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As we enter the third millennium, we experience one of the most important changes in our lives—the move to an Internet-based society. Almost everything is changed at home, in school, at work, in the government—even in our leisure activities. Some changes are already here, and they are spreading around the globe. Others are just beginning. One of the most significant changes is in the manner we conduct business, especially in how we manage the marketplaces and commerce.
Electronic commerce (EC) describes the manner in which transactions take place over networks, mostly the Internet. It is the process of electronically buying and selling goods, services, and information. Certain EC applications, such as buying and selling stocks on the Internet, is growing at a rate of several hundred percent every year. EC could have an impact on a significant portion of the world, on businesses, professions, and, of course, on people.
However, the impact of EC is not just the creation of Web-based corporations. It is the building of a new industrial order. Such a revolution brings a myriad of opportunities as well as risks. Bill Gates is aware of that, as Microsoft is continually developing Internet and EC products and services. Yet, Gates has said that Microsoft is always 2 years away from failure, that somewhere out there is a competitor, unborn and unknown, who will render your business model obsolete. Bill Gates knows that competition today is not among products, but among business models. He knows that irrelevancy is a bigger risk than inefficiency. What is true for Microsoft is true for just about every other company. The hottest and most dangerous new business models out there are on the Web.
The purpose of this book is to describe what EC is; how it is being conducted and managed; and its major opportunities, limitations, issues, and risks. EC is an interdisciplinary topic and, therefore, it should be of interest to managers and professional people in any functional area of the business world.
This new edition, the 2002 edition,. is as different from the first edition as EC in 2002 is different from EC in 2000. Today, e-commerce is going through a period of consolidation, where instead of enthusiasm, careful attention is given to proper strategy and implementation. Most of all, people recognize that e-business has two parts, one of which is business, not just technology. These changes are reflected in the second edition.
In addition, people in government, education, health services, and other areas could benefit from learning about EC. This book is structured around the notion that EC applications, such as home banking, e-government, or auctions, require certain technological infrastructures and other support mechanisms. The applications are divided into business-to-consumer, business-to-business, and intrabusiness. The infrastructure is in the areas of hardware, networks, and software. The support services range from secured payment systems to logistics and legal issues.
This book is one of the first texts entirely dedicated to EC. It is written by experienced authors who share academic as well as real-world experiences, including an e-business lawyer. It is a comprehensive text that can be used in one-semester or even two-semester courses, or it can supplement a text on Internet fundamentals, on MIS, or on marketing.
FEATURES OF THIS EDITION
Several features are unique to this book. They include:
THE MAJOR DIFFERENCES BETWEEN THE 1ST EDITION AND THIS EDITION
ORGANIZATION OF THE BOOK
The book is divided into six parts composed of 19 chapters with five supplemental technology appendices.
PART I—A REAL REVOLUTION
In this part we provide an overview of the entire book as well as the fundamentals of EC and some of its terminology (Chapter 1) and a discussion of the digital economy (Chapter 2).
PART II—B2C EC-INTERNET MARKETING
In this part we describe EC B2C applications in three chapters. Chapters 3 deals with e-tailing, Chapter 4 with Internet consumers and market research, ands Chapter 5 deals with EC advertisement, which is mostly related to business-to-consumer EC.
PART III—B2C EC
In this part we cover the one-to-many model (Chapter 6, including auctions), many-to-many model (Chapter 7, including exchanges), and business-to-business; services (Chapter 8).
PART IV—OTHER EC MODELS AND APPLICATIONS
This part begins with detailed description of online auctions (Chapter 9), then it moves to service industries online (travel, stocks, banking, etc.) (Chapter 10). In Chapter 11 we cover e-government, intrabusiness applications, and consumer-to-consumer EC.
PART V—BUILDING EC SYSTEMS
This part of the book opens with an overview of EC application development (Chapter 12). This is followed by security (Chapter 13) and payments (Chapter 14). Appendix 12A provides step-by-step instructions on how to build a storefront. Chapter 15 closes this part with order fulfillment and supply chain management coverage.
PART VI—IMPLEMENTING EC
Starting with e-strategy (Chapter 16), this part deals with implementing and deploying EC. The legal environment is the subject of Chapter 17. Chapter 18 gives a glance at electronic communities as well as at several other issues, such as global EC, small businesses and EC, and EC research. This chapter also provides an overview of future EC directions. The text concludes with Chapter 19 on mobile commerce (m-commerce).
LEARNING AIDS
We developed a number of learning aids including:
SUPPLEMENTARY MATERIALS
The following material is available to support this book:
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