e-commerce bba ( hons )
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E-Commerce BBA ( Hons ). (Electronic Retailing: Products and Services) Lectures 7,8,9 By : Farhan Mir. Retailing. - PowerPoint PPT PresentationTRANSCRIPT
© Farhan Mir© Farhan Mir
20201414 IMSIMS
E-CommerceE-CommerceBBA (Hons)BBA (Hons) (Electronic Retailing: Products (Electronic Retailing: Products and Services)and Services)Lectures 7,8,9Lectures 7,8,9
By: Farhan MirBy: Farhan Mir
© Farhan Mir© Farhan Mir
20201414 IMSIMS
RetailingRetailing
Retailing encompasses the business activities involved in selling goods and services to consumers for their personal, family, or household use. It includes every sale to the final consumer.
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Issues in RetailingIssues in Retailing
How can organization best serve their customers while earning a fair profit?
How can they stand out in a highly competitive environment where consumers have too many choices?
How can they grow their business, while retaining a core of loyal customers?
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Electronic RetailingElectronic Retailing
Overview of Electronic Retailing
electronic retailing (e-tailing)
Retailing conducted online, over the Retailing conducted online, over the InternetInternet
e-tailerse-tailers
Retailers who sell over the InternetRetailers who sell over the Internet
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Retailing Approaches: Retailing Approaches: Virtual versus TangibleVirtual versus Tangible
Follow the functions of the traditional retailer but as a “back office operation,” hidden from public
Web site merchandise represented by invisible electronic data entries
Generally prices are lower because of reduced operating/overhead costs
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20201414 IMSIMS
Electronic RetailingElectronic Retailing
Size and Growth of the B2C MarketReported amounts of online sales Reported amounts of online sales deviate substantially deviate substantially based on how the based on how the numbers are derivednumbers are derived
Annual online 2004 sales were estimated to be over $70 billion The average online shopper spent over $350 per quarterForrester Research estimates that e-tailing will reach $316 billion by 2010
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20201414 IMSIMS
Electronic RetailingElectronic Retailing
Computer hardware and softwareConsumer electronicsOffice suppliesSporting goodsBooks and music
ToysHealth and beautyApparel and clothingJewelryCarsServicesOthers
What Sells Well on the Internet?What Sells Well on the Internet?
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Electronic RetailingElectronic Retailing
Characteristics of Successful E-Tailing
High brand recognitionHigh brand recognition
A guarantee provided by highly reliable A guarantee provided by highly reliable or well-known vendorsor well-known vendors
Digitized formatDigitized format
Relatively inexpensive itemsRelatively inexpensive items
Frequently purchased items Frequently purchased items
Commodities with standard Commodities with standard specificationsspecifications
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Remember some of the Remember some of the Business ModelsBusiness Models
Classification by Distribution Channel
1.1. Mail-order retailers that go onlineMail-order retailers that go online
2.2. Direct marketing from manufacturersDirect marketing from manufacturers
3.3. Pure-play e-tailersPure-play e-tailers
4.4. Click-and-mortar retailersClick-and-mortar retailers
5.5. Internet (online) mallsInternet (online) malls
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E-Retailing Business E-Retailing Business ModelsModels
Direct Sales by ManufacturersSellers can understand their markets Sellers can understand their markets better because of the direct connection better because of the direct connection to consumersto consumers
Consumers gain greater information Consumers gain greater information about the products through their direct about the products through their direct connection to the manufacturersconnection to the manufacturers
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20201414 IMSIMS
E-Retailing in famous E-Retailing in famous sectorssectors● Travel and Tourism● Job and Placement● Real State & Insurance ● Stock Trading● Banking and Personal Finance● On Demand Gaming, Entertainment
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Travel and Tourism Services Travel and Tourism Services OnlineOnlineOnline travel is probably the most
successful e-commerce implementation
Services provided include:General information General information
Reserving and purchasing tickets, Reserving and purchasing tickets, accommodations, and entertainmentaccommodations, and entertainment
Travel tips Travel tips
Electronic travel magazinesElectronic travel magazines
Fare comparisonsFare comparisons
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Travel and Tourism Services Travel and Tourism Services OnlineOnline
Benefits of Online Travel ServicesBenefits to consumersBenefits to consumers
Large amount of free information available 24/7Substantial discounts can be found
Benefits to providersBenefits to providersAirlines, hotels, and cruise lines are selling otherwise-empty spacesDirect selling saves the provider’s commission and its processing
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Travel and Tourism Services Travel and Tourism Services OnlineOnline
Limitations of Online Travel ServicesMany people do not use the InternetMany people do not use the Internet
The amount of time and the difficulty of The amount of time and the difficulty of using virtual travel agencies may be using virtual travel agencies may be significantsignificant
Complex trips or those that require Complex trips or those that require stopovers may not be available online stopovers may not be available online because they require specialized because they require specialized knowledge and arrangementsknowledge and arrangements
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Travel and Tourism Services Travel and Tourism Services OnlineOnline
