>>>>>>>> Chapter 7 E-Business: Doing Business Online Define e-business and discuss 1 how it can help achieve business 5 Describe some of the challenges associated with e-business. 6 Discuss how organizations use Internet communications to advance their objectives. success. 2 Distinguish between a corporate and a marketing Web site. 3 List the major forms of B2B e-business. 4 Explain B2C e-business and identify the products most often sold online. 7 8 Discuss Web sites and identify methods for measuring Web site effectiveness. Explain the global scope of e-business. Electronic business (e-business) - Conducting business via the Internet. 1. E-tailing, or virtual storefronts on Web sites. 2. Online business-to-business transactions. 3. Electronic data interchange (EDI), the business-to-business exchange of data using compatible software. 4. E-mail, instant messaging, and other Web-enabled communication tools and their use as media for reaching prospective and existing customers. 5. The gathering and use of demographic, product, and other information through Web contacts. вЂў Global Reach. Goods and services can be sold to customers worldwide. вЂў Personalization. Companies can customize products and reduce inventory. вЂў Interactivity. Customers and suppliers can negotiate prices online. вЂў Right-time and integrated marketing. Online retailers provide products when and where customers want them and promotions can be directed to individual customers. вЂў Cost savings. E-business can reduce costs. University of Phoenix FreshDirect Boston Symphony Orchestra пѓј Increase a firmвЂ™s visibility, promote its offerings, and provide information to interested parties. пѓј Build customer goodwill and assist retailers and other resellers in their marketing efforts. пѓј Disseminate financial information to investors. пѓј Enable prospective employees to apply online for jobs. пѓјWeb Provide communication. sitese-mail are frequently used for marketing to attract visitors/customers. . вЂў Business-to-business e-business (B2B) Electronic business transactions between businesses using the Internet. вЂў B2B transactions total $2.5 trillion. вЂў By some estimates, account for 90% of all e-commerce activities. вЂў Can reduce cost of B2B transactions by almost 25 percent. вЂў Electronic data interchange (EDI) is a computer-to-computer exchange of invoices, purchase orders, price quotations and other sales information. вЂў Extranets offer an efficient way for business to collaborate with vendors, partners and customers. вЂў Private Exchanges are the next generation of extranets where all types of data related to ebusiness is shared. вЂў Business-to-consumer (B2C) вЂў E-tailing accounts for 4% of all U.S. sales. вЂў Growing at a rate of 18%. вЂў Services like banking and brokerage are key aspects of e-tailing вЂў Many retailers have electronic storefronts. вЂў Growth of broadband is aiding e-tailing. пѓј Typical user is young, highly educated, urban or suburban, and affluent. пѓј Demographics are shifting; there is decreasing difference in Internet purchasing habits among groups. Lower Prices вЂў Many products cost less online. вЂў Internet allows customers to easily compare prices from multiple sellers. Convenience вЂў Can order products from around the world anytime, day or night. вЂў Can register customer information to streamline transactions. Personalization вЂў Emphasis on personalized, one-on-one marketing to increase repeat purchases. вЂў Through encryption, data is encoded for security purposes. вЂў Many companies use Secure Sockets Layer (SSL) technology to encrypt information and verify senders and receivers. вЂў An electronic wallet contains credit card and identification information. Customers can avoid retyping purchase information. пѓј Privacy is among the top concerns of Internet users. пѓј E-business sites often require passwords and use electronic signatures, an electronic form of identity verification. пѓј Companies can track customersвЂ™ shopping and viewing habits through cookies. пѓј Customers usually prefer that companies do not share their personal information. Merchants have responded by joining privacy organizations. пѓј Privacy protections may soon become legally required. пѓј Employees also have concerns that employers are monitoring their Internet behavior. пѓј Companies worry about data theft. вЂў Internet Crime Complaint Center logs more than 200,000 complaints annually. вЂў 50% of the complaints referred to law enforcement agencies deal with online auctions. вЂў Phishing is a growing form of Internet fraud that uses email or pop-up messages to get unsuspecting victims to disclose personal information. вЂў Vishing, or voice phishing, involves phone calls to credit card customers to obtain personal and banking information. вЂў Payment fraud is growing. вЂў 50% of shopping carts are abandoned before any purchase is made. вЂ“ Lack of Information вЂ“ Inability to find the information they need вЂ“ Feeling overwhelmed by too much information вЂў Companies that have brick-and-mortar experience often have better success satisfying customers than Internetonly retailers. вЂў Online sales can compete with business partners such as retailers and distributors causing disputes called channel conflict. вЂў Web has four main functions: e-business, entertainment, information, and communication. вЂў Communication is WebвЂ™s most popular function. вЂў Firms use e-mail to communicate with customers, suppliers, and other partners. вЂў Online Communities: Internet forums, newsgroups, electronic bulletin boards, and Web communities that appeal to people who share common interests. вЂў Spam is junk e-mail. вЂў Blog - short for Web log, an online journal written by a blogger. вЂў May incorporate wikis, a Web page that anyone can edit. вЂў Some incorporate podcasts, video & audio recordings. Feedburner services more than 200,000 podcasts. вЂў Corporate blogs can help build brand trust. вЂ“ Example: AppleвЂ™s iLounge builds the iPod brand and gives Apple ideas for product improvement. вЂў Employee blogs may present ethical issues. вЂў Banner Ads вЂ“ messages placed on frequently visited websites вЂў Pop-up Ads вЂ“ ads that appear in separate windows вЂў Pre-roll Video Ads вЂ“ advertisements that roll as soon as a page is loaded вЂў Search marketing вЂ“ companies pay for top visibility in search results Some companies, such as ValPak Marketing Systems, offer virtual, searchable coupons. пѓј Future growth of many companies is linked to a global strategy that incorporates e-business. пѓј U.S. leads world in Internet users but ranks only 5th in Internet penetration. пѓј E-Bay may dominate most markets, but Chinese company Alibaba.com has 83% of the auction business in China. пѓј Three of four Web pages are written in English. пѓј E-business can heighten competition in the global marketplace... It is easier to create a bad website than a good one. Organizations must think about: пѓјPlanning and Preparation пѓјContent and Connections пѓјCosts and Maintenance вЂў Click-through rate - percentage of people presented with a Web banner ad who click on it. вЂў Conversion rate - percentage of visitors to a website who make a purchase.