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EC2006 1 4273ElectronicCommerce EC2006 2 Agenda YourinstructorCourseoutlineQ Aaboutthecourse4 LectureOverviewofeCommerce EC2006 3 YourInstructor Whatwouldyouliketoknowaboutme EC2006 4 ResearchInterests M Sc inComputerScienceMBAinElectronicBusinessPhDinMISThirdyearatLU OverviewofElectronicCommerce PrenticeHall EC2006 6 LearningObjectives Defineelectroniccommerce EC anddescribeitsvariouscategories DescribeanddiscussthecontentandframeworkofEC DescribethemajortypesofECtransactions DescribethedigitalrevolutionasadriverofEC EC2006 7 LearningObjectives DescribethebusinessenvironmentasadriverofEC DescribesomeECbusinessmodels DescribethebenefitsofECtoorganizations consumers andsociety DescribethelimitationsofEC DescribethecontributionofECtoorganizationsrespondingtoenvironmentalpressures EC2006 8 ElectronicCommerce DefinitionsandConcepts electroniccommerce EC Theprocessofbuying selling orexchangingproducts services orinformationviacomputernetworks EC2006 9 ElectronicCommerce DefinitionsandConcepts ECisdefinedthroughtheseperspectivesCommunications deliveryofinfoandproductsovernetworksCommercial trading buyingandsellingBusinessprocess virtualinfoexchangeService cutservicecostsandimprovequalityLearningCollaborativeCommunity EC2006 10 ElectronicCommerce DefinitionsandConcepts e businessAbroaderdefinitionofECthatincludesnotjustthebuyingandsellingofgoodsandservices butalsoservicingcustomers collaboratingwithbusinesspartners andconductingelectronictransactionswithinanorganizationInthiscourse weusethebroadestmeaningofEC whichisequivalenttoEB above EC2006 11 ElectronicCommerce DefinitionsandConcepts PureVersusPartialECECtakesseveralformsdependingonthedegreeofdigitization thetransformationfromphysicaltodigital 1 theproduct service sold 2 theprocess 3 thedeliveryagent orintermediary EC2006 12 TheDimensionsofElectronicCommerce EC2006 13 ElectronicCommerce DefinitionsandConcepts ECorganizationsbrick and mortarorganizationsOld economyorganizations corporations thatperformmostoftheirbusinessoff line sellingphysicalproductsbymeansofphysicalagentsvirtual pure play organizationsOrganizationsthatconducttheirbusinessactivitiessolelyonlineclick and mortar click and brick organizationsOrganizationsthatconductsomee commerceactivities butdotheirprimarybusinessinthephysicalworld EC2006 14 ElectronicCommerce DefinitionsandConcepts WhereECisconductedelectronicmarket e marketplace Anonlinemarketplacewherebuyersandsellersmeettoexchangegoods services money orinformationinterorganizationalinformationsystems IOSs CommunicationssystemthatallowsroutinetransactionprocessingandinformationflowbetweentwoormoreorganizationsintraorganizationalinformationsystemsCommunicationsystemsthatenablee commerceactivitiestogoonwithinindividualorganizations EC2006 15 TheECFramework Classification andContent AnECFramework supportsfivepolicymakingsupportareasPeoplePublicpolicyMarketingandadvertisementSupportservicesBusinesspartnerships EC2006 16 AFrameworkforeCommerce EC2006 17 ECClassification Classificationbynatureofthetransactionsorinteractionsbusiness to business B2B E commercemodelinwhichalloftheparticipantsarebusinessesorotherorganizationsbusiness to consumer B2C E commercemodelinwhichbusinessesselltoindividualshoppers EC2006 18 ECClassification e tailingOnlineretailing usuallyB2Cbusiness to business to consumer B2B2C E commercemodelinwhichabusinessprovidessomeproductorservicetoaclientbusinessthatmaintainsitsowncustomers EC2006 19 ECClassification consumer to business C2B E commercemodelinwhichindividualsusetheInternettosellproductsorservicestoorganizationsorindividualsseeksellerstobidonproductsorservicestheyneedconsumer to consumer C2C E commercemodelinwhichconsumersselldirectlytootherconsumers EC2006 20 ECClassification