Facebook Email Marketing Partnerships Learn more marketing channels The benefits of online marketing are the ability to track the results used strategies in real-time with the use of web analytics. Web analytics in online marketing allows for constant optimization of strategy. Online marketing develops fast, and new ideas on how to improve your tactics arise often, and improved methods of collecting data helps you find new opportunities all the time. In promotion, it’s essential to have clear strategies on how your brand and its messaging display across platforms. A wide range of platforms can lead to unified experiences for the customers, and that leads to worsened brand awareness. Controlling your brand and its communication in online marketing promotion is essential. People People as a marketing decision in the online marketing mix are crucial. Great products and businesses require people that are involved in the online distribution and personnel who are in direct contact with customers. To accurately answer the question of people in your marketing mix is to measure and evaluate the interactions between a business and its customers and the interactions between personnel and customers. In the end, it’s the people involved in the company that represents the values of a brand. How we do, customer service is vital in an online setting when interactions are not physical. Designing better customer support systems where your customers and your employees can interact with each other seamlessly and scalable, enables us to produce a more consistent experience for both. There are many options and combinations of online support you can introduce into your business workflow. For example, at the most basic, you can integrate social media as a channel for customer support or utilize online reviews (like Google My Business) as well. Depending on the place in your marketing mix, you need to get the most appropriate way of support that functions effectively in that place. For example, an online store or online consulting firm can use chat software to connect support personnel with customers directly on the website. How we plan our responses and our strategy of keeping our customers happy at all times is a critical marketing decision that, when unanswered will seriously harm any business when they reach a critical mass. 151 CU IDOL SELF LEARNING MATERIAL (SLM)
Process The process as a marketing decision in the online marketing mix defines the needed procedures and its optimization of delivering online products and the core experiences of it. What task is necessary for a product to provide its core experience for its users? Process optimization relies on collected data and measuring the data with key performance indicators (KPIs) in mind. To have an optimized process, a constant need for tracking the success of your operations in your marketing mix is essential. The better the process we have in place, the more ready we are at scale, and documenting every step we take, increases our chances of understanding the health of a business through the online marketing perspective. Tracking processes and the performance of the overall system enables us to find critical errors at best before they happen or, at the very least, finding them very early before any significant failures have occurred. Contextualizing online marketing processes in everything we do in our strategies helps we understand the core principles that make our approach viable at any given time. Physical Evidence (Online Evidence) In the extended marketing mix, physical evidence refers to the different elements of service experience, such as facilities, interior designs, livery, and post-purchase artifacts (souvenirs).In an online setting, these pieces of evidence will not have a physical element to them. However, the digitalization of this physical evidence is still possible, and an important marketing decision to have. Online brand awareness across multiple channels is an excellent example of online evidence. How well these channels expand service experiences, for instance, through the number of followers, likes, and other social engagement metrics. A website’s design is essential online evidence as, in most cases, it’s the most important channel for an online business. The elements of your website’s design crucially impact the non-human service experiences your customers will face when interacting with your online business. A controlled and complete multi-channel online experience enables us to enhance our online evidence in a way that improves our marketing decisions significant. 8.5 SUMMARY Like all business plans, cost estimates and budget forecasts are part of the equation. But for some ecommerce businesses, the management of startup funds plays a surprisingly minor role in the overall plan. There are even online businesses that you can launch and run with no upfront or operating costs at all. 152 CU IDOL SELF LEARNING MATERIAL (SLM)
The most important thing is to have a strategy and to define this by setting and measuring ongoing targets and goals against your plan. Numbers and metrics should play a key role in defining your success. These should be measured and reviewed on a periodic basis, and actions taken based on the outcomes. Almost all of the successful online businesses who have experienced compound growth year on year display common beliefs, characteristics and ambitions. The success of a strategy in ecommerce should be measured by the sales that are generated and profits made. A laser-like focus helps form unshakable conviction and dedication to building a successful online business. Be aware of and understand your site and customer analytics. Know which metrics are important and continue to focus on understanding and improving on all the numbers. Every day, week, month and year provides you with feedback that can be measured against targets and streamline your business. E-commerce impacts supply chain management in a variety of keyways. It reduces costs, streamlines business processes, accelerates business cycles and enhances customer service. Customers can manage the increasingly complex movement of products and information through the supply chain. E-commerce will allow users to establish an account and obtain real-time information about cargo shipments. Customers can also create and submit bills of lading, place a cargo order, analyse charges, submit a freight claim, and carry out many other functions on their web site. 8.6 KEYWORD E-procurement: the electronic sourcing of products and services by companies, focused on reducing costs and effort. Online stores: the electronic sale of products and services via appropriate platforms, such as online stores. Cost per Acquisition (CPA): It is one measure you can use to analyses individual marketing activities on their own or your advertising vs. sales overall. AIDA:The AIDA Model, which stands for Attention, Interest, Desire, and Action model, is an advertising effect model that identifies the stages that an individual goes through during the process of purchasing a product. SWOT analyses: SWOT, on the other hand, is a strategy development tool. It allows a digital firm to determine its Strengths, Weaknesses, Opportunities and Threats. This strategic view allows a firm to leverage its best areas and work on perfecting its weak points to ensure success. Marketing mix:In the traditional marketing case it includes product, 153 CU IDOL SELF LEARNING MATERIAL (SLM)
price, promotion and distribution. However, transferring this set into the Internet, the power of decision-making moves from seller to buyer. 8.7 LEARNING ACTIVITY 1. Define E-Business plan ___________________________________________________________________________ ___________________________________________________________________________ 2.How to create a proper marketing Mix for E-commerce? ___________________________________________________________________________ ___________________________________________________________________________ 8.8 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Write a short note on E-business plan? 2. Explain features of E-Business? 3. What you mean by price? 4. List the market participants E-Business? 5. Discuss the online product ideas? Long Questions 1. Elaborates details about the framework business plan. 2. Describe the implementation of E-Business plan? 3. Explain the online pricing strategy? 4. Point out the methods of online promotion strategy? 5. How to develop an E-Business for E-marketing mix-illustrate? B. Multiple Choice Questions 1. The E-commerce domain that involves business activity initiated by the consumer and targeted to businesses is known as ______________. a. Business to Business (B2B) b. Consumer to Consumer (C2C) c. Consumer to Business (C2B) d. Business to Consumer (B2C) 154 CU IDOL SELF LEARNING MATERIAL (SLM)
2. What is required in addition to a broad e-business strategy to detail how the sell-side specific objectives of the e-business strategy will be delivered through marketing activities such as research and communications? a. The marketing concept b. E-marketing plan c. Marketing orientation d. Situation analysis 3. Marketing tactics to implement strategies and objectives are traditionally based around the elements of the 'marketing mix'. This is a concept or framework that has been around for over 50 years so which of the following are taken from the original marketing mix? a. Product b. Price c. Promotion d. Product, Price, Promotion, Place 4. Creating multiple versions of information goods and selling essentially the same product to different market segments at different prices is called______________. a. versioning b. Bundling. c. trans active content d. price discrimination 5. A perfect market is one in which ______________. a. One firm develops an advantage based on a factor of production that other firms cannot purchase b. One participant in the market has more resources than the others c. there are no competitive advantages or asymmetries because all firms have equal access to all the factors to production 155 CU IDOL SELF LEARNING MATERIAL (SLM)
d. competition is at a minimum, as each niche market within an industry is served by the company with the greatest competitive advantage Answers 1-c, 2-b, 3-b. 4-d, 5-c 8.9 REFERENCES Reference books • JaiswalS.,E-Commerce • MohammadMahmoudiMaymand,E-Commerce • MurthyC.S.V.,E-Commerce-Concepts,ModelsandStrategies • Schneider, E-Commerce, Cengage Learning, New Delhi. • PeeLosuin&AMurphy,ElectronicCommerceJaicoPub Textbook references • JosephP.T.,E-Commerce–AnIndianPerspective • RaviKalkotaFrontiersofE-Commerce,AddisonWesley • K.Bajaj & D.Nag E-Commerce, The Cutting Edge of Business, Tata McGraw • Green Stein ElectronicCommerceTata McGraw. Website • https://www.cleverism.com/e-commerce-complete-guide • https://www.economicsdiscussion.net/business/e-commerce/31868 156 CU IDOL SELF LEARNING MATERIAL (SLM)
UNIT - 9: ORGANIZATIONALANDMANAGERIALISSUES STRUCTURE 9.0 Learning Objectives 9.1 Introduction 9.2 Organizational issues of E-Commerce 9.3 Managerial issues ofE-Commerce 9.4 Financial Planning and Working with Investors in E-Commerce 9.5 Summary 9.6 Keywords 9.7 Learning Activity 9.8 Unit End Questions 9.9 References 9.0 LEARNING OBJECTIVES After studying this unit, you will be able to: Describe Important Issues of Organizational Management Identify managerial issues of E-Commerce Discuss the major challenges of E-Commerce List the financial planning of investors in E-Commerce 9.1 INTRODUCTION E-commerce means using the Internet and the web for business transactions and/or commercial transactions, which typically involve the exchange of value (e.g., money) across organizational or individual boundaries in return for products and services. Here we focus on digitally enabled commercial transactions among organizations and individuals. E-business applications turn into e-commerce precisely, when an exchange of value occurs. Digitally enabled transactions include all transactions mediated by digital technology and platform; that is, transactions that occur over the Internet and the web. History of E-Commerce Early Development: The history of E-commerce begins with the invention of the telephone at the end of last century. EDI (Electronic Data Interchange) is widely viewed as the beginning of ecommerce 157 CU IDOL SELF LEARNING MATERIAL (SLM)
