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Electronic Commerce,
Ninth Edition
________________________________________________________________

Dr. Mudar Sarem
HUST

Wuhan, China
Spring 2013
E-Commerce, Dr. Mudar Sarem, HUST, 2013 1

Did You Know? • It is expected that China will need: more than 2000000 experts in E-Commerce during the next 10 years.

China Today Vol.59 No. 9 September 2010

E-Commerce, Dr. Mudar Sarem, HUST, 2013

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Chapter 1
The Second Wave of Global E-Business

Ninth Edition
___________________________
Introduction to Electronic Commerce

Old Editions
E-Commerce, Dr. Mudar Sarem, HUST, 2013 3

Objectives
In this chapter, you will learn about:
• Electronic Commerce: The Second Wave
– What electronic commerce is and how it has evolved into a second wave of growth

• Business Models, Revenue Models, and Business Processes
– Why companies now concentrate on revenue models and the analysis of business processes instead of business models when they undertake electronic commerce initiatives E-Commerce, Dr. Mudar Sarem, HUST, 2013 4

Objectives (continued)‫‏‬
• Economic Forces and Electronic Commerce
– How economic forces have created a business environment that is fostering the second wave of electronic commerce

• Identifying Electronic Commerce Opportunities
– How businesses use value chains and SWOT analysis to identify electronic commerce opportunities

• International Nature of Electronic Commerce
– The international nature of electronic commerce and the challenges that arise in engaging in electronic commerce on a global scale E-Commerce, Dr. Mudar Sarem, HUST, 2013 5

Autobytel

E-Commerce, Dr. Mudar Sarem, HUST, 2013

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Autobytel (continued)‫‏‬
• More than 90% of car buyers today do research on the Internet before buying their cars. • In 1995, Autobytel launched an online car-buying service. • Buying a car with the assistance of Autobytel requires that:

The buyer:
- Register with an Autobytel Website, and - Specify the desired auto in detail.

Autobytel:
- Provides the buyer with a firm price quote for the selected car, then - forwards the buyer’s contact information to a local participating dealer.

The dealer:
- Contacts the buyer, who then completes the purchase transaction at the dealer’s location. E-Commerce, Dr. Mudar Sarem, HUST, 2013 7

Autobytel (continued)‫‏‬
• Autobytel receives the monthly subscription fee from each dealer that it has under contract and sells advertising on its Web Site. • Autobytel’s revenue from fees paid by auto dealers is more than $70 million per year. • According to research studies, the average Internet car buyer pays between 2 to 4% less for a car than other buyers. • Auto dealers spend an average of $480 in marketing each new vehicle they sell. If they use Autobytel, these costs are reduced to $140 per car, including Autobytel’s referral fee. E-Commerce, Dr. Mudar Sarem, HUST, 2013 8

1. Electronic Commerce: The Second Wave
• The History of Electronic Commerce.
• The Definitions of Electronic Commerce and Electronic Business. • Categories of Electronic Commerce. • The Development and Growth of Electronic Commerce • The Dot-Com Boom, Bust, and Re-birth. • The Second Wave of Electronic Commerce. E-Commerce, Dr. Mudar Sarem, HUST, 2013 9

The History of Electronic Commerce
• The Internet did not open to commercial activity before 1991.

• From humble beginnings in the mid-1990s (1995), electronic commerce grew rapidly until 2000, when a major downturn occurred. • In the 2000 to 2003 period, many industry observers were writing obituaries for electronic commerce.  In March 2000, stock market valuations for dot.com companies begin to collapse.  By 2003, many of these firms either are trading at much lower values or have shut down. E-Commerce, Dr. Mudar Sarem, HUST, 2013 10

The History of Electronic Commerce (cont’d.)
• Begins in 2003; ongoing, the second wave of electronic commerce is well under way. – 2003: signs of new...
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