E-Commerce, Web 2.0, and Social Networking Chapter 8

E-Commerce, Web 2.0, and Social Networking

Chapter 8

Customer comment on Fox Lake’s Facebook page“I would totally recommend Fox Lake Country Club for your wedding reception if you want to be told to disinvite your close friends and family. . . they were TOTAL liars who planned ballroom renovations DURING my wedding reception. . .They are just greedy business people who want to get your money. . .Whatever you do, don’t ever work with Fox Lake Country Club!!!!!”

This Could Happen to You: “She Said What on Our Facebook Page?”

8-2Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall

Scenario Video

Study Questions


Q1: What Types of Interorganizational Systems Exist?


Inter-organizatio

nal Systems

Pre-Internet Systems

E-Commerce

Web 2.0 Enterprise 2.0

Postal mail, telephone,

fax

Web Storefronts

Google, eBay,

Amazon, CNet

Social CRM, SOA

Interorganizational Systems


Q2: How Do Companies Use E-Commerce?


Merchant companies—take title to goods they sell

Nonmerchant companies—arrange for purchase and sale of goods without owning or taking title to those goods

Example of Use of B2B, B2G, and B2C


• E-commerce application enables auction company to offer goods for sale and to support a competitive-bidding process

Online auctions

• Provide goods and services at stated price, arrange delivery, but do not take title

• Amazon.com sells books and other merchandise for other businesses

Clearinghouses

• Match buyers and sellers• Priceline.com

Electronic exchanges

Nonmerchant E-Commerce Companies


Disintermediation

Companies learn how customers internalize competitors’ pricing, advertising, and messaging

Q2: How Does E-Commerce Improve Market Efficiency?


Retail StoreX

• Channel conflict• Price conflict with

traditional channels• Logistics expenses

increase for manufacturer

• Customer-service expenses increase for manufacturer

Economic Factors in

Disintermediation

What Economic Factors Disfavor E-Commerce?


Q3: Why is Web 2.0 Important to Business?


Figure 8-6

Software as a (Free) Service (SaaS)


Software as a (Free) Service


SaaS—thin-client applications run in Internet cloud

• License-free software• Does not require an installation on the users’

computers • Web servers download Web 2.0 programs as code

within HTML, as Flash, or as Silverlight code.• Readily (and frequently) updated. New features

added with little notice or fanfare.

Google Docs & Spreadsheets

Google GroupsGoogle Earth

Google Maps

User-Generated Content


Crowdsourcing examples

Mashups•Mashup —a web application that combines

data from other websites•Example—map data from Google Maps to

add location information to real-estate data, thus creating a new and distinct web service

•See www.programmableweb.com/mashups

Organic User Interfaces and Mashups


•AdWords•Vendors pay for specific words, phrases•Placement on search results list

depends on how much you pay for search word

•Vendor pays when someone clicks on their link

•Amount can vary day to day, hour to hour

•Ad Sense•Google inserts ads that match web

page content•Google pays web page owner for every

click•Website owners enroll in this program

to enable text, image, and video advertisements on their websites

Advertising

How Can Businesses Benefit from Web 2.0?


Kelly Loftus

"Advertising" should receive the same treatment as "social networking" "Mashups" and "UGC." Consider having Q6 heading on slides 20-22 too?

• Information systems that deal with assets, whether financial or material, requires control, rather than flexibility and organic growth.

Don’t get carried away

• Credit card transaction processing

• Accounts payable or general ledger system interface

Examples

Web 2.0 Not for All Applications


Social Capital—investment in social relations with expectation of returns in the marketplaceAdds value in four ways:

1. Information about opportunities, alternatives, problems and other factors

2. Influence decision makers in your organization or others

3. Social credentials from linking to network of highly regarded contacts

4. Personal re-enforcement of professional image and position

Q4: How Does Social Capital Benefit You and Organizations?


