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BSAD 372 - CH 2
1.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Part 1 Introduction Chapter 2 Opportunity analysis for digital business and e-commerce Digital Business and E-Commerce Management Seventh Edition
2.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Learning outcomes âą Complete an online marketplace analysis to assess competitor, customer and intermediary use of digital technologies and media as part of strategy development âą Identify the main business and marketplace models for digital communications and trading âą Evaluate the effectiveness of business and revenue models for online businesses, particularly digital start-up businesses
3.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved âą What are the implications of changes in marketplace structures for how we trade with customers and other partners? âą Which business models and revenue models should we consider in order to exploit the Internet? âą What will be the importance of online intermediaries and marketplace hubs to our business and what actions should we take to partner these intermediaries? Management issues
4.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Figure 2.2 The environment in which digital business services are provided
5.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved âą For each of the environment influences shown in Figure 2.2, give examples of why it is important to monitor and respond in an e-business context. For example, the personalisation mentioned in the text is part of why it is important to respond to technological innovation. Activity â the e-commerce environment
6.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved âą Customers â which services are they offering via their website that your organisation could support them in? âą Competitors â need to be benchmarked in order to review the online services they are offering â do they have a competitive advantage? âą Intermediaries â are new or existing intermediaries offering products or services from your competitors while you are not represented? Environment constraints and opportunities
7.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved âą Suppliers â are suppliers offering different methods of procurement to competitors that give them a competitive advantage? âą Macro-environment âą Society â what is the ethical and moral consensus on holding personal information? âą Country specific, international legal â what are the local and global legal constraints, for example, on holding personal information, or taxation rules on sale of goods? Environment constraints and opportunities (Continued)
8.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved âą Country specific, international economic â what are the economic constraints of operating within a country or global constraints? âą Technology â what new technologies are emerging by which to deliver online services such as interactive digital TV and mobile phone-based access? Environment constraints and opportunities (Continued)
9.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Figure 2.8 A digital marketplace map
10.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Source: www.google.com/trends Figure 2.9 Google Trends â useful for consumer interest in products
11.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Figure 2.10 B2B and B2C interactions between an organisation, its suppliers and its customers
12.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved B2B and B2C characteristics Characteristic B2C B2B Proportion of adopters with access Low to medium High to very high Complexity of buying decisions Relatively simple â individual and influencers More complex â buying process involves users, specifiers, buyers, etc. Channel Relatively simple â direct or from retailer More complex, direct or via wholesaler, agent or distributor Purchasing characteristics Low value, high volume or high value, low volume. May be high involvement Similar volume/value. May be high involvement. Repeat orders (rebuys) more common Product characteristic Often standardised items Standardised items or bespoke for sale
13.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Figure 2.11 Disintermediation of a consumer distribution channel showing (a) the original situation, (b) disintermediation omitting the wholesaler, and (c) disintermediation omitting both wholesaler and retailer
14.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Figure 2.12 From original situation (a) to disintermediation (b) and reintermediation (c)
15.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved âą Creation of a new intermediary âą Example: â B&Q www.diy.com â Opodo www.opodo.com âą Acquiring an existing intermediary â Random House bought Figment.com, a community for aspiring writers of young adult fiction Countermediation
16.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Figure 2.13 Example channel chain map for consumers selecting an estate agent to sell their property
17.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved âą Timmers (1999) defines a âbusiness modelâ as: â An architecture for product, service and information flows, including a description of the various business actors and their roles; and a description of the potential benefits for the various business actors; and a description of the sources of revenue. Business model
18.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Source: Smart Insights. With permission. Figure 2.15 Business Model Canvas example
19.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Figure 2.16 Alternative perspectives on business models
20.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved âą Subscription access to content âą Pay per view content access âą CPM display advertising âą CPC advertising on site âą Sponsorship of sections, content or widgets âą Affiliate revenue (CPA or CPC) âą Subscriber data for email marketing âą Access to customers for research purposes. Revenue models â publisher example
21.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Note: Available for download at www.smartinsights.com/conversion-model-spreadsheets/ Figure 2.17 Example spreadsheet for calculating a site revenue model
22.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Figure 2.17 Example spreadsheet for calculating a site revenue model (Continued) Note: Available for download at www.smartinsights.com/conversion-model-spreadsheets/
23.
Copyright © 2019,
2015, 2011 Pearson Education, Inc. All Rights Reserved Summary âą You should be able to complete an online marketplace analysis to assess competitor, customer and intermediary use of digital technologies and media as part of strategy development âą You should be able to identify the main business and marketplace models for digital communications and trading âą You should be able to evaluate the effectiveness of business and revenue models for online businesses, particularly digital start-up businesses
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