Chapter 1 Summary

Revenue Model vs. a Business Model

Business Model: bottom-line driven
Revenue Model: a channel for generating revenue

Terms:
Globalization (of markets)
Localization (cultural nuances)
Translation (word by word)
EDI (Electronic Data Interchange)
EFT (Electronic Funds Transfer)

-60% of internet content is in english.

E Commerce is: the exchange of info across electronic networks at any stage of the supply chain, whether it is B2B, B2C, or btw public and private sectors. (E Commerce is: commerce, but commerce accelerated and enhanced by IT)

E-Business is: the transformation of key business processes through the use of INternet technologies. Includes front and back-office applications. Redefines old business models. (IBM)

E Commerce is broadly equivalent to E business

-B2B 97%, B2C 3%

E Commerce Categories/Models:

1. B2B: Supply-chain, Value-chain management (ie Dell)
2. B2C: Commerce over the net (Amazon & Dell)
3. C2B: Demand Aggregation (consumer groups)
4. C2C: Community Groups (eBay auctions)
5. B2G: Business to Government

Disintermediation: getting rid of the middle-man (driving the cost out of the supply chain)

1. First Wave: EFT's, EDI's and VAN. Mostly in the US, therefore predominantly English. Piracy, hacking. Customers not technologically "ready".
2. Second Wave: multi-lingual, multi-cultural, integration, broadband connection.

Product/Process Suitability:

• Commodity Item (hard to differentiate from competitors)
• Shipping Profile (how easily it can be packaged/shipped)
• High value-to-wieght value (ratio of shipping cost to selling price)
• Digital products

Pros of Ecommerce

• Increase sales through enhanced customer service
• decrase cost of handling inquiries and transactions
• reach new potential customers
• increase purchasing opportunities for buyers

Cons of Ecommerce

• difficult to calculate ROI
• perishable items difficult to sell
• cultural and lgeal obstacles

Global Issues in Ecommerce: trust, language, cultural, infrastructure