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E-commerce 2019
business. technology. society. Introduction to E-commerce Careers in E-commerce

Fifteenth Edition
• E-commerce involves the use of the Internet, the World • Position: E-commerce Specialist
Wide Web (Web), and mobile apps and browsers running
• https://ecommerceguide.com/guides/ecommerce-job-
Chapter 1 on mobile devices to transact business. More formally,
roles/
digitally enabled commercial transactions between
The Revolution Is Just and among organizations and individuals. • https://www.vietnamworks.com/ecommerce-kv
Beginning
• Use of Internet to transact business. • Qualification/Skills
– Includes Web, mobile browsers and apps • Preparing for the Interview
• More formally: • Possible Interview Questions
– Digitally enabled commercial transactions between
and among organizations and individuals
Copyright © 2020, 2019, 2018 Pearson Education, Inc. All Rights Reserved
E-commerce Job Roles Learning Objectives Uber: The New Face of E-commerce?
• Ecommerce web developers 1.1 Understand why it is important to study e-commerce. • Class Discussion
• Ecommerce business analysts
1.2 Define e-commerce, understand how e-commerce differs from e- – Have you used Uber or any other on-demand service
• Ecommerce Project Manager business, identify the primary technological building blocks underlying companies?
e-commerce, and recognize major current themes in e-commerce.
• Ecommerce customer service representative – What is the appeal of these companies for users and
• Ecommerce order clerks 1.3 Identify and describe the unique features of e-commerce providers?
technology and discuss their business significance.
• Ecommerce SEO content writer – Are there any negative consequences to the
1.4 Describe the major types of e-commerce. increased use of on-demand services like Uber and
• Ecommerce virtual assistant
• PPC Expert/ PPC Manager 1.5 Understand the evolution of e-commerce from its early years to Airbnb?
today.
• Ecommerce product manager
1.6 Describe the major themes underlying the study of e-commerce.
• Marketing specialist/ Marketing manager
1.7 Identify the major academic disciplines contributing to e-commerce.
Copyright © 2020, 2019, 2018 Pearson Education, Inc. All Rights Reserved Copyright © 2020, 2019, 2018 Pearson Education, Inc. All Rights Reserved
The Difference between E-commerce and Technological Building Blocks Underlying

The First Thirty Seconds E-business E-commerce
• E-commerce involves the use of the Internet, the World
• First two decades of e-commerce Wide Web (Web), and mobile apps and browsers running • Internet
– Just the beginning on mobile devices to transact business. More formally,
digitally enabled commercial transactions between • World Wide Web
– Rapid growth and change – H T ML
and among organizations
• Technologies evolve at exponential rates and individuals – Deep Web v s. “surface” Web
e rsu
– Disruptive business change • E-business: • Mobile platform

– New opportunities – Digital enabling of transactions and processes within – Mobile apps
• Why study e-commerce a firm, involving information systems under firm’s
control
– Understand opportunities and risks
– Does not include commercial transactions involving
– Analyze e-commerce ideas, models, issues
an exchange of value across organizational
boundaries
Copyright © 2020, 2019, 2018 Pearson Education, Inc. All Rights Reserved Copyright © 2020, 2019, 2018 Pearson Education, Inc. All Rights Reserved Copyright © 2020, 2019, 2018 Pearson Education, Inc. All Rights Reserved
Insight on Technology: Will Apps Make the
Web Irrelevant?
• Class Discussion
– What are the advantages and disadvantages of apps,
compared with websites, for mobile users?
– What are the benefits of apps for content owners and
creators?
– Will apps eventually make the Web irrelevant? Why or
why not?
Unique Features of E-commerce Unique Features of E-commerce

Major Trends in E-commerce Technology (1 of 2) Technology (2 of 2)
• Business trends include: 1. Ubiquity 5. Interactivity

– All forms of e-commerce show very strong growth 2. Global reach 6. Information density
• Technology trends include: 3. Universal standards 7. Personalization/customization
– Mobile platform has made mobile e-commerce reality
4. Information richness 8. Social technology
• Societal trends include:
– Increased online social interaction and sharing
Figure 1.5 The Growth of B2C E-commerce in Figure 1.7 The Growth of B2B E-commerce in
Types of E-commerce the United States the United States
• Business-to-Consumer (B2C)
• Business-to-Business (B2B)
• Consumer-to-Consumer (C2C)
• Mobile e-commerce (M-commerce)
• Social e-commerce
• Local e-commerce
Figure 1.8 The Growth of M-commerce in the
United States E-commerce: A Brief History (1 of 4) E-commerce: A Brief History (2 of 4)
• Precursors • 1995–2000: Invention

– Baxter Healthcare modem-based system – Sale of simple retail goods
– Order entry systems – Limited bandwidth and media
– Electronic Data Interchange (EDI) standards – Euphoric visions of
– French Minitel ▪ Friction-free commerce
▪ First-mover advantages
– Dot-com crash of 2000
Figure 1.10 Periods in the Development of

E-commerce: A Brief History (3 of 4) E-commerce: A Brief History (4 of 4) E-commerce
• 2001–2006: Consolidation • 2007–Present: Reinvention
– Emphasis on business-driven approach – Rapid growth of:
– Traditional large firms expand presence ▪ Web 2.0, including online social networks
– Start-up financing shrinks ▪ Mobile platform
– More complex products and services sold ▪ Local commerce
– Growth of search engine advertising ▪ On-demand service economy
– Business web presences expand – Entertainment content develops as source of
revenues
– Transformation of marketing
Insight on Business: Y Combinator’s

Startup Boot Camp Assessing E-commerce (1 of 2) Assessing E-commerce (2 of 2)
• Class Discussion • Stunning technological success • Other surprises

– Why do you think investors today are still interested in • Early years a mixed business success – Fast-follower advantages
investing in startups? – Start-up costs
– Few early dot-coms have survived
– What are the benefits of investing in a company that – Impact of mobile platform
– Online sales growing rapidly
is a graduate of a Y Combinator boot camp? – Emergence of on-demand e-commerce
– Is an incubator the best solution for startups to find • Many early visions not fulfilled
funding? Why or why not? – Price dispersion
– Information asymmetry
– New intermediaries
Understanding E-commerce: Organizing Figure 1.11 The Internet and the Evolution Insight on Society: Facebook and the Age
Themes of Corporate Computing of Privacy
• Technology: • Class discussion:

– Development and mastery of digital computing and – Why are social networks interested in collecting user
communications technology information?
• Business: – What types of privacy invasion are described in the
case? Which is the most privacy-invading, and why?
– New technologies present businesses with new ways
of organizing production and transacting business – How is e-commerce different from traditional markets
with respect to privacy? Don’t merchants always want
• Society: to know their customer?
– Intellectual property, individual privacy, public welfare – How do you protect your privacy online?
policy
Academic Disciplines Concerned with

Technology Careers in E-commerce
• Technical • Position: Category specialist in E-commerce Retail

– Computer science, management science, information Program
systems • Qualification/Skills
• Behavioral • Preparing for the Interview
– Information systems research, economics, marketing,
management, finance/accounting, sociology • Possible Interview Questions
E-commerce 2019: business. technology. Tweet Tweet: Will Twitter Ever Find a
society. Learning Objectives Business Model That Works?
Fifteenth Edition
2.1 Identify the key components of e-commerce business • Class Discussion
models. – What characteristics or benchmarks can be used to
Chapter 2 2.2 Describe the major B2C business models. assess the business value of a company such as
Twitter?
E-commerce Business 2.3 Describe the major B2B business models. – Have you used Twitter to communicate with friends or
Models and Concepts family? What are your thoughts on this service?
2.4 Understand key business concepts and strategies
applicable to e-commerce. – What are Twitter’s most important assets?
– Which of the various methods described for
monetizing Twitter’s assets do you feel might be most
successful?
E-commerce Business Models Eight Key Elements of a Business Model 1. Value Proposition
• Business model 1. Value proposition • “Why should the customer buy from you?”
– Set of planned activities designed to result in a profit in a
marketplace 2. Revenue model • Successful e-commerce value propositions:
– How a business create and deliver value to customer and make 3. Market opportunity – Personalization/customization
money in return, sustainably (Harvard Innovation Labs) – Reduction of product search, price discovery costs
• Business plan 4. Competitive environment
– Facilitation of transactions by managing product
– Describes a firm’s business model 5. Competitive advantage delivery
• E-commerce business model 6. Market strategy
– Uses/leverages unique qualities of Internet and Web
7. Organizational development
8. Management team
2. Revenue Model 3. Market Opportunity 4. Competitive Environment
• “How will you earn money?” • “What marketspace do you intend to serve and what • “Who else occupies your intended marketspace?”
is its size?” – Other companies selling similar products in the same
• Major types of revenue models:
– Marketspace: Area of actual or potential commercial marketspace
– Advertising revenue model
value in which company intends to operate – Includes both direct and indirect competitors
– Subscription revenue model
– Realistic market opportunity: Defined by revenue
▪ Freemium strategy • Influenced by:
potential in each market niche in which company
– Transaction fee revenue model hopes to compete – Number and size of active competitors
– Sales revenue model – Each competitor’s market share
• Market opportunity typically divided into smaller niches
– Affiliate revenue model – Competitors’ profitability
– Competitors’ pricing
5. Competitive Advantage 6. Market Strategy 7. Organizational Development
• “What special advantages does your firm bring to the • “How do you plan to promote your products or services to • “What types of organizational structures within the firm
marketspace?” attract your target audience?” are necessary to carry out the business plan?”
– Is your product superior to or cheaper to produce than – Details how a company intends to enter market and • Describes how firm will organize work
your competitors’? attract customers
– Typically, divided into functional departments
• Important concepts: – Best business concepts will fail if not properly
– As company grows, hiring moves from generalists to
marketed to potential customers
– Asymmetries specialists
– First-mover advantage, complementary resources
– Unfair competitive advantage
– Leverage
– Perfect markets
8. Management Team Raising Capital Categorizing E-commerce Business Models
• “What kind of backgrounds should the company’s leaders • Seed capital • No one correct way to categorize
have?”
• Elevator pitch • Text categorizes according to:
• A strong management team: – E-commerce sector (e.g., B2B)
• Traditional sources
– Can make the business model work – E-commerce technology (e.g., m-commerce)
– Incubators, angel investors
– Can give credibility to outside investors
– Commercial banks, venture capital firms • Similar models appear in different sectors
– Has market-specific knowledge
– Strategic partners • Companies may use multiple business models (e.g.,
– Has experience in implementing business plans
• Crowdfunding eBay)
– JOBS Act • Case studies: https://www.garyfox.co/business-
models/page/1/
B2C Business Models