if we consider ecommerce as the networking of business communities and digitalization of business information. Large organizations have been investing in development of EDI since sixties. It has not gained reasonable acceptance until eighties. The meaning of electronic commerce has changed over the last 30 years. Originally, electronic commerce meant the facilitation of commercial transactions electronically, using technology such as Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT). These were both introduced in the late 1970s, allowing businesses to send commercial documents like purchase orders or invoices electronically. The growth and acceptance of credit cards, automated teller machines (ATM) and telephone banking in the 1980s were also forms of electronic commerce. Another form of E-commerce was the airline and railway reservation system. Online shopping, an important component of electronic commerce was invented by Michael Aldrich in the UK in 1979. The world’s first recorded business to business was Thomson Holidays in 1981. The first recorded Business to consumer was Gates head SIS/Tesco in 1984. During the 1980s, online shopping was also used extensively in the UK by auto manufacturers such as Ford, General Motors and Nissan. The systems used the switched public telephone network in dial-up and leased line modes. From the 1990s onwards, electronic commerce would additionally include enterprise resource planning systems (ERP), data mining and data warehousing. An early online information marketplace, including online consulting, was the American Information Exchange, another pre Internet online system introduced-in 1991. In 1990 Tim Berners-Lee invented the World Wide Web and transformed an academic telecommunication network into a worldwide everyman everyday communication system called internet/www (dot) Commercial enterprise on the Internet was strictly prohibited until 1991. Although the Internet became popular worldwide around 1994 when the first internet online shopping started, it took about five years to introduce security protocols and DSL allowing continual connection to the Internet. By the end of 2000, many European and American business companies offered their services through the World Wide Web. Since then people began to associate a word “E-commerce” with the ability of purchasing various goods through the Internet using secure protocols and electronic payment services. The Internet and the Web: The Internet was conceived in 1969, when the Advanced Research Projects Agency (a Department of Defense organization) funded research of computer networking. The Internet could end up like EDI without the emergence of the World Wide Web in 1990s. The Web 158 CU IDOL SELF LEARNING MATERIAL (SLM)
became a popular mainstream medium (perceived as the fourth mainstream medium in addition to print, radio and TV) in a speed which had never been seen before. The Web users and content were almost doubled every a couple of months in 1995 and 1996. 9.2 ORGANIZATIONAL ISSUES IN E-COMMERCE E-Commerce – Impact of E-Commerce: E-commerce has made a profound impact on society. People can now shop online in the privacy of their own homes without ever having to leave. This can force larger brick and mortar retailers to open an online division. In some cases, it can also force smaller businesses to shut their doors, or change to being completely online. It also changes the way people look at making purchases and spending money. E-commerce has changed the face of retail, services, and other things that make our economy work. Undoubtedly, it will continue to influence how companies sell and market their products, as well as how people choose to make purchases for many years to come. The following are the impacts of e-commerce on the global economy: 1. Impacts on Direct Marketing: i. Product Promotion – E-commerce enhances promotion of products and services through direct, information-rich, and interactive contact with customers. ii. New Sales Channel – E-commerce creates a new distribution channel for existing products. It facilitates direct reach of customers and the bi-directional nature of communication. iii. Direct Savings – The cost of delivering information to customers over the internet results in substantial savings to senders when compared with non-electronic delivery. Major savings are also realized in delivering digitized products versus physical delivery. iv. Reduced Cycle Time – The delivery of digitized products and services can be reduced to seconds. Also, the administrative work related to physical delivery, especially across international borders, can be reduced significantly, cutting the cycle time by more than 100 percent. v. Customer Service – Customer service can be greatly enhanced by enabling customers to find detailed information online. Also, intelligent agents can answer standard e-mail questions in seconds and human experts’ services can be expedited using help-desk software. vi. Corporate Image – On the web, newcomers can establish corporate images very quickly. Corporate image means trust, which is necessary for direct sales. Traditional companies such as Intel, Disney, Dell, and Cisco use their web activities to affirm their corporate identity and brand image. 159 CU IDOL SELF LEARNING MATERIAL (SLM)
vii. Customization – E-commerce provides for customization of products and services, in contrast to buying in a store or ordering from a television, which is usually limited to standard products. Dell Computers Inc. is a success story of customization. Today, we can configure not only computers but also cars, jewellery, gifts, and hundreds of other products and services. If properly done, one can achieve mass customization. It provides a competitive advantage as well as increases the overall demand for certain products and services. viii. Advertisements- With direct marketing and customization comes as one-to-one or direct advertisement, which is much more effective than mass advertisement. This creates a fundamental change in the manner in which advertisement is conducted not only for online trades but also for products and services that are ordered in traditional ways. ix. Ordering Systems- Taking orders from customers can drastically be improved if it is done online. When taken electronically, orders can be quickly routed to the appropriate order- processing site. This saves time and reduces expenses, so salespeople have more time to sell. Also, customers can compute the cost of their orders, saving time for all parties involved. x. Markets- The physical market disappears as does the need to deliver the goods to the marketplace. In a market space, which is an electronic market, goods are delivered directly to buyers when purchasing is completed making markets much more efficient. Already, small but powerful software packages are delivered over the internet. This fundamentally affects packaging and greatly reduces the need for historical distribution. New selling models such as shareware, freeware are emerging to maximize the potential of the internet. New forms of marketing will also emerge, such as web-based advertising, linked advertising, direct e-mail, and an increased emphasis on relationship marketing. Customer’s convenience is greatly enhanced, availability of products and services is much greater, and cheaper products are offered. 2. Impacts on Organization: i. Technology and Organizational Learning: Rapid progress in e-commerce will force companies to adapt quickly to the new technology and offer them an opportunity to experiment with new products, services, and processes. New technologies require new organizational approaches. For instance, the structure of the organizational unit dealing with E- commerce might have to be different from the conventional sales and marketing departments. To be more flexible and responsive to the market, new processes must be put in place. This type of corporate change must be planned and managed. ii. Changing Nature of Work: 160 CU IDOL SELF LEARNING MATERIAL (SLM)
The nature of work and employment will be transformed in the digital age; it is already happening before our eyes. Driven by increased competition in the global marketplace, firms are reducing the number of employees down to a core of essential staff and outsourcing whatever work they can to countries where wages are significantly less expensive. The upheaval brought on by these changes is creating new opportunities and new risks and forcing us into new ways of thinking about jobs, careers, and salaries. The digital age workers will have to become very flexible. Few of them will have truly secure jobs in the traditional sense, and all of them will have to be willing and able to constantly learn, adapt, make decisions, and stand by them. iii. New Product Capabilities: E-commerce allows for new products to be created and existing products to be customized in innovative ways. Such changes may redefine organizations’ missions and the manner in which they operate. E-Commerce also allows suppliers to gather personalized data on customers. Building customer profiles as well as collecting data on certain groups of customers, can be used as a source of information for improving products or designing new ones. Mass customization enables manufacturers to create specific products for each customer, based on his or her exact needs. For example, Motorola gathers customer needs for a pager or a cellular phone, transmits them electronically to the manufacturing plant where they are manufactured, along with the customer’s specifications and then sends the product to the customer within a day. 3. Impacts on Manufacturing: The production systems are integrated with finance, marketing, and other functional systems, as well as with business partners and customers. Using web-based ERP systems, orders that are taken from customers can be directed to designers and to the production floor, within seconds. Production cycle time is cut by 50 percent or more in many cases, especially when production is done in a different country from where the designers and engineers are located. 4. Impacts on Finance: E-commerce requires special finance and accounting systems. Traditional payment systems are ineffective or inefficient for electronic trade. The use of the new payment systems such as electronic cash is complicated because it involves legal issues and agreements on international standards. Nevertheless, electronic cash is certain to come soon and it will change the manner in which payments are being made. In many ways, electronic cash, which can be backed by currency or other assets, represents the biggest revolution in currency since gold replaced cowry shells. 161 CU IDOL SELF LEARNING MATERIAL (SLM)
Its diversity and pluralism is perfectly suited to the internet. It could change consumers’ financial lives and shake the foundations of financial systems and even governments. 5. Impact on Supply Chain Management: Electronic commerce and the internet are fundamentally changing the nature of supply chains, and redefining how consumers learn about, select, purchase, and use products and services. The result has been the emergence of new business-to business supply chains that are consumer- focused rather than product-focused. They also provide customized products and services. E-commerce impacts supply chain management in a variety of keyways. These include: i. Cost Efficiency: E-commerce allows transportation companies of all sizes to exchange cargo documents electronically over the internet. E-commerce enables shippers, freight forwarders and trucking firms to streamline document handling without the monetary and time investment required by the traditional document delivery systems. By using e-commerce, companies can reduce costs, improve data accuracy, streamline business processes, accelerate business cycles, and enhance customer service. Ocean carriers and their trading partners can exchange bill of lading instructions, freight invoices, container status messages, motor carrier shipment instructions, and other documents with increased accuracy and efficiency by eliminating the need to re-key or reformat documents. The only tools needed to take advantage of this solution are a personal computer and an internet browser. ii. Changes in Distribution System: E-commerce will give businesses more flexibility in managing the increasingly complex movement of products and information between businesses, their suppliers and customers. E- commerce will close the link between customers and distribution centres. Customers can manage the increasingly Complex movement of products and information through the supply chain. iii. Customer Orientation: E-commerce is a vital link in the support of logistics and transportation services for both internal and external customers. E-commerce will help companies deliver better services to their customers, accelerate the growth of the e-commerce initiatives that are critical to their business, and lower their operating costs. Using the Internet for e-commerce will allow customers to access rate information, place delivery orders, track shipments and pay freight bills. 162 CU IDOL SELF LEARNING MATERIAL (SLM)
