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Features of e-commerce

(memorize these)

Ubiquity Global Reach Universal Standards Richness Interactivity Information Density Personalization/Customization . 2.7 features of e-commerce 1. 5. 7. 4. 6. 3.

these features are unique to e-commerce and explain why this technology has change the world so much more than other technologies Do these technologies have any of 7 features? • Phone. .Why study these feature?  To some extend. electricity. but not all 7. planes   Yes. cars.

but still there   Why is ubiquity good? .Ubiquity Available everywhere  Built into other devices  Hidden.

40/gallon  .Ubiquity Ubiquity lowers transaction costs for the consumer/buyer.  How so?  Think about buying gifts last Christmas  Think about the fact that gas costs $2.

Ubiquity reduces cognitive energy. hunting for it at various book stores.  .Related Concept  Cognitive Energy – mental effort needed to complete a task. • Humans tend to seek options that require the minimum cognitive energy. • Consider the mental effort needed to buy your book online vs.

Global Reach  e-commerce technologies enable a business to easily reach across geographic boundaries. Its really easy to understand how this feature can benefit business and consumers.  .

Luckily. business doesn’t have an interest in reaching this group. Demographics • • • • • age income race gender religion   There is one demographic boundary that technology can reach.Global Reach  While e-commerce can reach across geographic boundaries. . can it reach across demographic boundaries.

Universal Standards  e-commerce is made possible through hardware (Internet) and software/content (World Wide Web) The Internet – In its infancy.)  . HTML. the architects developed standards that are now globally recognized (TCP/IP)  The World Wide Web – Standards are becoming #1 priority (XML. etc.

Universal Standards  Universal standards can greatly influence market entry costs. web-based store. vs. How so? Consider the cost of bring goods to a market Consider the cost of setting up a virtual. a real brick-mortar store?    .

 This reduces entry costs  You can setup an e-commerce website for about $10/month in technology overhead costs.Universal Standards Standards make it much easier to build business from existing technologies.  . there is a lot more competition.  By reducing entry costs.

Since e-commerce is built on standard technology (XML. its really to integrate. aggregate.can the consumer/buyer find prices easily. HTML). . integration More price discovery opportunities. with minimal cognitive energy.Related Concept   Price discovery . Standardization  Low Entry Cost  More completion. Standardization  Info. and summarize information.

animation. signs.  e-commerce can deliver video.Richness Advertising and branding are an important part of commerce.  Comparison: Airplanes enable global reach. etc. etc.)  • However. much better than other technologies (billboards. but how about Richness? . audio. its about as rich as television technology.

• Here is where Web technology kick’s TV’s ass!  TV is a passive activity • Engaging consumer/user is a powerful feature. .Interactivity  Consumer/user can interact with the content.

mail.e. Consider the old way to share information. voice communication.. paper. i.   . etc.Information Density  The e-commerce technology • • reduces information costs raises the quality of information  How does the technology reduce costs? How does it raise quality.

Personalization/Customization  It seems like a contradiction that ecommerce has more opportunities for personalization then.  . going to a store and buying an item faceto-face with a cleck. umm. How can e-commerce permit or enhance personalization and customization.

apple. B buys a Mac Pro computer at  Which product is more customized?  . B buys Compaq computer at CompUSA.Customization Example 1992: Dr.  2007: Dr.

 . BTW. B’s 3-year old son is play the Bob the Builder Game on and suddenly a pop-up ad for the Talking Bob the Builder appears.Personalization Example Dr. he hates Polly Pocket or anything pink for that matter. B’s 3-year old son is watching Sponge Bob and sees an advertisement for Polly Pocket.  Dr.