Value of social capital: Number of relationships in a social network, by strength of those relationships, and by resources controlled by those related.

Professional social networking factors

•Gain social capital by adding more friends and strengthening relationships with existing friends.

•Gain more social capital by adding friends and strengthening relationships with people who control resources important to you.

Social Capital


People you know the least contribute the most to your network.

Importance of Weak Relationships


Eileen is weak tie

Expand network by meeting

Eileen

Progressive organizations maintain a presence on Facebook, LinkedIn,Twitter, and other sites

•Sales people, customer support, public relations, and endorsements by high profile people

How Do Social Networks Add Value to Business?


Fan Connections and Endorsements


1. Define capital, human capital, and social capital. Explain how these terms differ.

2. How does the expression “It’s not what you know, but who you know that matters” pertain to the terms you defined in item 1.

3. Do you, personally, agree with the statement in item 2? Form your own opinion before discussing it with your fellow group members.

4. As a group, discuss the relative value of human and social capital. In what ways is social capital more valuable than human capital? Formulate a group consensus view on the validity of the statement in item 2.

Experiencing MIS InClass Exercise 8: Computing Your Social Capital


5. Visit the Facebook, LinkedIn, Twitter, or other social networking presence, site of each group member.

• Using definition of social capital value in this chapter, assess value of each group member’s social networking presence.

• Recommend at least one way to add value to each group member’s social capital at each site.

6. Suppose you each decide to feature your Facebook, or other social networking, page on your professional résumé.

• How would you change your presence you evaluated in item 5 in order to make it more appropriate?

• Describe three or four types of professionals you could add to your social network that would facilitate your job search.

Experiencing MIS InClass Exercise 8: Computing Your Social Capital (cont’d)


7. Imagine that you are the CEO of a company that has just one product to sell: You!a. Review Enterprise 2.0 SLATES principles in Figure 8-10 and

assess how each could pertain to the selling of your “product” (i.e., obtaining a quality job that you want). You can find the McAfee article at: http://sloanreview.mit.edu/the-magazine/files/saleable-pdfs/47306.pdfb. Explain how you could use your social networking presence to facilitate social CRM selling of your product.

c. Devise a creative and interesting way to use this exercise as part of your social CRM offering.

8. Present your answers to items 4 and 7 to the rest of the class.

Experiencing MIS InClass Exercise 8: Computing Your Social Capital (cont’d)


Classical CRM organization speak to customers with one voice and controlled messages, offer support for customers, depending on value of customer.

Today, customers craft own relationship with a business by their use of touch points.

Social CRM—creation and use of Enterprise 2.0 collaborative relationship between businesses and customers.

Q5: How Does Social CRM Empower Customers?


What Are the Characteristics of Web 2.0: SLATES


Social CRM done in style of Enterprise 2.0.

Relationships between organizations and customers emerge as both parties create and process content.Employees create wikis, blogs, discussion lists, frequently-asked-questions, sites for user reviews and commentary, and other dynamic content. Customers search content, contribute reviews and commentary, ask more questions, create user groups, etc. Each customer crafts own relationship with company.

Social CRM is Enterprise 2.0 CRM


Classical CRM

Centered on customer lifetime valueControl what customer reads, sees, hears about company and its products

Social CRM

Effective reviewer, commentator, or blogger can have significant influence

Classical CRM vs. Social CRM


Fox LakeAnne: Craft new marketing capabilities using Web 2.0, social networking, Enterprise 2.0, and Social CRM

Jeff: Encourage other employees to consider new marketing efforts

You

Craft short summary of what you’ve learned about Web 2.0, Enterprise 2.0, and social CRM to use it in a job interview Use new insights into social networking in business to help you find a job

How Does the Knowledge in This Chapter Help Fox Lake and You?


Study Questions


Scenario A A 15 year old posts a fake picture of himself and other false information on river rafting company’s website. Someone believes him to be “cool” and decides to go on a rafting trip with him and is disappointed when they learn the truth.

