E-Commerce
e-Commerce
Chapter6
Business Process Engineering
[Book: E-Commerce : A Managerial Perspective, P.T. Joseph]
1.Approaches:
• A Business Model is the method of doing business by which a company can sustain itself, that is generate revenue.
• The Business Model spells out how a company makes money by specifying where it si positioned in the value of chain.
• Example Radio and TV aired free.
2.Models and Methodologies:
Although there are many different ways to categorize e- business models, they can be broadly categorized as
1) E- business Model based on the relationship of transaction parties
2) E- business Model based on the relationship of transaction types
E- business Model based on the relationship of transaction parties
Fig: E-business transaction (page 31)
• B2C : Sells products or services directly to customers, eg
• B2B : Sells products or services to other business, or brings multiple buyers and sellers together in a central market place, eg.
• B2G: Business selling to local, state and federal agencies, eg.
• C2C : Consumers sell directly to other consumers, eg
• C2B : Consumers fix price on their own, which business accept or decline. Eg
B2B B2C
Fig: Relation between B2B and B2C
2.1 B2C:
2.1.1 How B2C works
• Visiting the virtual mall
• Customer registration
• Customer buys the product
• Merchant process the order
• Credit card is processed
• Operations management :eg quality management
• Shipment or delivery
• Customer receives
• After sales service
2.1.2 Benefits of B2C
• Inexpensive cost
• Big Opportunities
• Globalization
• Reduced operational coast
• Customer convenience
• Knowledge management
2.1.3 Barriers of B2C
• You can see but you can not touch, feel and smell
• Digital Photographs are not color accurate
• Consumer expects high service standards
• Trusting the company/brand
• Financial security
• Personal Data
2.2 B2B:
2.2.1 How B2B works: Tools and techniques
• Use of pricing as a tool
• Use of application service provider Model
• Use of generic Model which are known for efficiency as well as personalized attention to various business customers
• Use of Comparison shopping
2.2.2 B2B Transaction Model
• B2B Storefronts: Provide business with purchase, order fulfillment and other value added services. Eg
• B2B vertical Markets: Provide a trading community for specifying industry. Eg
• B2B aggregators: Provide a single marketplace for business purchasing for multiple suppliers
• B2B trading hubs: Provide a market place for multiple vertical markets. Eg
• B2B Post and browse Markets: Provide Marketplace where participants post buy and sell opportunities eg
• B2B auction markets: Provide a market place for buyers and sellers to enter competitive bids and contracts eg
• B2B fully automated exchanges: : Provide a market place for the automatic matching of standardized buy and sell contracts. Eg
2.2.3 Benefits of B2B
• Direct interaction with customers
• Focussed sales promotion
• Building customer loyalty
• Scalability
• Savings in distribution cost
E- business Model based on the relationship of transaction types
This business model is usually controlled by two parameters namely Control and value Integration. Based on this five types of transaction can be identified:
• Brokerage:
• Aggregator : Connects buyers and sellers
• Info-mediary: Provides information e.g.
• Community:
• Value chain: portals e.g.
3. Management of Changes
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Business
Business
Customer
Customer
Government
Raw
Material
Producer
Manufac-
turer
Distributor
Retailer
Consumer
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