International contemporay business chapter07

>>>>>>>> Chapter E-Business: Doing Business Online s l a o G g n i n r a Le Define e-business and discuss how it can help achieve business Describe some of the challenges associated with e-business Discuss how organizations use Internet communications to advance their objectives success Distinguish between a corporate and a marketing Web site List the major forms of B2B Discuss Web sites and identify methods for measuring Web site effectiveness Explain B2C e-business and identify the products most often sold online Explain the global scope of e-business e-business ? s s e n i s u B E s i What Electronic business (e-business) - Conducting business via the Internet E-tailing, or virtual storefronts on Web sites Online business-to-business transactions Electronic data interchange (EDI), the business-to-business exchange of data using compatible software E-mail, instant messaging, and other Web-enabled communication tools and their use as media for reaching prospective and existing customers The gathering and use of demographic, product, and other information through Web contacts d n a s e i t i l i Capab E f o s t f Bene Business • Global Reach Goods and services can be sold to customers worldwide • Personalization Companies can customize products and reduce inventory • Interactivity Customers and suppliers can negotiate prices online • Right-time and integrated marketing Online retailers provide products when and where customers want them and promotions can be directed to individual customers • Cost savings E-business can reduce costs s s e n i s u B Some E s e s s e c Su c University of Phoenix FreshDirect Boston Symphony Orchestra b e W s s Busine Sites  Increase a firm’s visibility, promote its offerings, and provide information to interested parties  Build customer goodwill and assist retailers and other resellers in their marketing efforts  Disseminate financial information to investors  Enable prospective employees to apply online for jobs Web Provide communication sitese-mail are frequently used for marketing to attract visitors/customers o t s s e n i Bus ) B B ( s s Busine • Business-to-business e-business (B2B) Electronic business transactions between businesses using the Internet • B2B transactions total $2.5 trillion • By some estimates, account for 90% of all e-commerce activities • Can reduce cost of B2B transactions by almost 25 percent a t a D c i n o r t Elec , s t e n a r t x E s, e g n a h c r e t In s e g n a h c x E & Private • Electronic data interchange (EDI) is a computer-to-computer exchange of invoices, purchase orders, price quotations and other sales information • Extranets offer an efficient way for business to collaborate with vendors, partners and customers • Private Exchanges are the next generation of extranets where all types of data related to ebusiness is shared g n i p p o h Online S and B2C • Business-to-consumer (B2C) • E-tailing accounts for 4% of all U.S sales • Growing at a rate of 18% • Services like banking and brokerage are key aspects of e-tailing • Many retailers have electronic storefronts • Growth of broadband is aiding e-tailing e n i l n o e Who ar d n a s r e y bu sellers?  Typical user is young, highly educated, urban or suburban, and affluent  Demographics are shifting; there is decreasing difference in Internet purchasing habits among groups C B f o s t Benef s s e n i s u B E Lower Prices • Many products cost less online • Internet allows customers to easily compare prices from multiple sellers Convenience • Can order products from around the world anytime, day or night • Can register customer information to streamline transactions Personalization • Emphasis on personalized, one-on-one marketing to increase repeat purchases e f a S g n i Develop t n e m y a P Online Systems • Through encryption, data is encoded for security purposes • Many companies use Secure Sockets Layer (SSL) technology to encrypt information and verify senders and receivers • An electronic wallet contains credit card and identification information Customers can avoid retyping purchase information s s e n i s u E-B s e g n e l l a Ch (privacy)  Privacy is among the top concerns of Internet users  E-business sites often require passwords and use electronic signatures, an electronic form of identity verification  Companies can track customers’ shopping and viewing habits through cookies  Customers usually prefer that companies not share their personal information Merchants have responded by joining privacy organizations  Privacy protections may soon become legally required  Employees also have concerns that employers are monitoring their Internet behavior  Companies worry about data theft s s e n i s u E-B s e g n e l l a Ch ) d u a r F t e (Intern • Internet Crime Complaint Center logs more than 200,000 complaints annually • 50% of the complaints referred to law enforcement agencies deal with online auctions • Phishing is a growing form of Internet fraud that uses email or pop-up messages to get unsuspecting victims to disclose personal information • Vishing, or voice phishing, involves phone calls to credit card customers to obtain personal and banking information • Payment fraud is growing • s s e n i s u E-B r o o p ( s e g Challen ) n g i s e d e sit b e w 50% of shopping carts are abandoned before any purchase is made – Lack of Information – Inability to find the information they need – Feeling overwhelmed by too much information • Companies that have brick-and-mortar experience often have better success satisfying customers than Internetonly retailers • Online sales can compete with business partners such as retailers and distributors causing disputes called channel conflict s ’ b e W e h Using t n o i t a c i n u Comm Function • Web has four main functions: e-business, entertainment, information, and communication • Communication is Web’s most popular function • Firms use e-mail to communicate with customers, suppliers, and other partners • Online Communities: Internet forums, newsgroups, electronic bulletin boards, and Web communities that appeal to people who share common interests • Spam is junk e-mail • Web n o i t a c i n u Comm ogs l B Blog - short for Web log, an online journal written by a blogger • May incorporate wikis, a Web page that anyone can edit • Some incorporate podcasts, video & audio recordings Feedburner services more than 200,000 podcasts • Corporate blogs can help build brand trust – Example: Apple’s iLounge builds the iPod brand and gives Apple ideas for product improvement • Employee blogs may present ethical issues • Web n o i t a c i n u Comm d e s a B b e W Banner Ads – messages placed on frequently visited n o i t o m o r P websites • Pop-up Ads – ads that appear in separate windows • Pre-roll Video Ads – advertisements that roll as soon as a page is loaded • Search marketing – companies pay for top visibility in search results Some companies, such as ValPak Marketing Systems, offer virtual, searchable coupons Global E f o t n e m n o r i v n E Business  Future growth of many companies is linked to a global strategy that incorporates e-business  U.S leads world in Internet users but ranks only 5th in Internet penetration  E-Bay may dominate most markets, but Chinese company Alibaba.com has 83% of the auction business in China  Three of four Web pages are written in English  E-business can heighten competition in the global marketplace t e n r e t n I World s c i t s i t a t S a g n i p o l e Dev e t i s b e W l u f s s e c c u S It is easier to create a bad website than a good one Organizations must think about: Planning and Preparation Content and Connections Costs and Maintenance a g n i g a n Ma Website • Click-through rate - percentage of people presented with a Web banner ad who click on it • Conversion rate - percentage of visitors to a website who make a purchase  ... B2C e -business and identify the products most often sold online Explain the global scope of e -business e -business ? s s e n i s u B E s i What Electronic business (e -business) - Conducting business. .. visitors/customers o t s s e n i Bus ) B B ( s s Busine • Business- to -business e -business (B2B) Electronic business transactions between businesses using the Internet • B2B transactions total $2.5... E-tailing, or virtual storefronts on Web sites Online business- to -business transactions Electronic data interchange (EDI), the business- to -business exchange of data using compatible software E-mail,