E-commerce 2019: Business. Technology.
Society.
Fifteenth Edition, Global Edition
Chapter 1
Introduction to
E-commerce
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
2
What is Strategy ?
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
3
From Oxford Dictionary
Source:
http://www.oxforddictionaries.com/definition/english/strategy
What is Strategic Management?
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
What is Strategic Management?
• Strategic management involves the
formulation and implementation of the
major goals and initiatives based on
consideration of resources and an
assessment of the internal and external
environments in which the organization
competes
Nag, R., Hambrick, D. C. and Chen, M.-J. (2007), What is strategic management, really? Inductive
derivation of a consensus definition of the field. Strat. Mgmt. J., 28: 935–955. doi: 10.1002/smj.615
Definition of E-Business
•e-Business is the business use of
the Internet.
•The “use” results in a “business
benefit” such as higher revenues,
reduced costs or reaching an
underserved market
Source:
http://www.cioindex.com/article/articleid/3/what-is-estrategy
Definition of e-Strategy
• E-strategy is an iterative process to
create and/or modify an organization's
business model for e-business.
• The key is the formulation and
implementation of the sustainable and
financially viable business model not just
designing websites to address business
requirements Source:
http://www.cioindex.com/article/articleid/3/what-is-estrategy
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-
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 (1 of 2)
1. Ubiquity
2. Global reach
3. Universal standards
4. Information richness
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
Unique Features of E-commerce
Technology (2 of 2)
5. Interactivity
6. Information density
7. Personalization/customization
8. Social technology
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
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
Insight on Business: Rocket Internet
• Class Discussion
– What are the benefits of investing in a company
that Rocket Internet has launched?
– Is an incubator the best solution for start-ups to
find funding? Why or why not?
– Why is Rocket Internet controversial?
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
Insight on Society: Facebook and the
Age of Privacy
• Class discussion:
– Why are social networks interested in collecting
user information?
– What types of privacy invasion are described in
the case? Which is the most privacy-invading,
and why?
– How is e-commerce different from traditional
markets with respect to privacy? Don’t
merchants always want to know their customer?
– How do you protect your privacy online?
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
Copyright
Copyright © 2020 Pearson Education Ltd. All Rights Reserved
