Virtual Communities 31606

Workshop 6Virtual Communities & e-

Business

Team Vlans

Anthony Nguyen Don Le Richard Nim King Lam Anamur Tran Long Nguyen

Overview

Virtual Communities e-Business History of e-Business Virtual Communities & e-Business Benefits Four dynamics to capture and

increase revenue in VCs

Overview (cont.)

Four Stages of Member Development Advantages/Disadvantages of e-

Business Issues of e-Business Success factors of e-Business Conclusion References

Virtual Communities

Definition: Groups of people with similar interests who communicate and interact in an electronic or online environment. (E. Lawrence pg 388 )

e-Business

A Definition: “An e-Business is a business on the

Internet” Dmitry Nanev. E-business means any Internet or network-

enabled business activity. E-business is connecting customers,

suppliers and partners across the Internet using tools and standards that work cooperatively to achieve the required outcome in a secure manner.

e-Business

Purposes Increase Revenue Appeal to a global market Integrating dissimilar business processes Traverse organisational boundaries and

extend to partners, suppliers and customers.

Share information or allow external access

e-Business

Categories Business 2 Business (B2B)

Dell, IBM Business 2 Consumer (B2C)

Peter Alexander Consumer 2 Consumer (C2C)

Stuff.com.au

History of e-Business Early 70s

Government and big organizations make good use of IT, and computers in general

Banks use EFT (Electronic Fund Transfer) to speed up payments

Late 70s, early 80s E-business beginnings

Electronic messaging technologies to carry out business transactions

EDI (Electronic Data Interchange) Inter organizational e-mail

History of e-Business Late 70s, early 80s (cont.)

EDI, e-mail Reduce paperwork, speed up transactions, facilitate

communications, etc. BUT

Only for large companies (manufacturers, retailers) Complex, expensive

Late 80s Small companies join the game

Using e-mail to communicate with big companies Small investment A good move in order to stay in the game

History of e-Business Late 80’s, early 90s

Online services become popular e-mail, news, chat

educational & technical institutions, special interest groups join the game

TCP-IP used as a common communications backbone Birth of the Internet

1995 Online services for the large public (AOL) The browser (and HTML) is commercialized The home page: a new channel for doing business

History of e-Business Late 90’s

Companies began to build home pages to serve as online corporate brochures

As web technologies matured, the first e-commerce transactions were taking place

Around 2000 The “dot-com” revolution: use the web as a

primary channel for product distribution Huge impact on established consumer markets Huge impact on the supply chain (SC)

SC: the chain of processes behind all consumer purchases

History of e-Business Source: Digital Think & ACM Professional

Development Center (digitalthink.com, acm.org)

1970 200019901980 1995

E-commerce begins Online services

emerge Browser

Dot-coms

Virtual Communities & e-Business

Virtual Communities & e-Business General e-Business (slide 1)

ShopFast (www.shopfast.com.au) ABC Shop (www.abcshop.com.au) dStore (www.dstore.com.au)

e-Business that have Virtual Communities E-bay (www.ebay.com) Amazon (www.amazon.com) Toms Hardware (tomshardware.com)

Example – eBay

Example - Amazon ‘Friends & Favorites’ section Personalized Recommendations – Uses a

Recommender System Special Occasion Reminder Amazon Friends Wish List – that ‘friends’ can access Discussion Boards ‘About You’ Area – Provide information

about yourself to others Suggestions Given – Provide ideas to Staff

Benefits

Benefits of Virtual Communities to e-Business Customer benefits

Main benefit: Customer generated content

Access to competing vendors Commercial orientation

Benefits (cont.) Vendor benefits

Enhanced ability to target Better Marketing abilities Increase propensity for buying Lower marketing costs