E-commerce makes it easier for customers to do business with companies: Anything that simplifies the process of arranging transportation services will help build companies’ business and enhance shareholder value. By making more information available about the commercial side of companies, businesses will make their web site a place where customers will not only get detailed information about the services the company offers, but also where they can actually conduct business with the company. Ultimately, web sites can provide a universal, self-service system for customers. Shippers can order any service and access the information they need to conduct business with transportation companies exclusively online. E-commerce functions are taking companies a substantial step forward by providing customers with a faster and easier way to do business with them. iv. Shipment Tracking: E-commerce will allow users to establish an account and obtain real-time information about cargo shipments. They may also create and submit bills of lading, place a cargo order, analyse charges, submit a freight claim, and carry out many other functions. In addition, e-commerce allows customers to track shipments down to the individual product and perform other supply chain management and decision support functions. The application uses encryption technology to secure business transactions. v. Shipping Notice: E-commerce can help automate the receiving process by electronically transmitting a packing list ahead of the shipment. It also allows companies to record the relevant details of each pallet, parcel, and item being shipped. vi. Freight Auditing: This will ensure that each freight bill is efficiently reviewed for accuracy. The result is a greatly reduced risk of overpayment, and the elimination of countless hours of paperwork, or the need for a third-party auditing firm. By intercepting duplicate billings and incorrect charges, a significant percent of shipping costs will be recovered. In addition, carrier comparison and assignment allows for instant access to a database containing the latest rates, discounts, and allowances for most of major carriers, thus eliminating the need for unwieldy charts and tables. vii. Shipping Documentation and Labelling: There will be less need for manual intervention because standard bills of lading, shipping labels, and carrier manifests will be automatically produced; this includes even the specialized export documentation required for overseas shipments. Paperwork is significantly reduced and the shipping department will therefore be more efficient. 163 CU IDOL SELF LEARNING MATERIAL (SLM)
viii. Online Shipping Enquiry: This gives instant shipping information access to anyone in the company, from any location. Parcel shipments can be tracked, and proof of delivery quickly confirmed. A customer’s transportation costs, and performance can be analysed, thus helping the customer negotiate rates and improve service. The Important Issues of Organizational Management i. Formulate E-Commerce Strategy: Management has to develop e-commerce strategy based on the analysis of industry and competition. Many companies like IBM created independent division for formation .and implementation of e-commerce in the organization. The e-commerce division formulates strategy in the light of corporate strengthens and weaknesses. Then e-commerce division communicates the vision of top management throughout the organization and annual objectives are identified. Essential education and training is given to those who are to implement the e-commerce plans. Efforts are made to change the behavior and attitude of executives, managers, and trading partners. The management needs to view electronic commerce potential in the light of the competition and not just as technological advancement. E-commerce needs to be used as a strategic tool to gain and sustain competitive advantage in the industry. ii. Re-Engineering for E-Commerce: Organizations are to be restructured and re-engineered into a network based organization. Therefore, building and integrating infrastructure is a big challenge faced by company managements. Integrating information technology with existing business processes is a big task. In fact network of computers, complex transmission lines and dozens of pieces of software must all work together to make E-commerce happen. The business process re-engineering team has to ensure that they do not miss anything significant while building and implementing E- commerce system Manufacturers have to decide whether the whole manufacturing and distribution system is to be restructured to become committed to direct Internet based supply chain and marketing or to use e-commerce website as a simple channel of distribution. Company management has to make decision regarding in sourcing or outsourcing. Big companies go for in-house development of website. It means company’s own staff build e- commerce enabled website. Company management can also outsource this task to some third party, normally an experienced web development firm. iii. Managing Ethical, Cultural and Legal Issues: 164 CU IDOL SELF LEARNING MATERIAL (SLM)
There exist big ethical and cultural differences between countries. Something may be ethical in our country but unethical in another country. So MNCs have to study culture of each country and develop corporate ethical code. For example, France has certain language and cultural laws that must be obeyed. Therefore, it is necessary that advocates, accountants and executives of the companies must understand legal, trade, cultural and monetary issues of the countries with which their company has to deal. iv. Making Cost Benefit Analysis: Company management has to make cost benefit analysis of implementing e-commerce venture. Costs associated with e-commerce includes costs of hardware like PC clients, web servers, transaction servers routers and other networking devices, leased line and software like operating system, firewall, application software, web server software and transaction processing software, cost of recruiting and training staff for e-commerce etc. Benefits can be measured through economic indicators like return on investment or through indicators like numbers of online customers, customer satisfaction and business partner satisfaction. Organization of developed countries that have implemented e-commerce solutions have gained by way of realizing lower cost per transaction and taking advantage of economies of scale. In developing countries cost may exceed benefits in initial years of e-commerce initiatives. v. Promoting E-Commerce Venture: Company management has to take steps to promote the website. Broadly, promotional activities can be classified into two categories: a. Online Promotional Activities: Online promotion is concerned with submitting your site to search engine. The objective is to get your site registered with the search engine so that the site appears as a link in search results of certain keywords-typed by internet user at the search engine like Google. This requires use of appropriate keywords in META tag. Moreover, web team needs to search related sites and contact them so that their pages provide link to their web pages. So seeking reciprocal link is an effective way of promoting your e- commerce web site. Moreover, e-mails can be made of customers. Company that have advertising budget can promote the site by placing banner ads at popular websites and portals. b. Offline Promotional Activities: As far as offline promotion is concerned, company can advertise the web address through visiting cards, letter pads, bill books etc. Moreover, URL can also be advertised at various 165 CU IDOL SELF LEARNING MATERIAL (SLM)
trade fairs, exhibitions and business related events like seminars, conferences etc. Therefore, company management has to set up advertising budget and decide the tools that it shall use to promote the e-commerce website. vi. To Deal with Security & Privacy Issues: Websites collect information about visitors through filled in order forms, questionnaires and by recording browser information thought programs like cookies. But the personal information so collected must be used for stated business purposes. But many surveys have shown that online consumers have little privacy protection. Therefore, it is necessary that company management must form privacy practice and must assure consumers and partners that information so collected shall be kept confidential. In addition, management needs to form security policy. Data security and network security are major issues. There have been cases when vital information like credit card numbers are stolen by hackers. Similarly, e-mails can be and are often intercepted as they travel through the network. This type of data and message security needs security measures like encryption, password protection etc. Similarly, network security measures like firewall needs to be installed so that intruders are not able to make authorized access to corporate network. The firewall prohibits hackers from entering corporate network via internet. Therefore, management needs to set up some kind of intrusion detection system an establish security policy. vii. Handling Human Resource Management Related Issues: Electronic commerce is changing the manner in which staff is recruited, motivated, trained and educated. Two way interactions are now possible in video conferencing used for employee training and education. So, management needs to incorporate the impact of e- commerce on its human resource management practices. viii. Adopting Electronic Fund Transfer System: Company management has to make agreement with acquiring bank, Credit Card Company and payment gateway to ensure that it is able to receive and make payments electronically through modes like credit cards, smart cards, e-cash etc. The management has to devise ways and means of integrating Internet based payment system with offline system. 9.3 MANAGERIAL ISSUES IN E-COMMERCE Managerial Issues of E-Commerce Competing on price The first thing nearly all participants wanted to talk about is whether ecommerce sites should discount their products to remain competitive. The argument is that many people still think buying online should be cheaper and that puts ecommerce managers in a difficult position. 166 CU IDOL SELF LEARNING MATERIAL (SLM)
On one hand, they want to live up to expectations but there is still a cost of operations which may be in line with other distribution channels. Delegates resoundingly agreed that ecommerce sites are no longer required to deliver the lowest price. Consumers now choose ecommerce as a channel over physical visits because of the information available online, the many delivery options, and ease of clicking to buy. Ecommerce sites should now emphasize the value it provides as much as, if not more than, the price of goods. So, according to one attendee, ‘the time has now come’ and lowering prices does not have to be the only lever for increasing revenue. Managing offline retailers Another issue which concerned many ecommerce managers was how to work with offline retailers. Everyone agreed that both will exist for some time, but who should take the upper hand. Should ecommerce follow the offers and priorities set by the stores, or should the stores act as a physical presence for the ecommerce site. Following some discussion, delegates concluded only that there wasn’t any set answer; brands should be primarily concerned about the customers. In Asian markets, for example, many brands have found that consumers browse online and then purchase offline. In these cases, the stores should consult the ecommerce team to see what is popular. In many other markets, however, it is the other way around and consumers use physical stores as ‘showrooms’ before making an online purchase. Here, the ecommerce team needs to be kept in the loop about any deals or promotions that consumers may be expecting on the site. Ecommerce and store managers should strive to provide a seamless experience between online and offline as that is what consumers now expect. Integrating catboats Many other marketers, ecommerce managers worry about innovation. What will be the next technology to impact on their specialty? Participants felt that while virtual reality and AI- assisted shopping was interesting, chatbots with machine learning were probably the ‘next big thing’ for ecommerce. The reason is that ‘chat’ provides a universal interface for many different elements of ecommerce and ‘bots’ help them automate customer-facing aspects of their service. Attendees named many things that chatbots could be used for: Brand awareness. Product questions. Cart abandonment. Payments. 167 CU IDOL SELF LEARNING MATERIAL (SLM)
