106 Digital Business

Chapter 3 : Digital Business

Ecosystem

Prof : Manav Agarwal

9823962733
Manava_iom@bkc.met.edu
Digital Business Ecosystem: Electronic Commerce Mechanisms, Online Purchasing Process,
E-Marketplaces -Types, Components and Participants, Disintermediation and Reintermediation;
Customer Shopping Mechanisms -Webstores, Malls, and Portals, Webstores, Electronic Malls ,
Web (Information) Portals.
Intermediaries: Roles of Intermediaries in E-Marketplaces, Merchant Solutions: Electronic
Catalogs, Search Engines, and Shopping Carts, Electronic Catalogs, E-Commerce Search
Activities, Auctions - Traditional Auctions Versus E-Auctions, Dynamic Pricing.
Changing Supply Chains: Structure of the Supply Chain, EC Order Fulfillment Process,
Speeding Up Deliveries, Partnering Efforts and Outsourcing Logistics, Order Fulfillment in Make-
to- Order (MTO) and Mass Customization.
Digital Payments: Smart Cards, Stored-Value Cards, EC Micropayments, Payment Gateways,
Mobile Payments, Digital and Virtual Currencies, Security, Ethical, Legal, Privacy, and
Technology Issues. (7+2)
 Digital Business Ecosystem
• Electronic Commerce Mechanisms

• Online Purchasing Process

• E-Marketplaces :

“ The E-commerce marketplace or the online e-commerce marketing

is a place or a website where one can find different brands of
products coming from multiple vendors, shops or person
showcased on the same platform.”
 E-Marketplaces
E-Marketplace Components and Participants
• Customers • Infrastructure
• Sellers • Front end
• Products and services • Back end
– digital products • Intermediaries
Goods that can be Third parties that operates
transformed to digital between sellers and
format and delivered buyers
over the Internet • Other business partners
• Support services
Customers

Sellers COMPONENTS AND

Products and PARTICIPANTS IN E-
Services
MARKETPLACES
Infrastructure

Front End

Back End

Intermediaries
 Types of E marketplace
• Buyer-oriented e-marketplace
• Supplier-oriented e-marketplace ((CCO) Cisco connection Online)
• Vertical (Quill.com) and horizontal e-marketplaces (Amazon.com)
•  Independent/Gobal e-marketplace (Alibaba.com, eBay.com )
• Global Marketplace
• This is the most complex yet very popular marketplace type. These types of online marketplaces
are developed for delivering items or services from a wide range of categories to consumers.
• Amazon is the perfect example of Global Marketplaces. Can you think of a single category of
products that is not available on Amazon? If you know one, please share your answer in the
comment section below!
Horizontal Marketplace Vertical Marketplace
These are the marketplaces where multiple These are the marketplaces focusing on an
categories of products are offered but with a individual niche. Vertical marketplaces offer the
secondary character in common. Horizontal same products from a large number of
Marketplace is a blend of Vertical & Global
sellers/vendors. While eCommerce marketplace
marketplace because it offers multiple categories
leaders like Amazon or eBay are dominating the
like a Global Marketplace but it still has one factor
eCommerce space, there is still a lot of
common for all the offerings like Vertical
unexplored opportunities for niche-specific
Marketplace.
marketplaces.
Let’s understand this with the help of an example,
For instance, Airbnb or Instacart, once startups
Etsy is the perfect example of Horizontal
have now emerged as success stories for
Marketplaces because they offer a varied range
of products. But, the only characteristic that is aspiring entrepreneurs and now they are looking
common for all their offerings is that they are to grow their eCommerce business in a vertical
all handmade. market.
 E-Marketplace

Private E-Marketplace Public E-Marketplace

An online marketplace (or online e-

commerce marketplace) is a type of e-
Sell Side Buy Side commerce site where product or service Owned by third party &
information is provided by multiple group of buying and
selling
third parties, whereas transactions are
companies(consortium)
processed by the marketplace operator.
Re-intermediation
 Eg.
XIAOMI
DISINTERMEDIATION

Producer Wholeseller Consumer

Supplier Retailer

REINTERMEDIATION
Reintermediation can be defined as the reintroduction of an intermediary between end users
(consumers) and a producer. This term applies especially to instances in which
disintermediation has occurred first.

