E Commerce Applications

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                                        CONTENTS

1. Introduction                                                                                2

1.1. What is E-Commerce?                                                        2

2. Benefits of E-commerce                                                                2

3. About E-Mekaniks’ Business Idea                                                        3

4. Business Model                                                                        3

          4.1 The components and functions of a business model                        4

4.2 Roles of a business model                                                5

          4.3 Marketing Strategy                                                        5

5. SWOT Analysis (Strengths, Weaknesses, Opportunities and Threats)                6

          5.1 Strengths and Weaknesses affecting E-Mekaniks                        7

          5.2 Opportunities and Threats facing E-Mekaniks                                8

        5.3 Value Chain Analysis                                                        10

        5.4 Porters generic Strategies                                                11

        5.5 Ansoff Matrix                                                                11

6. Legal, Organisational and Cultural Issues                                                14

          6.1 Legal Issues                                                                14

        6.2 Ethical Issues                                                                15

          6.3 Organisational Issues                                                        16

6.4 Cultural Issues                                                                17

7. A High Level Online Marketing and Promotional Plan for E-Mekaniks                17

8. Overview of E-commerce architecture                                                17

9. OSI Model Layers                                                                        18

10. Why 3-tier architecture?                                                                18

11. Platform/technology Recommendations                                                20

12. Development approach                                                                21

13. Introduction to Usability                                                                27

14. Usability Plan for E-Mekaniks                                                        32

15. Website layout                                                                        34

          15.1 Content                                                                        35

16. Prototype                                                                                35

17. Individual Contribution Reports                                                        36

18. References                                                                        41

INTRODUCTION

This report is an assemblage of the business solutions to be presented to the Venture Capitalist for the offer of £500,000 to finance E-Mekaniks business venture.

The report outlines well researched findings reflecting trends in ecommerce operations, relative to the chosen business idea, business model, e-commerce architecture as well as the website usability.

What is E-Commerce?


E-commerce (Electronic Commerce or EC) is the process of buying, selling, transferring or exchanging products, services and/or information via computer networks including Internet (Turban et al, 2006). It is business that is conducted over the Internet using any of the applications that rely on the Internet.


E-commerce can be divided into: 

  • The gathering and use of demographic data through Web contacts.
  • Electronic Data Interchange (EDI) the business-to-business exchange of data.
  • Electronic mail (e-mail) and fax and their use as media for reaching prospects and established customers (for example, with newsletters)
  • Business-to-business buying and selling
  • The security of business transactions (TechTarget, 2008).


BENEFITS OF E-COMMERCE

  • Expand Geographical Reach Size of the market expands from regional, national and to international.
  • Reach a narrow Market Target, Market segmentation allows you to focus on a more select group of customers and therefore have a competitive advantage in satisfying them.
  • Increase visibility, ease of purchasing goods and price list is available.
  • Provide Customers valuable information about your business.
  • Always open for business.
  • Build customer loyalty and bring power to customers.
  • Reduction of marketing and advertising Costs.
  • Collection of customer data and better customer service (E-commerce news, 2007).

ABOUT E-MEKANIKS BUSINESS IDEA

This Ecommerce Venture Document is a compilation of a number of points that define ecommerce and describe the scope of application of ecommerce technologies in E-Mekaniks’ business venture.


        It is a report directed towards explaining a service oriented firm. This further describes what product and services we shall be offering. It describes how we shall steal the market share from the existing competition , what strategies we shall employ, all aimed at convincing the Venture Capitalist. Also, it includes a description of the adopted business model, the relevant legal, organisation and cultural issues that may impact on our venture and a full description of the high level online marketing strategy and promotional plan the company intends to adopt and execute.


        The Ecommerce Venture document further describes to the Venture capitalist the employed ecommerce architecture, the selected development approach for the ecommerce platform, a usability plan and a prototype of the website.
        At the end of it all, the strategies adopted to develop and launch E-Mekaniks’ business idea are well researched and designed to blend in with the latest market situations and technological trends.

BUSINESS MODEL

According to Chesbrough and Rosenbloom (2007), a Business model is a description of how your company intends to create value in the market place. It includes that unique combination of products, services, image, and distribution that the company carries forward. It also includes the underlying organization of people, and the operational infrastructure that they use to accomplish their work. A business model is the method of doing business by which a company can sustain itself that is, generate revenue. The business model spells out how a company makes money by specifying where it is positioned in the value chain (quick, 2007).

             

(Business model design template, Source (businssmodeldesign, 11/ 2005))

The components and functions of a business model are to:

According to Chesbrough and Rosenbloom, these are the six components of business for a model:

  • Articulate the value proposition, that is, the value created for users by the offering based on the technology;
  • Identify a market segment, that is, the users to whom the technology is useful and for what purpose;
  • Define the structure of the value chain within the firm required to create and distribute the offering;
  • Estimate the cost structure and profit potential of producing the offering, given the value proposition and value chain structure chosen;
  • Describe the position of the firm within the value network linking suppliers and customers, including identification of potential complementors and competitors;
  • Formulate the competitive strategy by which the innovating firm will gain and hold advantage over rivals

(Business Model Innovation Design, Source: 1000ventures.com)

Roles of a business model

The business model specifies a group of customers or a market segment to whom the proposition will be appealing and from whom resources will be received. A market focus is needed to begin the process in order to know what technological attributes to target in development, how to define and configure the offering, and how to resolve the many trade-offs that arise in the course of development, (e.g. cost vs. performance, or weight vs. power). Identification of a market is also required to define the “architecture of the revenues” – how a customer will pay, how much to charge, and how the value created will be apportioned between customers, the firm itself, and its suppliers. Options here cover a wide range including outright sale, renting, charging by the transaction, advertising and subscription models, licensing, or even giving away the product and selling after-sale support and services.

