SIZ02 – E-BUSINESS

Capaian Pembelajaran
Mata Kuliah
• Mahasiswa mampu mengidentifikasikan model
bisnis digital, infrastruktur teknologi pendukung,
serta keterkaitannya dengan lingkungan bisnis
(C3, A3)
• Mahasiswa mampu menunjukkan strategi dan
implementasi bisnis digital yang terdiri dari
pengelolaan SCM, Marketing, CRM, dan
transformasi bisnis (C3, A3)
Introduction to Digital Business
Session 1
Diadopsi dari sumber:

Dave Chaffey, Tanya

Hemphill, David
Edmundson - Bird. (2019).
Digital Business and E-
Commerce Management,
7th edition. Pearson
 Sub-CPMK
• Mahasiswa mampu menjelaskan konsep bisnis digital dan
menjelaskan gambaran perbedaan bisnis digital dan e-
commerce business. (C2, A2)
Materi
1. Learning Outcomes
2. Management Issues
3. Introduction
4. The Impact of Digital Communications on Traditional
Businesses
5. What Is The Difference Between a Digital Business and an E-
Commerce Business?
6. Digital business opportunities
7. Barriers to The Adoption of Technology by Digital Business
Stakeholders
8. Barriers to Consumer Digital Adoption
1. Learning Outcomes
 Learning Outcomes
• Introduces digital business and its relevance to
organizations, buyers, supliers, stakeholders,
and consumers. It clarifies terms and
concepts, such as the term ‘digital business’,
and puts business, revenue, technology
models in context by reviewing alternative
applications through activities and case
studies.
2. Management Issues
 The issues for managers raised
in this chapter include:
• How do we explain the scope and implications
of digital business to staff?
• What is the full range of benefits of
introducing digital business and what are the
risks?
• How do we evaluate our current digital
capabilities?
3. Introduction
 Introduction

• In digital business, we will explore approach

manager can use to assess the relevance of
different digital technologies and then devise
and implement strategies to exploit these
opportunities.
 Introduction (Cont’d)

Figure 1.1 Google circa 1998

Source: Wayback machine archive: http://web.archive.org/web/19981111183552/google.stanford.edu . Google and the Google logo are registered trademarks of Google Inc.,
used with permission.
 Introduction (Cont’d)
• Digital business is an exciting area to be involved with,
since many new opportunities and challenges arise
yearly, monthly, and even daily.
• Innovatives is a given with the continuous introduction
of new technologies, new business models and new
communications approaches.
• For example, Google innovates relentlessy. Its service
has developed a long way since 1998, with billions of
pages now indexed and other service such as web mail,
pay per clict adverts, analytics, shopping services,
social network and artificial intelligence all part of its
offering.
 4. The Impact of Digital
Communications on Traditional
Businesses
 The Impact of Digital
Communications on Traditional
Businesses
• All organizations have to review new digital
communications approaches for their potential to
make their business more competitive and also
manage ongoing risk such as security and performace.
For example, many business are reviewing the
benefits, costs, and risks of digital business
technologies they are currently implementing as a
part of digital transformation projects.
 The Impact of Digital
Communications on Traditional
Businesses (Cont’d)
• Stolterman and Forse describe digital
transformation as the changes that occur in any
part of human society through the application of
digital technology.
• Digital transformation in business occurs when
there are significant changes to organizational
processes, structures, and systems, implemented
to improve organizational performace through
increasing the application of digital technology.
 4.1 Inbound Marketing
• The consumer is proactive in actively seeking out
information for their needs, and interactions with
brands are attracted through content, search and
social media marketing.
• In digital world it is often the costumer who initiates
contact and is seeking informations by discovering
information on an organization’s digital presence.
Among marketing professionals, this powerful
approach to marketing is now commonly known as
inbound marketing (Shah and Halligan, 2009).
Google refers to this consumer decision making
before they visit a retailer as the Zero Moment of
Truth (ZMOT) in handbook by Lecinski (2012)
4.1 Inbound Marketing (Cont’d)
 4.2 Zero Moment of Truth (ZMOT)

• A summary of today’s multichannel

consumer decision-making for product
purchase where they search, review
ratings, styles, prices and comments on
social media before visiting a retailer.
 4.3 Social Media Marketing
• The increasing popularity of social media is a
major trend in digital business in particular social
network sites (SNS) such as facebook , twitter,
and for business to business users, LinkedIn and
RSS feeds.
• Social media marketing do monitoring and
facilitating customers, customer interaction and
participation throughout the web to encourage
positive engagement with company and its
brand. Interactions may occur on a company site,
social networks and other third party sites
 4.3 Social Media Marketing (Cont’d)