Customer questions. On-going engagement with the brand. Some even felt that a good enough Chabot would allow consumers to go directly to a vendor for product questions without ever using Google. Everyone agreed that this would affect ecommerce, but most felt that chatbots were not quite good enough for that. Maintaining investment from the business Ecommerce, like many aspects of digital, is not yet a profit-making enterprise for many brands. Because of this, ecommerce specialists are constantly worried about investment from their business sponsor. The consensus, though, was that it is getting more difficult for retail to survive with their legacy business. Even large retailers, such as Walmart in the US, are now investing heavily into ecommerce to face challengers such as Amazon. Managers should, however, be careful when asking the business to invest more in ecommerce, warned one attendee. Make sure that senior management understand that investments in ecommerce take time to bear fruit. Many projects lose investment because they promise returns in a matter of months, whereas ecommerce programmes often take a few years to break even. Boosting revenue Finally, it all comes down to money. Ecommerce professionals are constantly concerned about how to get more revenue through their site. Opinions varied widely on the best way to improve top-line numbers. Some participants said that simply increasing ad spend can increase revenue. That is, every dollar spent on advertising yields two dollars in revenue and so, to increase revenue, marketers should simply increase ad spend. Others felt that mature ecommerce brands often experience decreasing returns when they increase ad spend. Instead, they argued, brands should spend more intelligently on channels using attribution modeling. Everyone agreed, however, that a long-term plan for delivering return on investment (ROI) to the business was more important than boosting revenue in the short-term. Once senior management sees ecommerce on the path to profitability then marketers can spend their time worrying about ‘fancy stuff’ such as attribution modeling. Major Challenges Facing E-Commerce 1.Dependence on Google for traffic Google is the world leader in search engines, and by extension, responsible for the visibility of websites. More than 50% of online shops are dependent on Google for traffic. Despite plans for new search engines that are competing with Google, the supremacy of Google seems destined to last a few more years. And this can impact e-merchants when Google 168 CU IDOL SELF LEARNING MATERIAL (SLM)
changes the rules of the game. Recently, there was the requirement to switch to HTTPS to make Google Shopping campaigns, in addition to displaying the non-security of data in the Chrome and Firefox browsers. Unencrypted web pages that query passwords, bank details or credit card information was marked as “unsafe” by major browsers such as Google Chrome, Mozilla Firefox, Microsoft Edge and others. Therefore, it is recommended changing the traffic acquisition channels of websites, so as not to depend solely on Google for visibility and transactions. 2. Absence of online verification of customers The genuineness of the new customers is questionable in an online portal. When a visitor signs up, e-websites have nothing but the address and phone number entered by them. If those visitors are a scam, and if they order cash on delivery purchases to a fake address, it can be a huge loss for the company. It becomes impossible to contact them if the number is also fake. Therefore, to be at the safe side, e-websites or online portals should take all necessary steps required to decline these risks. It is necessary to recognize bogus orders, fake phone numbers, invalid zip code, etc. Alternatively, they can install services or software that automates a call on placing an order. These services also send some verification code through SMS to validate the customers’ identity. It can help in reducing the number of cancellation and bogus orders which may otherwise be expensive for the business. 3. Maintain Customer Loyalty Customer loyalty is an important indicator of firm performance. The modern consumer is so sophisticated and busy that showing content or sending offers that are not relevant to him at all is a real failure. If the online store does not understand what the potential consumer wants or does not consider it necessary to understand, then it may cost the store a customer. Unlike Normal Street shopping, the buyer and seller do not see each other in online shopping. Therefore, it is difficult to build trust between them. Building trust, therefore, can take some time and transactions in online shops. You can also earn customers loyalty through excellent customer service. By displaying your address, answering calls, adding a live chat option on your website, etc. can also help you in building trust among customers. 4. Customer Service In a general store, the customer leaves the store with his product. However, this situation is not the same as e-commerce. In e-shopping, the user sends you money for a product he does not have yet. He waits impatiently for the arrival of his order. Problems can still arise if the delivery service provider has lost a package, or the product has been damaged during transport, or you have simply fallen behind before shipping. This can cause customer 169 CU IDOL SELF LEARNING MATERIAL (SLM)
dissatisfaction, which will then need to be managed. The idea is to be transparent and responsive and to keep customers abreast of the situation as soon as possible. If you are in a discussion with the delivery provider to find a lost package, keep the user informed of your steps, do not wait for him to come to the news. Similarly, if you are late in your parcel preparations, inform him of the expected date of shipment. If the product has been damaged during transport, quickly propose a solution according to your legal notice, whether a total or partial refund or a replacement. Internet users who have received good communication in the case of litigation generally keep good relations with the e-commerce site, 95% of the negative opinions turn into loyal customers if a solution has been made. The responsiveness of the after-sales service greatly affects the image of a company. 5. Plan your digital strategy In the continuity of the multidisciplinary profession, the e-merchant forgets to promote and animate his merchant site that should be built by using a proper eCommerce platform as Wix or Shopify. E-merchants should determine the communication channels to be used (social networks, newsletters, partnerships, online advertising) and define the messages to be transmitted, set up editorial planning, create the visuals, etc. Getting help from an outside provider for some of these tasks can help to free up time for managing your e-commerce site. The everyday life of the e-shopkeeper is filled with things to manage, to plan, and lots of small tasks to do. As such, it requires outstanding strategies to survive in the e-commerce competition. Legal Issues of E-Commerce Online business is becoming a fast emerging trend. Every five in eight companies are operating online, conducting e-commerce business. But being functional online doesn’t mean you can escape legal matters. There are various legal issues associated with E- Commerce businesses as well. And if these issues are not taken care of in time, they can lead to serious problems for your business. Described below are some of the common legal issues an e-commerce business faces. Incorporation Problem If you are a company operated merely via a website, not being incorporated is a crucial problem. Any purchase and selling activity related to your products will be considered illegal and you can’t claim your right in case of any fraud and corruption. Without incorporation, your business has no shelter. Trademark Security Problem Not getting your trademark protected is one of the main legal issues in the field of e- 170 CU IDOL SELF LEARNING MATERIAL (SLM)
commerce. Since trademark is your company’s logo and symbol, the representation of your business all over the web, it must be protected. If you don’t secure it, it won’t take long before you’ll realize your trademark is being infringed upon. This is very common legal issue and can become a deadly threat to your e-business. With the hackers on loose and cybercrime so common, trademark infringement of your business or by your business can be a serious legal matter and may hinder your business’s progress. Copyright Protection Issue While publishing content for your e-commerce website, using content of any other company can be a severe legal problem. This might mark an end to your e-business. There are many sites online which are royalty free and allow you to access their content and images. You may use those sites for creating web content for your business site. Even if you unintentionally used copyrighted content, the other party can easily sue your business. Transaction Issues The Australian Consumer Law (ACL) governs all e-commerce transactions in Australia. Therefore, if you do not abide by the rules, you can get into serious law violation problems. If your business fails to provide clear and complete description of the product, cost and purchase details, information about delivery i.e. when the customer will receive products and other information related to exchange and refunds, the ACL can impose penalties on your business. Privacy Issues When it comes to online businesses, privacy is the major issue that can create problems both for the business and customers. Consumers share information with businesses online and they expect the sellers to keep their information confidential. By just one minor mistake and leakage of valuable information of a customer, you’ll not only lose your potential customer but your image and reputation will become a question mark. Moreover, you’ll be subjected to serious legal problems according to Australian privacy laws. If e-commerce businesses lead to exposure and advantages for businesses online, then it certainly has given rise to some legal issues too that can be avoided by keeping in mind the rules and laws framed by Australian Government. Technical Issues of E-Commerce An E-business is a good way to extend your market reach beyond the local community. It's not difficult to get your site up and running; just purchase a domain name and Web hosting space. Make sure you understand what kind of problems this sort of technology can bring. 171 CU IDOL SELF LEARNING MATERIAL (SLM)
Server Issues When using external Web hosting, the hosting company's servers may experience downtime. When the servers are down, your site is down, and when your site is down, you can't make sales, which translates into profit loss. To reduce the risk of server issues, choose a hosting company with backup servers, and make sure it guarantees at least 99.5 percent up-times for its regular servers. Bandwidth Issues Most hosting companies place a limit on the amount of bandwidth your e-business can use each month. Some e-businesses start small and do not require a lot of bandwidth, but the more your e-business grows, the more bandwidth you will likely need. If you anticipate that your business may eventually exceed the bandwidth allotment, choose a host that offers the option to upgrade to a dedicated server. A dedicated server is your own server with unlimited bandwidth. Otherwise, you will have to go through the hassle of moving your entire website to another host. Dynamic IP Address Issues The domain name for your business is assigned a “dynamic” Internet protocol address, or IP. An IP address is a series of numbers associated with your domain name. A dynamic IP address is shared with numerous other website owners, which decreases the stability of your e-business website. Dynamic IP addresses are always changing, which also decreases the stability of your site. Static IP Address To prevent a dynamic IP address problem, consider purchasing a “static” IP address, which is your own IP address. It never changes, and is not shared. This results in more site stability. To purchase a static IP address, contact your Web hosting provider or Internet service provider. If purchasing through your ISP, request that the ISP associate the static IP address with your e-businesses domain name. Security Issues Hackers can break into your business website's database to steal confidential and proprietary information, along with customer data. Many customers have learned how to look for “security seals” on websites, and will not make purchases from sites that are not secure. To prevent hacks and to increase customer confidence, secure your website by purchasing a secure socket layer, or SSL, certificate. Most Web hosting companies offer SSL certificates for an additional fee. 172 CU IDOL SELF LEARNING MATERIAL (SLM)
