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Chapter 1

Chapter 1. Introduction to e-business and e-commerce. Learning objectives. Define the meaning and scope of e-business and e-commerce and their different elements; Summarise the main reasons for adoption of e-commerce and e-business and barriers that may restrict adoption;

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Chapter 1

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  1. Chapter 1 Introduction to e-business and e-commerce

  2. Learning objectives • Define the meaning and scope of e-business and e-commerce and their different elements; • Summarise the main reasons for adoption of e-commerce and e-business and barriers that may restrict adoption; • Use resources to define the extent of adoption of the Internet as a communications medium for consumers and businesses; • Outline the business challenges of introducing e-business and e-commerce to an organization. WBT sheets week 1

  3. The impact of Internet on business • Andy Grove, Chairman of Intel, one of the early adopters of e-commerce, has made a meteorological analogy with the Internet. He says: • Is the Internet a typhoon force, a ten times force, or is it a bit of wind? Or is it a force that fundamentally alters our business? (Grove, 1996) WBT sheets week 1

  4. The impact on one industry – banking  (exercise) Table 1.1 7.5 years of web banking. Source: Online banking report, Number 89, December 10, 2002. Source: Online Banking Report estimates, +/- 25%, 11/02 WBT sheets week 1

  5. Online UK WBT sheets week 1

  6. The Internet’s impact on you • How many of you have purchased something on the Internet in the last 6 months? • What is the number of transactions? • Total value? • How many times have you used the Internet as an information source, before buying offline? WBT sheets week 1

  7. Popularity of online purchases Source: The Internet Monitor, BMRB, November 2001 (www.bmrb.co.uk) WBT sheets week 1

  8. Definitions • You are asked to distinguish between e-commerce and e-business at a job interview. • Write down your definitions. WBT sheets week 1

  9. E-commerce defined • ‘All electronically mediated information exchanges between an organization and its external stakeholders’ • Examples: • Buying books online (transactional) • Selecting a car online (informational) • Asking a customer service query, e.g. www.easyJet.com WBT sheets week 1

  10. E-business defined • All electronically mediated information exchanges, both within an organization and with external stakeholders supporting the range of business processes • Examples: • Purchasing from suppliers (e-procurement) • A company intranet (defined in Ch 3) • Supplying partners with information through an extranet (see Ch 3) WBT sheets week 1

  11. The distinction between buy-side and sell-side e-commerce • Figure 1.1The distinction between buy-side and sell-side e-commerce WBT sheets week 1

  12. Recap – which is correct? Figure 1.2Three definitions of the relationship between e-commerce and e-business WBT sheets week 1

  13. Activity – drivers and barriers to adoption • You are in a team of advisers at a local Business Link (a local government agency encouraging adoption of e-commerce) • List: • Drivers to adoption of sell-side e-commerce by business and how you can reinforce these by marketing benefits • Barriers to adoption of sell-side e-commerce by business and how you can reinforce these by stressing benefits WBT sheets week 1

  14. Business drivers to going online WBT sheets week 1

  15. Business barriers to going online WBT sheets week 1

  16. Drivers for e-commerce Figure 1.6Attitudes to benefits of online technologies Source: DTI (2002) WBT sheets week 1

  17. Barriers to e-commerce Figure 1.7Barriers to development of online technologies Source: DTI (2002) WBT sheets week 1

  18. B2B, B2C • Business to Business • example • Business to Consumer • example • Differences? • Why differentiate? • Two examples, see next sheets WBT sheets week 1

  19. Intro to B2B Company • Employs 600 people worldwide • Turnover £100m • Products – composites and speciality polymers • See www.globalcomposites.com • Distribution – 90 companies worldwide via joint ventures and agents • Competitors: • Derakan (www.dow.com/derakane) • Scott Bader (www.scottbader.com) • Owens Corning (www.owenscorning.com) WBT sheets week 1

  20. Intro to B2C Company • Established 1984, 80 staff • Products – Kitchenware • Distribution • Through retailers and transactional web sites • Competitors • Cooking.com (www.cooking.com) • Lakeland (www.lakelandlimited.com) • Tupperware (www.tupperware.com). WBT sheets week 1

  21. Activity - Benefits to B2B and B2C Company • See activity 1.6 • Give examples of these benefits of an online presence. Which of these are most important to each: • Cost reduction • New capability • Communication • Customer service • Control • Competitive advantage • Indicate with +/- which benefits are more/less important for B2B and B2C. See website Chaffey for indications answers WBT sheets week 1

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