B2B B2C B2C B2B
• E-tailer
Close relationship with customer Impersonal, mass communication Number of Buyers Large Small
Few Customers Many Customers Size of Orders Small Large • Community provider (social network)
From buyer demand, less price sensitive Stimulated by marketing, extremely value Value of Orders Low High
sensitive • Content provider
Purchase Initiation Self Demand Others: budget, needs
Consultative Selling based on understanding a Convincing customer approach
client’s needs and developing a relationship of Level of Risk Low to Medium Medium to High • Portal
trust
Complexity of decision Low to Medium Medium to High
• Transaction broker
Information Search Short Long
Time perspective Isolated Events Ongoing Relationship • Market creator

Role of Customer Active Supplier Active Supplier
Passive Consumer Active Consumer • Service provider
Purchasing Behevior One-sided Dyadic Interaction
B2C Models: E-Tailer B2C Models: E-Tailer Dropshipping
• Online version of traditional retailer • Ecommerce Business

• Revenue model: Sales
• Platforms
• Variations:
– Virtual merchant
• Dropshipping
– Bricks-and-clicks
– Catalog merchant
– Manufacturer-direct
• Low barriers to entry
Insight on Technology: Connected Cars and

B2C Models: Community Provider B2C Models: Content Provider the Future of E-commerce
• Provide online environment (social network) where • Digital content on the Web: • Class Discussion
people with similar interests can transact, share content, – News, music, video, text, artwork – What is the Internet of Things (IoT)?
and communicate
• Revenue models: – What value does the IoT have for businesses?
– Examples: Facebook, LinkedIn, Twitter, Pinterest – What impact does the IoT have on the content
– Use variety of models, including advertising,
• Revenue models: subscription; sales of digital goods industry?
– Typically, hybrid, combining advertising, subscriptions, – Key to success is typically owning the content – What impact does the IoT have on vehicles?
sales, transaction fees, and so on – Are there any disadvantages to “connected” cars?
• Variations:
– Syndication
– Aggregators
B2C Business Models: Portal B2C Models: Transaction Broker B2C Models: Market Creator
• Search plus an integrated package of content and • Process online transactions for consumers • Create digital environment where buyers and sellers can
services – Primary value proposition—saving time and money meet and transact
• Revenue models: – Examples: Priceline, eBay
• Revenue model:
– Advertising, referral fees, transaction fees, – Revenue model: Transaction fees, fees to merchants
– Transaction fees
subscriptions for premium services for access
• Industries using this model:
• Variations: • On-demand service companies (sharing economy):
– Financial services platforms that allow people to sell services
– Horizontal/general (example: Yahoo, AOL, MSN) – Travel services – Examples: Uber, Airbnb
– Vertical/specialized (vortal) (example: Sailnet) – Job placement services
– Search (example: Google, Bing)
B2C Models: Service Provider B2B Business Models B2B Business Models
• Online services • Net marketplaces • BerlinPackaging.com

– Example: Google—Google Maps, Gmail, and so on – E-distributor • Knobs.co
• Value proposition – E-procurement • BulkBookStore.com

– Valuable, convenient, time-saving, low-cost – Exchange
alternatives to traditional service providers – Industry consortium
• Revenue models: • Private industrial network
– Sales of services, subscription fees, advertising, sales
of marketing data
B2B Models: E-Distributor B2B Models: E-Procurement B2B Models: Exchanges
• Version of retail and wholesale store, M RO goods, and • Creates digital markets where participants transact for • Independently owned vertical digital marketplace for
indirect goods indirect goods direct inputs
• Owned by one company seeking to serve many – B2B service providers, SaaS and PaaS providers • Revenue model: Transaction, commission fees
customers – Scale economies
• Create powerful competition between suppliers
• Revenue model: Sales of goods • Revenue model:
• Tend to force suppliers into powerful price competition;
• Example: Grainger – Service fees, supply-chain management, fulfillment number of exchanges has dropped dramatically
services
• Example: Go2Paper
• Example: Ariba
B2B Models: Industry Consortia Private Industrial Networks How E-commerce Changes Business
• Industry-owned vertical digital marketplace open to select • Digital network used to coordinate among firms engaged • E-commerce changes industry structure by changing:
suppliers in business together – Rivalry among existing competitors
• More successful than exchanges • Typically evolve out of large company’s internal – Barriers to entry
– Sponsored by powerful industry players enterprise system – Threat of new substitute products
– Strengthen traditional purchasing behavior – Key, trusted, long-term suppliers invited to network – Strength of suppliers
• Revenue model: Transaction, commission fees • Example: Walmart’s network for suppliers – Bargaining power of buyers
• Industry structural analysis
• Example: SupplyOn
Value Proposition Canvas
Eight Key Elements of a Business Model 1. Value Proposition
1. Value proposition • “Why should the customer buy from you?”

2. Revenue model • Successful e-commerce value propositions:
3. Market opportunity – Personalization/customization
– Reduction of product search, price discovery costs
4. Competitive environment
– Facilitation of transactions by managing product
5. Competitive advantage delivery
6. Market strategy
8. Management team
What is your niche? Customer Avatar
Finding a niche is providing a specific solution to a specific • Demographics are statistics related to your ideal customers. This can
include factors such as: Age, Gender, Job, Marital status, Current
problem your ideal client struggles with. location, Income, Education, Employment status
• Psychographics are customers’ more intangible aspects which can

1. WHAT PROBLEM DO YOU WANT TO SOLVE?
reveal what type of buyers they are: Interests, Habits, Attitudes,
2. WHO DO YOU SERVE? Emotions, Preferences, Values, Lifestyle
• Use Customer Avatar Worksheet
Product Ideas
What is your solution? • HYDRATION
• P (Problem) = The problem is that

most people don't drink enough water,
• P = Problem. What is your product trying to solve? and dehydration is detrimental or even
dangerous to the human body.
• S= Statistic. This is data that supports the need for your product and adds
• S (Statistic) = A stat to highlight this
credibility. problem is that fatigue is one of the
first signs of dehydration. Our bodies
• S = Solution. What is the solution to the problem you identified earlier in the are made up of 64% water, and a loss
of just one to two percent of body
framework?
weight of water is enough to cause the
onset of fatigue.
• P = Product. What would this solution look like in the form of a product?
• S (Solution) = The solution is a
hydration solution that helps people
drink enough water.
• P (Product) = The product could be a

fruit infuser drink bottle to creatively
rehydrate on the go.
Product Ideas Is the product viable for E-commerce
• SUSTAINABILITY
• Shipping
• P (Problem) = The problem is the waste caused by single-use plastic, especially from
everyday items, like plastic, single-use drink bottles. - Can my product be shipped worldwide?
• S (Statistic) = A stat to highlight this problem and, thus, the need for a solution is that - Is my product lightweight?
single-use plastic from everyday products accounts for over half of the world's plastic
waste. - Is my product difficult to break?
• S (Solution) = The solution would be to make this drink bottle reusable.
• Regulations
• P (Product) = The product idea is a reusable, glass drink bottle
• Passion
Value Statement Value Statement
• We help [Write Your Target Audience here]

• By solving their problem of [Write Your What Problem here]
• Through our [Write Your Solution here]
• In order to get the result of [Write the Disired Results here]
Examples of Value Statement

2. Revenue Model 3. Market Opportunity
• 8 Powerful Value Proposition Examples (& How To Write
Yours) | Consulting Success • “How will you earn money?” • “What marketspace do you intend to serve and what
is its size?”
• Value Proposition Examples: 30 Of The Best Ever Created • Major types of revenue models:
– Marketspace: Area of actual or potential commercial
(garyfox.co) – Advertising revenue model
value in which company intends to operate
– Subscription revenue model
– Realistic market opportunity: Defined by revenue
▪ Freemium strategy potential in each market niche in which company
– Transaction fee revenue model hopes to compete
– Sales revenue model • Market opportunity typically divided into smaller niches
– Affiliate revenue model
• Reference Video:
https://www.youtube.com/watch?v=34KlPrRMXnI
3. Market Opportunity
3. Market Opportunity 3. Market Opportunity – AirBnB
• Keyword Research
• - Find how many people are searching
• - Find how many people are sharing online
• - Tools: Google, Keywordtool, Semrush,…
• Research ecommerce platforms: Shopee, Lazada,
• Social Listening and Engagement
• - Find what audience is talking about, sharing, asking right now
• - Learn how your audience speaks
• - Establish trust with audience
• - Go to where audience is: FB Groups, LinkedIn, Instagram,…
3. Market Opportunity 4. Competitive Environment 4. Competitive Environment

• Talk to audience
• - Ask them a few direct, open ended questions

• “Who else occupies your intended marketspace?” • SWOT Analysis?
• - Use surveys for one-to-many: google form, typeform,
– Other companies selling similar products in the same
marketspace • Best Sellers?
• - Follow up one-to-one
– Includes both direct and indirect competitors
• - Tools: Google, Keywordtool, Semrush,…
• Pricing?
• Magic Questions • Influenced by:
• - What is your biggest challenge with ….? – Number and size of active competitors • Product Categories/Structure?
• - What are some questions you have about ….? – Each competitor’s market share
• - What would you love to have when it comes to ….? – Competitors’ profitability
– Competitors’ pricing
Figure 4.1 SWOT Analysis 5. Competitive Advantage 6. Market Strategy
• “What special advantages does your firm bring to the • “How do you plan to promote your products or services to
marketspace?” attract your target audience?”
– Is your product superior to or cheaper to produce than – Details how a company intends to enter market and
your competitors’? attract customers
• Important concepts: – Best business concepts will fail if not properly
marketed to potential customers
– Asymmetries
– First-mover advantage, complementary resources
– Unfair competitive advantage
– Leverage
– Perfect markets
E-commerce 2019
business. technology. society Eight Key Elements of a Business Model Learning Objectives
Fifteenth Edition
1. Value proposition 4.1 Understand the questions you must ask and answer, and the steps
you should take, in developing an e-commerce presence.
2. Revenue model
Chapter 4 4.2 Explain the process that should be followed in building an e-
3. Market opportunity commerce presence.
Building an E-commerce 4.3 Identify and understand the major considerations involved in
Presence: Websites, Mobile choosing web server and e-commerce merchant server software.
Sites, and Apps 5. Competitive advantage 4.4 Understand the issues involved in choosing the most appropriate
6. Market strategy hardware for an e-commerce site.
4.5 Identify additional tools that can improve website performance.
4.6 Understand the important considerations involved in developing a
8. Management team mobile website and building mobile applications.
Walmart Website Redesign: Going Upscale

in Its Fight to Compete with Amazon Imagine Your E-commerce Presence (1 of 3) Imagine Your E-commerce Presence (2 of 3)
• Class Discussion • What’s the idea? The vision includes: • Where’s the money?
– Mission statement – Business model(s)
– Why is Walmart considered an underdog in
– Target audience – Revenue model(s)
the e-commerce arena?
– Intended market space • Who and where is the target audience?
– What was Walmart's objective in redesigning
– Strategic analysis – Demographics, lifestyle, consumption patterns, etc.
its website?
– Marketing matrix
– How does Walmart's website differ from – Development timeline
• What is the ballpark? Characterize the marketplace
Amazon's? – Size, growth, demographics, structure
– Preliminary budget
Develop a timeline: Milestones

