E-Commerce and Internet Overview

Pure vs. Partial E-Commerce

  • EC can be pure or partial based on ordering/payments, order fulfillment, and delivery.

Types of EC Organizations

  • Brick-and-mortar: Purely physical organizations.
  • Virtual (pure-play): Conduct business solely online (e.g., YouTube, Spotify).
  • Click-and-mortar: Conduct some e-commerce activities as an additional channel.

Comparison of Traditional Commerce and E-Commerce

  • Traditional Commerce: Organized management, walk-in customers, time-consuming, conventional marketing.
  • E-Commerce: Flat management, electronic customers, automated transactions, online marketing.

Categories of E-Commerce

  • B2B (Business-to-Business): Businesses sell to other businesses.
  • B2C (Business-to-Consumer): Businesses sell to individual shoppers.
  • B2B2C (Business-to-Business-to-Consumer): Business sells to a client business that provides the product/service to its own customers (e.g., Starbucks selling cards to companies).
  • C2C (Consumer-to-Consumer): Consumers transact directly with each other (e.g., eBay).
  • C2B (Consumer-to-Business): Individuals sell to organizations (e.g., Priceline).
  • Collaborative Commerce (c-commerce): Online activities to attain the same goal (e.g., business partners designing a product together).

Benefits to Organizations

  • Global reach, cost reduction, supply chain improvements, always open (24/7), improved customer service, lower distribution costs for digitizable products.

Benefits to Consumers

  • Huge selection, available anytime/anywhere, real-time delivery (for digital products), unique items, comfortable shopping.

Limitations to Electronic Commerce

  • Technical: Lack of standards, bandwidth issues, evolving software, web server costs, internet accessibility.
  • Nontechnical: Security/privacy concerns, legal issues, taxation, measurement difficulties, customer preference for physical stores, online fraud.

Business Uses of the Internet

  • Create customer value by improving communications with customers, employees, suppliers, and partners.

The Internet

  • Worldwide network built on common standards.

The Web

  • Most popular Internet service, provides access to web pages.

Internet Definition

  • Public, global communication network connecting to anyone via an ISP.

Internet Service Provider (ISP)

  • Company providing Internet connections and services (e.g., TM, UNIFI, MAXIS, TIME, CELCOMDIGI).

Web Client and Web Server

  • Web Client: Computer becomes a Web Client using browser software.
  • Web Server: Computer processes client requests.

Web Client-Server Architecture

  • Client requests services, server processes requests.

Two-Tier Architecture

  • Communication between client and server.

Three-Tier Architecture

  • Includes client, web server, and data management software.

Intranets

  • Internal network using Internet tools, accessible to selected individuals.
  • Benefits: improved communication, cost-effective, shares corporate knowledge, promote a common corporate culture, enhance collaboration

Extranets

  • Connects companies with suppliers/partners.
  • Types: Public networks (less secure), private networks (leased-line, secure but costly), virtual private networks (VPNs, use public networks with tunneling).