavailabletothefirminthatmarketspace
definedbytherevenuepotentialineachofthemarketnicheswhereyouhopetocompete
Marketspace theareaofactualorpotentialcommercialvalueinwhicha
companyintendstooperate
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CompetitiveEnvironment
Referstotheothercompaniesoperatinginthesame
marketplacesellingsimilarproducts
Influencedby:
howmanycompetitorsareactive howlargearetheiroperations themarketshareofeachcompetitor howprofitablethesefirmsare howtheypricetheirproducts
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CompetitiveAdvantage
Achievedbyafirmwhenitcanproduceasuperiorproduct
and/orbring
the
product
to
market
at
alower
price
than
most,orall,ofitscompetitors
Achievedbecauseafirmhasbeenabletoobtain
differential
access
to
the
factors
of
production
that
are
deniedtheircompetitors atleastintheshortterm
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OrganizationalDevelopment
Describeshowthecompanywillorganizetheworkthat
needs
to
be
accomplished
Workistypicallydividedintofunctionaldepartments
Move
from
generalists
to
specialists
as
the
company
grows
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ManagementTeam
Employeesofthecompanyresponsibleformakingthe
businessmodelwork
Strongmanagementteamgivesinstantcredibilitytooutside
investors
Astrong
management
team
may
not
be
able
to
salvage
aweakbusinessmodel
Shouldbeabletochangethemodelandredefinethe
business
as
it
becomes
necessary
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B2C: BusinesstoConsumer
B2B:Business
to
Business
B2G: BusinesstoGovernment
C2C:Consumer
to
Consumer
C2B: ConsumertoBusiness
eBusiness Models
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Businesssellsproductsorservicesdirectlytoconsumers
Eretailers e.g.Croma,Bestbuy,CostcoPureplayeretailers e.g.Amazon.comContentProviderse.g.EquityMaster.com,WSJ.com,crisil.com,
moneyconrol.com
TransactionBrokere.g.Sharekhan.com,Icicidirect.com,Cleartrip.com
VirtualMallsorEmailse.g.MSNshopping,Yahooshopping
BusinesstoConsumer[B2C]
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B2Cstorefronthasvariousmechanismforconductingsale:
Electroniccatalogs(presentationofproductinformationinanelectronicform)
Asearchengine(aprogramthatcanaccessadatabaseofInternetresources,searchforspecificinformation/keywords,
andreporttheresult)An
electronic
shopping
cart:
orderprocessingtechnologythat
allowshopperstoaccumulateitemstheywishtobuywhiletheycontinuetoshop)
Eauctionfacilities
Apayment
gateway
etc.
GeneralCharacteristics
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BusinesstoBusiness(B2B)
VarietyofformslikeB2C BasicStorefrontslikeOfficeDepot,Staples InternetandWebProductssuchasWebsitehosting,
Applicationhosting,Webdesigningetc. Verticalmarketse.g.StockExchanges,NSEandBSEterminals B2Bexchangese.g.Commodities,Energyexchanges MCXetc
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BusinesstoGovernment(B2G)
SimilartoB2Bmodel SellerswantingtodobusinesswithGovernmentagenciese.g.Bidmain
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ConsumertoConsumer[C2C]
Consumers
sell
products,
services
directly
to
otherConsumers
e.g.eBay.in
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ConsumertoBusiness(C2B)
Likeareverseauctionmodel
Customerspecifiesthepriceforaparticularproduct/serviceandinvitesbidsfrompotentialsellerse.g.Airlineticket,Hotelroometc.
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MajorBusinesstoConsumer(B2C)BusinessModels
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MajorBusinesstoConsumer(B2C)BusinessModels
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Summary
ECommerceFrameworkissupportedby5supportareas:
People
RegulatoryPolicy MarketingandAdvt SupportServices BusinessPartnerships
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Direct Marketing Search Jobs Online Banking E- government
E- purchasing B2B Exchanges C- Commerce M- Commerce Auctions
Travel Online Publishing Consumer Services
People:
Buyers, Sellers,
Intermediaries, Service,
IS People & Management
Public Policy:
Taxes, Legal,
Privacy Issue,
Regulations
& Technical Standards
Marketing &
Advertisement:
Market Research,
Promotions,
& Web Content
Support Services:
Logistics, Payments,
Content and Security
System Development
Business Partnerships:
Affiliate Programs,
Joint Ventures,
Exchanges,
E- marketplaces,
and Consortia
(1)
Common Business Services
infrastructure (security,
smart cards / authentication
electronic payments,
directories / catalogs)
(2)
Messaging and information
distribution infrastructure
(EDI, e- mail, hypertext
transfer protocol, chat
rooms)
(3)
Multimedia content
and network
publishing
infrastructure (HTML,
JAVA, XML, VRML)
(4)
Network Infrastructure
(telecom, cable TV wireless,
internet) (VAN, WAN, LAN,
intranet, extranet) access
(cell phones)
(5)
Interfacing
infrastructure (with
databases, business
partners applications)
A FRAMEWORK FOR ELECTRONIC COMMERCE
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Thankyou