E-commerce 2019: Business. Technology.

Society.

Chapter 1

Introduction to
E-commerce
Learning Objectives
1.1 Understand why it is important to study e-commerce.
1.2 Define e-commerce, understand how e-commerce differs
from e-business, identify the primary technological building
blocks underlying e-commerce, and recognize major current
themes in e-commerce.
1.3 Identify and describe the unique features of e-commerce
technology and discuss their business significance.
1.4 Describe the major types of e-commerce.
1.5 Understand the evolution of e-commerce from its early
years to today.
1.6 Describe the major themes underlying the study of e-
commerce.
1.7 Identify the major academic disciplines contributing to e-
Everything On Demand: The
“Uberization” of E-commerce
• To think about:
– Have you used Uber or any other on-demand
service companies?
– What is the appeal of these companies for users
and providers?
– Are there any negative consequences to the
increased use of on-demand services like Uber
and Airbnb?
The First Thirty Seconds
• First two decades of e-commerce
– Just the beginning
– Rapid growth and change
• Technologies evolve at exponential rates
– Disruptive business change
– New opportunities
• Why study e-commerce
– Understand opportunities and risks
– Analyze e-commerce ideas, models, issues
Introduction to E-commerce
• Use of Internet to transact business
– Includes Web, mobile browsers and apps
• More formally:
– Digitally enabled commercial transactions
between and among organizations and
individuals
The Difference between E-commerce
and E-business
• E-business:
– Digital enabling of transactions and processes within a
firm, involving information systems under firm’s control
– Does not include commercial transactions involving an
exchange of value across organizational boundaries
Technological Building Blocks
Underlying E-commerce
• Internet
• World Wide Web
– HTML
– Deep Web v s “surface” Web
ersu

• Mobile platform
– Mobile apps
Insight on Technology: Will Apps Make
the Web Irrelevant?
• To think about:
– What are the advantages and disadvantages of
apps, compared with websites, for mobile users?
– What are the benefits of apps for content
owners and creators?
– Will apps eventually make the Web irrelevant?
Why or why not?
Major Trends in E-commerce
• Business trends include:
– All forms of e-commerce show very strong
growth
• Technology trends include:
– Mobile platform has made mobile e-commerce
reality
• Societal trends include:
– Increased online social interaction and sharing
Unique Features of E-commerce
Technology (1 of 2)
1. Ubiquity
2. Global reach
3. Universal standards
4. Information richness
Unique Features of E-commerce
Technology (2 of 2)
5. Interactivity
6. Information density
7. Personalization/customization
8. Social technology
Types of E-commerce
• Business-to-Consumer (B2C)
• Business-to-Business (B2B)
• Consumer-to-Consumer (C2C)
• Mobile e-commerce (M-commerce)
• Social e-commerce
• Local e-commerce
Figure 1.5 The Growth of B2C E-
commerce in the United States
Figure 1.7 The Growth of B2B E-
commerce in the United States
Figure 1.8 The Growth of M-commerce
in the United States
E-commerce: A Brief History (1 of 4)
• Precursors
– Baxter Healthcare modem-based system
– Order entry systems
– Electronic Data Interchange (EDI) standards
– French Minitel
E-commerce: A Brief History (2 of 4)
• 1995–2000: Invention
– Sale of simple retail goods
– Limited bandwidth and media
– Euphoric visions of
▪ Friction-free commerce
▪ First-mover advantages
– Dot-com crash of 2000
E-commerce: A Brief History (3 of 4)
• 2001–2006: Consolidation
– Emphasis on business-driven approach
– Traditional large firms expand presence
– Start-up financing shrinks
– More complex products and services sold
– Growth of search engine advertising
– Business web presences expand
E-commerce: A Brief History (4 of 4)
• 2007–Present: Reinvention
– Rapid growth of:
▪ Web 2.0, including online social networks
▪ Mobile platform
▪ Local commerce
▪ On-demand service economy
– Entertainment content develops as source of
revenues
– Transformation of marketing
Figure 1.10 Periods in the Development
of E-commerce
Insight on Business: Rocket Internet
• To think about:
– What are the benefits of investing in a company
that Rocket Internet has launched?
– Is an incubator the best solution for start-ups to
find funding? Why or why not?
– Why is Rocket Internet controversial?
Assessing E-commerce (1 of 2)
• Stunning technological success
• Early years a mixed business success
– Few early dot-coms have survived
– Online sales growing rapidly
• Many early visions not fulfilled
– Price dispersion
– Information asymmetry
– New intermediaries
Assessing E-commerce (2 of 2)
• Other surprises
– Fast-follower advantages
– Start-up costs
– Impact of mobile platform
– Emergence of on-demand e-commerce
Understanding E-commerce:
Organizing Themes
• Technology:
– Development and mastery of digital computing
and communications technology
• Business:
– New technologies present businesses with new
ways of organizing production and transacting
business
• Society:
– Intellectual property, individual privacy, public
welfare policy
Figure 1.11 The Internet and the
Evolution of Corporate Computing
Insight on Society: Facebook and the
Age of Privacy
• To think about:
– Why are social networks interested in collecting
user information?
– What types of privacy invasion are described in
the case? Which is the most privacy-invading,
and why?
– How is e-commerce different from traditional
markets with respect to privacy? Don’t
merchants always want to know their customer?
– How do you protect your privacy online?
Academic Disciplines Concerned with
Technology
• Technical
– Computer science, management science,
information systems
• Behavioral
– Information systems research, economics,
marketing, management, finance/accounting,
sociology
Careers in E-commerce
• Position: Category specialist in E-commerce Retail
Program
• Qualification/Skills
• Preparing for the Interview
• Possible Interview Questions