Figure 1.3 Social media marketing radar

Source: Smart Insights (www.smartinsights.com). With permission.
5. What Is The Difference Between
a Digital Business and an E-
Commerce Business?
 5.1 E-Commerce Defined
• The scope of e-commerce is narrower than
digital business. It’s often throught simply to
refer to buying and selling using the internet.
People immediately think of consumer retail
purchases from companies such as Amazon,
but e-commerce can be considered as all
electronically mediated transactions between
an organization and any third party it deals
with.
 5.1 E-Commerce Defined (Cont’d)
Kalakota and Whinston (1997) referred to a range of different
perspectives for e-commerce that are still valid for today:
1. A communications perspective – the delivery of
information, products, and services or payment by
electronic means.
2. A business process perspective – the application of
technology toward the automation of business
transaction and workflows.
3. A service perspective – enabling cost cutting at the same
time as increasing the speed and quality of service
delivery.
4. An online perspective – the buying and selling of products
and information online.
 5.1 E-Commerce Defined (Cont’d)

Figure 1.4 The distinction between buy-​side and sell-​side e-commerce

 5.1 E-Commerce Defined (Cont’d)

• When evaluating the strategic impact of e-

commerce on an organization, it is useful to
identify opportunities for buy side and sell
side e-commerce transactions, as shown in
figure 1.4., since systems with difference
functionalities will need to be created in an
organization to accommodate transaction
with buyers and suppliers.
 5.1 E-Commerce Defined (Cont’d)
• Buy side e-commerce refers to transaction to procure
resource needed by an organization from its suppliers.
Sell side e-commerce refers to transactions involved
with selling products to an organizations customers.
• Social media commerce is an increasingly important
part of e-commerce for site owners since incoporating
reviews, rating and other social media interactions into
a site and linking to social networking sites can help
understand customers needs and increase conversion
to sale. It can also involve group buying, using a
coupon service such as Groupon.
 5.2 Digital Business Defined
• Digital business is broader in its scope than e-
commerce. Its similar to the term ebusiness
which was first coined by IBM in 1997 and
describe as: “ebusiness – the transformations of
key business processes through the use of internet
technologies”.
• Digital business – how businesses apply digital
technology and media to improve the
competitiveness of their organization through
optimising internal processes with online and
traditional channels to market and supply.
 5.3 Intranet and Extranet

Figure 1.5 The relationship between intranets, extranets and the Internet
 5.3 Intranet and Extranet (Cont’d)

• The majority of internet services are available

to any business or consumer that has acess to
the internet. However, many digital business
application that access sensitives company
information require access to be limited to
qualified individuals or partners. If
information is restricted to employees inside
an organization, this is an intranet.
 5.4 Different Types of Sell Side
E-Commerce
• As you review websites, note how
organization have different parts of the site
focusing on the five functions:
1. Transcational e-commerce site
2. Services orientated relationship building sites
3. Brand building sites
4. Publisher or media sites
5. Social network sites (SNS)
 5.5 Options for Organizations
To Reach a Digital Audience
For organization to be successful in their digital
communications they must decide how they
invest their time and budget in the sometimes
bewildering range of online communications
tools.
 5.5 Options for Organizations To
Reach a Digital Audience (Cont’d)

Figure 1.7 The three main options for online media investment
 5.6 The Six Types of Digital Media
Channels
• There are many online communications
techniques that marketers must review as part of
their digital business communications strategy or
as part of planning a digital marketing campaign.
To assist with planning, Chaffey and Smith (2012)
recommend reviewing the six main types of
digital media channels for reaching audiences,
shown in figure 1.8. Note that offline
communication should also be reviewed for their
role in driving visitors to a company website or
social network presence.
 5.6 The Six Types of Digital Media
Channels (Cont’d)

Figure 1.8 Digital and offline communications techniques

 5.7 The Social Internet and
User Generated Content
• From 2004, the Web 2.0 concept increased in
prominence among website owners and
developers. The main technologies and
principles of web 2.0 have been explained in
an influential article by Tim O’Reilly. Behind
the label ‘Web 2.0’ lies a bewildering range of
interactive tools and social communications
techniques such as blogs, podcast, and social
networks, which are still in use today.
 5.7 The Social Internet and User
Generated Content (Cont’d)

Figure 1.9 Evolution of web technologies

Source: Adapted from Spivack (2009).
 5.7 The Social Internet and User
Generated Content (Cont’d)
• Figure 1.9 summarises the evolutionof digital
and web related technologies. Note that the
term Web 2.0, 3.0, and 4.0 are not terms
commonly used today, yet it’s useful to
understand the principles of Web 2.0 in
particular since they are important to creating
interactive, integrated desktop, and mobile
experiences. Many sites still don’t have these
characteristics.
 5.8 Business or Consumer Models
of E-Commerce Transactions
• Figure 1.10 gives examples of different
companies operating in the B2C and B2B
spheres. Often companies such as BP or Dell
Computer will have products that appeal to
both consumers and business, so will have
different part of their site to appeal to these
separate audiences.
 5.8 Business or Consumer Models of
E-Commerce Transactions (Cont’d)
• Figure 1.10 also presents two additional type of
transcation, those where consumers transcat
directly with other consumers (C2C) and those
where they initiate trading with companies (C2B).
These monikers are less widely used, but they do
highlight significant differences between Internet
based commerce and earlier forms of commerce.
C2C interactions (also known as peer to peer of
person to person, P2P) were relatively rare, but
are now very common in the form of social
networks.
 5.8 Business or Consumer Models of
E-Commerce Transactions (Cont’d)