peer to peerTechnologythatenablesnetworkedpeercomputerstosharedataandprocessingwitheachotherdirectly canbeusedinC2C B2B andB2Ce commercemobilecommerce m commerce E commercetransactionsandactivitiesconductedinawirelessenvironment EC2006 21 ECClassification location basedcommerce l commerce M commercetransactionstargetedtoindividualsinspecificlocations atspecifictimesintrabusinessECE commercecategorythatincludesallinternalorganizationalactivitiesthatinvolvetheexchangeofgoods services orinformationamongvariousunitsandindividualsinanorganizatione g onedepartmentsellsinfotoanotherdept EC2006 22 ECClassification business to employees B2E E commercemodelinwhichanorganizationdeliversservices information orproductstoitsindividualemployeescollaborativecommerce c commerce E commercemodelinwhichindividualsorgroupscommunicateorcollaborateonlinee learningTheonlinedeliveryofinformationforpurposesoftrainingoreducation EC2006 23 ECClassification exchange electronic Apublicelectronicmarketwithmanybuyersandsellersexchange to exchange E2E E commercemodelinwhichelectronicexchangesformallyconnecttooneanotherforthepurposeofexchanginginformatione governmentE commercemodelinwhichagovernmententitybuysorprovidesgoods services orinformationtobusinessesorindividualcitizens EC2006 24 TheFutureofEC Overall thegrowthofthefieldwillcontinuetobestrongintotheforeseeablefutureDespitethefailuresofindividualcompaniesandinitiatives thetotalvolumeofECisgrowingby15to25 everyyear EC2006 25 DigitalEvolutionDrivesEC digitaleconomyAneconomythatisbasedondigitaltechnologies includingdigitalcommunicationnetworks computers software andotherrelatedinformationtechnologies alsocalledtheInterneteconomy theneweconomy ortheWebThedigitalrevolutionacceleratesECbyprovidingcompetitiveadvantagetoorganizationsandenablinginnovations EC2006 26 BusinessEnvironmentDrivesEC Economic legal societal andtechnologicalfactorshavecreatedahighlycompetitivebusinessenvironmentinwhichcustomersarebecomingmorepowerful EC2006 27 BusinessEnvironmentDrivesEC Theenvironment response supportmodelCompaniesmustnotonlytaketraditionalactionssuchasloweringcostsandclosingunprofitablefacilities butalsointroduceinnovativeactionssuchascustomizing creatingnewproducts orprovidingsuperbcustomerservice Thesearecriticalresponseactivities Insomecases ECistheonlysolution EC2006 28 MajorBusinessPressuresandtheRoleofEC EC2006 29 BusinessEnvironmentDrivesEC OrganizationalresponsestrategiesStrategicsystems e g supplychainmgtsystems AgilesystemsContinuousimprovementeffortsandbusinessprocessrestructuringCustomerrelationshipmanagementBusinessalliancesElectronicmarkets EC2006 30 BusinessEnvironmentDrivesEC ReductionsinCycleTimeandTime to MarketcycletimereductionShorteningthetimeittakesforabusinesstocompleteaproductiveactivityfromitsbeginningtoendEmpowermentofEmployeesECallowsthedecentralizationofdecisionmakingandauthorityviaempowermentanddistributedsystems butsimultaneouslysupportsacentralizedcontrolSupplyChainImprovementsECcanhelpreducesupplychaindelays reduceinventories andeliminateotherinefficiencies EC2006 31 BusinessEnvironmentDrivesEC MassCustomization Make to OrderinLargeQuantitiesmasscustomizationProductionoflargequantitiesofcustomizeditemsIntrabusiness FromSalesForceAutomationtoInventoryControlknowledgeManagement KM Theprocessofcreatingorcapturingknowledge storingandprotectingit updatingandmaintainingit andusingit EC2006 32 ECBusinessModels businessmodelAmethodofdoingbusinessbywhichacompanycangeneraterevenuetosustainitselfECfacilitatesthecreationofnovelbusinessmodels EC2006 33 ECBusinessModels TheStructureofBusinessModelsAdescriptionofthecustomerstobeservedandthecompany srelationshipswiththesecustomersAdescriptionofallproductsandservicesthebusinesswilloffer customers valueproposition