9.4 FINANCIAL PLANNING AND WORKING WITH INVESTORS IN E-COMMERCE A financial business plan is created by gathering all the components of the business and expressing them in numbers – both revenue and startup expenses. Your business is selling a product or service at a specific price point and the goal is to prove that your business is viable. The financial plan is where you translate ideas into numbers, according to Rob Stephens, founder of CFO Perspective. \"You are explaining where you plan on getting cash, what you will spend that cash on to start the company and what the operating cash flows of the company will be in the first few years,\" Stephens said. \"Show how lenders and investors will receive a return on their investment.\" Components ofa Financial Plan 1. Assumptions. Every projection is based on some assumptions. Pick reasonable assumptions. You don't need to spend much time justifying your assumptions unless they are critical to the company's success. Use the assumptions area for economic or tax rates as well as significant numbers like sales that drive other numbers like costs. 2. Key financial indicators and financial ratios. This highlights what you have determined to be the most important information for measuring the performance of the company. This acts almost like an executive summary of the more detailed financial information that follows. 3. Cash flow projection. Every business plan needs a cash flow projection. The rest of the plan tells the story of the business and how the company will execute that plan. The cash flow projection proves whether the plan is going to work. The timing of when to hire staff, make significant purchases and distribute cash to owners can all be modeled to make sure your strategy is feasible. You may find that you need to adjust the timing or amounts of some of your strategies. Not having a projection might cause you to make decisions or promises that you can't fulfill. 4. Projected income statements and balance sheets. Cash is king, but standard accounting income statements and balance sheets show profitability and aspects of the financial health of the company. Many investors and lenders calculate ratios from the income statement and balance sheet to determine whether to give money to the company. 5. Break-even analysis or cost-volume-profit analysis. Everything presented above is 173 CU IDOL SELF LEARNING MATERIAL (SLM)
for one scenario of outcomes. Everyone knows that it's a collection of guesses, many of which will not come true. The cost-volume-profit analysis shows the income or cash flows that occur with different scenarios of key assumptions, like sales or costs. Financial Planning For E-Commerce Business It’s useful to measure performance against a set of predetermined criteria. An open-to-buy plan is an inventory management tool that helps you figure out how much inventory you need to buy on a monthly basis to make your sales projections. Most retailers use product categories for planning rather than analyzing hundreds of individual products. This is possible because products in a category usually behave in a similar fashion. Open-to-buy planning is particularly useful if: Your store catalogs You add products quickly (fast fashion) Your store has a strong growth rate Retail price, cost price and unit-based approaches Open-to-buy can be figured based from three different points of view: Retail price/revenue goals Cost price/value of inventory Number of units Here are considerations to help you decide how to calculate your open-to-buy. Retail price/revenue Looking at forecasted revenue compared to inventory needs, open-to-buy using the revenue approach will show what your cash flow needs might be. Cost price/inventory value The goal of open-to-buy is to see how much inventory to buy to meet your needs. By using a cost price approach, you can easily use the calculation to know what funds need to be deployed to have enough inventories on hand. You will need to know your margins to ensure that you’re hitting target revenue goals and profitability. Units of inventory Use this approach when the costs of your products are roughly the same. You will use the average product price in your open-to-buy calculations. This is not a good method to use when your products vary widely in price. Unit-based planning is useful when you have space considerations, either with shipping (what 174 CU IDOL SELF LEARNING MATERIAL (SLM)
fits in a container) or storing (what fits in your warehouse). Getting started To start calculating your open-to-buy amount, you’ll need the following information from the last year both for your total store and by category: Revenue Opening and closing stock Markdowns (optional) Use last year’s information as-is if you were happy with the performance of your inventory spending and turnover. As a general guide, if you were within 5% of your budgeted spending, then your inventory financial planning is on track. If you were off by more than 5%, then keep that in mind while making calculations for next year. For the coming year, you’ll need: Growth rate or forecasted sales Financial goals New promotions or product launches (by category) Purchases (open purchase orders if any) How to calculate your open-to-buy amount Let’s look at an example. The actual opening stock for the current month was $424,340 The desired opening stock for the next month is $500,000 Planned revenue is $200,000 and $250,000 respectively The open-to-buy budget for the current month is computed using the following formula: Open-to-Buy (OTB) = Closing Stock + Planned Sales - Opening Stock - Purchases For the example above its $272,932 which is the stock retail value that is needed to generate $200,000 as the revenue and start the new month at $500,000. Planned sales can be seeded from the last year, forecasted sales, or your company’s revenue goals. To get the most accurate open-to-buy plan, the opening stock should be set correctly. Let’s say you plan to generate $100,000 of revenue for the next month. You may think you need to hold just $100,000 worth of products in your warehouse, but in reality it’s not true. You always sell a percentage of your stock, not all products contribute to the revenue and therefore you need to have more than your planned sales. Stock to sales ratio represents this difference and is computed as following: Stock to sales ratio (SSR) = Opening Stock / Planned Revenue 175 CU IDOL SELF LEARNING MATERIAL (SLM)
That means when SSR is 2 then you will sell every second product of your inventory during this month. It also can be seen as the inverse of sell through. To get the OTB in cost, set the planned margin for future months To get the OTB in units the average product price should be set. Contingency planning Consider creating different versions of a plan for “what-if” analysis. It helps to simulate what will happen if you have more sales or your stock day’s changes. Retailers use this modeling to understand the impact of moving performance variables and their impact ultimately on cash flow. How to use open-to-buy information With your open-to-buy amount in hand, you’ve answered how much to buy. To figure out what to buy, pair that with your product assortment plan. Using the two together, you can determine which items will be received and when. Plan to reserve some of your planned spending for new products or to respond to trends that emerge during the planning period. Like any plan, you need to compare your forecasting to actual results to evaluate the effectiveness of your efforts. Watch for: Variance between your plan and actual spending to see how close your forecast is to reality. When monitoring the difference between your plan and actual spending, is there a consistent difference between the two? If so, are there structural changes to make to your open-to-buy planning for future spending. Are opening and closing stock levels consistent with plans? How this is tied to either overstock (cash sitting on the shelves) or under stock (missing out on sales)? How is cash flow? Open-to-buy should give you a guide for inventory spending. Is too much cash tied up in inventory? How quickly are you turning over inventory so that you can reinvest it in your business? Are you forced to markdown inventory too often? If you’re not meeting planned margins, does that mean you’re overbuying in a category or product line? The Financial Section of Business Plan is Crucial to Recruiting Investors and Lenders: A financial business plan is created by gathering all the components of the business and expressing them in numbers – both revenue and startup expenses. Every business plan needs a cash flow projection. The rest of the plan tells the story of the business and how the company will execute that plan. 176 CU IDOL SELF LEARNING MATERIAL (SLM)
The cost-volume-profit analysis shows the income or cash flows that occur with different scenarios of key assumptions, like sales or costs. When looking for funding, inflated numbers and inaccurate financial statements are red flags for potential investors or lenders. Being practical and authentic can go a long way during a SWOT analysis, and it can identify assets and liabilities within your business model. Financial section of a business plan or completed any business planning at all for that matter, here are four tips that Spaziano suggested: Follow generally accepted accounting principles. As a rule, the financial part of your plan should follow these as set by the Federal Accounting Standards Advisory Board, especially if you're putting it together to get a loan or a line of credit. Get fluent in spreadsheets. Spreadsheets are the best and most accepted way to present financial information. Seek outside assistance. Getting advice from your financial planner or accountant can help you put the numbers together and present them properly. If you use an accountant and your financial statements have been audited, state that in the plan. Look up templates. If you want to attempt writing the financial section on your own, there are resources. Score, the Service Corps of Retired Executives, as well as many other sites, have templates available. 9.5 SUMMARY E-business applications turn into e-commerce precisely, when an exchange of value occurs. Digitally enabled transactions include all transactions mediated by digital technology and platform; that is, transactions that occur over the Internet and the web.It’s useful to measure performance against a set of predetermined criteria. An open-to-buy plan is an inventory management tool that helps you figure out how much inventory you need to buy on a monthly basis to make your sales projections. A financial business plan is created by gathering all the components of the business and expressing them in numbers – both revenue and startup expenses. New forms of marketing will also emerge, such as web-based advertising and linked advertising. Firms are reducing the number of employees down to a core of essential staff and outsourcing whatever work they can to countries where wages are significantly less expensive. E-commerce allows for new products to be created and existing products customized in innovative ways. The digital age workers will have to become very flexible. In many ways, electronic cash represents the biggest revolution in currency since gold replaced cowry shells. 177 CU IDOL SELF LEARNING MATERIAL (SLM)
E-commerce impacts supply chain management in a variety of keyways. It reduces costs, streamlines business processes, accelerates business cycles and enhances customer service. Customers can manage the increasingly complex movement of products and information through the supply chain. E-commerce functions are taking companies a substantial step forward by providing customers with a faster and easier way to do business with them. E-commerce can help automate the receiving process by electronically transmitting a packing list ahead of the shipment. It also allows companies to record the relevant details of each pallet, parcel, and item. E-commerce needs to be used as a strategic tool to gain and sustain competitive advantage in the industry. Integrating information technology with existing business processes is a big task. MNCs have to understand legal, trade, cultural and monetary issues of the countries they deal with. Company management has to make cost benefit analysis of implementing e-commerce venture. Web team needs to search related sites and contact them so that their pages provide link to their web pages. Cost includes costs of hardware like PC clients, web servers, transaction servers and other networking devices. Data security and network security are major issues. Ecommerce sites should emphasize the value they provide as much as, if not more than, the price of goods. Company management has to devise ways and means of integrating Internet based payment system with offline system. The management needs to form security policy. Chatbots with machine learning are probably the 'next big thing' for ecommerce. Ecommerce and store managers should strive to provide a seamless experience between online and offline. Even large retailers, such as Walmart in the US, are now investing heavily into e-commerce. Managers should be careful when asking businesses to invest more in ecommerce, suggests one attendee. Ecommerce programmes often take a few years to break even, says the expert. Everyone agreed that a long-term plan for delivering return on investment (ROI) was more important. 9.6 KEYWORD E-commerce:E-Commerce means using the Internet and the web for business transactions and/or commercial transactions, which typically involve the exchange of value (e.g., money) across organizational or individual boundaries in return for products and services EDI (Electronic Data Interchange): It is widely viewed as the beginning of ecommerce if we consider ecommerce as the networking of business communities and digitalization of business information. 178 CU IDOL SELF LEARNING MATERIAL (SLM)
