Chapter 1: Overview of Electronic Commerce

Comprehensive flashcards covering Chapter 1: Overview of Electronic Commerce, including foundational definitions, frameworks, transaction classifications, revenue models, benefits, and limitations.

How is electronic commerce (EC) defined?

The process of buying, selling, or exchanging products, services, or information via computer.

How does e-business differ from electronic commerce?

E-business is a broader definition of EC that includes not just buying and selling goods and services, but also servicing customers, collaborating with business partners, and conducting electronic transactions within an organization.

What three dimensions determine the degree of digitization in electronic commerce?

1. The product (or service) sold
2. The process (e.g., ordering, payment, fulfillment)
3. The delivery method

Based on the provided diagram (Exhibit 1.1), under what condition does commerce become Pure Electronic Commerce?

Pure Electronic Commerce occurs when all three dimensions—the product, the process, and the delivery method—are completely digital.

What are brick-and-mortar (old economy) organizations?

Old-economy organizations (corporations) that perform their primary business offline, selling physical products by means of physical agents.

What is the difference between virtual (pure-play) and click-and-mortar organizations?

Virtual (pure-play) organizations conduct their business activities solely online, whereas click-and-mortar (click-and-brick) organizations conduct some e-commerce activities, usually as an additional marketing channel.

What is an electronic market (e-marketplace)?

An online marketplace where buyers and sellers meet to exchange goods, services, money, or information.

How do an intranet and an extranet differ?

An intranet is an internal corporate or government network that uses Internet tools and protocols, while an extranet is a network that uses the Internet to link multiple intranets.

What are the five support areas (pillars) that support EC applications in the EC Framework?

1. People
2. Public Policy
3. Marketing and Advertisement
4. Support Services
5. Business Partnerships

What are the five infrastructure components of the Electronic Commerce Framework?

1. Common business services infrastructure
2. Messaging and information distribution infrastructure
3. Multimedia content and network publishing infrastructure
4. Network infrastructure
5. Interfacing infrastructure

What is business-to-business (B2B) e-commerce?

An e-commerce model in which all of the participants are businesses or other organizations.

What is the difference between B2C e-commerce and e-tailing?

Business-to-consumer (B2C) is an e-commerce model where businesses sell to individual shoppers, and e-tailing is online retailing, which is usually B2C.

What is the business-to-business-to-consumer (B2B2C) e-commerce model?

An e-commerce model in which a business provides some product or service to a client business that maintains its own customers.

What is consumer-to-business (C2B) e-commerce?

An e-commerce model in which individuals use the Internet to sell products or services to organizations or individuals who seek sellers to bid on products or services they need.

What is intrabusiness EC?

An e-commerce category that includes all internal organizational activities that involve the exchange of goods, services, or information among various units and individuals in an organization.

What is the business-to-employees (B2E) e-commerce model?

An e-commerce model in which an organization delivers services, information, or products to its individual employees.

What is consumer-to-consumer (C2C) e-commerce?

An e-commerce model in which consumers sell directly to other consumers.

What is collaborative commerce (c-commerce)?

An e-commerce model in which individuals or groups communicate or collaborate online.

How are e-learning and e-government defined?

E-learning is the online delivery of information for training or education. E-government is an EC model in which a government entity buys or provides goods, services, or information from or to businesses or individual citizens.

What is social computing?

An approach aimed at making the human–computer interface more natural.

What is Web 2.0?

The second generation of Internet-based services that lets people collaborate and share information online in new ways, such as social networking sites, wikis, communication tools, and folksonomies.

What is a social network service (SNS)?

A service that builds online communities by providing an online space for people to build free homepages and that provides basic communication and support tools for conducting different activities in the social network.

What examples of business-oriented and enterprise social networks are presented in the lecture?

Xing.com is cited as an example of a business-oriented social network, and Carnivalconnections.com is cited as an example of an enterprise social network.

What is a virtual world, and what is its most publicized example?

A user-defined world in which people can interact, play, and do business; the most publicized virtual world is Second Life.

What is the digital economy and what alternative names are used for it?

An economy based on digital technologies, including digital communication networks, computers, software, and related information technologies; also called the Internet economy, the New economy, or the Web economy.

What is a digital enterprise, and what are its three basic objectives?

A business model that uses IT fundamentally to: reach and engage customers more effectively, boost employee productivity, and improve operating efficiency.

What is a corporate portal?

A major gateway through which employees, business partners, and the public can enter a corporate Web site.

What is a business model, and what is a value proposition?

A business model is a method of doing business by which a company generates revenue to sustain itself. A value proposition consists of the benefits a company can derive from using EC.

What are the five common revenue models in electronic commerce?

1. Sales Model
2. Transaction Fees Model
3. Subscription Model
4. Advertisement Model
5. Affiliate Model

How does the Transaction Fees revenue model operate?

Commissions are paid based on the volume of transactions processed.

How does the Affiliate revenue model generate income?

Commissions are paid to referring websites for bringing in customers.

What is an electronic tendering (bidding) system?

A model in which a buyer requests would-be sellers to submit bids, and the lowest bidder wins.

By how much can online distribution reduce costs for digitizable products compared to traditional distribution?

Delivery online can be $90\%$ cheaper.

What are the societal benefits of electronic commerce?

Enabling telecommuting (less traffic and pollution), expanding public services (education and health in rural areas and for the poor), facilitating domestic homeland security, increasing standard of living, and closing the digital divide.

What are key technological limitations of electronic commerce?

Lack of universal quality/security/reliability standards, insufficient bandwidth (especially for m-commerce, videos, and graphics), evolving development tools, difficult integration with legacy databases, cost of special Web servers, expensive/inconvenient Internet access, and requirement of special automated warehouses for large-scale B2C.

What are key nontechnological limitations of electronic commerce?

Security and privacy concerns, lack of trust in paperless/faceless transactions and unknown sellers, unresolved legal/taxation/public policy issues, government regulations, difficulty measuring benefits, consumer desire to touch products, resistance to virtual shopping, insufficient buyer/seller volume, online fraud, and difficulty obtaining venture capital after dot-com crashes.