Imagine Your E-commerce Presence (3 of 3) Figure 4.1 SWOT Analysis
• Where’s the content coming from?
• Know yourself—SWOT analysis
• Develop an e-commerce presence map
• Develop a timeline: Milestones
• How much will this cost?
– Simple website: up to $5000
– Small startup: $25,000 to $50,000
– Large corporate website: $100,000+ to millions
Building an E-commerce Site: A Systematic Ecommerce Presence: The Systems
Figure 4.2 E-commerce Presence Map Approach Development Life Cycle
• Most important management challenges: • Methodology for understanding business objectives of a
1. Developing a clear understanding of business objectives system and designing an appropriate solution
2. Knowing how to choose the right technology to achieve those • Five major steps:
objectives
– Systems analysis/planning
• Main factors to consider – Systems design
– Management
– Building the system
– Hardware architecture
– Testing
– Software
– Design – Implementation
– Telecommunications
– Human resources
Table 4.2 System Analysis, Business Objectives,

Figure 4.5 Systems Development Life Cycle System Analysis/Planning System Functionalities, and Information
Requirements for a Typical E-commerce Site (1 of 2)
• Business objectives:
– List of capabilities you want your site to have Business Objective System Functionality Information Requirements
Display goods Digital Catalog Dynamic text and graphics catalog
• System functionalities: Provide product Product database Product description, stocking numbers,
information inventory levels
– List of information system capabilities needed to Personalize/customize Customer on-site tracking Site log for every customer visit; data mining
achieve business objectives product capability to identify common customer paths
and appropriate responses
• Information requirements: Engage customers in On-site blog; user forums Software with blogging and community forum
conversations functionality
– Information elements that system must produce in
Execute a transaction Shopping cart/payment Secure credit card clearing; multiple payment
order to achieve business objectives system options
Accumulate customer Customer database Name, address, phone, and e-mail for all
information customers; online customer registration
Table 4.2 System Analysis, Business Objectives, Systems Design: Hardware and Software Figure 4.6(a) A Logical Design for a Simple
System Functionalities, and Information Platforms Website
Requirements for a Typical E-commerce Site (2 of 2)
• System design specification:
Business Objective System Functionality Information Requirements
– Description of main components of a system and their
Provide after-sale Sales database Customer ID, product, date, payment, shipment
customer support date
relationship to one another
Coordinate Ad server, e-mail server, Site behavior log of prospects and customers • Two components of system design:
marketing/advertising e-mail, campaign linked to e-mail and banner ad campaigns
manager, ad banner
manager
– Logical design
▪ Data flow diagrams, processing functions,
Understand marketing Site tracking and reporting Number of unique visitors, pages visited,
effectiveness system products purchased, identified by marketing databases
campaign
– Physical design
Provide production Inventory management Product and inventory levels, supplier ID and
and supplier links system contact, order quantity data by product ▪ Specifies actual physical, software components,
models, and so on
Figure 4.6(b) Physical Design for a Simple Table 4.4 Basic Functionality Provided by
Website Web Server Software Web Servers
Functionality Description
• Apache
Processing of HTTP requests Receive and respond to client requests for HTML
– Leading web server software pages
– Works with UNIX, Linux operating systems Security services (Secure

Sockets Layer)/ Transport Layer
Verify username and password; process certificates
and private/public key information required for credit
– Reliable, stable, part of open software community Security card processing and other secure information
File Transfer Protocol Permits transfer of very large files from server to
• Microsoft’s Internet Information Server (IIS) server
Search engine Indexing of site content; keyword search capability
– Second major web server software
Data capture Log file of all visits, time, duration, and referral
– Windows-based source
– Integrated, easy-to-use E-mail Ability to send, receive, and store e-mail messages
Site management tools Calculate and display key site statistics, such as
unique visitors, page requests, and origin of
requests; check links on pages
Website Development Tools Website Development Tools Selection Criteria

• Shopify • Low Monthly Costs – How much does the shopping cart cost to run
• BigCommerce on a monthly basis including all plugins etc…
• Magento • High Level Of Extensibility – If there’s a feature that you need, can
you easily add functionality to your site?
• WooCommerce
• Wix • 3rd Party Support – Are there companies actively developing plugins
for the shopping cart?
• Haravan
• High Level Of Control – Do you have the freedom to change the
shopping cart and tailor it to your own needs?
• Ease Of Use – Is the shopping cart easy to use and maintain?
Wix Wix Free Plan WooCommerce

• Pros: • No Domain – Free Wix sites get an assigned URL of • Pros:
accountname.wixsite.com/yoursitename.
- Fully hosted - No tech knowledge required - Free to use
• Unwanted Ads – Wix displays ads on every page for free accounts.
- user friendly drag and drop interface, simplicity - full control over the website and source code
• Limited Storage – Free Wix accounts get up to 500MB.
- tons of themes to choose from - aeamless integration with Wordpress
• Limited Bandwidth – Free Wix accounts get up to 500MB in
- attractive price monthly bandwidth. - easily access to a large 3rd party developer community
• Cons: • Cons
- ecommerce feature set is limited - No tech support provided
- Requires a webhost
Shopify BigCommerce Magento
• Pros • Pros • Pros
- Fully hosted – No tech knowledge required - it’s free because it’s open source
- great option for enterprise-level merchants
- Very easy to use - great option for enterprise-level merchants
- % transaction fee no matter which plan you choose
- Large 3rd party app ecosystem
- limitless flexibility with store design
- get an unlimited number of staff accounts
- Extremely scalable
• Cons
- lots of free and premium design themes
- Incredible customer support
- generally not recommended for beginners
• Cons • Cons
- a steeper learning curve
- charge for every transaction, as well as additional features and themes - Premium design templates can be expensive, generally running
about $170 or more - prices of premium memberships could go up to as high as $20,000 per year
- monthly price plan for enterprise packages
- hard to customize
Web Hosting Provider E-commerce Merchant Server Software Other E-commerce Site Tools
• Provides basic functionality for sales • Website design: Basic business considerations
– Online catalog – Enabling customers to find and buy what they need
▪ List of products available on website • Tools for search engine optimization
– Shopping cart – Search engine placement: Ex: Yoast
▪ Allows shoppers to set aside, review, edit ▪ Metatags, titles, content
selections, and then make purchase ▪ Identify market niches
– Credit card processing ▪ Offer expertise
▪ Typically works in conjunction with shopping cart ▪ Links
▪ Verifies card and puts through credit to company’s ▪ Buy ads
account at checkout ▪ Local e-commerce
Right-Sizing Your Hardware Platform: the Building the System: In-House Versus
Demand Side Figure 4.7 Choices in Building and Hosting Outsourcing
• Customer Demand: • Outsourcing: Hiring vendors to provide services involved in
– Most important factor affecting speed of site building site
• Supplier Demand: • Build own v s. outsourcing:

ersu
– Scalability: Ability of site to increase in size as – Build your own requires team with diverse skill set; choice
of software tools; both risks and possible benefits
demand warrants
• Host own v s. outsourcing
e rs u
– 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
Table 4.10 E-commerce Website Features Table 4.10 E-commerce Website Features
Figure 4.10 Factors in Website Optimization That Annoy Customers (1 of 2) That Annoy Customers (2 of 2)
Feature • Inability to use browser’s Back button
• Requiring user to view ad or intro page before going to website • No contact information available (web form only)
content
• Unnecessary splash/flash screens, animation, etc.
• Pop-up and pop-under ads and windows
• Music or other audio that plays automatically
• Too many clicks to get to the content
• Unprofessional design elements
• Links that don’t work
• Text not easily legible due to size, color, format
• Confusing navigation; no search function
• Typographical errors
• Requirement to register and log in before viewing content or ordering
• No or unclear returns policy
• Slow loading pages
• Content that is out of date
Insight on Business: Weebly Makes Implementation, Maintenance, and

Creating Websites Easy Testing the System Optimization
• Class Discussion • Testing • Systems break down unpredictably

– What value does Weebly offer to small businesses? – Unit testing • Maintenance is ongoing
– Are there any drawbacks to using Weebly to create – System testing
an e-commerce presence? • Maintenance costs: Similar to development costs
– Acceptance testing
– How are service providers like Weebly changing the – A $40K e-commerce site may require $40K annually
– A/B testing (split testing) to upkeep
nature of e-commerce? – Multivariate testing
• Benchmarking
Table 4.11 The Eight Most Important Factors Table 4.13 Unique Features That Must be Taken
in Successful E-commerce Site Design Planning and Building a Mobile Presence into Account When Designing a Mobile Presence
• Identify business objectives, system functionality, and

