MIS 304Prof. Fang

Sonny GarciaJustin Fay

Blake GiuffreRicardo LedesmaSamir Hamideh

What is Ecommerce?

E-commerce is defined as “Electronic commerce or ecommerce is a term for any type of business, or commercial transaction, that involves the transfer of information across the Internet. It covers a range of different types of businesses, from consumer based retail sites, through auction or music sites, to business exchanges trading goods and services between corporations. It is currently one of the most important aspects of the Internet to emerge.”

History of Ecommerce

Year Event 1984 EDI, or electronic data interchange, was standardized through ASC X12. This

guaranteed that companies would be able to complete transactions with one another reliably.

1992 Compuserve offers online retail products to its customers. This gives people the first

chance to buy things off their computer. 1994 Netscape arrived. Providing users a simple browser to surf the Internet and a safe

online transaction technology called Secure Sockets Layer. 1995 Two of the biggest names in e-commerce are launched: Amazon.com and eBay.com. 1998 DSL, or Digital Subscriber Line, provides fast, always-on Internet service to

subscribers across California. This prompts people to spend more time, and money, online.

1999 Retail spending over the Internet reaches $20 billion, according to Business.com. 2000 The U.S government extended the moratorium on Internet taxes until at least 2005.

Industries Effected

Travel Stock Brokerage Books Entertainment Distance Education

Travel Industry

Channels of Sale:• Traditional Travel

Agencies: Brick and Mortor

• Ecommerce: Direct Reservation Systems (GDS) • Direct Sales

Channel• Online Travel Agents

Ecommerce Affect on Traditional Travel Agencies Struggles from Convenience Level

Online Travel Booking provide Uses old technology

Non GUI Interfaces• Can only compete on 2 extremes of

Income Scale• Low: Non Computer literate People• High: People who would rather pay someone

to book their trip.

Ecommerce Affect on Direct Sales Channels Ability to Dictate

their own Pricing Strategy

Increase Brand Image Stronger Customer

Relationship Management

Reduce Costs No GDS or Travel

Agent Fees

Ecommerce Affect on Online Travel Agencies

• Ability to Accommodate Customers Ease and Quickness of

Purchase Bundle of Air Travel,

Hotel, Rental Cars Wide Information

about prices and schedules

• Expand Market with Partnerships

Stock Brokerage

Key Words

Broker: An individual or firm which acts as an intermediary between a buyer and seller, usually charging a commission.

Stockbroker: Broker who deals primarily with transactions involving stock.

Full-Service Broker: A broker that provides a large variety of services to its clients, including research and advice, retirement planning, tax tips, and much more.

Online broker: A brokerage which provides trading services to its clients over the internet.

Discount Brokers

Online brokers are most often referred to as discount brokers…they allow you to:

Trade securities (fixed income and equities), options, mutual funds, and forex

Enter orders directly online Trade with other investors via ECN's

(electronic communication networks)

Discount Brokers Characteristics Low Commission Fees No advice to clients Trading Platform Research tools Real-time streaming quotes Up-to-date news releases

Three primary value components: Advice - The process of defining and

implementing an appropriate investment strategy given an investor's objectives and particular constraints.

Portfolio Management - The process of building and maintaining an investment portfolio that properly addresses the strategy that the advisory component has defined.

Administration - All the trading, clearing and reporting functions required to effectively execute the portfolio management processes.

Charges: Full Service vs. Discount Discount Brokers: We can assume

an annual cost of 0.5% per year, though it could be more or less depending on account size and trading volume.

An investor selecting load funds from a broker is outsourcing all three value components. Annual cost is around 2%.

Best Discount Brokers

Zecco Tradeking OptionsXpress ING Direct E-trade Scottrade Fidelity Vanguard Charles Schwab TD Ameritrade

What The Traditional Industry was Before E-commerce

Typical Retail system and operation Campus Bookstore

Inventory employees Customer oriented Additional products

E-Commerce Book Industry Business to Business (B2B) &

Business to Consumer (B2C) The Mother of the Book E-

Commerce Amazon

On-line bookstore Founder.

Largest online retailer Sales

Barnes & Nobles ebay.com

Half.com Individuals

Is still a service!!!

Pros and Cons Eliminated & Competed

physical-world retailers, catalog retailers, publishers, vendors, distributors & manufacturers

Save time Save Money

College students & Regulars Competitive Prices

Find scarce books Reviews & Feedback Information on book

Links

Pros & Cons Shipping Cost Time on Orders Students

Wrong Edition Don’t carry

Reviews Authors Customers buy the book they did not

want

Authors Do not make money

Future of the Current Industry

Kindle!!!!!!! Paperless Subscriptions

Entertainment Industry

Music Industry Movies/Film Industry Television Industry

Traditional Entertainment Industry

Buying music CDs

Going to the movies Renting movies

Cassette tapes DVDs

Going to concerts Watching TV as it comes on

Music

Before Ecommerce: You would go to your local Tower Records or

Wherehouse Music and buy a CD or tape You would go to your local Ticketmaster

outlet and stand in line to buy a concert ticket

After Ecommerce: You can go on iTunes and download your

favorite album You can log into Ticketmaster online and

buy your tickets without ever standing in line or even leaving your house.

Movies

Before Ecommerce: You would have to go to the movie theatre,

stand in line, and watch it with everyone else. You would have to go to the local video store

and rent the movie, then return it before it’s late, otherwise pay late fees.

After Ecommerce: You can download the latest movies in the

theatres from any one of hundreds of sites. Some charge a very nominal fee, others charge a subscription fee

You can rent movies from your computer from sites such as Netflix or Blockbuster Online.

Television

Before Ecommerce: You would have to watch your favorite

television shows as scheduled. You would have to call in to the cable

company and order a pay-per-view event. After Ecommerce:

You can stream live TV to your computer from all the major television networks

You can order pay-per-view on your computer, or directly on your television without ever having to talk to a person.

Entertainment Industry Conclusion Ecommerce has turned the

entertainment industry into a truly On Demand Industry

They have given people many options when it comes to music, movies, and TV that they’ve never had before.

Ecommerce has reshaped the entertainment industry and it will continue to do so.

Deliver education not physically onsite

History

1728 Short Hand Caleb phillips University of London was first to offer

distant learning degrees Charles Wedemeger of the University

of Wisconsin-Madison is considered the father of Distant education in America

20th century internet easier faster

Online Services and education University of Phoenix Registration 65.00 to 95.00 Resource Fee provides them full

access to an electronic library,textbooks and other ancillary materials required for the course.

Available are Virtual companies created by the university to give students more realistic assignments that can be done using case studies

Industry Economics

Fueling this growth are people who are busy

University of phoenix has 200,000 students and expects to have 500,000 by 2010

Little known about student success 96 percent of major colleges in the United

States offered online courses and almost 3.2 million US were at least taking one online course during the fall 2005 term.

Economics Continued

E learning indusrty estimated to be worth 38 billion Euros

Growth E learing, by 2006, 3.5 million students were participating in online learning at instuitions in US

Conclusion

As you can see E-commerce has forever changed every industry it’s touched. What was the standard foundation of business practices even as little as 20 years ago is no longer relevant.

The move to E-commerce has effected every aspect of peoples lives from the way they travel to how they travel, to how they make and spend their money, to how they entertain themselves.

Whether you’re an Ebay shop-aholic, Or you don’t even like checking your email you must admit one thing. The E-commerce way of life is now part of your life whether you like it or not.