CHAPTER 3:

BUILDING AN E-COMMERCE PRESENCE

LECTURE: 03 & 04
COURSE COACH: MASNOON
SALEHIN COURSE: E-BUSINESS
LECTURER, DEPARTMENT OF COURSE CODE: MGT 403
MANAGEMENT, FBS, UNIVERSITY OF
DHAKA
IMAGINE YOUR E-COMMERCE PRESENCE

WHAT’S THE IDEA? (THE VISIONING PROCESS)

◼ Mission statement
◼ Target audience
◼ Intended market space
◼ Strategic analysis (SWOT)
◼ Internet marketing matrix
IMAGINE YOUR E-COMMERCE PRESENCE (CONTD.)
WHERE’S THE MONEY? (BUSINESS & REVENUE MODEL)

◼ Business model(s):
• Portal, e-tailer, content provider, transaction broker, market creator,
service provider, community provider
◼ Revenue model(s):
• Advertising, subscriptions, transaction fees, sales, and affiliate revenue
IMAGINE YOUR E-COMMERCE PRESENCE (CONTD.)
WHO & WHERE IS THE TARGET AUDIENCE?

◼ Demographics
◼ Age, gender, income, location
◼ Behavior patterns (lifestyle)
◼ Consumption patterns (purchasing habits)
◼ Digital usage patterns (consumer actions on the web)
◼ Content creation patterns (blogs, Facebook)
◼ Buyers’ personas and characteristics
IMAGINE YOUR E-COMMERCE PRESENCE (CONTD.)

WHAT IS THE BALLPARK? CHARACTERIZE THE MARKETPLACE

◼ Demographics
◼ Size, growth, changes
◼ Structure
• Competitors
• Suppliers
• Substitute products
 IMAGINE YOUR E-COMMERCE PRESENCE (CONTD.)
WHERE IS THE CONTENT COMING FROM?

The content is why customers visit your site and either purchase things or look at ads that
generate revenue.

There are generally two kinds of contents-

1. Static Content- text, images that do not frequently change, such as product descriptions,
photos or images created to share with visitors

2. Dynamic Content- can be created by anyone. Search engine is more likely to catalog a site
if the content is changing.
IMAGINE YOUR E-COMMERCE PRESENCE (CONTD.)
KNOW YOURSELF: CONDUCT A
SWOT ANALYSIS

◼ A SWOT analysis is simple but

powerful method for
strategizing about your
business and understanding
where you should focus your
efforts.

Figure 3.1: SWOT analysis

of a typical startup venture
IMAGINE YOUR E-COMMERCE PRESENCE (CONTD.)

DEVELOP AN E-COMMERCE
PRESENCE MAP
◼ An e-commerce presence
requires firms to consider four
different kinds of presence
◼ The presence are associated
with platform and activity

Figure 3.2
IMAGINE YOUR E-COMMERCE PRESENCE (CONTD.)

DEVELOP A TIMELINE: MILESTONES

◼ Where would you like to be a year

from now?
◼ You should break your project into
small number of phases that could be
completed within a specified time
◼ Six phases are usually enough

Table 3.1
IMAGINE YOUR E-COMMERCE PRESENCE (CONTD.)

HOW MUCH WILL THIS COST?

◼ How much you spend on website, for instance, depends on what you want to do?

◼ BS
BUILDING AN E-COMMERCE PRESENCE: A SYSTEMATIC APPROACH

The two most important challenges are-

1. Developing a clear understanding of your business objectives

2. Knowing how to choose the right technology to achieve those objectives

BUILDING AN E-COMMERCE PRESENCE: A SYSTEMATIC APPROACH
(CONTD.)
FACTORS TO CONSIDER IN DEVELOPING E-COMMERCE PRESENCE

◼ Human resources and organizational capabilities

• Creating team with skill set needed to build and manage a successful site

◼ Hardware/Software
◼ Telecommunications
◼ Site design
BUILDING AN E-COMMERCE PRESENCE: A SYSTEMATIC APPROACH
(CONTD.)
PLANNING THE SYSTEMS
DEVELOPMENT CYCLE
▪ SDLC Methodology for understanding
business objectives of a system and
designing an appropriate solution
▪ Five major steps:
• Systems analysis/planning
• Systems design
• Building the system
• Testing
• Implementation

Figure 3.5
 BUILDING AN E-COMMERCE PRESENCE: A SYSTEMATIC APPROACH
(CONTD.)
PLANNING THE SYSTEMS
DEVELOPMENT CYCLE (CONTD.)
1. Systems Analysis/Planning:
◼ What do we want this e-commerce site
do for our business?
◼ Business objectives- List of capabilities you
want your site to have
◼ System functionalities- List of information
system capabilities needed to achieve
business objectives
◼ Information requirements- Information
elements the system must produce in
order to achieve business objectives

Table 3.2 Systems Analysis

 BUILDING AN E-COMMERCE PRESENCE: A SYSTEMATIC APPROACH
(CONTD.)

PLANNING THE SYSTEMS DEVELOPMENT CYCLE (CONTD.)

