E-Business Model

Cindy Himawan
President University
What is the so-called business model?

A business model depicts the content,

structure, and governance of
transactions designed so as to create
value through the exploitation of
business opportunities.
Amit & Zott (SMJ, 2001, p.511)
The Content of Business Model
 The goods or information that are being exchanged
 The resources and capabilities that are required to
enable the exchange
 E.g., transparency of transaction, vertical & horizontal
expansion of product/service, the degree of customization,
technologies of transaction
The Structure of Business Model
 The parties that participate in the exchange
 The ways in which these parties are linked
 The order process and the adopted exchange mechanism
 E.g., the providers of complementary assets, transaction speed,
mode, simplicity, safety & reliability, integration of online & offline
supply chains
The Governance of Business Model
 The ways in which flows of information, resources,
and goods are controlled by the relative parties
 The incentives for the participants in transactions
 E.g., cooperative and shared incentive among allied
partners, commitment and investment of co-specialized
assets, loyalty maintenance
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Business to Business (B2B)
 B2B refers to the transaction between businesses conducted
electronically over the internet , extranet or private network
 These transaction may take place between a business and its
supply chain partners as well as between two businesses .

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Business to Business (B2B) example

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Types of B2B E-Business Models
Types of B2B E-Business Models
 Customer Oriented B2B
 In this B2B e-business model the buyer provides information
about the product or service to the seller.
 Mostly the buyer want to buy the product in bulk and this is
most popular in government sector
 Supplier Oriented B2B
 In this B2B e-business model the seller provides
information about the product to the buyer . Generally
the seller display the product through advertisement
 Intermediary Oriented B2B
 In this B2B e-business model the agent who act as a
intermediary that deals between the seller and the buyer.
Neither the buyer nor the seller have the direct contact.
Advantages vs Disadvantages of B2B

Advantage Disadvantage
 Lower administration cost  Sale processes might get complicated
 Reduces inventory cost  Lacking from the side of government
 Lower transaction cost department
 Lower search cost  Inverted power structure
 Decrease product cycle time
 Improve the quality of product
 Create greater transparency in price
 Increase the opportunities for
collaboration
 Increase production of employees
 Enables customized online catalogues
 Create new sale opportunity
 Effective customer services
Business To Customer (B2C)
 A business that sells online merchandise to
individual customers is categorised as B2C.
 It refers to the business communicating with or
selling to an indvidiual customer rather than a
company.
Revenue Model of B2C

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B2C Business Models

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Advantages vs Disadvantages of B2C
Advantage
 Easier business administration.
 Frees your staff.
 More efficient business relationship.
 Workflow Automation.
 Economical .
 Unlimited market place.
 24 hours store reduced sale cycle.
 Lower cost of doing business.
 Eliminate middlemen.
 Secure payment systems.
 Customer will love it.
Disadvantage
 Catalog inflexibility
 High marketing expenses
 Limit market place
 Require higher cost of doing business
 Require a middleman
 Inefficient business administration
 Need to employ no. Of staff
 High sales cycle.
 Customer To Customer (C2C)
 In C2C model a consumer directly sells goods or services to
another consumer absence of intermediary makes this model
unique as consumer can directly interact and transact business
by the use of technology.
 Generally, in this model website provide space to consumer to
sell their products to other consumers through auctions etc.
 Example :
 E-Bay
 OLX
 Bazee.com
 Quikr
Advantages vs Disadvantages of C2C
Advantage
 Lowest cost is involved
 Elimination of intermediary
 Direct interaction
 Profit is highest
 Large no of buyers
 Elimination of wastage of time
Disadvantage
 Catalog inflexibility
 High marketing expenses
 Limit market place
 Require higher cost of doing business
 Require a middleman
 Inefficient business administration
 Need to employ no. Of staff
 High sales cycle.
Customer To Business (C2B)
 The C2B model involves a transaction that is conducted
between a consumer and a business organization.
 The C2B model has involved as a result of decreased cost of
technology where individual has access to various
technologies.
 C2B model is based on a business transaction originated by
the customer, who establishes the transaction, conditions from
the start. Instead of responding to a specific product or service
offer by the company, it’s the customer who makes a proposal
and collaborates. In this system individual offers are made and
here the customer personalization is taken to the extreme. It
works very well in the leisure and tourism industries.
Customer To Business (C2B) (cont’d)
 Examples :
 Bank Bazar.com
 Policy Bazar.com
 Go Ibibo.com
 Monster.com & Naukri.com are such websites on which consumer
can post their bio-data for the services they can offer. Any business
organization that is interested in deploying their services, can
contact and employee them if suitable.
 General Features C2B Model
 Direct action
 Collaborative consumption
 Interaction
 Reciprocity
 Bi-directionality
Business To Government (B2G) and
Customers To Government (B2G)
 It refers to businesses or customer that provide products,
services or information to governments or government
agencies.
 B2G or C2G are referred to as public sector marketing.
 Web based purchasing policies increase the transparency of
the procurement process and reduce the risk of irregularities.
 It can usually include following steps :
 Determination and evaluation of Government agency needs
 Creating and submitting a proposal
 Completion of proposed work
 Payment of the work
Government To Business (G2B) and
Government To Customers (G2C)
 It refers to how Government will provide products, services or
information to business or customer.
 G2B or G2C are also can be called as public sector marketing.
 The online business will help to increase the transparency of the
service process and reduce the risk of irregularities.
 The process usually will include :
 Government shows the service they open for public
 Business or Customer go to the website (replace the manual steps)
 Some of the manual activity still need to be done
 Business and Customer able to track the service request and get
notification
 Example business:
 Request business permit online
 Scheduling passport service
 E-Auction
Government To Government (G2G)
 It refers to service providing between government to
government
 Not limited to different country, but also from one
government ministry to others

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