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Resume chapter 1

What is E-Commerce?
E-Commerce-The use of the Internet and Web to transact business. Digitally enabled transactions include all transactions mediated by digital technology. For the most part, this means transactions that occur over the Internet and the Web. Coomercial transactions involve the exchangeof value (e.g., money) across organizational or individual boundaries in return for products and services. Exchange of value is important for understanding the limits of e-commerce. Without and exchange of values, no commerce occurs.

Why Study E-Commerce?
Prior to the development of e-commerce, the process of marketing and selling goods was a mass-marketing and sales force-driven process. Consumers were viewed as passive targets of advertising “campaigns” and branding blitzes intended to influence their long-term product perceptions and immidiate purchasing behavior. Selling was conducted in well-insulated “channels.” Consumers were considered to be trapped by geographical and social boundaries, unable to search widely for the best price and quality. Information about prices, costs, and fees could be hidden from the consumer, creating profitable “information asymmetries” for selling firm. Information asymmetry refers to any disparity ini relevant market information among parties in a transaction. It was so expensive to change national or regional prices in traditional retailing (what are called menu costs) that “one national price” was norm, and dynamic pricing to the marketplace-changing prices in real time-was unheard of.

Seven Unique Features of E-Commerce Technology

  1. Ubiquity
    E-Commerce is ubiquitous, meaning that is it available just about everywhere, at all times
  2. Global Reach
    E-commerce technology permits commercial transactions to cross cultural and national boundaries far more conveniently and cost effectively than is true in traditional commerce. As a result, the potential market size for e-commerce merchants is roughly equal to the size of world’s online population (over 500 million in 2003, and growing rapidy, according to the Computer Industry Almanac)
  3. Universal Standards
    One strikingly unusual feature of e-commerce technologies is that the technical standards of the Internet, and therefore the technical standards for conducting e-commerce, are universal standards-they are shared by all nations around the world. In contrast, most traditional commerce technology differ from one nation to the next.
  4. Richness
    Information richness refer to the complexity and the content of a message (Evan and Wurster, 1997; 1999). The richness of traditional markets make them a powerfull selling or commercial environtment. Prior to the development of the Web, there was a trade-off between richness and rich: the larger the audience reached, the less rich the message.
  5. Interactivity
    E-commerce technologies are interactive, meaning they allow for two-way communication between merchant and consumer. Interactivity allows an online merchant to engage a consumer in ways similar to a face-to-face experience, but on a much more massive, global scale.
  6. Information Density
    The Internet and the Web vastly increase information density-the total amount and quality of information available to all market participants, consumers, and merchant alike. E-commerce technologies reduce information collection, storage, processing, and communication costs. At the same time, these technologies increase greatly the currency, accuracy, and timeliness of information-making information more useful and important than ever. As a result, information becomes more plentiful, cheaper, and of higher quality.
  7. Personalization/Customization
    E-commerce technologies permit personalization: Merchant can target their marketing messages to specific individuals by adjusting the message to a person’s name, interests, and past purchases. The technology also permits customization-changing the delivered product or service based on a user’s preferences or prior behavior. Given the interactive nature of e-commerce technology, a lot of information about the consumer can be gathered in the marketplace at the moment of purchase. With the increase in information density, a great deal of information about the consumer past purchases and behavior can be stored and used by online merchants.

Types of E-Commerce
There are variety of different types of e-commerce and many different ways to characterize these types.

  1. B2C. The most commonly discussed type of e-commerce is Business-to-Consumer (B2C) e-commerce, in which online businesses attempt to reach individual consumers.
  2. B2B. Business-to-Business (B2B) e-commerce, in which businesses focus on selling to other businesses.
  3. C2C. Consumer-to-Consumer (C2C) e-commerce provides away for consumer to sell to each other, with the help of an online market maker such as the auction site eBay.
  4. P2P. Peer-to-peer technology enables Internet users to share files and computer resources directly without having to go through a central Web server.
  5. M-commerce. Mobile commerce, or M-commerce, refers to the use of wireless digital devices to enable transactions on the Web.

Understand the success and the failures of E-commerce I.
E-commerce during the E-commerce I era was:
• a technological success, with the digital infrastructure created during the period solid enough to sustain significant growth in e-commerce during the next decade.
• a mixed business success, with significant revenue growth and customer usage, but low profit margins.
E-commerce during E-commerce I era did not:
• fullfill economist’s visions of the perfect Bertrand market and friction-free commerce.
• fullfill the visions of entrepreneurs and venture capitalists for first mover advantages, low customer acquisition and retention costs, and low costs of doing business.

Yang saya harapkan dari pelajaran ini semoga dapat lebih mengerti penjualan online, membuat website yang menarik konsumen, dapat mengetahui ecommerce lebih dalam

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