2. System Design:
◼ Description of main components of a system and their relationship to one another
◼ Two components of system design:
a. Logical design- Data flow diagrams, processing functions, databases
b. Physical design- Specifies actual physical, software components, models, and so on
BUILDING AN E-COMMERCE PRESENCE: A SYSTEMATIC APPROACH
(CONTD.)
PLANNING THE SYSTEMS DEVELOPMENT CYCLE (CONTD.)

Figure 3.6 (a) Simple Data Flow Diagram Figure 3.6 (b) Simple Physical Design
 BUILDING AN E-COMMERCE PRESENCE: A SYSTEMATIC APPROACH
(CONTD.)
PLANNING THE SYSTEMS DEVELOPMENT CYCLE
(CONTD.)
3. Building the System:
◼ Outsourcing: Hiring vendors to provide services involved
in building site
◼ Build own vs. outsourcing:
• Build your own requires team with diverse skill set;
choice of software tools; both risks and possible
benefits
◼ Host own vs. outsourcing
• Hosting: Hosting company responsible for ensuring
site is accessible 24/7, for monthly fee
• Co-location: Firm purchases or leases Web server
(with control over its operation), but server is located
at vendor’s facility Figure 3.7
BUILDING AN E-COMMERCE PRESENCE: A SYSTEMATIC APPROACH
(CONTD.)
PLANNING THE SYSTEMS DEVELOPMENT CYCLE (CONTD.)
4. Testing the System:
◼ Unit Testing
◼ System Testing
◼ Acceptance Testing
◼ A/B Testing (Split Testing)
• Template Test
• New Concept Test
• Funnel Test
◼ Multivariate Testing
BUILDING AN E-COMMERCE PRESENCE: A SYSTEMATIC APPROACH
(CONTD.)

PLANNING THE SYSTEMS DEVELOPMENT CYCLE (CONTD.)

5. Implementation & Maintenance:
◼ Maintenance is ongoing
◼ Maintenance costs: Similar to development costs
◼ Benchmarking
BUILDING AN E-COMMERCE PRESENCE: A SYSTEMATIC APPROACH
(CONTD.)
FACTORS IN OPTIMIZING WEBSITE PERFORMANCE

Figure 3.10
 CHOOSING SOFTWARE

SIMPLE VERSUS MULTI-TIERED WEBSITE ARCHITECTURE

◼ System architecture
• Arrangement of software, hardware, and tasks in an information system needed to
achieve a specific functionality
◼ Two-tier
• Web server and database server
◼ Multi-tier
• Web application and other servers
• Backend, legacy databases
CHOOSING SOFTWARE
SIMPLE VERSUS MULTI-TIERED WEBSITE ARCHITECTURE (CONTD)

Figure 3.11 (a & b)

CHOOSING SOFTWARE (CONTD.)

E-COMMERCE MERCHANT SERVER SOFTWARE FUNCTIONALITY

Provides basic functionality for online sales
◼ Online catalog
• List of products available on Web site
◼ Online shopping cart
• Allows shoppers to set aside, review, edit selections, and then make purchase
◼ Credit card processing
• Typically works in conjunction with shopping cart
• Verifies card and puts through credit to company’s account at checkout
 CHOOSING HARDWARE

◼ Hardware platform:
• Underlying computing equipment needed for e-commerce functionality
◼ Objective:
• Enough platform capacity to meet peak demand without wasting money
◼ Important to understand the factors that affect speed, capacity, and scalability of a site
CHOOSING HARDWARE (CONTD.)
RIGHT-SIZING YOUR HARDWARE PLATFORM
The Demand Side The Supply Side
◼ Customer demand:
◼ Scalability:
• Most important factor affecting speed of site
• Ability of site to increase in size as demand
◼ Factors in overall demand: warrants
• Number of simultaneous users in peak periods ◼ Ways to scale hardware:
• Nature of customer requests (user profile) ◼ Vertically
• Type of content (dynamic vs. static Web pages) • Increase processing power of individual
• Required security components – e.g., using multiple
processers, faster chips
• Number of items in inventory
◼ Horizontally
• Number of page requests (Google has 40,000
per sec) • Employ multiple computers to share
workload
• Speed of legacy applications
OTHER E-COMMERCE SITE TOOLS
TOOLS FOR SEARCH ENGINE OPTIMIZATION
◼ Search engine placement

• Metatags and titles, help search engines find you

• Identify market niches, and tailor site to them

• Offer expertise such as white papers, industry analysis etc. to attract customers

• Encourage links from other sites to yours

• Buy Search engine keywords and ads

• Use key words to suggest the location of your establishment

OTHER E-COMMERCE SITE TOOLS (CONTD.)

Table 3.10 E-Commerce Website Table 3.11 The Eight Most Important Factors in
Features that Annoy Customers Successful E-Commerce Site Design
DEVELOPING A MOBILE WEBSITE & BUILDING MOBILE
APPLICATIONS
◼ Three types of m-commerce software
◼ Mobile Web site
• Browser-based Internet services accessed
from handheld mobile devices
◼ Mobile Web app built for a mobile web
browser of a smart device (phone, tablet)
◼ Native app designed specifically for mobile
device

Table 3.13 Unique Features that must be Taken into

Account When Designing A Mobile Presence