CIT 4453 Technologies of Global eCommerce

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CIT 4453 - Technologies of Global e-Commerce
Successful E-Commerce Web site
Technologies
Business Principles
-HTML -Dreamweaver -Database -Forms -Shopping
cart -Language Translation

• Business Model
• Value Proposition
• Egg Diagram
• Resource System
• Revenue Model
• Cultural considerations

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CIT 4453 - Technologies of Global e-Commerce
Successful E-Commerce Web site
Technologies
Business Principles

• Business Model
• Value Proposition
• Egg Diagram
• Resource System
• Revenue Model
• Cultural considerations

-HTML -Dreamweaver -Catalog pages -Order
Forms -Language Translation
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Term Project
Each student will be responsible for developing a
prototypical e-commerce website. This is a
culminating project that provides the opportunity
to apply both the business concepts and
technologies that we are studying this semester.
Students will be provided server space from an
ASU server and the project must be located at
that server.
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• Students should consider the following guidelines
  when developing their web sites
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• Students are free to choose any of the business
  models discussed in class or covered in the text
  as the basis for developing the web site.
• Students must incorporate database technology to
  capture and store information from site visitors.
• Students must target at least three international
  markets. One must be from a country that does not
  speak English
• Students are encouraged to begin this process by
  outlining a project (one page typed HW2) and
  then bringing the outline to the professor for
  feedback and discussion.

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• Students should consider the following guidelines
  when developing their web sites
•  
• Students are free to choose any of the business
  models discussed in class or covered in the text
  as the basis for developing the web site.
• Students must target at least three international
  markets. One must be from a country that does not
  speak English
• Students are encouraged to begin this process by
  outlining a project (one page typed HW2) and
  then bringing the outline to the professor for
  feedback and discussion.

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Term Project

• 40 (400 pts) of your course grade more than
  just a term paper.
• Project graded 200 pts on the Web site and 200
  pts on the Business Plan
• All Business plans are due April 24th
• All Web sites graded on May 1st

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Business Plan

• 7-15 pages total with exhibits.
• Use sub-headings on various sections.
• Use exhibits to shorten text and then use text to
  go in-depth on exhibits. Walk reader through
  exhibits. Dont throw in exhibits as after
  thought.
• Number all pages and exhibits.
• Proof read - no grammatical or spelling errors.
• Must have cover page with URL

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Porter Strategy Model

• Key concepts
• There are only three basic strategies
• Each implies a different business model
• Firms can pursue only one strategy at the time

Possible Strategies
Differentiation
Cost
Niche

• Requires constant innovation and leadership on
  the benefits that matter most to the customer

• Focus on gaining competitive advantage on costs
  while maintaining parity level on differentiation

• Focus the business on a particular segment of
  the market and then pursue either differentiation
  or cost strategy

Business Model
Networked Economy Example

• Travelocity.com

• Lowestfare.com

• Lastminute.com

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Components of a Business Model
Developing a business model in the networked
economy requires four key choices on the part of
the senior management
Value Cluster

• Specify the value proposition or the value
  cluster for the business

Marketspace Offering

• Articulate the online product, service and
  information offer

Resource System

• Define how the company needs to align its
  resources to deliver the value proposition

• Define and select the most appropriate revenue
  model to pursue

Financial Model
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Value Proposition/Cluster
The definition of the value proposition is the
result of a combination of choices about the
customers, the benefits offered and the unique
capabilities of the firm
Target Segments
Key Benefits Offered
Unique Capabilities
Value Proposition



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Egg Diagram
Decision Process

• Need Recognition

Product/Service Offering

• Build Relationship

• Search for Ideas and Offerings

• Post-Sale Support and Perks

• Evaluation of Alternatives

• Purchase Decision

• Message Selection

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Step No. 1 Identify Core Benefits
The core benefits must be identified in the
construction of the value cluster
1-800-Flowers.com serves the mid- to high-end
market with a broad gift assortment, fresh
flowers, reasonable prices and easy access
because of its strong brand name, product and
media partnerships and bricks-and-mortar network
of franchises.
Broad Assortment of Gifts
High Quality of Flowers
Customer Service
Widespread, Easy Access
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Step No. 2 Link Capabilities to Benefits
Managers need to identify which capabilities are
required to deliver each benefit, regardless (at
this point) of the ability of the company to
access or develop that capability
For 1-800-Flowers.com, the benefit widespread,
easy access is linked to four capabilities
strong brand name, wide reach to customers,
multiple points of contacts and a popular
website.
Broad Assortment of Gifts
High Quality of Flowers
Popular Website
Multiple Contact Points
Customer Service
Widespread, Easy Access
Wide Reach to Customers
Core benefits
Strong Brand Name
Capabilities
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Step No. 3 Link Resources to Capability
After the capabilities are identified, the firm
should determined the resources necessary to
deliver each capability
Broad Assortment of Gifts
High Quality of Flowers
Popular Website
Telephone
3,000 Affiliates
Online
Franchise Stores
Multiple Contact Points
Catalog
Customer Service
Widespread, Easy Access
Wide Reach to Customers
Strong Brand Name
Core benefits
Activities assets
Capabilities
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Revenue Models
While firms can pursue a number of revenue
models, some are used most frequently
Advertising

• Advertising revenues can be generated through
  the selling of ads, site sponsorships, event
  underwriting, etc. (e.g., Yahoo, AOL,
  Business2.com)

Product, Service, Information

• Revenues can be generated from the sales of
  goods and services (e.g., Amazon, CDNow, Buy.com)

Transaction

• Revenues can be accrued from charging a fee or
  taking a portion of the transaction sum for
  facilitating a customer-seller transaction (e.g.,
  Schwab, eBay)

Subscription

• Website can gain revenues by offering
  subscription services for information (e.g.,
  FT.com, NYTimes.com)

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Cultural Considerations

• Hofstedes Cultural Dimensions
• Make assumptions for each of the four dimensions
  and discuss site adjustments as a result for each
  of your targeted markets
• Language Translation issues
• Other cultural issues such as color etc.