E-Commerce Strategy: Text and Cases

269 Pages·2013·2.356 MB·English

by  Sanjay Mohapatra (auth.)

Springer Texts in Business and Economics
For furthervolumes:
http://www.springer.com/series/10099
Sanjay Mohapatra
E-Commerce Strategy
Text and Cases
123
SanjayMohapatra
XavierInstituteof Management
XavierRoad
Bhubaneswar, Odisha751013
India
ISSN 2192-4333 ISSN 2192-4341 (electronic)
ISBN 978-1-4614-4141-0 ISBN 978-1-4614-4142-7 (eBook)
DOI 10.1007/978-1-4614-4142-7
SpringerNewYorkHeidelbergDordrechtLondon
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Dedicated to
Late Parmananda Mishra
Late Dr. Sushila Mishra
Dr. B. C. Mohapatra
Preface
This textbook is ideal for the E-Commerce class in an MBA program. It can also
beusedinseniorundergraduateelectivesandforITconsultantsandpractitioners.
The book has many strengths:
• Placing e-commerce in the historical context: a chronological events of evolu-
tion of e-commerce that provides the perspective on the rise and fall of dot-
coms.Thebookanalyzesthecauseofthefailuresofdot-coms,providesareport
card of the different sectors of e-commerce, and the challenges of the future.
• Unique topic coverage: the book covers topics not found in many competing
books (e.g. open source, online research, m-commerce, peer-to-peer systems,
socio-commerce,web2.0).Sometopicsarealsocoveredinmuchgreaterdepth
(e.g. e-channel adoption, factors affecting e-commerce adoption and strategy
design, integration of e-commerce with social networking sites). New ideas are
placed in the context of respected theories. Managerial frameworks are pro-
vided.Theapproachreliesoninformationandtheoriesfrommanydisciplines.I
have tried to integrate these different perspectives to create an integrative
overview of the field.
• Case studies: this book presents both the positives and negatives of new ideas.
In-depth case studies analyze well-known companies(i.e.Amazon.com,eBay).
Rather than limiting the discussion to successes, cases also cover failures (e.g.
Fabmall.com,Walmart.com).Unlikeotherbooksonthesametopic,itillustrates
cases from developing countries where e-commerce has strong potential.
• Learning objectives: Learning objectives appear at the beginning of each
chapter and highlight the major goals to keep in mind while reading each
chapter.
• Summaries:anexecutivesummaryisprovidedforeachchapter.Thisisidealfor
thebusystudentoftoday.Instructorscanalsoperusethesummarytogetabetter
idea of the contexts.
• Written with a practitioner’s approach, this book can be utilized in a variety of
courses in information systems, e-marketing, and management.
vii
viii Preface
• The book is divided into two parts—Part I and Part II. Part I deals with fun-
damental concepts such as Web design technology, concepts of e-business,
evolution of e-commerce, e-tailing, etc. which are part of the syllabi offered in
most universities. Part II deals with e-commerce strategy, socio-commerce
strategy, e-commerce distribution channel design strategy, role of stakeholders,
adoptionofe-commerceinsmallandmediumenterprises.ThechaptersforPart
I deal with fundamentals while the chapters for Part II deal with strategy.
Acknowledgments
Theproductionofanybookofthismagnitudeinvolvesvaluedcontributionsfrom
manypersons.IwouldliketothankAmboyMatthewforprovidingustheeditorial
support and making this project a reality.
One chapter of the book has been contributed by Inma Rodríguez-Ardura,
Antoni Meseguer-Artola, Jordi and Vilaseca-Requenaeed (Drivers of online-sell-
ing diffusion: a look at organizational and environmental factors through time).
Theundersignedacknowledgestheircontributionwithgratitudeastheytookquite
an effort to prepare the write-up for the book.
I would also like to thank Soumya Das from XIMB who has helped me in
preparing contents on irctc.co.in. I would also like to place in records the help
extended by Amrit Swain, Mani Tiwari, M Srikanth, Mainak Das, Nishith Sahu,
and Piyush Panda while preparing the manuscript. I wish them fulfilling and
rewarding careers. May God bless them all.
