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Chapter -2

E-Marketplaces: Mechanisms, Tools, and Impacts of E-commerce

Learning Objectives
 Describe the major electronic commerce (EC) activities and processes and the mechanisms that support them. Define e-marketplaces and list their components. List the major types of e-marketplaces and describe their features. Describe electronic catalogs, search engines, and shopping carts. Describe the major types of auctions and list their characteristics.

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Learning Objectives
 Discuss the benefits, limitations, and impacts of auctions.  Describe bartering and negotiating online.

EC ACTIVITIES AND MECHANISMS
The EC trading activities are divided into six categories. Each activity is supported by one or more EC mechanism.

Sellers, Buyers and transaction
Typically a seller (retailer, whole seller or manufacturer) sells to customers. The sellers buys either raw material (as a manufacturer) or finish goods (as retailer). This process is shown below figure.

Purchasing Process
Customer buy good online in different ways. The most common way purchasing from catalogs at fixed price. Sometime price may be negotiated or discounted. The buyers use the process shows in next slide Exhibit 2.3. The process starts with login into seller website , registering(if needed) and entering into on line catalog or the buyer’s “ my account” . E-catalog can be very large so a search mechanism may be needed. Also buyers should compare price. Some sellers (ex. American Airlines) provide comparisonss with competing vendors.

Purchasing Process
The buyers can leave the site or do comparison before entering into the specific seller’s store. If not satisfied the buyer will abandon the site. If satisfied select the item and place it in a shopping cart. The buyers can return to the catalog and choose more items. Each selected item is placed in the shopping cart. When shopping is complete, the buyer go checkout page where shipment option is selected from menu. Also pay option available . For example newegg.com let us you pay buy credit card, with Pay Pal by check after belling. After checking all details for accuracy the buyer submit the order.

 Functions of a market (electronic or otherwise)
i. Matching buyers and sellers

ii. Facilitating the exchange of information, goods, services, and payments iii. Providing an institutional infrastructure such as legal and regularity framework

E-Marketplaces
 Functions of a market (electronic or otherwise)
i. Matching buyers and sellers

ii. Facilitating the exchange of information, goods, services, and payments iii. Providing an institutional infrastructure such as legal and regularity framework

E-Marketplaces
 e-marketplace
An online market, usually B2B, in which buyers and sellers exchange goods or services; the three types of e-marketplaces are private, public, and consortia  Market space A marketplace in which sellers and buyers exchange goods and services for money (or for other goods and services), but do so electronically

E-Marketplaces
• E-MARKETPLACE COMPONENTS AND PARTICIPANTS:  Customers  Sellers  Products and services (digital or physical) digital products: Goods that can be transformed to digital format and delivered over the Internet 4. Infrastructure: electronic networks, hardware, software, etc. 5. Front end The portion of an e-seller’s business processes through which customers interact, its components include the seller’s portal, electronic catalogs, a shopping cart, a search engine, and a payment gateway

E-Marketplaces
 Back end The activities that support online order fulfillment, inventory management, purchasing from suppliers, payment processing, packaging, and delivery  Intermediary A third party that operates between sellers and buyers  Other business partners: such as shippers

 Support services: such as certification or guarantee

E-Marketplaces
TYPES OF E-MARKETPLACES

1. Private E-Marketplaces: they are...
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