Factor Description
Functionality Pages that work, load quickly, and point the customer toward
information requirements Feature Implications For Mobile Platform
your product offerings Hardware Mobile hardware is smaller, and there are more resource
• Choice: constraints in data storage and processing power.
Informational Links that customers can easily find to discover more about
you and your products – Mobile website or mobile Web app Connectivity The mobile platform is constrained by slower connection
speeds than desktop websites.
Ease of use Simple foolproof navigation
▪ Less expensive Displays Mobile displays are much smaller and require simplification. Some
Redundant navigation Alternative navigation to the same content screens are not good in sunlight.
Ease of purchase One or two clicks to purchase – Native app
Interface Touch-screen technology introduces new interaction
Multi-browser Site works with the most popular browsers ▪ Can use device hardware, available offline routines different from the traditional mouse and keyboard.
functionality The mobile platform is not a good data entry tool but can
Simple graphics Avoids distracting, obnoxious graphics and sounds that the be a good navigational tool.
user cannot control
Legible text Avoids backgrounds that distort text or make it illegible
Cross-Platform Mobile App Development Mobile Presence: Performance and Cost
Mobile Presence Design Considerations Tools Considerations
• Platform constraints • Objective C, Java • Mobile first design
– Graphics, file sizes – Most efficient
• Low cost, open-source alternatives
• Mobile first design – Appery.io • Mobile website
– Desktop website design after mobile design – Codiqa – Resizing existing website for mobile access is least
• Responsive web design (RWD) – Swiftic expensive
– CSS site adjusts layout of site according to device screen – PhoneGap • Mobile web app
resolutions
– Axway Appcelerator – Can utilize browser API
• Adaptive web design (AWD)
• Native app
– Server delivers different templates or versions of site
optimized for device – Most expensive; requires more programming
Insight on Technology: Carnival Cruise

Ships Go Mobile Careers in E-commerce Copyright
• Class Discussion • Position: UX Designer

– What influenced Carnival in deciding to create a • Qualification/Skills
mobile app?
– Are there any disadvantages in making a mobile app • Preparing for the Interview
a central part of the Carnival Cruise experience? • Possible Interview Questions
– How will the Ocean Medallion system add value to
the cruising experience?
E-commerce 2019 Building Your Website
business. technology. society Eight Key Elements of a Business Model
Fifteenth Edition
1. Value proposition
2. Revenue model
Chapter 4 – P2
3. Market opportunity
Building an E-commerce
Presence: Websites, Mobile
Sites, and Apps 5. Competitive advantage
6. Market strategy
8. Management team
Map your customer journey

1. Your Idea Purpose of Your Website
• Think about how you want a potential client to interact with your site:
• What is the website about? • Communication
• buying a product
• Who is your audience? • Capturing
• filling out a contact form
• What do you want the website visitors to do on you • Conversion
• joining your email list
site?
• subscribing to your podcast
• following you on social media
• Where do you want them to go?
• What do you want them to do from each page?
2. Your Content Your Business Messaging Your Business Messaging
• Pages
• Posts
• Sidebar
• Videos
• Pictures
• Audios
Your website copy Figure out the key web pages Figure out the key web pages
• Homepage
• Research 1-2 keywords for each page
• About Us
• Be clear & obvious who you’re talking to • What are the key web pages? • Product Categories
• Product Pages
• Blog
• Check-out Page
• Operational Pages: Return Policy, Shipping Information, FAQ,
Contact us
Homepage The Grunt Test The Grunt Test
• Clear Description • What do you offer?
• Focused Content: avoid overloaded with images, text, • How will it make my life better?
blog posts + show images of success to show case the
• What do I need to do to buy it?
success your customer will experience.
• Credibility
• Testimonial
Lee Chalmers
Contact Page Category Pages and Product Pages The key elements of product pages
• High quality product images & videos
• Video – Hello from us • Keyword Research • Video – Why buy from us
• Introduction of company • Write 1000 words • Incredible Description
• Clear CTA
• Pictures of Your Team • Sprinkle your keywords (3-5x)
• FAQ
• Follow the product page key element checklist • Shipping & Returns info
• Assembly & Use Instructions
• Reviews & Trust
• Stock levels
• Overall page (mobile responsiveness, load speed ,etc)
• Testimonials
Your Design – Brand Kit

3. Your Design
• Logo: a symbol representing your business
• Layout • Tag Line: a short and sweeet motto
• Visuals • Visual Aesthetic:

- Color Palette – https://coolors.co
• Colors
- Font Combination
- Design elements: overall concept, graphics, icons, patterns,
illustrations, …
- Voice: the brand’s tone, vocabulary and syntax
• A brand board is a document that helps you stay clear on the visual
elements of your brand so that everything you create looks
consistent.
Logo Logo Color Palette
• A good logo is distinctive, appropriate, practical, simple

in form and transmit a predetermined message.
• Keep it clean and simple. Text alone can make a great

logo
• Keep clip art to a minimum
• Stick to your brand’s fonts and colors

Color Psychology Font Combination Font Combination
4. Your Organization Website Organization
• Site Organization
• Site Hierarchy
• Navigation/Menus
Website Golden Rules Website Architecture

• Rule 1: Keep things simple and scalable
• Rule 2: Keep every page three clicks from your homepage
Building Your Website
5. Website Infrastructure • Hosting Service Providers:
Choose your website software platform
• - Bluehost
• Domain Name • https://www.wix.com/ecommerce/website
• - GoDaddy
• Web Hosting • https://www.wix.com/logo/maker
• E-commerce Merchant Server Software:
• Software Updates • https://www.wix.com/blog/2021/02/how-to-make-a-
• - Shopify website#viewer-15gbu
• - WooCommerce
• https://www.pavietnam.vn/vn/dang-ky-ten-mien.html
• - BigCommerce
• - Wix
• Other tools:
• - Yoast
• - Zipify
Select A Domain 6. Synthesize your marketing hub Assignment
• Select a Name • A website is the HUB: the centralized, unified location that
• Develop your business brand board
connects all your marketing strategies: search, social, email &
• Select a Domain: .com, .vn, .net, … analytics.
• Develop your website structure
• Register your Name with a domain registrar • Set up your website performance tracking: install Google
Analytics & Google Search Console.
Ex: GoDaddy, NameCheap, Wix, Inet, PA Vietnam, … • Develop your web pages
• Integrate your SEO keywords while you build your website
• Link up your social media accounts
• Make sure everyone can browse your website easily
• Add your email marketing integrations
E-commerce 2019
business. technology. society. Learning Objectives Video Ads: Shoot, Click, Buy
Fifteenth Edition
6.1 Understand the key features of the Internet audience, • Class Discussion
the basic concepts of consumer behavior and purchasing, – What advantages do video ads have over traditional
Chapter 6 and how consumers behave online. banner ads?
6.2 Identify and describe the basic digital commerce – Where do sites such as YouTube fit in to a marketing
E-commerce Marketing and marketing and advertising strategies and tools. strategy featuring video ads?
Advertising Concepts
6.3 Identify and describe the main technologies that – What are some of the challenges and risks of placing
support online marketing. video ads online?
– Do you think Internet users will ever develop
6.4 Understand the costs and benefits of online marketing “blindness” toward video ads as they have towards
communications. display ads?
Consumers Online: The Internet Audience Consumers Online: The Internet Audience Consumers Online: The Internet Audience
and Consumer Behavior (1 of 3) and Consumer Behavior (2 of 3) and Consumer Behavior (3 of 3)
• Around 280 million in the U.S. have Internet access in • Broadband and mobile • Consumer behavior models
2018 – Significant inequalities in broadband access – Study of consumer behavior; social science discipline
• Growth rate has slowed – Older adults, lower income, lower educational levels – Attempt to predict or explain wide range of consumer
– Non-broadband household still accesses Internet via decisions
• Intensity and scope of use both increasing mobile or other locations
– Based on background demographic factors and other
• Some demographic groups have much higher • Community effects intervening, more immediate variables
percentages of online usage – Role of social emulation in consumption decisions • Profiles of online consumers
– Income, education, age, ethnic dimensions – “Connectedness”
– Consumers shop online primarily for convenience
▪ Top 10–15% are more independent
▪ Middle 50% share more purchase patterns of friends
– Recommender systems - co-purchase networks
Figure 6.1 A General Model of Consumer Figure 6.3 A Model of Online Consumer The AISAS Model
Behavior Behavior
Shoppers: Browsers and Buyers What Consumers Shop for and Buy Online How Consumers Shop
• Shoppers: Over 90% of Internet users • Big ticket items ($1000 or more) • How shoppers find online vendors
– Around 80% are buyers – Travel, computer hardware, electronics – Highly intentional, goal-oriented
– Around 13% are browsers (purchase offline) – Consumers now more confident in purchasing costlier – Search engines
items – Marketplaces (Amazon, eBay)
• Online research influenced about $2.6 trillion of retail
purchases in 2017 • Small ticket items ($100 or less) – Specific retail site
• Online traffic also influenced by offline brands and – Apparel, books, office supplies, software, etc. • About 8% of Internet users don’t shop online
shopping • Sales of bulky goods, furniture and large appliances, – Trust factor
• E-commerce and traditional commerce are coupled: Part rapidly expanding – Hassle factors (shipping costs, returns, etc.)
of a continuum of consuming behavior
Trust, Utility, and Opportunism in Online Figure 6.2 The Consumer Decision Process
Markets The Online Purchasing Decision (1 of 2) and Supporting Communications
• Two most important factors shaping decision to purchase • Five stages in consumer decision process
online: – Awareness of need
– Utility: – Search for more information
▪ Better prices, convenience, speed – Evaluation of alternatives
– Trust: – Actual purchase decision
▪ Perception of credibility, ease of use, perceived – Post-purchase contact with firm
risk
▪ Sellers develop trust by building strong reputations
for honesty, fairness, delivery
Customer Journey
The Online Purchasing Decision (2 of 2) Customer Journey
• Decision process similar for online and offline behavior • The sequence of online and offline touchpoints a
• General online behavior model customer or buyer persona takes during a buying
– User characteristics
process or broader customer experience (Dave
– Product characteristics
– Website features: latency, usability, security Chaffey et al., 2019).
– Attitudes toward online purchasing
– Perceptions about control over Web environment
• Clickstream behavior
Digital Commerce Marketing and
Multi-Channel Marketing Advertising: Strategies and Tools Multi-channel Marketing Goals
• Integration of online and offline marketing • Internet (Digital) Marketing: Achieving marketing • Reach – Attract new leads and customers
objectives through applying digital media, data and
• Increasing percentage of American media consumers use • Act - Nurture leads
technology (Dave Chaffey et al., 2019)
several media at once
• Convert - Convert leads to customers
• Features of Internet marketing (v s. traditional)
• Reinforce branding messages across media
e rs u
– More personalized • Engage - Create communities of brand advocates and