Asit Mahapatra, Commissioner of Income Tax has gone out of his way to
provide a smooth passage for the contract with the publisher. The author
acknowledges his efforts and wishes him Godspeed in all his endeavors.
Last but not the least, I would like to thank Dr. Bharati (my wife) for helping
me in taking decisions at a critical stage of the manuscript.
Dr. Sanjay Mohapatra
ix
Contents
Part I Fundamentals
1 Understanding E-Commerce. . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.1 Learning Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.2 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.3 The Dot-Com Era. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.4 Amazon.Com: Synonymous with E-Commerce . . . . . . . . . . 5
1.5 Dell: An Evolutionary E-Commerce . . . . . . . . . . . . . . . . . . 6
1.6 What is E-Commerce?. . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.7 The Changing Times in E-Commerce. . . . . . . . . . . . . . . . . 10
1.7.1 Growth of Internet . . . . . . . . . . . . . . . . . . . . . . . 10
1.7.2 Chronological Events. . . . . . . . . . . . . . . . . . . . . . 11
1.8 Present Scenario. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.9 Future of E-Commerce . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.10 Constituents of E-Commerce . . . . . . . . . . . . . . . . . . . . . . . 14
1.10.1 E-Commerce Design Services. . . . . . . . . . . . . . . . 14
1.11 E-Commerce Web Design . . . . . . . . . . . . . . . . . . . . . . . . . 15
1.11.1 E-Commerce Development. . . . . . . . . . . . . . . . . . 16
1.11.2 Marketing E-Commerce Portal . . . . . . . . . . . . . . . 16
1.12 E-Commerce Portal and Web 2.0—Future Trend . . . . . . . . . 17
1.12.1 Web 2.0. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
1.12.2 Changing Role of Web 2.0. . . . . . . . . . . . . . . . . . 18
1.13 E-Business and E-Commerce Web Portals. . . . . . . . . . . . . . 20
1.13.1 Variety of Portals . . . . . . . . . . . . . . . . . . . . . . . . 20
1.13.2 E-Commerce and Social Networking Portals . . . . . 21
1.13.3 Business to Business. . . . . . . . . . . . . . . . . . . . . . 22
1.13.4 Future Trend in Web 2.0 and B2b E-Commerce. . . 23
1.14 Case: Sullekha.com. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
1.15 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
1.16 Review Questions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
xi
xii Contents
2 Technologies for E-Commerce . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.1 Learning Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.2 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
2.3 Basic Architecture of Internet. . . . . . . . . . . . . . . . . . . . . . . 28
2.4 TCP/IP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
2.5 IPv4 Versus IPv6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
2.6 Evolution of Internet. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
2.7 Uniform Resource Locator. . . . . . . . . . . . . . . . . . . . . . . . . 35
2.8 Hypertext Transfer Protocol. . . . . . . . . . . . . . . . . . . . . . . . 36
2.9 Cookies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
2.10 Client Side or Web Programing . . . . . . . . . . . . . . . . . . . . . 38
2.11 HTML Programing Techniques . . . . . . . . . . . . . . . . . . . . . 39
2.12 Links. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
2.13 Images. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
2.14 Tables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
2.15 Frames . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
2.16 Form. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
2.17 Style Sheets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
2.18 JavaScript . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
2.19 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
2.20 Review Questions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
3 Web Page Hosting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
3.1 Learning Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
3.2 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
