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  Ch 10 - E-Commerce: Digital Markets, Digital Goods

1. Electronic Commerce and the Internet    (p375)
   1. E-commerce in 2008
      1. Consumer sales - $255 billion
      2. People purchasing - 117 million
   2. Why E-commerce is Different
      1. Ubiquity - marketplace is extended beyond traditional physical buildings to home, work, mobile devices
      2. Global reach - Internet reaches across national boundaries
      3. Universal standards - TCP/IP (Ch7 outline II.D.3)
      4. Richness - wordprocessed documents, workbooks, presenations, audio, video, ...
      5. Interactivity - consumer actively engaged in each website visit
      6. Information density - information plentiful, cheap, and more accurate
      7. Personalization/Customization - example - MyYahoo webpage
      8. Social Technology - users share text, photos, videos.  Can create new social networks and/or strengthen existing ones.
   3. Note by PJL  about Social Technology (for your info only)
      1.  Interesting book - Here Comes Everybody - The Power of Organizing without Organizations by Clay Shirky.  Five word summary of book by Clay Shirky - "Group action just got easier."
         1. http://www.amazon.com/Here-Comes-Everybody-Organizing-Organizations/dp/1594201536
         2. http://fora.tv/2008/07/06/Clay_Shirky_Here_Comes_Everybody
            First 4:00 minutes - successful student reaction to HSBC "free" checking
            Starting at 5:30 - getting arrested for eating ice cream in Minsk, Belarus.
   4. Digital Markets
      1. Def - Information Asymmetry - information asymmetry is high when it is costly for consumer to do product research.
      2. The digital markets created by the Internet have greatly reduced information asymmetry, especially for autos.
      3. Def - Disintermediation - removal of organizations responsible for intermediary steps in the supply chain.
      4. Cost of sweater reduced more than 50%.  See Fig 10-2, p383.
   5. Digital Goods
      1. Def - Digital Goods - goods that can be delivered over a digital network.  Examples are music tracks, video, software, newspapers, books.
      2. The impact of the Internet on the market for digital goods is profound.
   6. Internet Business Models - see Table 10-5, p385
      1. Virtual storefront - sells physical products directly to consumers - Amazon.com
      2. Information broker - provides product info to consumers - Realtor.com
      3. Transaction broker - processes online sales transactions - Expedia.com for travel
      4. Online marketplace - provides environment for buyers and sellers - eBay.com
      5. Content provider - provides digital content, such as news - WSJ.com (Wall St. Journal)
      6. Social network - provides meeting place - Linkedin.com
      7. Portal - provides initial web entry point along with personalized content - Yahoo.com
      8. Service provider - provides Web 2.0 applications - YouTube.com
          
2. Electronic Commerce     (p388)
   1. Types of Electronic Commerce
      1. Business-to-consumer (B2C)
      2. Business-to-business (B2B)
      3. Consumer-to-consumer (C2C)
   2. Achieving Customer Intimacy
      1. Interactive Marketing and Personalization
         1. Def - Clickstream Tracking - tracking data about customer website visits and storing them in a log.
         2. Def - Collaborative Filtering - compares a specific user's behavior at a website to previous customers to predict what the user would like to see next.  This is an example of using data mining to find sequences.  See Ch6 outline VI.B.3.b. 
            Amazon.com uses collaborative tracking for "Customers who bought this book also bought ..."
      2. Customer Self-service
         1. Airline websites allow customers to check seat availability, purchase tickets, check arrival times.
             
3. M-commerce - skip     (p397)
    
4. Electronic Commerce Payment Systems - skip     (p399)

                             (This page was last edited on January 17, 2010 .)