MIS 111: Computers and the Inter-networked Society

1. MIS 111: Computers and the Inter-networked Society Class 4: E-Commerce July 14th, 2011

3. Today’s Learning Objectives • List one or two current events in technology news • Define e-commerce • List at least 4 different ways e-commerce can make money • Explain the difference between Business-to-Customer and Business-to-Business e-commerce • List the components of an online store • Discuss how the “long tail” is implemented in e-commerce and why it makes e-commerce successful • Discuss a few ways you can make money online

4. Survey When was the last time you used a physical store to buy… Music Book Software DVD

5. E-Commerce: An Example

6. E-Commerce: A Definition “The process of buying, selling, transferring, or exchanging products, services, or information via computer networks, including the Internet.”

7. Pure vs. Partial E-Commerce • Bricks and mortar (not e-commerce) • Virtual (pure e-commerce) • Clicks and mortar (partial e-commerce)

8. A Word on Nomenclature • Business and technology people are fairly simple people. • Hence, the names they choose mean exactly what they say (for example, management information systems? The world wide web?)

9. Types of E-Commerce • Business-to-Consumer • Business-to-Business • Consumer-to-Consumer • Business-to-Employee • E-Government • Mobile Commerce

10. Business-to-Consumerand Business-to-Business More details

11. Business-to-Consumer EC (B2C) • Means of Access (E-Tailing) • Direct sale through Electronic Storefronts • Like www.officedepot.com • Direct sale through Electronic Malls • May include thousands of vendors • Benefits of E-Tailing: • Can buy from home 24/7 • Wider variety of products at lower prices (text books?)

12. Business-to-Consumer Services • Online Service Industries (in addition to goods) • Cyberbanking (paying bills, applying for loans) • Online Securities Trading (E*Trade) • Online Job Market (www.monster.com) • Travel Services (www.hotels.com)

13. Business-to-Consumer Ads • Online Advertising Methods • Banners (electronic billboards) • Pop-ups/Pop-unders (annoying!!) • Spamming vs. Permission Marketing • (Will you please sign up for our newsletter?) • Viral Marketing • “Word of Mouth” marketing • Addwords (not as good as search engine optimization)

14. Business-to-Business (B2B) • Sell-Side Marketplaces • Organizations sell products to others • Buy-Side Marketplaces • Organizations buy products from others • Electronic Exchanges • One buyer, many sellers

15. Some E-Commerce Business Models • Online direct marketing • Manufacturers/Retailers sell directly to customers • Deep discounters • Appeals to customers who consider only price • Viral marketing • Receivers send info about product to friends • Group purchasing • Small buyers aggregate demand to get low price • Online auctions • Like regular auction, but online

16. How do they make money?

17. Amazon.com

18. Pandora.com

19. Ebay.com

20. iTunes

21. http://www.barnesandnoble.com/

22. Google

23. Facebook

24. CNN

25. ESPN

26. NCN.com

27. go.disney.com

28. www.arizona.edu

29. Woot.com

30. Where to start? • Q1. how are you going to make money • Adverting • Selling a product • Selling a service • Selling digital media • Affiliate program • Selling sort of you own program • Subscriptions • Hybrid • DO YOUR RESEARCH!

31. Example, I’m going to be selling a digital product • Tomorrow, we will do an affiliate program so today we are going to be selling videos and music • Q2. how much work am I willing to put into Web development?

32. Option 1 • Online solutions • http://shopping-cart-review.toptenreviews.com/ • https://www.bigcommerce.com/ecommerce-solution-features.php

33. Online Stores:Components & Processes • Catalogue • List of Products • Descriptions • Prices • Options, size, etc. • Pictures Customer Catalogue a 1 b Shopping Cart 2 • Shopping Cart • A temporary list of item to be purchased c 3 • Checkout • Billing Info • Shipping Address • Shipping Cost • Record Order • Process Payment d Payment Collection Checkout e-commerce - Michael McDonnell

34. Electronic Payments • Electronic Checks • Electronic Credit Cards • Purchasing Cards • Do you know what that little lock means in the upper right hand corner of the browser?

35. Electronic Payments (cont’d) • Electronic Cash • Stored-Value Money Cards (calling cards) • Smart Cards (like the CatCard) • Person-to-Person Payments (PayPal) • Digital Wallets (stores financial info of buyer so no reentry is needed)

36. Option 2 • Content Management System • Blog • Google sites • Word press • Joomla • Drupal • Plugins • http://extensions.joomla.org/

37. Option 3 • Completely program it • Why? • Complete flexibility • Your platform doesn’t support content management systems • http://govollow.appspot.com/ • Free and lots of traffic (great for facebook, iphone integration) • You’re a geek 

38. With option 2 and 3 • You usually need to find you own place to host the Web site (they are just software) • Install software • Create a database

39. The Long Tail

40. “The Long Tail” • What happened to Touching the Void? • What does it mean that we have a “market of hits?” (anyone listen to the Top 40 station?) • Why aren’t obscure products in the market? • What is the 20/80 principle and why doesn’t it apply to the market for music and videos?

41. The Long Tail: Power Law Distribution

42. The Rules of The Long Tail • Rule 1: Make Everything Available • Why can sellers sell everything online? • Rule 2: Cut the Price in Half; Now Lower it. • Is any price too low? • Rule 3: Help Me Find it. • How do recommendations work?

43. You: A Money Maker • Affiliate Programs (http://www.amazon.com/) • Advertising (www.google.com/adsense/) • Create Products (http://www.spreadshirt.com/) • I want to sell my own product … • Don’t want to handle order fulfillment • http://www.amazonservices.com/content/fulfillment-by-amazon.htm?id=hm2

44. Tomorrow • No reading • Meet in McClelland Hall 214 • We’re going to make a business!!!

45. Quiz