3.3 Web Page Elements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
3.3.1 Offline Web Pages . . . . . . . . . . . . . . . . . . . . . . . 46
3.4 Web Page Development Life Cycle . . . . . . . . . . . . . . . . . . 48
3.4.1 Formatting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
3.4.2 Troubleshooting . . . . . . . . . . . . . . . . . . . . . . . . . 49
3.4.3 Publish the Web Page . . . . . . . . . . . . . . . . . . . . . 49
3.5 Installing Web Pages on a Web Server . . . . . . . . . . . . . . . . 49
3.5.1 Steps for Web Page Publishing. . . . . . . . . . . . . . . 50
3.5.2 Plagiarism in Web Publishing. . . . . . . . . . . . . . . . 53
3.6 Legal and Ethical Issues in Web Publishing. . . . . . . . . . . . . 53
3.6.1 Copyright Basics. . . . . . . . . . . . . . . . . . . . . . . . . 55
3.7 Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
3.8 Review Questions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
4 Concepts in E-Commerce . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
4.1 Learning Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
4.2 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Contents xiii
4.3 Concepts and Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . 73
4.3.1 What is E-Commerce?. . . . . . . . . . . . . . . . . . . . . 73
4.3.2 Is E-Commerce the Same as E-Business?. . . . . . . . 73
4.3.3 Is the Internet Economy Synonymous
with E-Commerce and E-Business?. . . . . . . . . . . . 74
4.4 Different Types of E-Commerce?. . . . . . . . . . . . . . . . . . . . 74
4.4.1 B2B E-Commerce. . . . . . . . . . . . . . . . . . . . . . . . 77
4.4.2 Transaction Costs . . . . . . . . . . . . . . . . . . . . . . . . 78
4.4.3 Disintermediation . . . . . . . . . . . . . . . . . . . . . . . . 78
4.4.4 Transparency in Pricing. . . . . . . . . . . . . . . . . . . . 78
4.4.5 Economies of Scale and Network Effects. . . . . . . . 79
4.4.6 B2C E-Commerce. . . . . . . . . . . . . . . . . . . . . . . . 79
4.4.7 B2G E-Commerce. . . . . . . . . . . . . . . . . . . . . . . . 80
4.4.8 C2C E-Commerce. . . . . . . . . . . . . . . . . . . . . . . . 80
4.5 Understanding M-Commerce? . . . . . . . . . . . . . . . . . . . . . . 81
4.6 Factors Affecting E-Commerce . . . . . . . . . . . . . . . . . . . . . 82
4.7 E-Commerce Components . . . . . . . . . . . . . . . . . . . . . . . . . 84
4.7.1 Internet and E-Commerce . . . . . . . . . . . . . . . . . . 85
4.7.2 Intranet and E-Commerce . . . . . . . . . . . . . . . . . . 85
4.8 E-Commerce and Consumers. . . . . . . . . . . . . . . . . . . . . . . 87
4.9 Business Transformation Through E-Commerce. . . . . . . . . . 87
4.9.1 Linking Stakeholders Through E-Commerce . . . . . 87
4.10 Components of E-Business . . . . . . . . . . . . . . . . . . . . . . . . 88
4.11 E-Commerce Applications: Issues and Prospects . . . . . . . . . 88
4.12 E-Commerce in Developing Countries. . . . . . . . . . . . . . . . . 88
4.12.1 A. Traditional Payment Methods. . . . . . . . . . . . . . 89
4.12.2 B. Electronic Payment Methods . . . . . . . . . . . . . . 89
4.13 Electronic Payment System . . . . . . . . . . . . . . . . . . . . . . . . 89
4.13.1 Security Issues in E-Payment System . . . . . . . . . . 90
4.14 Understanding E-Banking . . . . . . . . . . . . . . . . . . . . . . . . . 90
4.14.1 E-Banking in Third World Countries. . . . . . . . . . . 90
4.14.2 The Philippine Experience. . . . . . . . . . . . . . . . . . 90
4.14.3 The Singapore Experience . . . . . . . . . . . . . . . . . . 91
4.14.4 The Malaysian Experience. . . . . . . . . . . . . . . . . . 91
4.15 Factors of the Growth of E-Banking
in Developing Countries . . . . . . . . . . . . . . . . . . . . . . . . . . 92
4.16 Future Trend in E-Banking in Third World Countries. . . . . . 92
4.17 Understanding E-Tailing . . . . . . . . . . . . . . . . . . . . . . . . . . 93
4.17.1 Trends and Prospects for E-Tailing. . . . . . . . . . . . 93
4.18 Online Publishing and E-Commerce . . . . . . . . . . . . . . . . . . 93
4.18.1 Advantages of Online Publishing to Business. . . . . 93
4.18.2 Issues in Online Publishing . . . . . . . . . . . . . . . . . 94