Ecommerce Platform Pricing by tkv74755

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									                             Electronic commerce,
                            digital information, and
                                     the firm


                Howard Rosenbaum
               hrosenba@indiana.edu


      School of Library and Information Science
            Center for Social Informatics
                  Indiana University
             Center for Digital Commerce
                Syracuse University
                   November 2000
http://www.slis.indiana.edu/hrosenba/www/Pres/asis00/
    I. Introduction: the social context of ecommerce
      II. The digital information environment of ecommerce
        III. Information imperatives for the firm
           IV. Conclusion: information and the conduct of
               ebusiness



        http://www.slis.indiana.edu/hrosenba/www/Papers/asis00.html


Rosenbaum: Ecommerce, digital information and the firm
    I. Introduction: the social context of ecommerce
    What is ecommerce
      The use of electronic networks to conduct business-
      to-business or business-to-consumer transactions
      Using the net buyers and sellers find each other and
      conduct negotiations and transactions
      They exchange of information, currency, and both
      digital and non-digital goods and services
      Ordering, order fulfillment and delivery of goods and
      services take place, although the latter may occur
      offline


Rosenbaum: Ecommerce, digital information and the firm
      Internet Economy Indicators
      Annual Employee Figures by Layer and Total Internet Economy
                                                  1998      1999        Growth
      Layer 1 - Infrastructure                    527,037   778,602      48%
      Layer 2 - Application                       513,125   681,568      33%
      Layer 3 - Intermediaries                    290,856   340,673      17%
      Layer 4 - Internet Commerce                 577,937   726,735      26%
      The Internet Economy                        1,819,716 2,476,122    36%
      (after removing overlap)

        http://www.internetindicators.com/key_findings_june_00.html



Rosenbaum: Ecommerce, digital information and the firm
    Internet Economy Indicators
    Annual Revenue and Growth Summary by Layer and Total Internet
    Economy (millions)
                                                 1998      1999       Growth
    Layer 1 - Infrastructure                     $117,143 $197,853    68%
    Layer 2 - Application                        $71,615   $101,304   41%
    Layer 3 - Intermediary                       $63,629   $96,809    52%
    Layer 4 - Internet Commerce                  $99,813   $171,473   72%
    The Internet Economy                         $322,530 $523,923    62%
    (after removing overlap)

        http://www.internetindicators.com/key_findings_june_00.html


Rosenbaum: Ecommerce, digital information and the firm
     Ecommerce is expected to grow worldwide
     Internet Economy companies generated almost one of
     every five dollars in revenue from the Internet
     18.5% of the companies’ revenues were generated
     from the Web
     17 million US households will be shopping online by
     the end of this year, with online retail sales expected to
     top USD 20.2 billion (Forrester Research)
     56% of US companies will sell their products online
     this year, up from 24% in 1999. (NUA)
     Small businesses who use the net have grown 46%
     faster than those that do not (American City Business
     Journals)


Rosenbaum: Ecommerce, digital information and the firm
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Rosenbaum: Ecommerce, digital information and the firm
        http://www.thestandard.com/powerpoint/101600met5_cou.ppt
Rosenbaum: Ecommerce, digital information and the firm
     I. Introduction: the social context of ecommerce
       II. The digital information environment of ecommerce
         III. Information imperatives for the firm
             IV. Conclusion: information and the conduct of
                 ebusiness




Rosenbaum: Ecommerce, digital information and the firm
    II. The digital information environment of ecommerce
    Ecommerce takes place in a digital IE
      It is the social context within which ICTs are designed,
      implemented and used
      It is the context within which digital information is
      created, accessed, valued, manipulated, stored,
      disseminated, and used
      It affects the generation and flow of information
      through “any defined entity,” in this case the
      ecommerce firm and its web site(s)
      It is the setting in which people engage in the social
      interactions that constitute ebusiness

Rosenbaum: Ecommerce, digital information and the firm
   The digital IE is the setting within which ecommerce
   takes place
   Rules and resources constitute its basic structure are
   used together as people engage in social interaction
   They enable and constrain the transactions and
   information exchanges that comprise ecommerce
   As people draw upon the rules and resources of this IE to
   conduct business, they recreate and maintain the IE.
   Information is an important resource in this environment,
   as are the rules that shape its acquisition and/or
   generation, manipulation, dissemination, and use


Rosenbaum: Ecommerce, digital information and the firm
    Ecommerce is an information intensive activity
       A wide range of information is generated dynamically,
       continually, synchronously, and in great volumes
       Much is created by the actions of web site visitors
       The firm also produces a continual stream of digital
       information about its ecommerce activities
    All of this information is important to capture and use.
    The IE is dynamic and unstable and the rules and
    resources that constitute its structure are emerging
    One subset includes procedures and policies being
    developed in practice to handle this information flow


Rosenbaum: Ecommerce, digital information and the firm
     I. Introduction: the social context of ecommerce
       II. The digital information environment of ecommerce
         III. Information imperatives for the firm
             IV. Conclusion: information and the conduct of
                 ebusiness




Rosenbaum: Ecommerce, digital information and the firm
   III. Information imperatives for the firm
   There are at least three information imperatives for the
   firm:
      Digital information generated by the firm’s ecommerce
      activities must flow rapidly and effectively through the
      entire organization
      The firm is responsible for the careful management of
      this information
      Firms must be involved in a continual effort to build and
      maintain trust with and customers and partners