IP Address:IP address stands for internet protocol address. It is an identifying number that is associated with a specific computer or computer network. When connected to the internet, the IP address allows the computers to send and receive information. Open-to-Buy (OTB) = Closing Stock + Planned Sales - Opening Stock – Purchases. Stock to sales ratio (SSR) = Opening Stock / Planned Revenue. 9.7 LEARNING ACTIVITY 1. What are major security issues of E-Commerce? ___________________________________________________________________________ ___________________________________________________________________________ 2. How has E commerce affected FMCG industry during Covid 19? ___________________________________________________________________________ ___________________________________________________________________________ 9.8 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Explain the history of E-Commerce? 2. Short note on legal issues of E-Commerce? 3. What are the major challenges of E-Commerce? 4. What are security issues? 5. Explain the financial planning of E-Commerce? Long Questions 1. Discuss the organizational issues of E-Commerce? 2. Explain the managerial issues of E-Commerce? 3. Point out the components of financial plan? 4. What are the technical issues of E-Commerce? 5. Give an opinion to financial planning with investors for example? B. Multiple Choice Questions 1. Which of the following represents a limiting factor for the growth of e-commerce? 179 CU IDOL SELF LEARNING MATERIAL (SLM)
a. Persistent cultural attraction of physical markets and traditional shopping experiences b. Inadequate selection of goods compared to physical marketplaces. c. E-commerce lacks the convenience of other methods of transacting business d. The potential audience for e-commerce is too low to support it as a widespread method of commerce 2. The primary source of financing during the early years of e-commerce was ______________. a. bank loans b. large retail firms c. venture capital funds d. initial public offerings 3. The taxation system for e-commerce sales is best described as ______________. a. complex b. streamlined c. universal d. standardized 4. Industry structure is defined as ______________. a. the nature of the players in an industry and their relative bargaining power b. a set of plans for achieving long term returns on the capital invested in a business firm c. set of planned activities designed to result in a profit in a marketplace d. how a company's product or service fulfils the needs of customers 5.______________ influences the behavior of others through their personality, skills, or other factors. a. Opinion leaders b. Direct reference groups c. Indirect reference groups d. Lifestyle groups 180 CU IDOL SELF LEARNING MATERIAL (SLM)
Answers 1-a, 2-c, 3-a. 4-a, 5-a 9.9 REFERENCES Reference books • JaiswalS.,E-Commerce • MohammadMahmoudiMaymand,E-Commerce • MurthyC.S.V.,E-Commerce-Concepts,ModelsandStrategies • Schneider, E-Commerce, Cengage Learning, New Delhi. • PeeLosuin&AMurphy,ElectronicCommerceJaicoPub Textbook references • JosephP.T.,E-Commerce–AnIndianPerspective • RaviKalkotaFrontiersofE-Commerce,AddisonWesley • K.Bajaj & D.Nag E-Commerce, The Cutting Edge of Business, Tata McGraw • Green Stein ElectronicCommerceTata McGraw. Website • https://www.cleverism.com/e-commerce-complete-guide • https://www.economicsdiscussion.net/business/e-commerce/31868 \\ 181 CU IDOL SELF LEARNING MATERIAL (SLM)
UNIT - 10: IMPLEMENTATION STRUCTURE 10.0 Learning Objectives 10.1 Introduction 10.2 E-Business Implementation 10.3 Implementation and Control of E-Business plan 10.4 Summary 10.5 Keywords 10.6 Learning Activity 10.7 Unit End Questions 10.8 References 10.0 LEARNING OBJECTIVES After studying this unit, you will be able to: Know about the E-business plan Analyze the E-Commerce implementation State the Advantages of E-Commerce implementation Point out control ofE-business plan 10.1 INTRODUCTION E-commerce essentially means selling products and services online but it's not as simple as it may sound. E-commerce requires a sophisticated content management system and a strategy that combines many separate elements. To begin with, e-commerce demands dedicated purchase, payment, and support systems along with customer relationship management procedures. A quality marketing effort is paramount. Underpinning it all is a quality Web site that needs professional development and attentive management. In implementing e- commerce, keep in mind.E-commerce is not suitable for every product and service. The best strategy is a \"clicks-and-mortar\" approach that combines online capabilities with more traditional retail resources. E-commerce is complex, and getting it right is expensive. Don't underestimate the difficulty of designing and managing an efficient e-commerce Web site. E-Business E-business is short for “electronic business.” As an overarching term, it refers to any method of utilizing digital information and communication technologies to support or streamline 182 CU IDOL SELF LEARNING MATERIAL (SLM)
business processes – from preparation to implementation. However, it can also refer more specifically to the business processes of online stores or other internet-based companies.E- Commercerefers to trading products and services online, and so is strictly only speaking of one aspect of e-business. Definition E-business is a general term that encompasses all forms of using digital information and communication technologies to support and optimize business processes. In contrast, e- commerce describes only the online trading of products and services, and is therefore only a subsection of e-business. Examples ofE-Business The E-Procurement sector includes the following activities: Organize the implementation of a Desktop Purchasing System (DPS) that supports the whole procurement process, such as checking stock availability and handle the order and payment Constructing and operating an Online Marketplace for products and services Integrating various electronic supplier catalogs into your own Enterprise Resource Planning (ERP) system to support procurement, warehouse management, order processing, production management, and logistics The E-Commerce sector includes the following activities: Designing and maintaining an internet presence and/or an online store, products or services accessible from anywhere at all times, multiple payment options, automatic e-mail notifications on orders, and customer support (live chat, hotlines, or help centers) Developing and provisioning additional content, such as an informational blog or comparison portal Expanding online marketing and targeting advertising to customers, for example by using big data from cookies, purchase behavior, and customer data. 10.2 E-BUSINESS IMPLEMENTATION Concept of E-Business 1. E-Business Concept What is e-business concept and how is it essential for a successful business? It describes the basic information of the business including goals, vision, products and offers from which it 183 CU IDOL SELF LEARNING MATERIAL (SLM)
will earn revenue. The effective concept is based on market analysis that will identify the customers’ interests to purchase the product and how much they can pay for it. What is e-business concept? It is based on goals such as “Become a major bus seller or commercial enterprise” and objectives such as “have $80 million in revenues in five years”. Whether the company is prepared to achieve their goals and objectives addressed in the implementation plan for running a business and in the business plan process for startup companies. Corporate strategies are also embedded in the e-business concept and describe how the business concept will be implemented and can be modified in order to enhance business performance. Business concept and market research are important to understand the market, which comprises it and what do they want. Once the market research is done, now the pricing should be established according to the competition. 2. Value Proposition As the name denotes, the value proposition is a value that an organization or business will provide to its customers. It may include one or more of the following points: Reduced price Improved service or better functionalities with user-friendliness Speedy delivery and improved assistance Products or services that result in greater efficiency and productivity Access to available inventory having different options for the buyer Value Delivery withthe Help of Integrations Every functional website is based on two parts: frontend for dealing directly with the customers and backend in order to automate the online operations of the company without having direct dealing with customers. Order placements using POS (Point of Sales) systems, product customization, tracking and order fulfillment are the activities that require integrated systems. 3. Sources of Revenue What does ecommerce mean and how do companies earn revenue? Ecommerce is also known as Electronic/internet commerce, refers to the buying and selling of services/products. It also includes the online payment options to the great online shopping experience. So, e-business will have three, four, or a mix of the following sources referred to as a revenue model: Advertisement 184 CU IDOL SELF LEARNING MATERIAL (SLM)
Affiliation Agent/Representative commissions Licensing Sales commissions Sponsorship Syndication Use Fees Subscription 4. Required Activities, Resources, and Capabilities In order to carry out the mission of the business, different activities are required and certain resources are needed. For example, professional employees with specific skills or capabilities can better perform particular business activities. Activities Particular business processes or groups of processes that are required to implement the business concept are known as activities. The operational business model is used to identify the costs/expenses and outputs of each activity. What are e-business and its processes? Keep in mind, some of the e-business activities may infringe on patents. Different business processes or “Method of doing business” might be patented, so that the business model may unintentionally include the intellectual property and patents will be freely awarded for business processes. For example: Amazon’s “one-click” purchasing patent has a most widely renowned patent infringement case because buyers can easily buy the products and services without using a shopping cart. Several companies have patented Internet Business Models, which are being used by many companies. So, they charge for licensing otherwise they will face problems in the future development of e-business. Resources Organizations require human, tangible, intangible, and supporting resources in order to perform the activities in an efficient manner. Tangible resources are also known as physical and financial including company equipment, case reserves, and facilities. Whereas the intangible resources include the customized software, customers data, intellectual property and business processes that can be patented. Supporting resources include the IT and communication processes and organizational structure. Capabilities 185 CU IDOL SELF LEARNING MATERIAL (SLM)
Workers with required skills are vital for every successful business. What is e-business and why are the capabilities necessary? E-business is similar to the traditional business except internet presence, broader audience and buying facility without visiting the company’s outlet. First/initial wages are the highest cost for a business and capable worker may not be available all the time. Important E-Business Drivers What is e-business and why do we need its drivers? As you hire a salesman for your traditional shop to efficiently manage your processes and to increase your sales. For a similar purpose, there are several processes used to enhance e-business operations and functionality with the help of different drivers. These drivers include streamlining physical operating processes, reducing their costs, delivering rapid response (information) and increasing services to customers as you can see in the figure given below: Product Inquiry Fulfillment Process Once you have finalized the product availability inquiry in order to make your e-business application more effective and trustworthy. It is necessary to identify the information assets and mapping them with the processes that support them. In the example given in the picture below is the information asset created by the process “product availability”. The E-Business Supply Chain In order to understand the e-business conceptually you need to be defined from both B2C and B2B perspectives. In B2C, online retailers have introduced consumer-based supply chain for assistances of Internet consumers and enhance the processes of the physical world as you can view in the figure given below: There are mainly three classes of B2C that make it possible the e-business realities: Delivery of unlimited products under the single business brand Creation of new market channels Eliminating the middlemen Amazon is the first, eBay is the second and Dell is an example of a third B2C e- business class. The Key Differences between E-Commerce and E-Business E-Business is not limited to just buying and selling products or services. Whereas E- Commerce is the name of buying and selling products/services with the help of the internet. E-Commerce is a main part of E-Business. There is no need for an E-Business to have a 186 CU IDOL SELF LEARNING MATERIAL (SLM)