Happens especially in digital

landscape
Disintermediation and Re-intermediation
 Customer Shopping Mechanisms -
Webstores
• Webstore (storefront) TYPES OF STORES AND MALLS

A single company’s website where products or services are 1. General stores/malls

sold; usually has an online shopping cart associated with it. 2. Specialized stores/malls

Many Webstores target a specific industry and find their 3. Regional versus global stores

own unique corner of the market. 4. Pure-play versus click-and-

mortar stores
Ex. Raliance trends or shopppers stop

• e-mall (online mall)

An online shopping center where many online stores are
located
 Intermediation and Syndication in E-
Commerce
• Intermediaries (brokers) provide value-added activities and services
to buyers and sellers
• Intermediaries in the physical world are wholesalers and retailers

• Infomediaries:

electronic intermediaries that control information flow in

cyberspace, often aggregating information and selling it to
others
1. Unique: these are catalogues that offer products or services on a website. They are called unique because
they are not accompanied by other catalogues.

2. E-malls: they are present on a website. E-malls are a collection of various catalogues offering a wide range of
services or products. This type of e-catalogue contains a searcher, so that consumers can choose the
products or services category they want to consult.

3. Incrusted catalogues: they are part of a company’s website. They are called incrusted because they are
found into a company’s website and not in a different one. This type of e-catalogue is often useless to sell
products or services, but they are useful as marketing or advertising tools, where consumers can get rid of
any doubt about products or services.

4. Catalogues through e-mails: this type of e-catalogues is sent to a particular addressee, previously selected-
it can be either a company’s customer or professionals in a specific field. Companies create a target group
directory, so that a more personalized catalogue can be sent to each addressee. E-mail templates are good
options to send catalogues through e-mail in a professional, smart and personalized way.
 Search Engine
• Crawler Based Search Engines.

• Directories Search Engines.

• Hybrid Search Engines.

• Meta Search Engines.

 SEO
• Def:

SEO stands for Search Engine Optimization, which is the practice of increasing the
quantity and quality of traffic to your website through organic search engine results.

Uses for Business:

• User-Friendly Websites
• Bring in MORE Customers
• Better Conversion Rates
• Build Brand Awareness
• Bypass Competition
 Customer Shopping Mechanisms:
Storefronts, Malls, and Portals
Types of Portals
Web (information) Portal Commercial (public) portals
A single point of access, through a Web Corporate portals
browser, to critical business information Publishing portals
located inside and outside (via Internet) Personal portals
an organization. mobile portal
A portal accessible via a mobile
device.
voice portal
A portal accessed by telephone or cell phone
 Changing Supply Chains: Structure of
the Supply Chain
• EC Order Fulfillment Process,
• Speeding Up Deliveries,
• Partnering Efforts and Outsourcing Logistics,
• Order Fulfillment in Make-to- Order (MTO)
• Mass Customization.
 EC Order Fulfillment Process
1) Receive online order
2) Process order in your back-office
system (example: an ERP)
3) Notify customer that order has been
received
4) Send request for fulfillment to the
warehouse
5) Order is picked
6) Order is packed
7) Order is shipped
8) Shipping notification is sent to the
customer
9) Order arrives
Partnering Efforts and Outsourcing Logistics,
It’s important to approach outsourcing from a partnership stance. Allowing an e-fulfilment
company handle your logistics means that you’re trusting experts to do what they do best, while
you focus your personal expertise where it counts. Supply chain and logistics management
requires careful planning, cost analysis, and experience to be optimized efficiently, and third-
party logistics providers have an investment in your company’s success. Don’t think of them as
a service provider, think of them as a partner dedicated to making your logistics the best it can
possibly be.
Here are 5 reasons to outsource logistics and supply chain management:
Cut costs by Gaining Experience
Use the size of an E-fulfillment company to your advantage
Get access to optimized Transport Management System and software
Profit from their logistics innovation
Allow them to handle risk management
 Ethical, Legal, Privacy, and Technology
Issues.
• Web Tracking
• Privacy
Legal issues:
1.Fraud on the internet
2.Domain name
3.Copyright
 Public Policy Issues in E commerce
• Information rights: What rights to their own personal information do individuals have in a public
marketplace, or in their private homes, when Internet technology make information collection so pervasive
and efficient? What rights do individuals have to access information about business firms and other
organizations?

• Property rights: How can traditional intellectual property rights be enforced in an internet world where
perfect copies of protected works can be made and easily distributed worldwide in seconds?

• Governance: Should the Internet and e-commerce be subject to public laws? And if so, what law-making
bodies have jurisdiction - state, federal, and/or international?

• Public safety and welfare: What efforts should be undertaken to ensure equitable access to the Internet
and ecommerce channels? Should governments be responsible for ensuring that schools and colleges have
access to the Internet? Is certain online content and activities - such as pornography and gambling - a threat
to public safety and welfare? Should mobile commerce be allowed from moving vehicles?
Thank you