• Most effective multi-channel campaigns use consistent – More participatory promoters
imagery across media
– More peer-to-peer
– More communal
• The most effective Internet marketing has all four features
The RACE Framework – Smart Insights Paid, owned and earned media Paid, owned and earned media
• Paid media. These are bought media through search, display ad
networks or affiliate marketing. Offline, traditional media such as print
and TV advertising and direct mail remain important for some brands
such as consumer goods brands.
• Owned media. This is media owned by the brand. Online this
includes a company’s own websites, blogs, email list, mobile apps or
their social presence on Facebook, LinkedIn or Twitter. Offline owned
media may include brochures or retail stores.
• Earned media. Traditionally, earned media has been the name given
to publicity generated through PR invested in targeting influencers to
increase awareness about a brand. Now earned media also includes
word of mouth that can be stimulated through viral and social media
marketing, and conversations in social networks, blogs and other
communities.
Multi-channel Marketing Plan Six categories of digital media channels

Smart Insights
• Website
• Traditional online marketing
– Search engine, display, e-mail, affiliate
• Social marketing
– Social networks, blogs, video, game
• Mobile marketing
– Mobile/tablet sites, apps
• Offline marketing
– Television, radio, newspapers
Source: Chaffey and Smith (2017)
Traditional Online Marketing and
Strategic Issues and Questions Advertising Tools Lead generation marketing
• Which part of the marketing plan should you focus on • Search engine marketing and advertising • Services and tools for collecting, managing, and
first? converting leads
• Display ad marketing
• How do you integrate the different platforms for a • A lead magnet is an excellent way to generate highly
• E-mail marketing
coherent message? qualified leads for your business.
• Affiliate marketing
• How do you allocate resources? • A lead magnet allows a customer to continue to engage
– How do you measure and compare metrics from • Viral marketing with your brand without having to place an order.
different platforms? • Lead generation marketing • A lead magnet guides customer through the
– How do you link each to sales revenues? enlightenment phase of relationship.
Lead Magnet Lead Magnet Types Lead-Magnet
• A lead magnet guides customer through the enlightenment • PDF • What is the title of your lead magnet?
phase of relationship. • E-book • How will the lead magnet benefit your audience?
• Webinar • Short and simple
• A lead magnet is an excellent way to generate highly qualified
• Give-aways • Solve a specific problem
leads for your business.
• Mini-games • Qualify audience
• A lead magnet allows a customer to continue to engage with • Zalo Group
your brand without having to place an order.
• Quiz
• …
Search Engine Marketing and Advertising (1 of 2) Search Engine Marketing and Advertising (2 of 2)
Create Your Lead Magnet
• Search engine marketing (SEM) • Search engine optimization (SEO)
• Introduce the Problem – Use of search engines for branding
• Google search engine algorithms
• Ram up the Problem and Offer the Solution • Search engine advertising
• Social search
• Deliver the Value – Use of search engines to support direct sales
– Utilizes social contacts and social graph to provide
• Call to Action (CTA) • Types of search engine advertising fewer and more relevant results
– Paid inclusion • Search engine issues
– Pay-per-click (PPC) search ads – Paid inclusion and placement practices
▪ Keyword advertising – Link farms, content farms
▪ Network keyword advertising (context advertising) – Click fraud
Keywords SEO content checklist
• Keywords are the phrases in your web content that make it possible for people to find • Choose Product
your site via search engines.
• Research keywords
• SERP: search engine result page
• Draft title (include keyword)
• Write content, speading keyword
• Add images: name the file with kw + add an alt tag on each image
• Add external link
• Prepare SERP: title, URL, and meta description include kw
Figure 6.6 How an Advertising Network

Display Ad Marketing (1 of 2) Display Ad Marketing (2 of 2) Works
• Banner ads • Content marketing
• Rich media ads • Advertising networks
• Video ads • Ad exchanges, programmatic advertising, and real-time
– Far more effective than other display formats bidding (RTB)
• Sponsorships • Display advertising issues

– Ad fraud
• Native advertising
– Viewability
– Ad blocking
E-mail Marketing Spam Email Sequences

• Direct e-mail marketing • Unsolicited commercial e-mail • Abandoned cart campaign: activated when a customer doesn’t complete checkout, get
them back
– Messages sent directly to interested users
• Around 55% of all e-mail in 2017 • A re-engagement campaign: activated when a customer hasn’t purchased for a certain
– Benefits include period
▪ Inexpensive • Most originates from bot networks • A pre-purchase campaign: activated when a customer signs up for your list
▪ Average around 3% to 4% click-throughs • Efforts to control spam have largely failed:
▪ Measuring and tracking responses – Government regulation (CAN - SPAM)
▪ Personalization and targeting – State laws
• Three main challenges – Voluntary self-regulation by industries (DMA)
– Spam – Canada’s stringent anti-spam laws
– Anti-spam software
– Poorly targeted purchased e-mail lists
Pre-purchase campaign
Re-engage campaign Other Types of Traditional Online Marketing
• Welcome and thank you
• Maintain contact with your customer on a constant basis
• Brand story + UPV • Affiliate marketing
• Send an offer if they haven’t purchased in 60 days
• Product Recommendations – Commission fee paid to other websites for sending
• Convince them to come back with a coupon, special offer,…
• Social Proof customers to their website
• Community – follow us on FB, Tiktok, Twitter • Viral marketing
– Marketing designed to inspire customers to pass
message to others
Social, Mobile, and Local Marketing and Social Media Marketing – 4 stages Insight on Business: Are the Very Rich
Advertising Different from You and Me?
• Social marketing and advertising • Class Discussion

– Use of online social networks and communities – What distinguishes luxury marketing from ordinary
retail marketing?
• Mobile marketing and advertising
– What challenges do luxury retailers have in
– Use of mobile platform
translating their brands and the look and feel of luxury
– Influence of mobile apps shops into Web sites?
• Local marketing – How has social media affected luxury marketing?
– Geotargeting – Visit the Net-a-Porter website. What do you find
– Display ads in hyperlocal publications there?
– Coupons
Other Online Marketing Strategies Pricing Strategies (1 of 2) Pricing Strategies (2 of 2)
• Customer retention strategies • Pricing: integral part of marketing strategy • Free and freemium
– One-to-one marketing (personalization) • Traditional pricing based on fixed costs, variable costs, • Versioning
– Behavioral targeting (interest-based advertising) demand curve
• Bundling
– Retargeting – Marginal costs
– Marginal revenue • Dynamic pricing
• Customization and customer co-production
– Auctions
• Customer service • Piggyback strategy
– Yield management
– FAQs • Price discrimination – Surge pricing
– Real-time customer service chat systems – Flash marketing
– Automated response systems
Insight on Technology: The Long Tail: Big
Long Tail Marketing Hits and Big Misses Internet Marketing Technologies
• Internet allows for sales of obscure products with little • Class Discussion • Internet’s main impacts on marketing:
demand – What are recommender systems? Give an example of – Scope of marketing communications broadened
• Substantial revenue because one you have used. – Richness of marketing communications increased
– Near zero inventory costs – What is the Long Tail and how do recommender – Information intensity of marketplace expanded
systems support sales of items in the Long Tail? – Always-on mobile environment expands marketing
– Little marketing costs
– How can human editors, including consumers, make opportunities
– Search and recommendation engines
recommender systems more helpful?
Insight on Society: Every Move You Make,

Web Transaction Logs Cookies and Tracking Files Every Click You Make, We’ll be Tracking You
• Built into web server software • Types of tracking files • Class Discussion
• Record user activity at website – Cookies – Are beacons innocuous? Or are they an invasion of
– Flash cookies personal privacy?
• Provides much marketing data, especially combined with: – Do you think your web browsing should be known to
– Web beacons (“bugs”)
– Registration forms marketers?
– Tracking headers (supercookies)
– Shopping cart database – Why hasn't the DNT effort been successful thus far?
• Other tracking methods
• Answers questions such as: – What impact might Apple's ITP system have?
– Deterministic cross-device tracking
– What are major patterns of interest and purchase?
– Probabilistic cross-device tracking
– After home page, where do users go first? Second?
Databases Data Warehouses and Data Mining Hadoop and the Challenge of Big Data
• Enable profiling • Data warehouse: • Big data

• Store records and attributes – Collects firm’s transactional and customer data in – Petabyte, exabyte range
single location for offline analysis by marketers and – Web traffic, e-mail, social media, content
• Database management system (DBMS): site managers – Traditional DBMS unable to process the increasing
• SQL (Structured Query Language): • Data mining: volume of data
– Industry-standard database query and manipulation – Analytical techniques to find patterns in data, model • Hadoop
language used in a relational database behavior of customers, develop customer profiles – Open-source software framework
• Relational databases • Query-driven data mining – Processes any type of data, even unstructured
• Model-driven data mining – Distributed processing
• Rule-based data mining

Marketing Automation and Customer Figure 6.9 A Customer Relationship
Relationship Management (CRM) Systems Management System Online Marketing Metrics: Lexicon
• Marketing automation systems • Audience size/market share metrics

– Track steps in lead generation – Impressions, click-through rate (CTR), page views,
viewability rate, stickiness, loyalty, reach, recency
• CRM systems
• Conversion to customer metrics
– Manage relationship with customers once purchase is
made – Acquisition rate, conversion rate, browse-to-buy ratio, cart
conversion rate, abandonment rate
– Create customer profiles
• Video ad metrics
• Customer data used to: – View time, completion rate
– Develop and sell additional products
• E-mail campaign metrics
– Identify profitable customers
– Open rate, delivery rate, click-through rate, bounce-back
– Optimize service delivery, and so on rate
How Well Does Online Advertising Work? The Costs of Online Advertising Marketing Analytics
• Use ROI to measure ad campaign • Pricing models • Software that analyzes data at each stage of the customer
– Barter, cost per thousand (CPM), cost per click (CPC), conversion process
• Difficulty of cross-platform attribution
cost per action (CPA), hybrid, sponsorship – Awareness
• Highest click-through rates: Search engine ads, – Engagement
permission e-mail campaigns • Measuring issues
– Interaction
– Correlating online marketing to online or offline sales – Purchase activity
• Online channels compare favorably with traditional
• In general, online marketing is more expensive on CPM – Loyalty and post-purchase
• Most powerful marketing campaigns use multiple basis, but more efficient in producing sales
channels, including online, catalog, TV, radio, • Helps managers
newspapers, stores • Effective cost-per-thousand (eCPM) – Optimize ROI on website and marketing efforts
– Build detailed customer profiles
– Measure impact of marketing campaigns
Figure 6.11 Web Analytics and the Online

