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Chapter 2 - Slide
Chapter 2 - Slide
society.
Fifteenth Edition
Chapter 2
E-commerce Business
Models and Concepts
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Learning Objectives
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Tweet Tweet: Will Twitter Ever Find a
Business Model That Works?
• Class Discussion
– What characteristics or benchmarks can be used to
assess the business value of a company such as
Twitter?
– Have you used Twitter to communicate with friends or
family? What are your thoughts on this service?
– 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?
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E-commerce Business Models
• Business model
– Set of planned activities designed to result in a profit in a
marketplace
– How a business create and deliver value to customer and make
money in return, sustainably (Harvard Innovation Labs)
• Business plan
– Describes a firm’s business model
• E-commerce business model
– Uses/leverages unique qualities of Internet and Web
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Eight Key Elements of a Business Model
1. Value proposition
2. Revenue model
3. Market opportunity
4. Competitive environment
5. Competitive advantage
6. Market strategy
7. Organizational development
8. Management team
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1. Value Proposition
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2. Revenue Model
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3. Market Opportunity
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4. Competitive Environment
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5. Competitive Advantage
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6. Market Strategy
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7. Organizational Development
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8. Management Team
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Raising Capital
• Seed capital
• Elevator pitch
• Traditional sources
– Incubators, angel investors
– Commercial banks, venture capital firms
– Strategic partners
• Crowdfunding
– JOBS Act
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Categorizing E-commerce Business Models
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B2B B2C
From buyer demand, less price sensitive Stimulated by marketing, extremely value
sensitive
Consultative Selling based on understanding a Convincing customer approach
client’s needs and developing a relationship of
trust
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B2C B2B
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B2C Business Models
• E-tailer
• Community provider (social network)
• Content provider
• Portal
• Transaction broker
• Market creator
• Service provider
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B2C Models: E-Tailer
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B2C Models: E-Tailer
• Ecommerce Business
• Platforms
• Dropshipping
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Dropshipping
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B2C Models: Community Provider
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B2C Models: Content Provider
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Insight on Technology: Connected Cars and
the Future of E-commerce
• Class Discussion
– What is the Internet of Things (IoT)?
– What value does the IoT have for businesses?
– What impact does the IoT have on the content
industry?
– What impact does the IoT have on vehicles?
– Are there any disadvantages to “connected” cars?
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B2C Business Models: Portal
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B2C Models: Transaction Broker
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B2C Models: Market Creator
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B2C Models: Service Provider
• Online services
– Example: Google—Google Maps, Gmail, and so on
• Value proposition
– Valuable, convenient, time-saving, low-cost
alternatives to traditional service providers
• Revenue models:
– Sales of services, subscription fees, advertising, sales
of marketing data
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B2B Business Models
• Net marketplaces
– E-distributor
– E-procurement
– Exchange
– Industry consortium
• Private industrial network
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B2B Business Models
• BerlinPackaging.com
• Knobs.co
• BulkBookStore.com
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B2B Models: E-Distributor
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B2B Models: E-Procurement
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B2B Models: Exchanges
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B2B Models: Industry Consortia
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Private Industrial Networks
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How E-commerce Changes Business
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Group Project:
Business Plan Development
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Eight Key Elements of a Business Model
1. Value proposition
2. Revenue model
3. Market opportunity
4. Competitive environment
5. Competitive advantage
6. Market strategy
7. Organizational development
8. Management team
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1. Value Proposition
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Value Proposition Canvas
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What is your niche?
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Customer Avatar
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What is your solution?
• S= Statistic. This is data that supports the need for your product and adds
credibility.
• S = Solution. What is the solution to the problem you identified earlier in the
framework?
• P = Product. What would this solution look like in the form of a product?
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Product Ideas
• HYDRATION
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Product Ideas
• SUSTAINABILITY
• P (Problem) = The problem is the waste caused by single-use plastic, especially from
everyday items, like plastic, single-use drink bottles.
• S (Statistic) = A stat to highlight this problem and, thus, the need for a solution is that
single-use plastic from everyday products accounts for over half of the world's plastic
waste.
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Is the product viable for E-commerce
• Shipping
- Can my product be shipped worldwide?
- Is my product lightweight?
• Regulations
• Passion
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Value Statement
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Value Statement
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Examples of Value Statement
• 8 Powerful Value Proposition Examples (& How To Write
Yours) | Consulting Success
• Value Proposition Examples: 30 Of The Best Ever Created
(garyfox.co)
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2. Revenue Model
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3. Market Opportunity
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3. Market Opportunity
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3. Market Opportunity – AirBnB
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3. Market Opportunity
• Keyword Research
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3. Market Opportunity
• Talk to audience
• - Follow up one-to-one
• Magic Questions
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4. Competitive Environment
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4. Competitive Environment
• SWOT Analysis?
• Best Sellers?
• Pricing?
• Product Categories/Structure?
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Figure 4.1 SWOT Analysis
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5. Competitive Advantage
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6. Market Strategy
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Copyright
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