Four dynamics to capture and increase revenue in VCs

Content attractiveness Generate product reach, attract

customers and foster the virtual community

Content Attractiveness

Hours On-line

Member-generated content

Members

Member-to-member interaction

Marketing effectiveness

Member churn

Four dynamics to capture and increase revenue in VCs

Member profile “Personalised” profiles through

intelligent agents & data mining - recommender agents, etc

Member Profiles

Data-collectingcapabilities

Targetedtransaction offerings

Advertising revenue Transaction volume

TargetedadvertisingAdvertising

click through

Four dynamics to capture and increase revenue in VCs

Member loyalty Customer retention through VCs and

competitive advantage

Member Loyalty

Hours On-line

member-generated content

Members in VC Memberrelationships

Customised interaction

Member churn rate

Four dynamics to capture and increase revenue in VCs

Transaction offerings Deliver value added G+S and focus

on customer pulling power

Transaction Offerings

Vendor marketing spending

Vendors in VC

Vendor marketing effectiveness

Member willingnessto spend

Attractiveness tovendors

Members in VC

Four stages of Member Development Attract members

Market the eBusiness to the target Attractive website with competitive pricing

Promote participation Incorporate VC features & functionality

Build loyalty Foster community and reward users

Capture value Develop vendor and customer relationships Expansion and continual innovation

Advantages of e-Business Benefits for Consumer

Cheaper products Greater range and variety of products Easier Accessibility Dynamic Support Shop 365 days a year, 24 hours a day Shop at your own pace in your own

privacy No lines, crowds, or annoying salespeople

Advantages of e-Business (cont.)

Benefits for Vendors Cheaper Operating Costs Financial Returns Global Market Place Business operates 24 Hours, 7 Days

of the Week Flexible time Commitment

Disadvantages of e-Business for Consumer

Social Aspects Loss of Senses – touch, smell, sight, taste,

aural Can be Bandwidth Intensive

for Vendor Multiple Legal Systems Greater Competition Consumers have immediate access to

Competitors

Success Factors Increased interaction between potential

consumers Mutual trust between buyer and seller Representation & specification of the product Appropriate functionality within the market

place Reaching out to a global marketplace with a

competitive advantage through competitive pricing and value added products

Provide an eBusinesss solution that builds on the customer’s trust and confidence

Success Factors (cont.) Have an eBusiness operation that is scalable,

secure, manageable and flexible Utilize the knowledge and experience of the

employees in the organisation “Engage customers & suppliers into thinking up

new ways to improve the business” (Leung M. 2002)

Enhanced customer experience through automation

Adapt to constant and continual change in the Internet

Foster the virtual community and customer loyalty Customer interfaces

Issues - Trust

A dynamic process that deepens or weakens according to experience. [Lawrence pg 274]

Customers have different concerns Security, Privacy and Rights

Current law isn’t enough to protect us

Issues - Security

Security concerns include viruses, trojan, spams

Denial-of-Service (DoS) attacks MafiaBoy

A 15 year old tennager hacking into CNN

Issues – Implementing Security

Update the Operating System Virus Scanners Digital Certificates Secured Network Infrastructure Security Policy

Issues – Law

Law conflicts due to International Market

ISP responsibility in Australia Implement An Agreement of Terms

Conclusion

VC & e-Businesses improve the overall aim and goals of a business as a whole

Thank you for your time! Hope you enjoyed the last

Workshop Brought to you by V-Lans© 2003.

References Technology of the Internet Business, Elaine

Lawrence 2002 Digital Think & ACM Professional Development

Center (digitalthink.com, acm.org) Internet Commerce – Digital Models for

Business, Elaine Lawrence 2000 Electronic Commerce Technology Briefing July

10, 1996 Communities in E-Business March 9 - 11, 2003 The E-Business Community must be

embraced, Don Tapscott September 28, 1998

References (cont.) Enabling Knowledge Exchanges For E-Business

Communities, Dr. Yogesh Malhotra, 2002 Richard Turnbill - eROI anonymous - key success factors for new

businesses ebiz.enable - Success Factors Michelle Leung - What are the success factors

for eBusiness? Faruk Waja - So whats this about a anew

economy?