Purchasing Process Careers in E-commerce Copyright
• Position: Digital Marketing Assistant

• Qualification/Skills
• Preparing for the Interview
• Possible Interview Questions
E-commerce 2019
business. technology. society. Learning Objectives Building a Microbrand with Facebook Ads
Fifteenth Edition
7.1 Understand the difference between traditional online • Class Discussion
marketing and the new social-mobile-local marketing platforms – Have you ever made a purchase based on something
and the relationships between social, mobile, and local
Chapter 7 marketing.
you have read or seen on Facebook? What was the
product and what made you interested?
Social, Mobile, and Local 7.2 Understand the social marketing process from fan acquisition – What types of Facebook ads did Hubble use? Which
Marketing to sales and the marketing capabilities of social marketing types were the most effective?
platforms such as Facebook, Twitter, and Pinterest.
– What are some of the issues for firms hoping to use
7.3 Identify the key elements of a mobile marketing campaign. Facebook ads to build a microbrand?
7.4 Understand the capabilities of location-based local
marketing.
Introduction to Social, Mobile, and Local

Marketing Figure 7.3 Online Marketing Platforms
• New marketing concepts
– Conversations
– Engagement
• Impact of smartphones and tablets
• Social-mobile-local nexus
– Strong ties between consumer use of social networks,
mobile devices, and local shopping
* Reading: https://www.mytotalretail.com/article/how-e-
commerce-m-commerce-and-s-commerce-are-setting-
new-customer-experience-standards/
Sales Funnels
Social Marketing Social Marketing Players
• Traditional online marketing goals • The most popular sites account for over 90% of all social
– Deliver business message to the most consumers network visits
– Facebook, Twitter, LinkedIn, Pinterest, Instagram,
• Social marketing goals
Snapchat, Tumblr
– Encourage consumers to become fans and engage
– Unique visitors v s. engagement
and enter conversations
e rsu
▪ Engagement measures the amount and intensity of

– Strengthen brand by increasing share of online
user involvement
conversation
▪ Facebook dominates in both measures
– Dark social – sharing outside of major social networks
(e-mail, IM, texts, etc.)
Figure 7.4 The Social Marketing Process Understand Your Prospects Social Marketing Strategy
• What are their biggest challenge as it pertains to my • Goal setting

products, programs or services?
– Business Goals
• What is the ideal solution to overcome those challenges?
– Social Marketing Goals
• How can my business solve that challenge
• What social platform is right for your business?
• What topics about my industry are they interested in
learning about?
• How are they using social media? Time, frequency
• What other social media pages and blogs do they follow?
What social platform is right for your

Goal Setting business?
• Launch new product
• Where your people are hanging out online
• Increase brand awareness
• Increase Income • Where your competitors are active on

- More Followers
- More Traffic • Be selective with your social media platforms.

- More Email Subscribers
• Keep social media goals in mind to guide your selection
- More Sales
Social Media Content Plan Facebook Marketing
• Content Buckets • Basic Facebook features

• Description – News Feed
– Timeline (Profile)
• Frequency
– Search
– Livestreaming
• Social density of audience is magnified
– Facebook is largest repository of deeply personal
information
– Facebook geared to maximizing connections between
users
Facebook Marketing Tools Typical Facebook Marketing Campaign Measuring Facebook Marketing Results
• Reactions Buttons • Establish Facebook brand page • Basic metrics:
• Brand Pages – Fan acquisition (impressions)
• Use comment and feedback tools to develop fan
• News Feed Page Post Ads comments – Engagement (conversation rate)
• Right-Hand Column Sidebar Ads – Amplification (reach)
• Develop a community of users – Community
• Facebook Live
• Encourage brand involvement through video, rich media, – Brand strength/sales
• Facebook Watch
contests
• Facebook analytics tools
• Video Ads
• Use display ads for other Facebook pages and social – Facebook Page Insights
• Mobile Ads
search – Social media management systems (HootSuite)
• Facebook Messenger
– Analytics providers (Google Analytics, Webtrends)
• Display Like button liberally
• Facebook Exchange (F BX)
Facebook Ads Facebook Ads Campaign Measuring Facebook Ads Results

• Create a Business Manager: a central space to manage your business separate from • Product Page Retargeting • Reach: the total number of people you have reached with your ads.
your personal Facebook profile. You’ll manage your Pages and ad accounts in • Collection and Homepage Retargeting • Impression: the total number of times your ad has been seen. One person can see
your ad multiple times.
Business Manager. Go to business.facebook.com. • Shopping Cart Retargeting
• Frequency: the number of times a person sees your ad. If you have 100,000
• Facebook Pixel: an analytics tool that allows you to measure the effectiveness of your • Loyalty Campaign impressions with a reach of 20,000, that means your frequency is 5.
advertising by understanding the actions people take on your website. You install the • Cost Per Purchase: how much it costs you to get a customer to buy. You’re
Pixel on your page and it communicates back to your Facebook account all the results essentially buying purchases so your goal is to buy those purchases for as little as
possible.
of your ads.
• Others
• Ads Campaign/Ad Set/Ad
Insight on Technology: Optimizing Social

Marketing with Sprout Social Twitter Marketing Twitter Marketing Tools
• Class Discussion • Real-time interaction with consumers • Promoted Tweets/Twitter Promote Mode
– How do social media analytics help companies • Over 335 million active users worldwide • Promoted Trends
identify and attract customers? • Promoted Accounts
– Over 90% access Twitter from mobile device
– What are the challenges in measuring the
• Basic features • Amplify
effectiveness of social marketing campaigns?
– What advantages did Wahl Professional find in using – Tweets, retweets, followers, message (DM), hashtag, • Promoted Video
Sprout's analytics and tools? mention, reply, links • Twitter Cards
– Moments tab, Timeline • Mobile Ads
Typical Twitter Marketing Campaign Measuring Twitter Marketing Results Pinterest Marketing
• Follow others relevant to your content and conversation • Similar to Facebook results • One of the fastest-growing and largest image-sharing sites
• Experiment with simple Promoted Tweets and Twitter – Fan acquisition, engagement, amplification, • Enables users to talk about brands using pictures rather than
Promote Mode community, brand strength/sales words
• For larger budgets, use Promoted Trends • Analytics tools • Features include:
– Twitter’s real-time dashboard – Pins and re-pins to boards
• For retail business local sales, build Twitter Cards – Share
– Twitter’s Timeline activity and Followers dashboards
– Third-party tools – Follow
▪ TweetDeck, Twitalyzer, BackTweets – Contributors
– Links to URLS
– Price displays
Pinterest Marketing Tools Typical Pinterest Marketing Campaign Marketing on Other Social Networks
• Rich Pins, Promoted Pins, Cinematic Pins • Create Pinterest brand page and multiple lifestyle-themed • Instagram
• Buyable Pins/Shop the Look Pins boards – Brand profiles, ad campaigns (display and video), Buy
• Promoted Video
– Improve quality of photos, use U RL links and keywords buttons, Marquee ads
• Add Pin It and Follow buttons • Utilize Pinterest Rich Pins and/or Product pins, Pin It buttons • Snapchat
• Pin as display ad • Integrate with Facebook and Twitter – Snapchat Stories, Live Stories, Discover, Snap Ads,
• Theme-based (lifestyle) boards • Follow and interact with other pinners and boards Sponsored Geofilters, Sponsored Lenses
• Brand pages • Measuring Pinterest Marketing Results • LinkedIn
• URL link to stores – Same dimensions as Facebook, Twitter – Company profiles, showcase pages, Career Page,
• Integration with other social sites Display ads (Feeds), self-service ads or Advertising
Partner Solutions, sponsored inMail, LinkedInPulse
• Network with users, followers, others
Insight on Society: Marketing to Children

The Downside of Social Marketing of the Web in the Age of Social Networks Mobile Marketing
• Loss of control • Class discussion: • Mobile marketing involves the use of mobile devices such as
smartphones and tablet computers to display banner ads, rich media,
– Where ads appear in terms of other content – Why is online marketing to children a controversial video, games, e-mail, text messaging, instore messaging
– What people say practice?
• Over 255 million Americans use a mobile device for Internet access
▪ Posts – What is the Children’s Online Privacy Protection Act
– Devices used multiple times per day
▪ Comments (COPPA) and how does it protect the privacy of
children? • By 2021, m-commerce will account for more than 50% of all retail
▪ Inaccurate or embarrassing material and travel e-commerce.
– How do companies verify the age of online users?
• In contrast, TV ads maintain near complete control – Should companies be allowed to target marketing • Challenges: Mobile search
efforts to children under the age of 13? – Motivating consumers to click
– Raising fees for each click
Figure 7.5 The Growth of M-commerce How People Actually Use Mobile Devices In-App Experiences and Ads
• Average of over three and a half hours hours daily on • Mobile use
mobile devices – Smartphone apps—70% of total time using mobile
– Over 55% entertainment apps
– Over 20% social networks ▪ Over 90% of app time spent on user’s top 5 apps
– Almost 70% occur in home – Users use about 20 apps/month.
• Activities are similar to desktop activities • App marketing
• Rapidly growing smartphone m-commerce sales – Most effective are in-app ads
– Placed in most popular apps
• Mobile devices currently used more for communicating
and entertainment than for shopping and buying – Targeted to immediate activities and interests
How the Multi-Screen Environment

Changes the Marketing Funnel Mobile Marketing Features Mobile Marketing Tools: Ad Formats
• Consumers becoming multi-platform • Mobile marketing almost 70% of all online marketing • Mobile marketing formats
– Desktops, smartphones, tablets, T V • Dominant players are Google, Facebook – Search ads
– 90% of multi-device users use multiple devices to • Mobile device features – Display ads
complete a specific action – Personal communicator and organizer – Video
▪ View ad on T V, search on smartphone, purchase – Screen size and resolution – Text/video messaging
on tablet – GPS location – Other: e-mail, classifieds, lead generation
– Web browser
• Marketing implications • Mobile interface versions of social network techniques
– Apps
– Consistent branding
– Ultraportable and personal
– Responsive design – Multimedia capable
– Increased complexity, costs – Touch/haptic technology
Figure 7.9 U.S. Mobile Ad Spending by Insight on Business: Mobile Marketing

Format Revs Up with 3D and Augmented Reality Mobile Marketing Campaigns
• Class discussion: • Mobile website