Rosenbaum: Ecommerce, digital information and the firm
   1. Managing the information flow
   Ecommerce firms must learn to manage the flow of
   digital information into and out of the organization and
      This info should be directed to the right person, at the
      right time and in the correct format
   They must learn how to mine this dynamic information
   flow, aggregating and segmenting it so that it can be
   used and reused when and where it is needed
      They should also be able to drill down into this
      information so that they can use “mass customization”
   Each unit in the firm must have real time access to
   current information about customers, competitors, firm
   activities and trends

Rosenbaum: Ecommerce, digital information and the firm
     Front end activities
   Direct solitary interactions (browsing, making
   or abandoning purchases, filling out forms,
   accepting cookies, downloading, and
   searching the knowledge base)
   Indirect interaction (server, browser, error,
   and other activity log files)
   Social interactions (people interact with the
   firm and other customers through the web
   site, customer service and support)                   Information flow

     Back end activities
   Group action (adding and removing content
   and functionality, changing design and
   structural features)
   “Customer facing information” (product and
   service descriptions, pricing information,
   warranty and service policies, return and
   complaint procedures, and privacy policies)

Rosenbaum: Ecommerce, digital information and the firm
   2. Being responsible users of the information
   Firms must be the stewards of the information they,
   solicit, and receive from customers, partners, suppliers
   and others
     They must take care of this information and let their
     customers and others know what they are doing with it
   Firms must seek to “balance the competitive advantages
   provided by the use of this information with the privacy
   concerns that use of personal information might raise
   among” their customers
                                        (Culnan and Armstrong 1999; 112)


Rosenbaum: Ecommerce, digital information and the firm
    Responsibility has a social component
    There should be clear policies easily accessible
    throughout the firm‟s web site explaining:
      ~How this information will be collected
      ~What it will be used for
      ~The rights that customers and other information
      providers have with respect to this information
    There should be social practices within the firm
    organized around protecting customer information




Rosenbaum: Ecommerce, digital information and the firm
  Responsibility also has a technical component
  Firms should investigate and become familiar with the
  range of privacy strategies that currently under
  discussion and evaluation by the ecommerce industry
    Platform for Privacy Preferences (P3P): individuals
    control their own personal information on the web
    Platform for Internet Content Selection (PICS): firms
    rate their own web pages and digital products
    RSACi: another labeling scheme
    INCORE: European self-labeling scheme



Rosenbaum: Ecommerce, digital information and the firm
   3. Building and maintaining trust
   Firms should be involved in a constant effort to build
   and maintain trust
   There is a “fundamental lack of faith between most
   businesses and consumers ...[who] simply do not trust
   most Web providers enough to engage in „relationship
   exchanges‟ involving money and personal information”
      (Hoffman, Novak, and Peralta, 1999; 80)
   Trust influences the transition from browser to buyer
   and is the basis of relationships between customer and
   firm
      Trust is essential to repeat business and the strength
      and public perception of the firm‟s reputation

Rosenbaum: Ecommerce, digital information and the firm
   Trust-building typically depends on face-to-face
   interaction or other shared experiences
      These are missing from the ecommerce experience
   The web site is the point of social contact between the
   customer and the firm and most exchanges are stripped
   to text, images, forms, links, and clicks.
   There are few social cues that the customer can garner
   from the presence of the other
      There is little online on which to base trust in the firm
      This is a limitation of the digital IE of ecommerce


Rosenbaum: Ecommerce, digital information and the firm
   To overcome this limitation, firms are developing means
   of building and maintaining relations of trust with
   customers
   Technical strategies for trust-building include the use of
   encryption and secure electronic transactions
   Social means of trust building are also important
     Perfect security will not encourage a person to
     purchase from an online firm if he or she does not trust
     the person or firm at the other end
     Web based customer service and support
     Privacy audits (TRUSTe)


Rosenbaum: Ecommerce, digital information and the firm
     I. Introduction: the social context of ecommerce
       II. The digital information environment of ecommerce
         III. Information imperatives for the firm
             IV. Conclusion: information and the conduct of
                 ebusiness




Rosenbaum: Ecommerce, digital information and the firm
  IV. Conclusion: information and the conduct of ebusiness
  The social context of ecommerce (its digital IE) has an
  information-intensive character
  Two constituent and useful elements of the IE are rules
  and resources
     They influence the ways in which people in the IE work
     with information and ICTs
     The subset of these rules considered here are called
     information imperatives
     These affect the flow of digital information produced by
     the ecommerce activities of the firm and its customers,
     partners, and suppliers

Rosenbaum: Ecommerce, digital information and the firm
   One subset of these rules are composed of three
   information imperatives for ebusinesses:
     ~Digital information generated by the firm’s ecommerce
     activities must flow rapidly and effectively through the
     entire organization
     The firm is responsible for the careful management of
     this information
     Firms must be involved in a continual effort to build and
     maintain trust with and customers and partners
   The next step involves the investigation of ebusinesses
   to examine the instantiations of these imperatives
     Research on trust in ecommerce

Rosenbaum: Ecommerce, digital information and the firm

								
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