The business model maps from the technical domain of inputs to the social domain of outputs, it requires linking the physical domain of inputs to an economic domain of outputs, sometimes in face of great technical and market uncertainty. The business model can be regarded as a construct that links these domains.

E-Mekaniks’ Business Model

Marketing Strategy

We need to have some marketing objectives for our venture. These objectives help us for the research of marketing strategies and action to be performed. There are two types of objectives that we must think about: Financial and Marketing. In Financial objectives we should think about the long term return on investment hence knowing the profit for the current year. According to researchers, Marketing Objectives must be obtained from financial objectives. After setting up marketing objectives we should think about the orientation that our venture is having.

There are 3 types of orientation Product or service, Market and sales orientation.
        According to us our venture is having a
Service Orientation as we are having more stress on providing the customer a best service rather than selling anything. Now we should think about the various marketing tools and techniques which can be helpful for us to achieve our marketing objectives basically think about 4P’s to target a market.

  1. Product: In this part we should think about the different varieties of product since we are providing a service we think about the different services we are offering. Unique features of our service like it is cheap; no one else is having this kind of service in Coventry. Main is Quality of service.
  2. Price: We should list different prices for different services, what is our payment period and credit terms.
  3. Promotion: What should be our advertising modes? Like leaflets, via emails, via text messages, how we going to promote, what is our marketing force?
  4. Place: What are the different channels that we are going to cover? What should be our location? What is our transport mode?


So we can say that different unique features in our venture as explained above. The pricing strategy like its free for first time users (with certain terms and conditions), cheap after that and u can pay in instalments also (with some conditions). We are going to advertise on internets, via leaflets, through emails etc. We will provide support with in Coventry and according to postal code. Initial transportation has to be arranged to cover with in our planned range. We can also talk about E-Marketing, as we are using digital technologies also there are various advantages of using digital technologies like it can be find out easily, 24 hour of service.

SWOT ANALYSIS

The main aim of SWOT analysis is to identify the key internal and external factors    that are important to achieving the E-mekaniks objectives.

  • Strengths - It analyzes what E-mekaniks does well.

  • Weaknesses- The areas in which we need to improve.

  • Opportunities - Looks at where we could be gaining more business.

  • Threats - Determine what competition or market conditions could hold it back.

The strengths and weakness are basically internal factors to the organization and threats represent the external factors of an organization. Businesses of all sizes and types run SWOT analysis, which examine the internal workings of a company and the market in which the company operates.

Strengths and Weaknesses affecting E-mekaniks

Looking at traditional retailers, strategic location is an advantage in the sense that E-mekaniks will be paying no costs to maintain or buy Service centres in prime locations; we’ll operate through the web sites (Internet) and thus save drastically on the real estate costs and maintenance costs of a virtual store. Visibility is the most important factor as consumer will be able to compare and contrast service, prices and products available in the internet. As our catalogue will list the latest technological offers of E-mekaniks.

An important ethical crisis that online businesses face is the privacy of the customer’s data. The security and safety of customer data is very critical as some online retailers sell their customer listings to others vendors with similar products without the permission of the customer. E-mekaniks will have a clear security and privacy policies which states the information we’ll collect from customers who request services. This information is used to respond to customer requests and react to their future Servicing options and requirements. As technology is ever changing, it can pose as a threat to E-mekaniks therefore we can overcome this threat by equipping our team with more advanced technology. The website functionally is very important as the customers will be requesting service online. According to (Jacob Nielsen, 2003) if the site is difficult to use and the homepage does not clearly identify what the company offers, users will leave that site to another site. E-mekaniks website will clearly follow the usability principles and guidelines to make the site pleasant to use and view. Ease of use with out getting bored, quickly completion of the task and user’s satisfaction on the interface is very much important. E-mekaniks-site will also be visible to consumers who are surfing the net using the search engines like MSN, Yahoo and Google. We’ll also ensure the good relationship with our spare parts distributors to ensure that our customers get a good service and longer life of their equipment.

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Opportunities and Threats facing E-mekaniks

 

Cost of advertising is an opportunity for E-mekaniks as we’ll be advertising our services online and spending less to the cost of manual catalogues, brochures and flyers. Through e-mails communication is faster and cheaper and access to information as well is an opportunity for E-mekaniks as Internet is the global source of information.  High quality services, low costs and diverse products contribute a lot to international market as the whole. As E-mekaniks Provides Service to the Top international electronic Brands and local Brands it will give a good scope for overall customer retention. ...

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