Corporate TravelTo reduce corporate travel costs, companies To reduce corporate travel costs, companies can make arrangements that enable can make arrangements that enable employees to plan and book their own trips employees to plan and book their own trips using online optimization tools provided by using online optimization tools provided by travel companies, such as those offered by travel companies, such as those offered by Rosenbluth InternationalRosenbluth International
Travel authorization software that checks Travel authorization software that checks availability of funds and compliance with availability of funds and compliance with corporate guidelines is usually provided by corporate guidelines is usually provided by travel companiestravel companies
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Employment Placement Employment Placement and the Job Market Onlineand the Job Market Online
The Internet Job MarketJob seekersJob seekers
Employers seeking employeesEmployers seeking employees
Job agenciesJob agencies
Government agencies and institutionsGovernment agencies and institutions
The Internet is a global online portal for job seekers
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Employment Placement Employment Placement and the Job Market Onlineand the Job Market Online
Limitations of the Electronic Job Market
Many people do not use the Internet. This Many people do not use the Internet. This limitation is even more serious with non-limitation is even more serious with non-technology-oriented jobstechnology-oriented jobs
Security and privacy: resumes and other Security and privacy: resumes and other online communications are usually not online communications are usually not encrypted, so one’s job-seeking activities encrypted, so one’s job-seeking activities may not be securemay not be secure
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Exhibit 3.7 Intelligent Agents MatchExhibit 3.7 Intelligent Agents Match Resumes with Available Jobs Resumes with Available Jobs
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Real Estate OnlineReal Estate Online
Real Estate ApplicationsAdvice to consumers on buying or selling Advice to consumers on buying or selling a homea home
Commercial real estate listingsCommercial real estate listings
Listings of residential real estate in Listings of residential real estate in multiple databasesmultiple databases
The National Association of Realtors U.S The National Association of Realtors U.S ((realtor.comrealtor.com) has links to house listings in ) has links to house listings in all major citiesall major cities
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Real Estate OnlineReal Estate Online
Real Estate ApplicationsMaps are availableMaps are available
Information on current mortgage ratesInformation on current mortgage rates
Mortgage brokers can pass loan Mortgage brokers can pass loan applications over the Internet and receive applications over the Internet and receive bids from lenders who want to issue bids from lenders who want to issue mortgagesmortgages
Online lenders can tentatively approve Online lenders can tentatively approve loans onlineloans online
Automated closing of real estate Automated closing of real estate transactionstransactions
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Insurance OnlineInsurance Online
Insurance OnlineAn increasing number of companies use An increasing number of companies use the Internet to offer standard insurance the Internet to offer standard insurance policies (auto, home, life, or health) at a policies (auto, home, life, or health) at a substantial discountsubstantial discount
Third-party aggregators offer free Third-party aggregators offer free comparisons of available policiescomparisons of available policies
Several large insurance and risk-Several large insurance and risk-management companies offer management companies offer comprehensive insurance contracts onlinecomprehensive insurance contracts online
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Exhibit 3.8 Online Electronic Stock Exhibit 3.8 Online Electronic Stock TradingTrading
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Schematic Representation of a Stock Market TransactionSchematic Representation of a Stock Market Transaction
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Online Stock Trading Online Stock Trading ModelModel
CustomerCustomer(trader)(trader)
Online Online BrokerBroker
Market-Market-makermaker
Clearing-Clearing-househouse
StockStockExchangeExchangecustomer’scustomer’s
accountaccount
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Online Demonstration of one of the major online brokers
(AKD Securities – Akeel Karim Deddy Securities )
www.akdtrade.com
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After opening an account, you need to login through this interface
Note the secure server presence
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Trading Section
You need to place order
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You can cancel the order if it’s not executed
You can view the status of your order
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Banking and Personal Finance OnlineBanking and Personal Finance Online
electronic banking (e-banking)Various banking activities conducted from home or the road using an Internet connection; also known as cyberbanking, virtual banking, online banking, and home banking
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Exhibit 3.9 Online Banking CapabilitiesExhibit 3.9 Online Banking Capabilities
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Banking and Personal Finance OnlineBanking and Personal Finance Online
Virtual BanksVirtual banks Virtual banks have no physical location, but only have no physical location, but only conduct online transactionsconduct online transactions
International and Multiple-Currency Banking
Hong Kong and Shanghai Banking Corporation Hong Kong and Shanghai Banking Corporation ((hsbc.com.hkhsbc.com.hk))
Tradecard and MasterCard for global Tradecard and MasterCard for global transactions (see transactions (see tradecard.comtradecard.com))