– Why do mobile devices represent such a promising • Facebook and Twitter brand pages
opportunity for marketers?
– What are the benefits and the appeal of 3D and AR • Mobile versions of display advertising campaigns
mobile advertising? • Ad networks
– Have you ever engaged with 3D or AR mobile ads?
• Interactive content aimed at mobile user
– What types of products are best suited for 3D or AR
ads? • Tools for measuring responses
– Key dimensions follow desktop and social marketing
metrics
Figure 7.10 Measuring the Effectiveness of a Mobile The Growth of Local and Location-Based
and Social Marketing Branding Campaign Local and Location-Based Marketing Mobile Marketing
• Location-based marketing • Prior to 2005, nearly all local advertising was non-digital
– Targets messages to users based on location – Google Maps (2005)
– Marketing of location-based services ▪ Enabled targeting ads to users based on I P
• Location-based services address and general geographic location
– Provide services to users based on location – Smartphones, Google’s mobile maps app (2007)
▪ Personal navigation ▪ Enabled targeting ads based on G PS
▪ Point-of-interest • Location-based mobile marketing
▪ Reviews
– Expected to triple over next five years
▪ Friend-finders, family trackers
• Consumers have high likelihood of responding to local ads
Figure 7.11 Location-Based Mobile Location-Based Mobile Marketing

Marketing in Perspective Location-Based Marketing Platforms Technologies
• Google • Two types of location-based marketing techniques

– Android OS, Google Maps, Google Places, AdMob, – Geo-aware techniques
AdWords ▪ Identify location of user’s device and target ads,
recommending actions within reach
• Facebook – Proximity marketing
▪ Identify a perimeter around a location and target ads and
• Oath
recommendations within that perimeter
• Twitter • Identifying locations
– GPS signals
– Cell-tower locations/BTS (Base Transceiver Station)
– Wi-Fi locations
Location-Based Mobile Marketing Identifying locations Why is Local Mobile Attractive to

Technologies • - GPS (Global Positioning System): determine position based on
Marketers?
signals from satellites - And smartphones are the most popular
satellite receivers . • Mobile users more active, ready to purchase than
• - BTS (Base Transceiver Station): Transceiver station (2G / 3G / 4G) desktop users
of telecom operators - mobile devices will be identified by thousands
of BTS stations. • Easily to segment audience base on their location
• - Wifi Location: more specifically Wifi broadcasting system for mobile • Increase visibility and engagement with target audiences
devices: Free internet access service covers many schools,
hospitals, railway stations, airports or cafes. …. Users will be • Over 80% of U.S. consumers use mobile devices to
determined based on the wifi they visit. search for local products, services
– 50% of smartphone users visit a store within 1 day of
local search
– 18% of smartphone users make a purchase
Location-Based Marketing Tools
Location-Based Marketing Tools
• Local SEO – Google My
Business
• Geo-social-based services marketing
• Search Ads based on
• Location-based services marketing Location (PPC)
• Mobile-local social network marketing • Location-based SMS
• Proximity marketing: In-store messaging • https://www.youtube.com/watch?v=
vtdPWji5f8w
• Location-based app messaging
MEASURING LOCATION-BASED
Location-Based Marketing Campaigns MARKETING RESULTS Careers in E-commerce
• Location-based considerations
– Action-based, time-restrained offers and opportunities
• Position: Social Media Associate
– Target demographic and location-aware mobile user demographics
– Strategic analysis of marketspaces • Qualification/Skills
• Measuring marketing results • Preparing for the Interview
– Same measures as mobile and Web marketing
– Metrics for unique characteristics • Possible Interview Questions
▪ Inquire
▪ Reserve
▪ Click-to-call
▪ Friend
▪ Purchase
Copyright
E-commerce 2019 Amazon Takes on B2B with Amazon
business. technology. sSociety. Learning Objectives Business
Fifteenth Edition
12.1 Discuss the evolution and growth of B2B e-commerce, as well as • Class Discussion
its potential benefits and challenges..
– What made the difference in Amazon Business
Chapter 12 12.2 Understand how procurement and supply chains relate to B2B e- moving from being a distributer of supplies to a real
commerce. B2B marketplace?
B2B E-commerce: Supply 12.3 Identify major trends in supply chain management and – What benefits over other B2B marketplaces does
Chain Management and collaborative commerce. Amazon Business offer buyers?
Collaborative Commerce
12.4 Understand the different characteristics and types of Net – What benefits do suppliers have in using Amazon
marketplaces.
Business?
12.5 Understand the objectives of private industrial networks, their role – Does Amazon Business pose any disadvantages for
in supporting collaborative commerce, and the barriers to their
buyers or sellers?
implementation.
Trends in B2B E-commerce Basic Definitions Figure 12.4 The Procurement Process
• Flexibility: growing emphasis on rapid-response and optimal supply • B2B commerce:
chains
– All types of computer-enabled inter-firm trade
• Resurgence in Net marketplaces bringing together hundreds of – Before Internet, B2B transactions called trade or
suppliers and thousands of buying firms procurement process
• Supply chain visibility—real time • B2B e-commerce:
• Social/mobile commerce and customer intimacy – The portion of B2B commerce enabled by the Internet
• Cloud computing • Supply chains
• Big data and growing use of business analytics – Organizations, people, business processes, technology,
information required to produce products efficiently
• Internet of Things
– Often global
• Accountable and sustainable supply chains
Figure 12.1 The Evolution of the Use of

The Evolution of B2B Commerce Technology Platforms in B2B E-commerce The Growth of B2B E-commerce (1 of 2)
• Automated order-entry systems • B2B e-commerce will grow to almost 50% of total U.S.
– Seller-side solution inter-firm trade by 2022
• Electronic data interchange (EDI) • Private industrial networks continue to play dominant role
– Buyer-side solution in B2B
– Hub-and-spoke system • Non-EDI B2B e-commerce most rapidly growing type of
– Serve vertical markets e-commerce
• B2B e-commerce websites • EDI continues as workhorse of B2B commerce
• Net marketplaces
• Private industrial networks
Figure 12.6 The Evolution of EDI as a B2B
Electronic Data Interchange (EDI) Medium The Growth of B2B E-commerce (2 of 2)
• Communications protocol for exchanging documents • Not all industries similarly affected by B2B e-commerce
among computers
• Not all industries would benefit equally
– Each industry has own standards
• Factors influencing move to e-commerce
• Developed in 1970s, 1980s to automate exchange and
– Significant utilization of EDI
reduce cost and errors in purchase orders, shipping
documents, and more – Large investments in IT and Internet infrastructure
– Market concentrated on purchasing or selling
• Today, provides for exchange of critical business
information between computer applications supporting
wide variety of business processes
• Suited to small set of strategic partners
Figure 12.2 Growth of B2B E-commerce in Potential Benefits and Challenges of B2B Potential Benefits and Challenges of B2B
the United States E-commerce (1 of 2) E-commerce (2 of 2)
• Lower administrative costs • Decreased product cycle time

• Lower search costs for buyers • Increased opportunities for collaboration
• Reduced inventory costs • Greater price transparency
• Lower transaction costs • Increased visibility, real-time information sharing
• Increased production flexibility by ensuring just-in-time • However, some risk is posed by increased globalization
parts delivery and consolidation
• Improved quality of products by increasing cooperation
among buyers and sellers
Insight on Society: Where’s My iPad? The Procurement Process and the Supply
Supply Chain Risk and Vulnerability Chain Figure 12.4 The Procurement Process
• Class discussion: • Procurement process:
– Why does concentrating production on fewer – The way firms purchase materials they need to make
suppliers also concentrate risk? products
– How does globalization play a part in increased risk? • Steps in procurement process
– What types of procedures could be implemented, – Deciding who to buy from and what to pay
given increased globalization, to reduce risk?
– Completing transaction
– Each step is composed of many business processes
and subactivities requiring data to be recorded in
seller, buyer, and shipper information systems
Types of Procurement (1 of 2) Types of Procurement (2 of 2) Multi-Tier Supply Chain
• Firms purchase two types of goods • Procurement is highly information intensive and labor intensive • Complex series of transactions between firm and
– Direct goods: Integrally involved in production process – Requires managing information among many corporate thousands of suppliers, supplying thousands of goods
– Indirect goods: All goods not directly involved in production systems
• Challenges
process (MRO goods) – Involves over 1 million U.S. workers
– Supply chain visibility
• Firms use two methods to purchase • Purchasing managers
– Demand forecasting
– Contract purchasing: – Key players in procurement process
– Production scheduling
▪ Involves long-term written agreements to purchase – Key decision-makers for adoption of B2B e-commerce
specified products, with agreed-upon terms and quality solutions – Order management
– Spot purchasing: – Logistics management
▪ Involves purchase of goods based on immediate needs
in larger marketplaces that involve many suppliers
The Role of Existing Legacy Computer

Figure 12.5 The Multi-Tier Supply Chain Systems Trends in Supply Chain Management
• Legacy computer systems • Supply chain management (SCM)

– Generally, older mainframe and minicomputer – Activities used to coordinate procurement process
systems used to manage key business processes
• Major trends in SCM
within firm
– Continual efforts to improve process
• Enterprise systems – Trends include: Just-in-time and lean production,
– Corporate-wide supply chain simplification, adaptive supply chains,
– Support/control all aspects of production, including sustainable supply chains, electronic data
▪ Procurement interchange, supply chain management (SCM)
systems
▪ Finance
▪ Human resources
Just-In-Time and Lean Production Supply Chain Simplification Adaptive Supply Chains
• Just-in-Time production • Reducing size of supply chain • Reducing centralization

– Method of inventory cost management – Working with strategic group of suppliers to reduce product – Reduce risks caused by relying on single suppliers who
and administrative costs and improve quality are subject to local instability
– Seeks to keep excess inventory at a bare minimum
• Essential for just-in-time production models ▪ For example: European financial crisis, Japanese
• Lean production earthquake
– Set of production methods and tools • May involve:
• Creating regional- or product-based supply chains
– Focuses on elimination of waste throughout customer – Joint product development and design
– Allowing production to be moved to temporary safe
value chain, not just inventory – Integration of computer systems
harbors in case of local manufacturing disruptions
– Tight coupling
– Focus on “optimal-cost”, distributed manufacturing, and
▪ Ensuring precise delivery of ordered parts at specific flexible supply chains that can shift to low-risk areas
times
Accountable Supply Chains Sustainable Supply Chains Mobile B2B
• Labor conditions in low-wage, under-developed producer countries • Taking social and ecological interests into account • Mobile devices increasingly important in all aspects of
are acceptable to consumers B2B e-commerce
– For example: water usage, air pollution
– Slave/forced and child labor
– Used in all phases of purchase process
– Routine exposure to toxic substances • Using most efficient environment for production,
– More than 48 h rs/week distribution, logistics – Users increasingly expect B2B e-commerce sites to
be accessible from mobile devices
ou
– Harassment, abuse, and sexual exploitation – Good business, over long-term

