E-commerce 2019: Business. Technology.
Society.
Fifteenth Edition, Global Edition
Chapter 1
Introduction to
E-commerce
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Learning Objectives
1.1 Understand why it is important to study e-commerce.
1.2 Define e-commerce, understand how e-commerce differs from e-
business, identify the primary technological building blocks underlying e-
commerce, and recognize major current themes in e-commerce.
1.3 Identify and describe the unique features of e-commerce technology
and discuss their business significance.
1.4 Describe the major types of e-commerce.
1.5 Understand the evolution of e-commerce from its early years to
today.
1.6 Describe the major themes underlying the study of e-commerce.
1.7 Identify the major academic disciplines contributing to e-commerce.
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Everything On Demand: The
“Uberization” of E-commerce
• Class Discussion
– Have you used Uber or any other on-demand service
companies?
– What is the appeal of these companies for users and
providers?
– Are there any negative consequences to the increased
use of on-demand services like Uber and Airbnb?
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
The First Thirty Seconds
• First two decades of e-commerce
– Just the beginning
– Rapid growth and change
• Technologies evolve at exponential rates
– Disruptive business change
– New opportunities
• Why study e-commerce
– Understand opportunities and risks
– Analyze e-commerce ideas, models, issues
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Introduction to E-commerce
• Use of Internet to transact business
– Includes Web, mobile browsers and apps
• More formally:
– Digitally enabled commercial transactions between
and among organizations and individuals
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
The Difference between E-commerce
and E-business
• E-business:
– Digital enabling of transactions and processes within a
firm, involving information systems under firm’s control
– Does not include commercial transactions involving an
exchange of value across organizational boundaries
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Technological Building Blocks
Underlying E-commerce
• Internet
• World Wide Web
– HTML
– Deep Web v s “surface” Web
ersu
• Mobile platform
– Mobile apps
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Insight on Technology: Will Apps Make
the Web Irrelevant?
• Class Discussion
– What are the advantages and disadvantages of apps,
compared with websites, for mobile users?
– What are the benefits of apps for content owners and
creators?
– Will apps eventually make the Web irrelevant? Why or
why not?
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Major Trends in E-commerce
• Business trends include:
– All forms of e-commerce show very strong growth
• Technology trends include:
– Mobile platform has made mobile e-commerce reality
• Societal trends include:
– Increased online social interaction and sharing
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Unique Features of E-commerce
Technology
Unique Features of E-commerce
Technology (1 of 3)
1. Ubiquity
It’s available just about everywhere, at all times
Marketspace vs. Marketplace
Ubiquity reduces transaction costs
2. Global reach
permits commercial transactions to cross cultural,
regional, and national boundaries
the potential market size is roughly equal to the size of
the world’s online population
3. Universal standards
technical standards for conducting e-commerce are
shared by all nations around the world
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Unique Features of E-commerce
Technology (2 of 3)
5. Information richness
refers to the complexity and content of a message
6. Interactivity
the enabling of two-way communication between
merchant and consumer and among consumers.
7. Information density
refers to the total amount and quality of information
available to all market participants
Benefits:
Price transparency
cost transparency
price discrimination (Merchant side)
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Unique Features of E-commerce
Technology (3 of 3)
5. Personalization/customization
Personalization of marketing messages and
customization of products and services are based on
individual characteristics
6. Social technology
Enables user content creation and distribution, and
support social networks
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Types of E-commerce
• Business-to-Consumer (B2C)
• Business-to-Business (B2B)
• Consumer-to-Consumer (C2C)
• Mobile e-commerce (M-commerce)
• Social e-commerce
• Local e-commerce
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Copyright © 2016 Pearson
Education, Ltd.
Slide 1-15
The Relative Size of different Types of
Ecommerce in US
Figure 1.5 The Growth of B2C E-
commerce in the United States
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Figure 1.7 The Growth of B2B E-
commerce in the United States
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Figure 1.8 The Growth of M-commerce
in the United States
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
?!
E-commerce: A Brief History (1 of 4)
• Precursors
– Baxter Healthcare modem-based system
– Order entry systems
– Electronic Data Interchange (EDI) standards
– French Minitel
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
E-commerce: A Brief History (2 of 4)
• 1995–2000: Invention
– Sale of simple retail goods
– Limited bandwidth and media
– Euphoric visions of
▪ Friction-free commerce
▪ First-mover advantages
– Dot-com crash of 2000
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
E-commerce: A Brief History (3 of 4)
• 2001–2006: Consolidation
– Emphasis on business-driven approach
– Traditional large firms expand presence
– Start-up financing shrinks
– More complex products and services sold
– Growth of search engine advertising
– Business web presences expand
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
E-commerce: A Brief History (4 of 4)
• 2007–Present: Reinvention
– Rapid growth of:
▪ Web 2.0, including online social networks
▪ Mobile platform
▪ Local commerce
▪ On-demand service economy
– Entertainment content develops as source of revenues
– Transformation of marketing
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Figure 1.10 Periods in the Development
of E-commerce
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Assessing E-commerce (1 of 2)
• Stunning technological success
• Early years a mixed business success
– Few early dot-coms have survived
– Online sales growing rapidly
• Many early visions not fulfilled
– Price dispersion
– Information asymmetry
– New intermediaries
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Assessing E-commerce (2 of 2)
• Other surprises
– Fast-follower advantages
– Start-up costs
– Impact of mobile platform
– Emergence of on-demand e-commerce
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Understanding E-commerce:
Organizing Themes
• Technology:
– Development and mastery of digital computing and
communications technology
• Business:
– New technologies present businesses with new ways
of organizing production and transacting business
• Society:
– Intellectual property, individual privacy, public welfare
policy
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Figure 1.11 The Internet and the
Evolution of Corporate Computing
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Academic Disciplines Concerned with
Technology
• Technical
– Computer science, management science, information
systems
• Behavioral
– Information systems research, economics, marketing,
management, finance/accounting, sociology
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Careers in E-commerce
• Position: Category specialist in E-commerce Retail
Program
• Qualification/Skills
• Preparing for the Interview
• Possible Interview Questions
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