Bank of America and most other major banksBank of America and most other major banks
Fxall.comFxall.com is a multidealer foreign exchange is a multidealer foreign exchange serviceservice
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Banking and Personal Finance OnlineBanking and Personal Finance Online
Implementation Issues in Online Financial Transactions
Securing financial transactionsSecuring financial transactions
Access to banks’ intranets by outsidersAccess to banks’ intranets by outsiders
Using imaging systemsUsing imaging systems
Pricing online versus off-line servicesPricing online versus off-line services
RisksRisks
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Banking and Personal Finance OnlineBanking and Personal Finance Online
Online Billing and Bill PayingAutomatic transfer of mortgage Automatic transfer of mortgage paymentspayments
Automatic transfer of funds to pay Automatic transfer of funds to pay monthly utility billsmonthly utility bills
Paying bills from online banking Paying bills from online banking accountsaccounts
Merchant-to-customer direct billingMerchant-to-customer direct billing
Using an intermediary for bill Using an intermediary for bill consolidationconsolidation
Person-to-person direct paymentPerson-to-person direct payment
Pay bills at bank kiosksPay bills at bank kiosks
TaxesTaxes
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On-Demand On-Demand Delivery Services and E-grocersDelivery Services and E-grocers
on-demand delivery serviceExpress delivery made fairly quickly after an online order is received (fedEx, DHL, UPS)
e-grocerA grocer that takes orders online and provides deliveries on a daily or other regular schedule or within a very short period of time (freshdirect.com)
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Online Delivery of Digital Products,Online Delivery of Digital Products,Entertainment, and MediaEntertainment, and Media
Certain goods, (software, music, or news stories) may be distributed in a physical form or they may be digitized and delivered over the Internet
For sellers, the costs associated with the manufacture, storage, and distribution of physical products can be enormous
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Online Delivery of Digital Products,Online Delivery of Digital Products,Entertainment, and MediaEntertainment, and Media
Interactive EntertainmentWeb browsingWeb browsing
Internet gamingInternet gaming
Fantasy sport gamesFantasy sport games
Single and multiplayer gamesSingle and multiplayer games
Card gamesCard games
Participatory Web sitesParticipatory Web sites
ReadingReading
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Online Delivery of Digital Products,Online Delivery of Digital Products,Entertainment, and MediaEntertainment, and Media
Noninteractive EntertainmentEvent ticketingEvent ticketing
RestaurantsRestaurants
Information retrievalInformation retrieval
Retrieval of audio and video Retrieval of audio and video entertainmententertainment
Live eventsLive events
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Online Delivery of Digital Products,Online Delivery of Digital Products,Entertainment, and MediaEntertainment, and Media
Online EntertainmentMore than 50% US youngsters prefer to More than 50% US youngsters prefer to go online for entertainment purposesgo online for entertainment purposes
Online MusicOnline Musicwww.napster.com launched P2P file sharing of musinwww,youtube.com
Online GamingOnline GamingExpected to be around a 12 Billion$ market
Online Dating & Adult EntertainmentOnline Dating & Adult Entertainment
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Online Purchase-Decision Online Purchase-Decision AidsAids
shopping portalsGateways to e-storefronts and e-malls; may be comprehensive or niche oriented
shopping robots (shopping agents or shopbots)Tools that scout the Web on behalf of consumers who specify search criteria
Wireless Shopping Comparisons—Enable shoppers to compare prices any time from anywhere, including from any physical store
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Online Purchase-Decision Online Purchase-Decision AidsAids
Business Ratings Sites
Trust Verification Sites
Other Shopper ToolsEscrow servicesEscrow services
Communities of consumers who offer Communities of consumers who offer advice and opinionsadvice and opinions
E-wallet (or e-purse)E-wallet (or e-purse)
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Online Purchase-Decision Online Purchase-Decision AidsAids
Other Shopper ToolsAmazon.com’s A9 Search EngineAmazon.com’s A9 Search Engine
Remembers information A user can make notes about any Web page and search themOffers a new way to store and organize bookmarksRecommends new sites and favorite old sites specifically for the user to visit
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Issues in E-Tailing Issues in E-Tailing
disintermediationThe removal of organizations or business process layers responsible for certain intermediary steps in a given supply chain
reintermediationThe process whereby intermediaries (either new ones or those that had been disintermediated) take on new intermediary roles
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Exhibit 3.12Exhibit 3.12 Disintermediation and Disintermediation and ReintermediationReintermediation
in the B2C Supply Chain in the B2C Supply Chain
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Issues in E-TailingIssues in E-Tailing
Channel ConflictSituation in which an online marketing channel upsets the traditional channels due to real or perceived damage from competition
Determining the right pricePersonalizationFraud and illegal activitiesHow to make customers happy
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Managerial IssuesManagerial Issues1. What should our strategic position
be?
2. Are we financially viable?
3. Should we recruit out of town?
4. Are there international legal issues regarding online recruiting?
5. Do we have ethics and privacy guidelines?
6. How will intermediaries act in cyberspace?
7. Should we set up alliances?