– Adequate compensation ▪ Good risk management • Bring Your Own Device (BYOD) policies
• Efforts to make global supply chains more accountable and – Create value for consumers, investors, communities • Supply chain software and network providers providing
transparent to reporters and citizens
support for mobile platform
– Fair Labor Association
– National Consumers League, Human Rights First, and more
Figure 12.8 Supply Chain Management

B2B in the Cloud Supply Chain Management Systems Systems
• Cloud-based B2B systems • Continuously link activities of buying, making, and moving
– Shift much of the expense of B2B systems from firm to B2B products from suppliers to purchasing firms
network provider (data hub or B2B platform)
– SAP and Oracle Mobile apps for smartphones, tablets
• Cloud platform owner provides
– Computing/telecommunications capabilities
• Integrates demand side of business equation by including
order entry system in the process
– Software
– Connectivity • With SCM system and continuous replenishment,
– Data cleansing and quality inventory is eliminated and production begins only when
– File storage order is received
• Network effects: Costs spread out over all members • Hewlett Packard’s SCM system: Elapsed time from order
• Cloud-based solutions can be implemented rapidly entry to shipping PC is 48 hours
Insight on Technology: Blockchain Takes

Blockchain and Supply Chain Management on the Diamond Supply Chain Collaborative Commerce
• Transaction database that operates on a distributed P2P • Class discussion: • Use of digital technologies for organizations to collaboratively
network that connects participants in a single database – What challenges is De Beers hoping to deal with by design, produce, and manage products through life cycles
– Secure implementing a blockchain system? • Moves focus from transactions to relationships among supply
– Reliable – How does De Beer's blockchain system work? chain participants
– Resilient
– If you were purchasing a diamond, would you want to • Unlike EDI, more like an interactive teleconference among
– Inexpensive
know its provenance? Would you be willing to pay members of supply chain
• Is expected to transform supply chain management, more for this information? If so, how much more? • Use of Internet technologies for rich communications
eventually replacing EDI environment
• Firms expected to spend over $2 billion on blockchain – Sharing designs, documents, messages, network
hardware, software, and services in 2018 meetings, videconferencing
Figure 12.9 Elements of a Collaborative
Commerce System Social Networks and B2B B2B Marketing
• Social networks can provide personal connections that • More interpersonal than traditional retail marketing
can help decision making in supply chain
• B2B contract selling
• Example: Dell’s YouTube channel – Very long-standing relationships between suppliers
• Example: Cisco’s Facebook pages for product campaigns and buyers
for business clients • Spot purchase markets for MRO, commodities
– More similar to B2C marketing tactics
– Mobile advertising
– Predictive analytics
– Sales enablement systems
Table 12.3 Characteristics of Net Figure 12.10 Pure Types of Net

Net Marketplaces Marketplaces: A B2B Vocabulary Marketplaces
• Ways to classify Net marketplaces:
Characteristic Meaning
– Pricing mechanism, nature of market served, ownership Bias Sell-side v s. buy-side v s. neutral. Whose interests are
e rs u e rs u
advantaged: buyers, sellers, or no bias?

• By business functionality
Ownership Industry v s. third party. Who owns the marketplace?
– What businesses buy (direct v s. indirect goods)
ers u
Pricing mechanism Fixed-price catalogs, auctions, bid/ask, and RFPs/RFQs

e rs u
– How businesses buy (spot purchasing v s. long-term sourcing)

ersu
Scope/focus Horizontal v s. vertical markets

ersu
– Four main types Value creation What benefits do they offer customers or suppliers?
▪ E-distributors Access to market In public markets, any firm can enter, but in private markets,
entry is by invitation only
▪ E-procurement
▪ Exchanges
▪ Industry consortia
E-distributors Figure 12.11 E-distributors E-procurement Net Marketplaces

• Most common type of Net marketplace • Independently owned intermediaries
• Electronic catalogs representing products of thousands of • Connect hundreds of suppliers of indirect goods
direct manufacturers
• Firms pay fees to join market
• Typically, independently owned intermediaries
• Long-term contractual purchasing of indirect goods
• Offer industrial customers single source to purchase indirect
• Revenues from transaction fees, licensing consultation
goods (MRO) on spot basis
services and software, network fees
• Typically, horizontal
• Offer value chain management (VCM) services
• Usually, fixed price discounts for large customers
• Many-to-many market
• Example: W.W. Grainger, Amazon Business
• Example: Ariba
Figure 12.12 E-procurement Net
Marketplaces Exchanges Figure 12.13 Exchanges
• Independently owned online marketplaces
• Connect hundreds to thousands of suppliers and buyers
in dynamic, real-time environment
• Vertical market, spot purchasing, single industry
• Typically charge commission fees on transaction
• Tend to be buyer-biased; suppliers disadvantaged by
competition
• Many have failed due to low liquidity
Industry Consortia Figure 12.14 Industry Consortia Private Industrial Networks (1 of 2)
• Industry-owned vertical markets • Most prevalent form of B2B e-commerce

• Purchase of direct inputs from set of invited participants • Web-enabled networks for coordination of trans-
organizational business processes (collaborative
• Emphasize long-term contractual purchasing, stable
commerce)
relationships, creation of data standards
– Direct descendant of EDI; closely tied to ERP
• Aim to unify supply chain within entire industry through systems
common platform – Manufacturing and support industries
• Revenue from transaction and subscription fees – Single, large manufacturing firm sponsors network
• Range in scope from single firm to entire industry
• Example: Procter & Gamble
Figure 12.15 P&G’s Private Industrial Insight on Business: Walmart's Private

Private Industrial Networks (2 of 2) Network Industrial Network Supports Omni-
channel Growth
• Objectives include:
– Efficient purchasing and selling industry-wide • Class discussion:
– Increasing supply chain visibility – What is Walmart’s Retail Link system and how has it
– Closer buyer–supplier relationships changed since the early 1990s?
– Global scale operations – What functionality does Walmart’s GRS provide?
– Why did Walmart have a inventory problem?
• Focus on continuous business process coordination
– What other steps is Walmart taking in its effort to
• Typically, focus on single sponsoring company that compete with Amazon?
“owns” the network
– Do you prefer to shop online at Walmart or Amazon?
Why?
Private Industrial Networks and Figure 12.16 Pieces of the Collaborative
Collaborative Commerce Commerce Puzzle Implementation Barriers
• Forms of collaboration: • Concerns about sharing of proprietary, sensitive data

– Collaborative resource planning, forecasting, and • Integration of private industrial networks into existing ERP
replenishment (CPFR): systems and EDI networks difficult, expensive
– Demand chain visibility
• Requires change in mindset and behavior of employees
– Marketing coordination and product design and suppliers
▪ Can ensure products fulfill claims of marketing
– All participants lose some independence
▪ Feedback enables closed loop marketing
Careers in E-commerce Copyright
• Position: Junior Supply Chain Analyst

• Qualification/Skills
• Preparing for the Interview
• Possible Interview Questions

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E-commerce 2019

business. technology. society. Introduction to E-commerce Careers in E-commerce

The Difference between E-commerce and Technological Building Blocks Underlying

– Disruptive business change • E-business: • Mobile platform

Unique Features of E-commerce Unique Features of E-commerce

• Business trends include: 1. Ubiquity 5. Interactivity

• Precursors • 1995–2000: Invention

Figure 1.10 Periods in the Development of

Insight on Business: Y Combinator’s

• Class Discussion • Stunning technological success • Other surprises

• Technology: • Class discussion:

Academic Disciplines Concerned with

• Technical • Position: Category specialist in E-commerce Retail

2. Revenue Model 3. Market Opportunity 4. Competitive Environment

8. Management Team Raising Capital Categorizing E-commerce Business Models

B2C Business Models

Time perspective Isolated Events Ongoing Relationship • Market creator

• Online version of traditional retailer • Ecommerce Business

Insight on Technology: Connected Cars and

• Online services • Net marketplaces • BerlinPackaging.com

• Value proposition – E-procurement • BulkBookStore.com

B2B Models: E-Distributor B2B Models: E-Procurement B2B Models: Exchanges

1. Value proposition • “Why should the customer buy from you?”

What is your niche? Customer Avatar

• Psychographics are customers’ more intangible aspects which can

• Use Customer Avatar Worksheet

• P (Problem) = The problem is that

• P (Product) = The product could be a

Value Statement Value Statement

• We help [Write Your Target Audience here]

Examples of Value Statement

• - Find how many people are searching

• - Find how many people are sharing online

• - Tools: Google, Keywordtool, Semrush,…

• Research ecommerce platforms: Shopee, Lazada,

• Social Listening and Engagement

• - Find what audience is talking about, sharing, asking right now

• - Learn how your audience speaks

• - Establish trust with audience

• - Go to where audience is: FB Groups, LinkedIn, Instagram,…

3. Market Opportunity 4. Competitive Environment 4. Competitive Environment

• - Ask them a few direct, open ended questions

Figure 4.1 SWOT Analysis 5. Competitive Advantage 6. Market Strategy

Walmart Website Redesign: Going Upscale

Develop a timeline: Milestones

Table 4.2 System Analysis, Business Objectives,

– Works with UNIX, Linux operating systems Security services (Secure

Website Development Tools Website Development Tools Selection Criteria

Wix Wix Free Plan WooCommerce

• Supplier Demand: • Build own v s. outsourcing:

– Hosting: Hosting company responsible for ensuring site is

Insight on Business: Weebly Makes Implementation, Maintenance, and

• Class Discussion • Testing • Systems break down unpredictably

• Identify business objectives, system functionality, and

Insight on Technology: Carnival Cruise

• Class Discussion • Position: UX Designer

Map your customer journey

• following you on social media

• Where do you want them to go?

• What do you want them to do from each page?

2. Your Content Your Business Messaging Your Business Messaging

Homepage The Grunt Test The Grunt Test

• Clear Description • What do you offer?

• Introduction of company • Write 1000 words • Incredible Description