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    ECOMMERCE

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    Myspace and Facebook

    Tv programs vs online venture

    2008 Survey for a US Tv show(12 M) vsfacebook(40 M) and myspace(72 M) of total

    111 M. World wide 130M facebook and 115 M

    myspace

    Both sites have more than 100 M profiles

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    Myspace history

    Founders:Tom Anderson and Chris DeWolfe(2003)

    People to talk about the things they loved and

    in personal way bulletin board type building your own website,

    promote themselves

    Top 100 sites over the world

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    Myspace

    They started advertising

    Big Companies willing to pay for the audience.

    They used popular pages/sites on myspace topromote their products.

    Toyota, Proctor & Gamble

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    Myspace

    In 2005 they sold myspace for $580 M

    User profiles banned.

    Downfall- 2011 they sold it for $35 M

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    Facebook (2004)

    As rival of myspace Marck Zukerberg createdfacebook with a new thefacebook.com ashobby at Harward.

    Digital version of traditional student classpicture

    Became popular and expanded to 3000

    colleges and unv.

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    Facebook

    Originally restricted to college students.

    They opened it for all in 2006.

    At start they have fixed templates rather thanuser designed web pages

    Opened up its Web pages to thousands ofwidgets

    Allow users to create apps on their site.

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    Some facts about E-commerce

    Online consumer sales (retail, travel andonline content) to an estimated $255 billion.

    Shop electronics, home furnishings, and

    apparel.About 78 % of US population use internet

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    Some facts about E-commerce

    On an average day, 112 million people goonline. Around 97 million send e-mail, 33million share music and 35 million research a

    product.

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    What is E-commerce?

    Use of Internet and Web to transact business

    More formally:

    Digitally enabled commercial transactionsbetween and among organizations and individuals

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    E-commerce

    E-commerce involves

    Digitally enabled transactions this meanstransactions that occur over the Internet and

    the Web Commercial transactions involve the exchange

    of value across organizational or individual

    boundaries in return for products or services

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    E-commerce vs. E-business

    E-business:

    Digital enablement of transactions and

    processes within a firm, involving informationsystems under firms control

    Does not include commercial transactions

    involving an exchange of value acrossorganizational boundaries

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    E-commerce vs E-Business

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    Unique Features of E-commerceTechnology

    1. Ubiquity

    2. Global reach

    3. Universal Standards

    4. Information richness

    5. Interactivity

    6. Information density7. Personalization/customization

    8. Social technology

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    Ubiquity

    Traditional comm. Marketplace is physical.

    television and radio typically motivate

    Its is available everywhere. (home,job)

    Came out of being restricted to a physicalplace.

    Reduce transaction cost (time + money)

    Lower the Cognitive energy.

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    Universal Standards

    There is one set of technology standards,namely Internet technology.

    most traditional commerce technologies differ

    from one nation to the next lower market entry costs.

    Lower search costs

    Users can find any type of product any wherein the world

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    Global Reach

    permits commercial transactions to crosscultural and national boundaries far moreconveniently and cost-effectively than is true in

    traditional commerce. potential market size for e-commerce

    merchants is roughly equal to the size of the

    worlds online population. Traditional comm. Has limited reach.

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    Richness

    Trad comm do face to face sales

    More information richeness.

    Chatting with online users

    Sell complex goods that require face to facepresentation.

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    Interactivity

    Two way interaction (telephone,ecomm)between merchant and consumer.

    Trad tevel commercials cant ask any question

    or enter in to conversation.

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    Information Density

    Information processing, storage andcommunication costs drop dramatically, whilecurrency and accuracy improve greatly.

    Information becomes plentiful, cheap, andaccurate.

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    Personalization/Customization

    merchants can target their marketingmessages to specific individuals

    They will store the past purchased of customer

    and show them to others

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    Social Technology

    the Internet and e-commerce technologieshave evolved to be much more social byallowing user to create and share content.

    Traditional forms are one to many. (press,broadcasting model)

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    Web 2.0

    Technologies that allow users to:

    Create and share content, preferences,bookmarks, and online personas

    Participate in virtual lives

    Build online communities

    E.g. Twitter, YouTube, Facebook, 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)

    C

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    Business-to-Consumer E-commerce

    Most commonly discussed type

    Online businesses attempt to

    reach individual consumers Consumers will spend $255

    billion in 2008.

    B i B i E

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    Business-to-Business E-commerce Businesses focus on sell to other

    businesses

    Largest form of e-commerce

    $3.8 trillion in transactions in 2008

    C t C E

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    Consumer-to-Consumer E-commerce

    Provide a way for consumers tosell to each other

    Estimated $5 billion market

    Ebay and craiglist

    Consumer: prepares the product for market

    places the product for auction orsale

    relies on market maker to provide

    catalog, search engine, and

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    Peer-to-Peer E-commerce

    Enables Internet users to sharefiles and computer resources

    BitTorrent

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    Mobile E-commerce

    Wireless digital devices enable totransactions on the Web

    involves the use of wirelessnetworks to connect cell phonesonce connected they can

    conduct transcation through theirIphone, Andriod etc.

    Used most widely in Japan and

    Europe

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    The Internet

    Worldwide network of computer networksbuilt on common standards

    Created in late 1960s

    Services include the Web, e-mail, filetransfers, etc.

    Can measure growth by looking at numberof Internet hosts with domain names

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    The Growth of the

    Internet, Measuredby Number ofInternet Hosts with

    Domain Names

    Figure 1.3, Page 23

    SOURCE: Internet Systems Consortium,Inc. , 2010.

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    The Web

    Most popular Internet service

    Developed in early 1990s

    Provides access to Web pages

    HTML documents that may include text, graphics,animations, music, videos

    Web content has grown exponentially

    Google indexes between 75100 billion pages

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    Origins & Growth of E-commerce Precursors:

    Baxter Healthcare

    Electronic Data Interchange (EDI)

    French Minitel (1980s videotex system)

    None had functionality of Internet

    1995: Beginning of e-commerce

    First sales of banner advertisements

    E-commerce fastest growing form ofcommerce in United States

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    The Growth of B2C E-commerceFigure 1.4, Page 25

    SOURCES: Based on data from eMarketer, Inc., 2010; authors estimates.

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    The Growth of B2B E-commerceFigure 1.5, Page 28

    SOURCES: Based on data from U.S. Census Bureau, 2010; authors estimates.

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    Search the Web for an example of each of thefive major types of e-commerce. Create awritten report describing each Web site (take a

    screenshot of each), and explain why it fits intoone of the five types of e-commerce.