E-Commerce: Digital Markets and Digital Goods

What are the unique features of e-commerce, digital markets, and digital goods? Name and describe four business trends and three technology trends shaping e-commerce today

There are eight unique features of e-commerce, digital markets, and digital goods that may be explained by the unique nature of the Internet and the Web that serve as the basis for any kind of e-commercial activity. They are ubiquity (the possibility to use it everywhere), global reach (the possibility reach any part of the world), universal standards (all people should follow the same Internet standards), richness (the possibility to send and deliver various messages with video, audio, text, and photos), interactivity (the possibility of interaction between the technology and the user), information density (a huge amount of information that cannot be even calculated is available to market participants), personalization (modification of messages is possible), and social technology (user content creation and distribution are possible through social networks).

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The main business trends that are connected with e-commerce are an online market for software, online travel reservations, social networks such as Twitter or Facebook, and mobile e-commerce. Three technology trends are the wireless Internet connection, smartphones, and mobile devices that can support web usage, music, and other forms of entertainment, and Internet-based computing models like Cloud Computing.

What are the principal e-commerce business and revenue models?

There is seven principal e-commerce business model. E-tailer makes physical products available to consumers. The transaction broker helps to save money and time during online transactions. Market creator promotes the required digital environment where users can meet, search, choose, and take other activities to make purchases. The content provider makes it financially possible to share digital news, music, and other information via the Internet. Community provider takes responsibility for places where people with the same interests can meet and communicate. Portal is the point of entry to the Internet. The service provider introduces Web 2.0 applications with the help of which information exchange is possible.

The main e-commerce revenue models are advertising revenue (to attract people), sales revenue (to sell products), subscription revenue (to charge a subscription fee), free revenue (to offer free services), transaction fee revenue (to promote a fee for transactions), an affiliate revenue (to redirect visitors).

How has e-commerce transformed marketing? Explain how social networking and the “wisdom of crowds” help companies improve their marketing.

There are several reasons why it is possible to believe that e-commerce has successfully transformed marketing. Internet providers offer new ways of how to identify consumers and provide them with the best communicative environment. The cost of such opportunities is lower in comparison to the costs required by traditional media. The idea of “the wisdom of crowds” penetrates society and helps organizations use their customers as the sources of information on how to improve their services and working conditions. Thousands of customers may share their opinions so that companies may satisfy their needs. In other words, e-commerce succeeds in increasing customer value in comparison to ordinary marketing. Companies learn how to make use of banners, video ads, and other media to attract more consumers from different parts of the world in a short period of time.

How has e-commerce affected business-to-business transactions? Explain how Internet technology supports business-to-business electronic commerce

The relations between e-commerce and business-to-business transactions cannot be neglected. Business-to-business transactions have been considerably improved with e-commerce because organizations get numerous opportunities and options to choose and contact their suppliers, place orders, discuss delivery details, and save their time due to the available electronic forms of communication. A single marketplace is offered to take the necessary steps and make decisions. The current Internet technologies support business-to-business commerce by means of the development of special electronic schedules that can be available and corrected in a short period of time and transactions that can be transmitted quickly from one part of the world to another without any additional efforts or travels.

What is the role of m-commerce in business, and what are the most important m-commerce applications?

M-commerce plays a crucial role in business because of the possibility to provide users with quick access to the required information at any place due to the constantly available Internet connection. Though people are still challenged with m-commerce options because of tiny mechanisms, the possibility to choose any payment systems and support data-rich communication attracts many people. The most important applications are location-based services (a symbolic compass for people in need), financial services (operations with bank accounts are possible), wireless advertising (ad messages can be sent), games and other forms of entertainment (the possibility to download movies, music, games, etc.), and personal services (a chance to write diaries, create data profiles, etc.).

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What issues must be addressed when building an e-commerce Web site? List and describe the four types of e-commerce presence

The process of building a new e-commerce Web site is not an easy process and requires a number of skills and understanding of what should be done and what goals should be met. All important decisions concerning the sphere of business, team members, and goals should be made beforehand. It is necessary to consider the necessary technological aspects and analyze the level of readiness to work hard and constantly. Besides, design details should be discussed. In regards to the identified goals and opportunities, it is necessary to understand what kind of information is available and what data should be found. Finally, the solution if it is an in-house, or partially, or fully outsourced activity should be offered. A person has to decide if he/she is able to build a website alone or external expert services are required.

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