E-Commerce

Priyanka Gupta
E-commerce
• The use of the Internet, the Web,
and mobile apps and browsers
running on mobile devices to
transact business
• Can be defined as digitally
enabled commercial
transactions between and among
organizations and individuals.
Traditional Vs E-commerce
• Traditional commerce start from manufacturer to the dealer’s
prospective, commerce entail the design, manufacturing, retailer,
wholesaler, locating the product/services, marketing, positioning,
distribution and delivery of product
• E-commerce includes advertisement, website containing all the
details about product or services, delivery, customization of product
 Information
Exchange

order marketing

Shipment
Customer
and
service
payment
E-COMMERCE AND E-
BUSINESS • E-commerce- Buying and
selling aspect of business
over internet

• E-Business- Administration
of conducting business via
internet includes buying and
selling, serving customers,
collaboration with business
partner, conducting
electronic transaction
 FEATURES
OF E-
COMMERCE
TECHNOLO
GY
TYPES OF E-COMMERCE
• Business-to-consumer (b2c) e-commerce
• Business-to-business (b2b) e-commerce (Net marketplaces, which
include e-distributors, e-procurement companies )
• Consumer-to- consumer (C2C) e-commerce
• Mobile e-commerce (m-commerce) (use of mobile devices to enable
online transactions)
• Social e-commerce (enabled by social networks and online social
relationships)
Amazon.com
American company
• Headquarters- Seattle, Washington
• Web services business includes renting data storage and computing
resources, so-called “cloud computing,”
• In 1994 Jeff Bezos, a former Wall Street hedge fund executive
• Amazon.com- first alphabet and South American river
•  Silicon Valley- selling books from its inventory to its technically astute
customers in 1991
• promise of Amazon.com was to deliver any book to any reader anywhere
• to succeed as an online retailer, a company needed to “Get Big Fast,” a
slogan he had printed on employee T-shirts
• 180,000 customer accounts by December 1996
• October 1997, it had 1,000,000 customer accounts with revenue $148 million in
1997
• By 1999 the company was also selling consumer electronics, video games,
software, home-improvement items, toys and games, and much more.
• Amazon Web Services (AWS)-offered data-elastic Compute Cloud (EC2),
which rents out computer processing power-Simple Storage Service (S3), which
rents data storage 
• 2000 the company started a service that lets small companies and individuals
sell their products through Amazon.com
• 2007 Amazon.com-Kindle e-readers for e-book market.
• In 2011 the company introduced a related low-cost tablet computer
• In 2017 Amazon.com announced that it had agreed to buy the supermarket
chain Whole Foods Market
Business Model (Business Process)
• Business model is a set of planned activities designed to result in a
profit in a marketplace
• Business plan is a document that describes a firm’s business model
• E-commerce business model aims to use and leverage the unique
qualities of the Internet, the Web, and the mobile platform.
Key
Elements of
Business
model
 Value Preposition
Why customer choose your
company considering all
For instance, before Amazon existed, most customers personally
alternative company
traveled to book retailers to place an order. In some cases, the
desired book might not be available, and the customer would
have to wait several days or weeks, and then return to the
bookstore to pick it up. Amazon makes it possible for book What the firm provides that
lovers to shop for virtually any book in print from the comfort
of their home or office, 24 hours a day, and to know other firms do not and cannot
immediately whether a book is in stock. Amazon’s Kindle takes
this one step further by making e-books instantly available with
no shipping wait. Amazon’s primary value propositions are
unparalleled selection and convenience.
E-commerce value propositions
include personalization and
customization
 Revenue Model
Function of business organizations is both to generate profits and to produce
returns on invested capital
Following major revenue models:

Advertising revenue model, Companies that can attract the greatest viewership
or that have a highly specialized, differentiated viewership.
Subscription revenue model, Subscription fee for access to some or all its
offerings.
Freemium strategy, certain level of product or services for free and charges for
premium level
 Revenue Model
• Transaction fee revenue model

• Sales revenue model revenue by selling goods, content, or services to customers.