physical presence. If the company has physical offices along with their online business activities then it can be referred to as E-Commerce. E-Commerce supports any kind of business transaction related to money, but E-Business includes monetary and allied activities. E-Commerce needs the internet to be able to communicate with their online customers from all over the world. E-Business can use the internet, intranet and extranet to be able to connect with the parties. E-Commerce Implementation Implementing an e-commerce shopping cart gives your business the ability to sell your products online day and night, reach new clients, target your ideal market, establish a strong brand, and build closer relationships with your customers by improving their purchasing experience. Whether you’re setting up an online store for the first time or updating your current platform, platform implementation is one of the most complex aspects of launching an e-commerce site. Without the guidance of a consultant with years of e- commerce experience, programming expertise and deep knowledge, your efforts to set up an e-commerce solution can become plagued by cost overruns, programming errors, and delays resulting in poor sales performance and reduced profits. Simplicity has over 20 years of e- commerce implementation experience. We have been helping businesses just like yours, big and small, build e-commerce platforms to get their businesses up and running on the web. Contact us today to see how we can get your business’ e-commerce store implemented and making money. Advantages of E-Commerce Implementation Allows you to sell products 365 days a year, 24 hours a day. Lowers your costs and raises your sales margins Creates cost-saving efficiencies Creates an automated cycle of repeat business Connects you to new customers previously unavailable to you due to distance and operating hours Collects customer data, demographics, and produces marketing leads Gives your customers control over how and when they’d like to shop Successfully Implement To E-Commerce Business Plan Even though it takes time and effort to put together, you wouldn’t start a new business without a good business plan. It’s critically important because it helps you clarify exactly 187 CU IDOL SELF LEARNING MATERIAL (SLM)
where you’re heading and how you’ll get there. In the process you identify opportunities you can take advantage of, and get clear on what resources and knowledge you will need along the way. Whenyou implement e-commerce, you are essentially starting a “new” business (even if you’re merely transitioning). That new business needs its own business plan. Your e- commerce plan serves several purposes, for example to: Set goals and priorities Establish business milestones Securing financing Avoid costly mistakes Create alignment with other existing channels, partners or owners A Model fora Successful E-Business Plan According to Swiss business theorist, Alexander Osterwalder, there are several important aspects to consider when putting together your e-commerce plan: 1. What key activities will your business carry out? 2. What is your unique selling point (USP)? 3. What resources do you need? 4. Who will you partner with? 5. What channels will you use to market your business? 6. What do your different types of customers want and need? 7. What expenses will you incur? 8. Where will your income come from? 10.3 IMPLEMENTATION AND CONTROL OF E-BUSINESS PLAN E-Commerce - Business Models E-Commerce needs the internet to be able to communicate with their online customers from all over the world. E-Business can use the internet, intranet and extranet to be able to E- commerce business models can generally be categorized into the following categories. Business - to - Business (B2B) Business - to - Consumer (B2C) Consumer - to - Consumer (C2C) Consumer - to - Business (C2B) Business - to - Government (B2G) 188 CU IDOL SELF LEARNING MATERIAL (SLM)
Government - to - Business (G2B) Government - to - Citizen (G2C) Business - To - Business A website following the B2B business model sells its products to an intermediate buyer who then sells the product to the final customer. As an example, a wholesaler places an order from a company's website and after receiving the consignment, sells the end product to the final customer who comes to buy the product at one of its retail outlets. Business - To - Consumer A website following the B2C business model sells its products directly to a customer. A customer can view the products shown on the website. The customer can choose a product and order the same. The website will then send a notification to the business organization via email and the organization will dispatch the product/goods to the customer. Consumer - To - Consumer A website following the C2C business model helps consumers to sell their assets like residential property, cars, motorcycles, etc., or rent a room by publishing their information on the website. Website may or may not charge the consumer for its services. Another consumer may opt to buy the product of the first customer by viewing the post/advertisement on the website. Consumer - To - Business In this model, a consumer approaches a website showing multiple business organizations for a particular service. The consumer places an estimate of amount he/she wants to spend for a particular service. For example, the comparison of interest rates of personal loan/car loan provided by various banks via websites. A business organization that fulfills the consumer's requirement within the specified budget approaches the customer and provides its services. Business - To - Government B2G model is a variant of B2B model. Such websites are used by governments to trade and exchange information with various business organizations. Such websites are accredited by the government and provide a medium to businesses to submit application forms to the government. Government - to – Business Governments use B2G model websites to approach business organizations. Such websites support auctions, tenders, and application submission functionalities. Government -To - Citizen 189 CU IDOL SELF LEARNING MATERIAL (SLM)
Governments use G2C model websites to approach citizen in general. Such websites support auctions of vehicles, machinery, or any other material. Such website also provides services like registration for birth, marriage or death certificates. The main objective of G2C websites is to reduce the average time for fulfilling citizen’s requests for various government services. Implementation andControllingofE- Business Plan Determine the ‘Why’ The need to be crystal clear on exactly what’s happening in your business, in your industry and with your competitors. A SWOT analysis (strengths, weaknesses, opportunities and threats) is a good place to start, and will help you clarify why a move into e-commerce is so important. Perhaps your business hasn’t been performing as well or growing as fast as you would like. Or maybe your customers are moving across to your competitors, who are better meeting their changing expectations. Clarify Your Value Proposition What makes you stand out from your competitors? What problem are you solving for your customers? Who exactly are you solving the problem for? If you have an existing business, you may have explored some of these questions when you launched. Things change though, so it’s worth revisiting them, especially in context of your move into e-commerce. Determine Your Customer’s Requirements Knowing who your customers are and then catering specifically for their needs and wants is essential. Whether you run a B2B or B2C business will also make a difference here. Segment your customers so you know exactly who you’re dealing with. That information will tell you a lot, for example, what products and prices they are looking for, where they browse online, what communication channels they prefer and what type of marketing grabs their attention. It will also give you a good idea of how they like to pay and what delivery options they prefer. Keep checking what you think you know as customer needs do change. Define the E-Commerce Business Model Use the understanding you now have of your customers and products to define your sources of revenue. Also get clear on how the finances will work. To do this, you’ll need to run cash flow and income statements, and create a final budget. Then you’ll be ready to decide whether your business model can stay the same or needs to change. Some companies run their e-commerce as a separate business, with different prices and processes, while others neglect it in favor of their bricks-and-mortar business. We believe 190 CU IDOL SELF LEARNING MATERIAL (SLM)
both of these are a mistake. At the very least, you should plan to run your e-commerce business on a par with other channels and integrate it into all touch points. All aspects of the business should appear seamless to your customer. Clarify Impacted Business Processes Once you know what your e-commerce business model looks like, you can assess how your processes will be impacted (or if your business is new, what processes you need). Start by determining if your current processes, and the skills, tools and other resources you have in- house, are capable of handling the new work. If not, decide what changes are needed. Figure 10.1 E-Commerce Business Process For example, your fulfillment processes might need to be restructured and your customer service team unskilled. Your e-commerce site needs to be designed and built, and the technology managed, and you’ll need a digital communication strategy. Each of these things will also attract a cost, which needs to be included in your budget. Once you know what’s required, consider outsourcing those aspects where you don’t have the capacity or expertise in-house. In our experience, the processes below can be effectively outsourced if need be. Identify the best e-commerce / IT model Depending on the size of your business, your budget and how hands-on you wish to be, you could choose to own the software or have it hosted. If you decide to have it hosted, there are different ways to do this. For example: Shared: You share a server with other websites. 191 CU IDOL SELF LEARNING MATERIAL (SLM)
Dedicated: You have your own server. VPS (Virtual Private Server): This is a middle ground where a physical server is still shared, but it is divided into separate virtual machines, of which one is yours. Cloud: This is similar to VPS but your site is housed on a network spread across multiple virtual computers. Determine the integration strategy Your integration strategy needs to align with your business strategy. The ultimate aim is to streamline your business processes for efficiency, while fulfilling the needs of your e- commerce customers. This all relies on data. Since this data is probably already held in your ERP, your e-commerce site and your ERP should work in tandem. Critical decisions need to be made around where the different data elements are stored and managed (“owned”). For example, e-commerce product data and prices can be held in the ERP or PIM system, while inventory could be held in the ERP or another integrated system. This will also affect where business processes need to happen, such as product, inventory or customer information updates. There should always be one source of truth. Done right, you will eliminate errors, duplications and delays in your business going forward. Although the ERP is generally the main system our e-commerce software integrates with, it should ideally integrate with at least some of the following systems and programs too: Marketplaces like Amazon, eBay, Wal-Mart, PriceCheck, Facebook, Google Shopping, etc. Shipping or delivery solutions like SmartFreight and Parcel ninja EDI for larger corporate purchases POS for in-store purchases Supply, marketing or PR partners CRM, so there is one source of customer data Marketing integrations are unlimited, with the four listed above being very important Other integrations are also unlimited, but the ones listed are important, with sales force management being most pertinent to B2B companies. Choose your e-commerce software Now that you know what kind of solution will be the best fit for your business, you will have narrowed down the range of software choices available to you. Changing software mid- stream is extremely disruptive, so explore these options in depth up front to identify the best one for you and your customers. 192 CU IDOL SELF LEARNING MATERIAL (SLM)
