BUSINESS PLUG-IN B11

1. BUSINESS PLUG-IN B11 Ebusiness

2. LEARNING OUTCOMES • Describe the four common tools an organization can use to access Internet information • Compare ISPs, OSPs, and ASPs. • Describe how marketing, sales, financial services, and customer service departments can use ebusiness to increase revenues or reduce costs

3. LEARNING OUTCOMES • Explain why an organization would use metrics to determine a Web site’s success • Identify the different types of egovernment business models • Define m-commerce and explain how an egovernment could use it to increase its efficiency and effectiveness

4. INTRODUCTION • Pure play – an Internet retailer that has no physical store, such as Expedia.com and Amazon.com • Ebusiness – conducting business on the Internet, not only buying and selling, but also serving customers and collaborating with business partners • Ebusiness model – an approach to conducting electronic business through which a company can become a profitable business on the Internet

5. Accessing Internet Information • Four tools for accessing Internet information • Intranet – internalized portion of the Internet, protected from outside access, for employees • Extranet – an intranet that is available to strategic allies • Portal – Web site that offers a broad array of resources and services • Kiosk – publicly accessible computer system that allows interactive information browsing

6. Providing Internet Information • Three common forms of service providers • Internet service provider (ISP) –provides individuals and other companies access to the Internet • Online service provider (OSP) – offers an extensive array of unique Web services • Application service provider (ASP) – offers access over the Internet to systems and related services that would otherwise have to be located in organizational computers

7. Providing Internet Information • Common ISP services include: • Web hosting • Hard-disk storage space • Availability • Support

8. Providing Internet Information Wireless Internet service provider (WISP)

9. Providing Internet Information • ISPs, OSPs, and ASPs use service level agreements (SLA) which define the specific responsibilities of the service provider and set the customer expectations • See Figure B11.3 for a listing of the top ISPs, OSPs, and ASPs

10. Organizational Strategies for Ebusiness • Primary business areas taking advantage of ebusiness include: • Marketing/sales • Financial services • Procurement • Customer service • Intermediaries

11. MARKETING/SALES • Generating revenue on the Internet: • Online ad (banner ad) - box running across a Web page that contains advertisements • Pop-up ad - a small Web page containing an advertisement • Associate programs (affiliate programs) - businesses generate commissions or royalties • Viral marketing - a technique that induces Web sites or users to pass on a marketing message • Mass customization - gives customers the opportunity to tailor products or services

12. MARKETING/SALES • Generating revenue on the Internet: • Personalization - occurs when a Web site can fashion offers that are more likely to appeal to that person • Blog - Web site in which items are posted on a regular basis and displayed in reverse chronological order • Real simple syndications (RSS) - a Web feed format used for Web syndication of content • Podcasting - the distribution of audio or video files, such as radio programs or music videos, over the Internet to play on mobile devices

13. MARKETING/SALES • Generating revenue on the Internet: • Search engine optimization (SEO) - a set of methods aimed at improving the ranking of a Web site in search engine listings • Spamdexing - uses a variety of deceptive techniques in an attempt to manipulate search engine rankings, whereas legitimate SEO focuses on building better sites and using honest methods of promotion

14. FINANCIAL SERVICES • Online consumer payments include: • Financial cybermediary • Electronic check • Electronic bill presentment and payment (EBPP) • Digital wallet

15. FINANCIAL SERVICES • Online business payments include: • Electronic data interchange (EDI) • Value-added network (VAN) • Financial EDI (financial electronic data interchange)

16. FINANCIAL SERVICES Electronic Trading Network

17. PROCURMENT • Maintenance, repair, and operations (MRO) materials (also called indirect materials) – materials necessary for running an organization but do not relate to the company’s primary business activities • Eprocurement - the B2B purchase and sale of supplies and services over the Internet • Electronic catalog - presents customers with information about goods and services offered for sale, bid, or auction on the Internet

18. CUSTOMER SERVICE • Customer service is the business process where the most human contact occurs between a buyer and a seller • Ebusiness strategists are finding that customer service via the Web is one of the most challenging and potentially lucrative areas of ebusiness • The primary issue facing customer service departments using ebusiness is consumer protection

19. Consumer Protection

20. Consumer Protection • Ebusiness security • Encryption: scrambles information into an alternative form that requires a key or password to decrypt. • Secure socket layer (SSL): (1) creates a secure and private connection between a client and server computer, (2) encrypts the information, and (3) sends the information over the Internet—https. • Secure electronic transaction (SET): Similar to SSL, SET encrypts information before sending it over the Internet. E.g. MasterCard, American Express, Visa, Netscape, and Microsoft.

21. INTERMEDIARIES • Intermediaries – agents, software, or businesses that bring buyers and sellers together that provide a trading infrastructure to enhance ebusiness • Reintermediation – using the Internet to reassemble buyers, sellers, and other partners in a traditional supply chain in new ways

22. Measuring Ebusiness Success • Most companies measure the traffic on a Web site as the primary determinant of the Web site’s success • However, a large amount of Web site traffic does not necessarily equate to large sales • Many organizations with high Web site traffic have low sales volumes

23. Measuring Ebusiness Success • Web site traffic analysis can include: • Cookie: a small file is deposited to contain information about customers and their Web activities • Click-through: a count of the number of visitors and click on the targeted advertisement • Banner ad: a small ad on one Web site that advertises the products and services of another business • Interactivity: visitor interactions with the target ad

24. Behavioral Metrics • Clickstream data tracks the exact pattern of a consumer’s navigation through a Web site • Clickstream data can reveal: • Number of pageviews • Pattern of Web sites visited • Length of stay on a Web site • Date and time visited • Number of customers with shopping carts • Number of abandoned shopping carts

25. Behavioral Metrics • Web site metrics include • Visitor metrics: unidentified, unique, session, tracked, identified visitors • Exposure metrics: page exposure Vs site exposure • Visit metrics: stickiness, raw visit depth, visit depth • Hit metrics: regular hits Vs qualified hits

26. Classroom Activity • Compare Web sites of two retailers that are in the same business • jcrew.com vs. abercrombie.com • amazon.com vs. bn.com • Review the range of information resources and services used in the sites • the ways in which resources are organized, de­signed, and presented. • how well the sites support the conduct of ebusiness • compare the strengths and weak­nesses of the two sites • attracting customers to the Web site and retaining them

27. New Trends in Ebusiness: Egovernment and Mcommerce • Egovernment -involves the use of strategies and technologies to transform government(s) by improving the delivery of services and enhancing the quality of interaction between the citizen-consumer within all branches of government

28. New Trends in Ebusiness: Egovernment and Mcommerce

29. New Trends in Ebusiness: Egovernment and Mcommerce • Mobile commerce - the ability to purchase goods and services through a wireless Internet-enabled device.

30. Classroom Activity • The official U.S. gateway to all government information http://firstgov.gov/ • Review the following Web sites to further understand the progress being made in egovernment • C2G – eGov.com • B2G – lockheedmartin.com • G2B – export.gov • G2C – medicare.gov • G2G – disasterhelp.gov

31. Recap: Lecture 3 & 4 • Four common tools an organization can use to access Internet information: Intranet, Extranet, Portal, Kiosk • Compare ISPs, OSPs, and ASPs. • Role of ebusiness in marketing, sales, financial services, and customer service departments • Use metrics to determine a Web site’s success • Different types of egovernment business models • Role of m-commerce in egovernment business models