Summary and examples of transaction alternatives between businesses,

Figure 1.10
consumers and governmental organisations
 5.9 Dot Gov Defined
The application of digital technologies to government and
public services for citizens and business. In the same way that
digital business can be understood as transaction and
engagement with consumer (citizens), suppliers and internal
communications. Dot Gov covers similar range of
applications:
1. Citizen is facility for dissemination of information and use
of digital services at local and national levels
2. Suppliers is government departement have a vast
network of suppliers
3. Internal communications include information collection
and dissemination and email and workflow systems for
immproving efficiency within government departements
6. Digital Business
Opportunities
 Digital Business Opportunities

• Digital business has introduced new

opportunities for small and large organizations
to compare in the global marketplace. As we
observed that the start of this chapter, many
commentators have noted that one of the
biggest changes introduced by electronic
communications is how approaches to
transmitting and transforming information can
be used for competitive advantage
 6.1 Drivers of Digital
Technology Adoption
Business adoption of e-commerce and digital business is
driven by benefits to different parts of the organization.
First and foremost, business are concerned about how the
benefits of digital business will impact on profitability or
generating value to an organization. The two main ways in
which this can be achieved are:
• Potential for increased revenue arising from increased
reach to a large costumer base and encouraging loyalty
and repeat purchases among existing customers
• Cost reduction achieved through delivering services
electronically – reductions include staff cost, transport
costs, transport costs, and costs of materials such as
paper
 6.1 Drivers of Digital Technology
Adoption (Cont’d)
At early point in digital technology adoption, a government report
identified two main categories of drivers that remain relevant today
for introducing new technology:
Cost / efficency drivers
1. Increasing speed with which supplies can be obtain
2. Increasing speed with which goods can be dispatched
3. Reduced sales and purchasing costs
4. Reduced operating cost
Competitive drivers
5. Customer demand
6. Improving the range and quality of services offered
7. Avoiding losing market share to business already using e-commerce
 7. Barriers to The Adoption of
Technology by Digital Business
Stakeholders
 Barriers to The Adoption of Technology
by Digital Business Stakeholders
In the section of digital business technology opportunities, we reviewed
the concept of soft lock in; however, if the consumer experience of
service is very bad, they will stiop using it and switch to order digital
options. Excamples of poor digital consumer experience include:
1. Website that fail because of a spike in visitor traffic after a peak hour
TV advertising campaign
2. Hackers penetrating the security of the system and stealing credit
card detail
3. A company email costumers without receiving their permission, thus
annoying customers and potential breaking privacy and data
protection laws
4. Problems with digital fulfilment of goods ordered, meaning customer
orders go missing or are delayed
5. Customers service enquiries through email, contact form and social
media don’t reach the right person and are ignored
 7.1 Evaluating and Organization’s
Digital Business Capabilities

Figure 1.11 A simple stage model for buy-​side and sell-​side e-commerce
 7.2 Drivers of Consumers
Technology Adoption
• Stage models used to review how advanced a
company is in its use of information and
communications technology (ICT) to support
different processes.
8. Barriers to Consumer Digital
Adoption
 Barriers to Consumer Digital
Adoption
An indication of some barrier to using the barriers to
using the internet, in particular for consumer purchases,
is clear from a survey (Booz Allen Hamilton, 2002) of
perceptions in different countries. It noted that consumer
barriers to adoption of the internet included:
• No perceived benefit
• Lack of trust
• Security problems
• Lack of skills
• Cost
 Summary
• E- commerce traditionally refers to
electronically mediated buying and selling.
• Sell side e-commerce or digital marketing
involves all electronic business transactions
between an organization and its customers,
while buying buy side e-commerce involves
transactions between an organization and its
suppliers. Social commerce encourges
customers to interact to support sales goals.
 Summary (Cont’d)
• Digital business is broader term, referring to how
technology can benefit all internal business
processes and interactions with third parties. This
includes buy side and sell side e-commerce and
internal value chain.
• The main business drivers for introducing e-
commerce and digital business are opportunities
for increased revenues and reducing cost, but
many other benefits can be identified that
improve customer service and corporate image.
 Summary (Cont’d)
• Consumer adoption of the digital technology is
limited by lack of imperative, cost of access and
security fears. Business adoption tends to be
restricted by percrptions of cost, making return
on investment difficult to quantity.
• Introducing new technology is not all that is
required for success in introducing e-commercce
and digital business. Clearly defined objectives,
creating the right culture for change, a mix of
skills, partnerships, and organizational structure
are arguably as, if not more, important.