These are the kinds of criteria you can look at: 1. Features, such as responsive design, customer reviews, wish lists and loyalty programmes. For B2B, look at customer specific tiered pricing, quoting and repeat order functionality. See more B2C features here and B2B ones here. 2. Software costs 3. Hosting options and costs 4. Integration options 5. Payment options 6. Responsiveness, plus processes such as payment and forms should be optimized for mobile use 7. Self-service, so customers, especially B2B ones, can manage their own accounts and access all the product, order and inventory details they need 8. Scalability, so your site can effortlessly manage more traffic and purchasing volume when your business grows 9. Encryption security to protect your own and your customer’s data, including full site SSL (Secure Sockets Layer) and PCI compliance for at least your payment gateway 10. Personalization to match your customers’ needs. Select an e-commerce implementation partner Your implementation partner should be able to advise you on everything from branding, content and SEO issues, through to user experience and the latest trends. They should also be able to provide custom programming if necessary. You will be working closely with them on an ongoing basis, so do your due diligence before making a decision. Ask if you can try out their demos and notice how their support team responds to queries and concerns. Do some research online to see how other users have found working with them? Take your time and ask questions. Pull it all together into a strategic plan Use the Oster alder one-page model described above to pull the plan together. When you specifically identify and run all the income and expenses involved, it should be easy to see if your plan so far will be financially viable. Experiment with different options by adjusting the finances to create scenarios which may be helpful or attractive to your stakeholders. Share the final document or business plan, with attached financials, with your various stakeholders, including your Board of Directors, mentors, investors and suppliers. This will help you gain their buy-in and/or allow you to fine-tune your plan based on their feedback. 193 CU IDOL SELF LEARNING MATERIAL (SLM)
Figure 10.2E- Business Plan Set up a cross functional team with a clear (and invested) senior sponsor Tempting as it may be to consider e-commerce as purely an IT project, the reality is that it involves your entire business. Identify all your key stakeholders up front so they have an opportunity to give their input. For example: 1. IT 2. Marketing 3. Accounting 4. Inventory / stock control 5. Fulfillment / shipment 6. Customer service 7. Sales team (if B2B) Key customers and suppliers (eventually, when you are ready for them) The manager you choose should have strong business and project management skills, and be comfortable with an agile approach. He/she also needs to care deeply about the project and have the drive and influence necessary to overcome any challenges that arise along the way. Develop a project plan Referring back to your strategic plan from Step 10, document in detail all the activities that need to happen. Allocate realistic time frames and budgets, and identify the person responsible for every step of the process. Be sure to include time for training, testing, approval and sign-off from all stakeholders at regular intervals along the way. Start building your e-commerce website 194 CU IDOL SELF LEARNING MATERIAL (SLM)
Although building the actual website for a big e-commerce project may take anything from 4 weeks to 4 months, the full implementation of the project from a business perspective can take much longer. Data and circumstances can change within that timeframe, and we therefore recommend that you take an agile approach – building, implementing and improving as you go. That way you can always see exactly what’s happening as the site is being developed and can make (reasonable) adjustments to the plan if necessary. Also, if the most important parts are always being built first, you should be able to work with those while you wait for the other less critical parts to be completed. As early as possible, get input from your customers and suppliers and use the feedback to fine-tune the process. Launch your e-commerce site – then get back to work The launch of an e-commerce site is vital to its success. In our experience of companies that do this well, a very senior, yet hands-on, business manager tests the site and all its associated processes in detail before the launch. That manager is then fully involved in the first 6 months of running the site, overseeing its integrations, and monitoring the impact on and results of the fulfillment centre, the customer service team and any other teams that are particularly affected. This firm hand is involved until the change is embedded and working smoothly. By then it may well be time to assess your customers’ ever-changing needs again and decide if further adjustments are needed to stay on top of them. 10.4 SUMMARY E- Business implementation is utilizing digital information and communication technologies to support or streamline business processes from preparation to implementation. However, it can also refer more specifically to the business processes of online stores or other internet-based companies. E-Commerce refers to trading products and services online, and so is strictly only speaking of one aspect of e-business. Implementing an e-commerce shopping cart gives your business the ability to sell your products online day and night, reach new clients, target your ideal market, establish a strong brand, and build closer relationships with your customers by improving their purchasing experience. A good business plan is critically important because it helps you clarify where you're heading. E-commerce business models can generally be categorized into the following categories. A website following the B2B business model sells its products 195 CU IDOL SELF LEARNING MATERIAL (SLM)
to an intermediate buyer who then sells the product to the final customer. The consumer places an estimate of amount he/she wants to spend for a particular service. A SWOT analysis (strengths, weaknesses, opportunities and threats) is a good place to start, and will help you clarify why a move into e-commerce is so important. Knowing who your customers are and catering specifically for their needs and wants is essential. Some companies run their e-commerce as a separate business, while others neglect it in favor of their bricks-and-mortar business. Identify how your processes will be impacted and what you'll need to do to keep up-to-date. Your e-commerce site should ideally integrate with at least some of the following systems and programs: •Marketplaces like Amazon, eBay, Wal-Mart, Price Check, Facebook, Google Shopping, etc. For B2B companies, look at customer specific tiered pricing, quoting and repeat order functionality. Identify and run all the income and expenses involved, it should be easy to see if your plan so far will be financially viable. Share the final document or business plan with your various stakeholders, including your Board of Directors, mentors, investors and suppliers. Set up a cross functional team with a clear (and invested) senior sponsor. Identify the person responsible for every step of the process. Allocate realistic time frames and budgets. Take an agile approach – building, implementing and improving as you go. Get feedback from customers and suppliers early on to fine-tune the site's design and performance. 10.5KEYWORDS VPS (Virtual Private Server): This is a middle ground where a physical server is still shared, but it is divided into separate virtual machines, of which one is yours. Point of Sale(POS):Point of sale refers to the time at which a cardholder and a merchant complete a transaction. The point of sale (or POS) in retail industries uses a combination of software as well as hardware. Desktop Purchasing System (DPS): That supports the whole procurement process, such as checking stock availability and handle the order and payment Enterprise Resource Planning (ERP): The system to support procurement, warehouse management, order processing, production management, and logistics. 10.6LEARNING ACTIVITY 1. State the E-Business? ___________________________________________________________________________ ___________________________________________________________________________ 196 CU IDOL SELF LEARNING MATERIAL (SLM)
2.How to implement the E-Business? ___________________________________________________________________________ ___________________________________________________________________________ 10.7UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Write the example of E-Business? 2. How to identify the best e-commerce model in IT? 3. Explain the E-business Concept? 4. State the Differences between E-Commerce and E-Business? 5. Explain the successful E-Business plan? Long Questions 1. Point Out the Important E-Business Drivers 2. Explain the advantages of E-Business implementation? 3. Discuss the E-Commerce Business Model? 4. Elaborate details about E-Business implementation and control? 5. Give an Example of E-business implementation of IT sectot.Explain it? B. Multiple Choice Questions 1. Which of the following model is part of E-Governance? a. G2B b. G2C c. B2G d. C2G 2. The type of social network described as a community built around a common interest such as games, sports, music, and so on is called ______________. a. general community b. practice network c. affinity community d. interest-based social network 197 CU IDOL SELF LEARNING MATERIAL (SLM)
3. Which of the following is an example of a portal? a. Amazon b. eBay c. Yahoo d. Face book 4. All of the following are tools for optimizing a Web site's location in search engine listings except ______________. a. keywords and page titles b. identifying market niches c. buying ads d. benchmarking 5. Which of the following is not an entertainment industry value chain model? a. content owner direct model b. user distribution model c. aggregator model d. Internet innovator model Answers 198 1-d, 2-d, 3-c. 4-d, 5-b 10.8 REFERENCES Reference books • JaiswalS.,E-Commerce • MohammadMahmoudiMaymand,E-Commerce • MurthyC.S.V.,E-Commerce-Concepts,ModelsandStrategies • Schneider, E-Commerce, Cengage Learning, New Delhi. • PeeLosuin&AMurphy,ElectronicCommerceJaicoPub Textbook references CU IDOL SELF LEARNING MATERIAL (SLM)
• JosephP.T.,E-Commerce–AnIndianPerspective • RaviKalkotaFrontiersofE-Commerce,AddisonWesley • K.Bajaj & D.Nag E-Commerce, The Cutting Edge of Business, Tata McGraw • Green Stein ElectronicCommerceTata McGraw. Website • https://www.cleverism.com/e-commerce-complete-guide • https://www.economicsdiscussion.net/business/e-commerce/31868 199 CU IDOL SELF LEARNING MATERIAL (SLM)
UNIT - 11: E-BUSINESSSECURING STRUCTURE 11.0 Learning Objectives 11.1 Introduction 11.2 E-Business security issues 11.3 E-Business website Security 11.4 E-business Securing in Electronic payment systems 11.5 Summary 11.6 Keywords 11.7 Learning Activity 11.8 Unit End Questions 11.9 References 11.0 LEARNING OBJECTIVES After studying this unit, you will be able to: Analyze the E-Commerce security issues Know the concept of E-Commerce security State the importance of E-Commerce security List the issues of E-Commerce security system 11.1 INTRODUCTION The term “e-security” is often interchangeable used with other terms such as “internetsecurity”, “cyber security”, and / or “IT Security”? Broadly “e-security encompasses securityaspectsoftheinformationeconomy,includinginformationsystemsandcommunicationsne tworks”. E-Security isabranchof computersecurity specificallyrelatedtothe Internet,ofteninvolving browsersecurity butalso networksecurity.Itsobjectiveistoestablishrulesandmeasures to use against attacks over the Internet. The Internet represents an insecure channel forexchanginginformationleadingtoahighriskofintrusionorfraud,suchasphishing.Different methods have been used to protect the transfer of data, including encryption. Like that, there arebenefits associated with the popularity of the Internet and ever-increasing growth rate of thecomputers being connected to it. But there is a down side too. The task of protection of the dataand information stored in the computers and travelling across the Internet has never been sochallenging. Therefore, Computer and Internet Security has become a specialized area in 200 CU IDOL SELF LEARNING MATERIAL (SLM)
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