Page 81 - Introduction to Electronic Commerce and Social Commerce

Summary 59

SECTION 2.8 REVIEW QUESTIONS mechanisms are marketplaces, webstores, shopping
carts, catalogs, search engines, Web 2.0 tools, and vir-
1. What is Web 3.0, and how will it differ from Web 2.0? tual communities.
2. Define Semantic Web. Most of the activities are between sellers and buyers.
3. List the major potential inhibitors and concerns of However, there also are collaboration activities among
e- commerce and Web 3.0. supply chain members as well as among people within
4. What are the major influencing computing and IT trends? organizations. EC attempts to automate the interaction
5. What are Web 4.0 and Web 5.0? process for the above activities.
2. E-marketplaces and their components. An e- market-
place or marketspace is a virtual market that does not
MANAGERIAL ISSUES suffer from limitations of space, time, or borders. As
such, it can be very efficient and effective. Its major
Some managerial issues related to this chapter are as follows. components include customers, sellers, products (some
digital), infrastructure, front-end processes, back- end
1. Should we use auctions for selling? A major strategic activities, electronic intermediaries, other business part-
issue is whether to use auctions as sales channels. Auctions ners, and support services.
do have some limitations, and forward auctions may cre- The role of intermediaries will change as e-markets
ate conflicts with other distribution channels. If a company develop: Some will be eliminated (disintermediation);
decides to use auctions, it needs to select auction mecha- others will change their roles and prosper (reintermedia-
nisms and determine a pricing strategy. These decisions tion). In the B2B area, for example, e-distributors con-
determine the success of the auctions and the ability to nect manufacturers with buyers by aggregating e-catalogs
attract and retain visitors on the selling site. Auctions also of many suppliers. New value-added services that range
require support services. Decisions about how to provide from content creation to syndication are mushrooming.
these services and to what extent to use business partners 3. The major types of e-marketplaces. In the B2C area,
are critical to the success of high-volume auctions. there are webstores and e-malls. In the B2B area, there
2. Should we barter? Bartering can be an interesting strat- are private and public e-marketplaces, which may be
egy, especially for companies that lack cash, need special vertical (within one industry) or horizontal (across dif-
material or machinery, and have surplus resources. ferent industries). Exchanges are the platform for many
However, the valuation of what is bought or sold may be buyers and sellers to meet and trade. Different types of
hard to determine, and the tax implications in some coun- portals provide access to e-marketplaces.
tries are not clear. 4. Electronic catalogs, search engines, and shopping
3. How do we select merchant software? There are many carts. The major mechanisms in e-markets are e- catalogs,
products and vendors on the market. Small businesses search engines, software (intelligent) agents, and elec-
should consider offers from Yahoo! or eBay since the tronic shopping carts. These mechanisms, which are
software is combined with hosting and offers exposure to known as merchant suites, facilitate EC by providing a
the vendor-managed e-market. The functionalities of the user-friendly and efficient shopping environment.
software as well as the ease of building webstores need to 5. Types of auctions and their characteristics. In for-
be examined. ward auctions, bids from buyers are placed sequentially,
4. How can we use Facebook and other social networks either in increasing mode or in decreasing mode. In
in our business? There are many possibilities that are reverse auctions, buyers place an RFQ and suppliers
presented in Chapter 7, mostly in marketing and advertis- submit offers in one or several rounds. In name-your-
ing. Any progressive organization should examine and own-price auctions, buyers specify how much they are
experiment with social networking. willing to pay for a product or service, and an intermedi-
ary tries to find a supplier to fulfill the request. Penny
auctions are forward auctions where a small fee is paid
SUMMARY each time a bid is made. The final member to bid wins
the auction when the designated time is up.
In this chapter, you learned about the following EC issues as 6. The benefits and limitations of auctions. The major ben-
they relate to the chapter’s learning objectives. efits for sellers are the ability to reach many buyers, sell
quickly, and save on intermediary commissions. Buyers
1. Activities and mechanisms. The major activities are have excellent access to auctions, and a chance to obtain
information dissemination and presence, online trading, bargains and collectibles while shopping from their
collaboration, entertainment, and search. The major homes. The major limitation is the possibility of fraud.