Q: Would the rafting company have any responsibility to refund person’s fees?

Ethics Guide: Hiding the Truth?


Scenario B

Assume you own and manage the rafting company.

Q: Is it unethical for you to encourage your employees to write positive reviews about your company?

Q: Does your assessment change if you ask your employees to use an email address other than the one they have at work?

Ethics Guide: Hiding the Truth? (cont’d)


Scenario CSuppose you pay your employees a bonus for every client they bring to a rafting trip. You encourage them to be creative in obtaining clients. One employee invites his MySpace friends to a party to show rafting trip photos. A guest dies in auto accident on way to party. His spouse sues your company.Q: Should company be held accountable?

Q: What if MRV managers knew about the presentation parties?

Q: Does it matter if you knew about the presentation? Would it matter if you had not encouraged employees to be creative?



Scenario DSuppose your rafting company has a website for customer reviews. In spite of your best efforts at camp cleanliness, on one trip (out of dozens) your staff accidentally serves contaminated food and everyone becomes ill with food-poisoning. One of those clients writes a poor review because of that experience.

Q: Is it ethical for you to delete that review from your site?

Ethics Guide: Hiding the Truth? (Cont’d)


Scenario EAssume you have a professor who has written a popular textbook. You are upset with the grade you received in his class, so you write a scandalously poor review of that professor’s book on Amazon.com.

Q: Are your actions ethical?



Scenario FInstead of owner, suppose you were at one time employed by this rafting company and you were, undeservedly you think, terminated by the company. To get even, you use Facebook to spread rumors to your friends (many of whom are river guides) about the safety of the company’s trips.

Q: Are your actions unethical?

Q: Are they illegal?

Q: Do you see any ethical distinctions between this situation and that in Scenario D?

Ethics Guide: Hiding the Truth? (Cont’d)


Scenario GSuppose you were once employed by rafting company and undeservedly terminated. You notice company’s owner has no Facebook account, so you create one. You’ve known her for many years and have dozens of photos, some were taken at parties and are unflattering and revealing. You post those photos along with critical comments she made about clients and employees when she was tired or frustrated. Comments are hurtful and humorous. You send “friend invitations” to people she knows, many were targets of her remarks.

Q: Are your actions unethical?



Employees sharing personal information at sociallyTechnology leads to blurring lines between work life and home life

Work is portable and always on

You need to be more careful about what you sayWork networks are not social networks

Guide: Blending the Personal and the Professional


Publicly listed New Zealand corporation that owns multiple brands and businesses in tourism industry.

$5 million (2009) in EBIT on $170 million in revenue

Operates in New Zealand, Australia, and Fiji, and has sales offices in Germany and United Kingdom

Current list of businesses, visit www.thlonline.com/THLBusinesses

Case Study 8: Tourism Holdings Limited


Case Study 8: Tourism Holdings Limited (cont’d)


CEO considers information systems and technology a core component of its business value and invested in a variety of innovative information systems and Web 2.0 technologies CEO speaks knowledgeably about information technologies, including SharePoint, Microsoft Office SharePoint Services (MOSS), Microsoft Report Server, OLAP, and data mining



Acquisition of multiple brands and companies created a disparate set of information systems using a variety of different technologies

Result: Excessive software maintenance and costs

Single development platform reduces maintenance expenses and focuses management attention, development, and personnel training on single set of technologies

Converted customer-facing websites to use Microsoft SharePoint and MOSS to reduce costs and simplify IS management

Sells directly to consumer

Actively uses Google AdWords and Google Analytics to understand how their sites are processed Experimenting with online chat, both voice and video

www.KiwiExperience.com. Click on “Plan Your NZ Trip”This case implies frequent acquisition and disposition of tourism brands poses problems for information systems



All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic,

mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.

Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall

Documents

E-Commerce, Web 2.0, and Social Networking Chapter 8