Adescriptionofthebusinessprocessrequiredtomakeanddelivertheproductsandservices EC2006 34 ECBusinessModels TheStructureofBusinessModelsAlistoftheresourcesrequiredandtheidentificationofwhichonesareavailable whichwillbedevelopedin house andwhichwillneedtobeacquiredAdescriptionoftheorganizationsupplychain includingsuppliersandotherbusinesspartnersAdescriptionoftherevenuesexpected revenuemodel anticipatedcosts sourcesoffinancing andestimatedprofitability financialviability EC2006 35 ECBusinessModels RevenueModelsDescriptionofhowthecompanyoranECprojectwillearnrevenue MajorrevenuemodelsSalesTransactionfeesSubscriptionfeesAdvertisingfeesAffiliatefees referrals Otherrevenuesources IntermsofEC therearetwocriticalelementsofallbusinessmodels EC2006 36 ECBusinessModels ValuepropositionvaluepropositionThebenefitsacompanycanderivefromusingECe g howtheproductorservicemayfulfilltheneedsofcustomersHowdoe marketplacescreatevalue SearchandtransactioncostefficiencyComplementaritiesLock inNovelty EC2006 37 CommonRevenueModels EC2006 38 ECBusinessModels TypicalECBusinessModelsOnlinedirectmarketingElectronictenderingsystemstendering reverseauction Modelinwhichabuyerrequestswould besellerstosubmitbids thelowestbidderwinsname your own pricemodelModelinwhichabuyersetsthepriceheorsheiswillingtopayandinvitessellerstosupplythegoodorserviceatthatprice EC2006 39 ECBusinessModels TypicalECBusinessModelsfindthebestpriceS tryourtextbookbyISBNaffiliatemarketingAnarrangementwherebyamarketingpartner abusiness anorganization orevenanindividual refersconsumerstothesellingcompany sWebsiteviralmarketingWord of mouthmarketinginwhichcustomerspromoteaproductorservicetofriendsorotherpeople EC2006 40 ECBusinessModels TypicalECBusinessModelsgrouppurchasingQuantitypurchasingthatenablesgroupsofpurchaserstoobtainadiscountpriceontheproductspurchasede co opsAnothernameforonlinegrouppurchasingorganizations EC2006 41 ECBusinessModels TypicalECBusinessModelsproductandservicecustomizationcustomizationCreationofaproductorserviceaccordingtothebuyer sspecificationselectronicmarketplacesandexchangesinformationbrokers EC2006 42 BenefitsofEC BenefitstoOrganizations EC2006 43 BenefitsofEC GlobalReachCostReductionSupplyChainImprovementsExtendedHoursCustomizationNewBusinessModelsVendors SpecializationRapidTime to Market LowerCommunicationCostsEfficientProcurementImprovedCustomerRelationsUp to DateCompanyMaterialNoCityBusinessPermitsandFeesOtherBenefits BenefitstoOrganizations EC2006 44 BenefitsofEC BenefitstoConsumers EC2006 45 BenefitsofEC UbiquityMoreProductsandServicesCustomizedProductsandServicesCheaperProductsandServices InstantDeliveryInformationAvailabilityParticipationinAuctionsElectronicCommunitiesNoSalesTaxinsomecases BenefitstoConsumers EC2006 46 BenefitsofEC BenefitstoSociety EC2006 47 BenefitsofEC BenefitstoSocietyTelecommutingHigherStandardofLivingHopeforthePoorAvailabilityofPublicServices EC2006 48 Exhibit1 7LimitationsofEC EC2006 49 ManagerialIssues 1 IsitrealthatEChaschangedthebusinessworld EC2006 50 ManagerialIssues 1 IsitrealthatEChaschangedthebusinessworld Probably yes RecallECactivitiesinwhichyouhavebeenalreadyinvolved CanyouimaginethewordwithouttheInternet EC2006 51 ManagerialIssues 2 WhyisB2Be commercesoattractive EC2006 52 ManagerialIssues 2 WhyisB2Be commercesoattractive B2Biseasiertoimplementthantraditionaloff linemodelsB2ChassomeproblemsEasytomoveoff lineB2BrelationshipsonlineThevalue volumeoftransactionsinB2BislargeEasiertoachievecriticalmass EC2006 53 ManagerialIssues 3 TherearesomanyECfailures howcanoneavoidthem EC2006 54 ManagerialIssues 3 TherearesomanyECfailures howcanoneavoidthem Industryconsolidationoftenoccursaftera goldrush StandardsandbestpracticesappearedLearnfromthemistakesdot comsmadesevenyearsago EC2006 55 ManagerialIssu

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