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Critical Evaluation of E-Business Applications

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Introduction

Critical Evaluation of E-Business Applications A business model can be defined as "a high-level description of an application type which contains all the common features which can be found in specific examples of the model." (Ince, D, 2004). In short a business model could be thought of as the architecture or layout the e-business site will take to provide a mechanism for people to interact and obtain goods or services. Providing an all-inclusive listing of electronic commerce business models is a never ending task-new business models emerge rapidly. I will focus my review of a selection of e-business models on the models Paul Timmers has identified. Timmers identified 11 models however I have just focused on the most common of these. E-Procurement - This is the electronic tendering of goods and services. It is mainly used by large organisations hoping to reduce costs by having a wider choice of suppliers. E-procurement works by the business announcing the fact it wants to acquire goods and possible suppliers can then bid for the contract. E-Auction - This model describes sites which electronically simulate the bidding process from a traditional physical auction. Revenues are raised by this form of site by charging for a transaction and for advertising. A very successful example of an e-auction is eBay. E-Shop - This is the web marketing of a company to promote the company and its goods or services, e-shops also inevitably also contain facilities for ordering and paying for products. ...read more.

Middle

The area which allows individuals to list their products and sell them to other Amazon customers is an example of a small scale third party marketplace and e auction. Furthermore, Amazon has built up affiliations with other online businesses to help boost business. Therefore, the company also operates in a business to business way. The companies who Amazon have an affiliation with will include links to the shop and then for each customer Amazon gains as a result of that link they will pay a finder fee to whatever site the customer came from. These sorts of features are common across a lot of the major e-shops. Amazon has exploited a lot of the benefits of conducting business via an e-shop. Advancing technologies have allowed e-businesses to offer facilities that greatly enhance the customer service made available. For example it is possible to send registered customers reviews of newly published titles, to send suggestions of titles based on historic data from previous orders. This will make the customers feel the business is taking note of their purchases to have an idea what they are interested in. This is a great advantage of e-business because customers will be happy they are being kept up to date with new releases etc. while the business is happy as they are automatically promoting new products to customers they already know have an interest in the particular genre. ...read more.

Conclusion

The e-shop industry is arguably more competitive than normal high street shops because of the increased choice at the disposal of consumers because of the internets global presence. There is a wider choice for consumers on the internet than there is with high street shopping, therefore e-shops are under more pressure to keep prices as low as possible in order to be competitive. In conclusion my analysis of the e-shop business model has helped me understand the processes and functions these models take. I have learned that e-shops have become a large part of the general business world because many exist for "pure play" companies and many are increasingly being used as an extra dimension for high street businesses to help increase growth and profitability. E-shops are run along the same principles as regular physical shops in that customers can specifically search for a particular product or simply browse the online catalogue of available products. Once finished, the customer proceeds with their "virtual trolley" to the checkout where payment takes place. My evaluation has showed me that there are several negative aspects of running e-shops, the most obvious being that despite recent advancements in online payment options many are still wary of conducting business via the internet. However, I feel that the advantages outweigh the disadvantages, and as my example from Amazon shows e-shops carry a lot of potential for opportunities either to "pure play" businesses starting out or to high street shops who wish to extend into e-business. ...read more.

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