5. Competitive advantage + What special advantages does your firm bring to the marketspace?” 6. Market strategy + How do you plan to promote your products or services to attract your target audience? 7. Organizational development « What types of organizational structures within the firm are necessary to carry out the business plan? 8. Management team + What kind of backgrounds should the company’s leaders have? _Potential Benefits of B2B E-commerce = Lower administrative costs = Lower search costs for buyers = Reduced inventory costs @ Lower transaction costs @ Increased production flexibility by ensuring just-in-time parts delivery = Improved quality of products by increasing cooperation among buyers and sellersThe Online Retail Sector @ Most important theme in online retailing is the effort to integrate online and offline operations @ $17.8 trillion U.S. economy @ U.S. retail market + Personal consumption of goods and services accounts for $12.2 trillion (about 68%) of total gross domestic product (GDP)Imagine Your E-commerce Presence w What's the idea? Vision includes: «Mission statement wA sentence describing a company's function, markets and competitive advantages; a short, written statement of your business goals and philosophiesE-COMMERCE WEB SITE FEATURES THAT ANNOY CUSTOMERS use browser's Back button ‘Nocontact information available (Web form only) Unnecessary splashyflash screens, animation, etc. Music or other audio that plays automatically Unprofessional design elements Text not easily legible due to size, color, format Typographical errors No-or unclear returns policyHow E-commerce Changes Business ™ E-commerce changes industry structure by changing: * Rivalry among existing competitors * Barriers to entry * Threat of new substitute products + Strength of suppliers + Bargaining power of buyersTHE EIGHT MOST IMPORTANT FACTORS IN SUCCESSFUL E-COMMERCE SITE DESIGN FACTOR DESCRIPTION | Fu nal ity Pages that work, load quickly, and point the customer toward | your product offerings Links that customers can easily find to discover more about you and your products Simple foo!-proof navigation Altemative navigation to the same content ‘One or two clicks to purchase Site works with the most popular browsers ‘Avoids distracting, obnoxious graphics and sounds that the user cannot control Avoids backgrounds that distort text or make it illegibleStrategic Analysis Factors @ Key industry strategic factors + Barriers to entry + Power of suppliers + Power of customers u je Ses Pree Existence of substitute products lect; % Industry value chain i en ¢ Nature of intra-industry competition u Firm-specific factors { i © Firm value chain « Core competencies WY + Synergies + Technology % Social and legal challenges {Right-Sizing Your Hardware Plattorm The Demand Side & Customer demand: * Most important factor affecting speed of site @ Factors in overall demand: 4 Number of simultaneous users in peak periods + Nature of customer requests (user profile) % Type of content (dynamic vs. static Web pages) + Required security q + Number of items in inventory Number of page requests « Speed of legacy applicationsEight Key Elements of a Business Model 1. Value proposition + Why should the customer buy from you? 2. Revenue model + How will you earn money? 3. Market opportunity « What market do you intend to serve and how big is it? 4. Competitive environment « Who else occupies your intended marketspace? IPotential Benefits of B2B E-commerce (Cont.) w Decreased product cycle time ® Increased opportunities for collaboration = Greater price transparency = Increased visibility, real-time information sharing = However, some risk is posed by increased globalization and consolidationE-tailing Business Models 8 Virtual merchant + Amazon, Newegg, Overstock, Wayfair, Blue Nile @ Omni-channel (bricks-and-clicks) + Walmart, Macy’s, JC Penny, Staples, Target = Catalog merchant + Lands’ End, L.L. Bean, CDW Corp, Cabela's @ Manufacturer-direct « Apple, Dell, Sony + Channel conflict +: Move from supply-push model to demand-pullPrivacy and Information Rights = Privacy « Moral right of individuals to be left alone, free from surveillance, or interference from other individuals or organizations @ Information privacy + The “right to be forgotten” « Claims: ® Certain information should not be collected at all @ Individuals should control the use of whatever information is collected about them « Behavioral tracking on the Internet, social sites, and mobile devicesThe Internet and Web: Features = Features on which the foundations of e-commerce are built: + E-mail + Instant messaging + Search engines + Online forums + Streaming media « Cookies « Web 2.0 features and servicesEvolution of the Use of Technology Platforms in B2B Commerce an iii = seasinenil cs = Private Industral | Networks: eastern === Web Stes. Interchange (ED!) > ome ____| Entry Systoms y > SES 1970 1980 1990 2009 2010 2015 Fioure 12.1. Paco FS? YoarPrivacy and Information Rights (cont.) & Threats to privacy + Personal information collected by commercial Web sites + Personal information collected by government authorities + Impact of mobile devices = Tracking people's locations and movements = Tracking personal behaviorThe Growth . of Online 8 Retailinthe O° United = ‘ States & eo x "i go 0 s } Figure 9.2, p. 582 @ = ® ° SOURCES: Based on data from Internet Recaller, 2015 ebtarteter, Inc. 2015y Apes! ed cometBasic Definitions = B2B commerce: « All types of computer-enabled inter-firm trade + Before Internet, B2B transactions called trade or procurement process @ B2B e-commerce: « The portion of B2B commerce enabled by the Internet @ Supply chains + Organizations, people, business processes, technology, information required to produce products efficiently ( + Often globalDomain Names, DNS, and URLs ® Domain name © IP address expressed tn natural language ® Domain name system (DNS) * Allows qumeric IP addresses to be expressed in natural ignguage ® Uniform resource locator (URL) Address used by Web brow'ser to identify location af content on the Web + Fore mam phe: erp ferwrer areoth-interactive.com flak teatOther E-commerce Site Tools = Web site design: Basic business considerations + Enabling customers to find and buy what they need & Tools for Web site optimization + Search engine placement = Metatags, titles, contentRight-Sizing Your Hardware Platform: The Supply Side w Scalability: + Ability of site to increase in size as demand warrants @ Ways to scale hardware: + Vertically u Increase processing power of individual components + Horizontally = Employ multiple computers to share workload + Improve processing architecture + Outsource to cloud service, CDNCanadian Growth of B2C and B2B Online Shopping Continues (Statistics) = Canadian small businesses have struggled to keep up with eCommerce and multi-channel customer management.PNewwpe FY Eight Unique Features of E-commerce Technology Ubiquity (“the fact of appearing everywhere or of being very common”) Global reach Universal standards 280 Information richness Interactivity sass, Information density Personalization/customization Social technology