• Affiliate revenue model “affiliate” receive a referral fee or percentage (or points)
of the revenue from any resulting sales.

•
Market Opportunity

Refers to the company’s intended marketspace and the overall

potential financial opportunities available to the firm in that
marketspace

the area of actual or potential commercial value in which a company

intends to operate
Competitive
Environment

• Other companies
operating in the same
marketspace selling
similar products
• Presence of substitute
products and potential
new entrants to the
market,
• Asymmetry exists whenever one participant in a market has more
resources
• First-mover advantage
• unfair competitive advantage (brand name cannot be purchased)
• perfect market: a market in which there are no competitive
advantages or asymmetries because all firms have equal access to all
the factors of production
Market Strategy
• Market strategy is the plan how you intend to enter a new market
and attract new customers.
Organizational Development
• how the company will organize the work
• work is divided into functional departments, such as production,
shipping, marketing, customer support, and finance
• As per functional areas defined, and the recruitment begins for
specific job titles and responsibilities.
Management Team
• Management team responsible for making the model work.
RAISING CAPITAL
• Raising capital is one of the most important functions for a founder of
a start-up business and its management team.
• seed capital typically, an entrepreneur’s personal funds derived from
savings, credit card advances, home equity loans,
• Incubators typically provide a small amount of funding, but more
importantly, also provide an array of services to start-up companies
include TechStars, DreamIt, and Capital Factory.
• Angel investors are typically wealthy individuals (or a group of
individuals) who invest their own money in an exchange for an equity
share in the stock in the business.
• Venture capital investors invest funds they manage for other
investors such as investment banks, pension funds, insurance
companies, or other businesses
• Crowdfunding involves using the Internet to enable individuals to
collectively contribute money to support a project.
CATEGORIZING E-COMMERCE
BUSINESS MODELS: SOME DIFFICULTIES
• B2B
• B2C
MAJOR BUSINESS-TO-CONSUMER
(B2C) BUSINESS MODELS
• Online retail stores, often called e-tailers, come in all sizes, from giant
Amazon to tiny local stores.
• Online only (virtual word)- Amazon, Myntra
• Both (Online and Offline)- Nykaa, Van Huesan, Puma, Nike
• Extremely competitive, because barriers to entry
• Develop a niche strategy, clearly identifying their target market and its
needs, prepared to make a profit. Keeping expenses low, selection
broad, and inventory controlled is key to success in e-tailing
COMMUNITY PROVIDER
• Community-building tools and services like Facebook, LinkedIn,
Twitter, the social networks sites

• Creates an online environment where people with similar interests

can buy and sell goods; share interests, photos, and videos;
communicate

• Community providers make money from advertising and through

affiliate relationships with retailers
CONTENT PROVIDER
• Content providers distribute information content, such as digital
video, music, photos, text, and artwork.
PORTAL
• Portals such as Google, Micro- soft’s Bing,, Yahoo, Ask offer users
powerful search tools as well as an integrated package of content and
services
• Portals sought to be viewed as “gateways” to the Internet.
• Portals generate revenue primarily by charging advertisers for ad
placement, collecting referral fees for steering customers to other
sites, and charging for premium services.
TRANSACTION BROKER
• Companies that process transactions for consumers normally handled
in person, by phone, or by mail are transaction brokers.
MARKET CREATOR
• Market creators build a digital environment in which buyers and
sellers can meet, display and search for products and services, and
establish prices.
Service Provider
• While e-tailers sell products online, service providers offer services
online. Ex. Google Maps, Google Docs, and Gmail
BUSINESS-TO-BUSINESS (B2B) BUSINESS MODELS

• E-DISTRIBUTOR These are companies that supply products and

services directly to individual businesses

• E-PROCUREMENT These firms create and sell access to digital

electronic markets. They make their money through transaction fees,
fees based on the number of workstations using the service
 E-
COMMERC
E CHANGES
BUSINESS:
STRATEGY,
STRUCTUR
E, AND
PROCESS
BUSINESS STRATEGY
• Differentiating (Red Bus, Whatsapp, e-Payment)
• Focus/Niche Market (chumbak, Bawakoof)