The Web Revolution
5. E-Business and E-Commerce 6. Mobile, Wireless, and Pervasive Computing
chapter E-Business and E-Commerce
Dell Is Using E-Commerce for Success b.l Overview of E-Business and E-Commerce D.C Major EC Mechanisms u.u Business-to-Consumer Applications S.4 B2B Applications D.b Major Models of E-Business: From E-Government to C2C D.u E-Commerce SupportServices: Advertising, Payment, and Order Fullfilment b./ Ethical and Legal Issues in E-Business b.O Managerial Issues
Alter suid\ins this chapter, you will he able to: O Desciibe electronic commerce, its scope, benefits, limitations, and l\pes.
0 Understand the basics of how online auctions and battering woik. O Descnbe the major applications ,)( business-to-consumerconimeice. including ser\ice industries and the major issues taced by e-taileis.
O Describe business-to-business applications. 0 Describe intrabusiness and B2E e-commerce.
0 Describe e-government activities and consumer-toconsumer e-commerce. O Describe the e-commerce support services, specifically payments and logistics. 0 Discuss the importance and activities of online advertising. _-/ 0Discuss some ethical and legal issues relating to e-commerce. © Describe EC failures and strategies for success.
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IPELL IS USING E-COMM
The Business Problem/Opportunity
Founded in 1984 by Michael Dell, Dell Computer Corp. (now known as Dell) was the first company to offerpersonal computers (PCs) via mail order. Dell designed its own PC system and allowed customers to configure their own customized systems using the build-to-order concept (see Appendix 2A) and shipped to them by direct mail. These concepts were, and are, Dell's cornerstone business models. By 1993, Dell had become one of the top-five computer makers worldwide, threatening Compaq, which started aprice war. At that time, Dell was taking orders by fax and snail mail and losing money. Losses reached over $100 million by 1994. The company was in trouble.
For example, British Airways (BA) considers Dell to be a strategic supplier. Dell provides notebook and desktop cgftnputers to 25,000 BA users. Dell offers two e-procurement services to BA purchasing agents. The more basicservice, Premier Dell, allows BA (and other businesses) to browse, ^P buy, and track orders on a Dell Web site customized for --j*„ the user's requirements. The site enables authorized users to select preconfigured PCs for their business unit or department. This provides automatic requisition and order fulfillment once an authorized user has chosen to buy a PC from Dell. BA has placed thee-procurement tools on their EWorking intranet. This allows authorized staff to purchase PCs through a portal that connects directly into Dell's systems. Business-to-Consumer (B2Q. Dell sells direct to individuals from its private marketplace (store). Using fairly standard mechanisms such as electronic catalog, shopping carts, and payment gateway and shipping, any customer can configure and price a desktop,laptop, or other product sold by Dell. Payment must be arranged in advance. Customers can also participate in auctions of refurbished computers, which are periodically conducted online. In addition to supporting its business customers with e-procurement tools, such as in the case of BA, Dell is using EC in its own procurement. Actually, Dell developed an e-procurement model that it shares with itsbusiness partners, such as BA. One aspect of this model is the use of electronic tendering to conduct bids, known as reverse auctions. Dell uses electronic tendering when it buys the components for its products. E-Collaboration. Dell has many business partners with which communication and collaboration is necessary. For example, Dell uses shippers such as UPS and FedEx to deliver its computers...