Business Categories and Models in Internet: An Overview, Slides of Business Strategy

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Chapter 4. BUSINESS

CATEGORIES AND MODELS

IN Internet

4.1 Business Categories

by Professor Vasile AVRAM, PhD

References

4.2 Business Models

4.3 The E-Commerce Development

And Functional Architecture

4.1 Business Categories

Concepts, Notions, and Definitios introduced:

Digital firm

Business processes

Electronic market

Electronic business (e-business)

Electronic commerce (e-commerce)

VPN

Intranet

Extranet

Private industrial network

The e-business – e-commerce relationships

CRM (Customer Relationship Management)

SCM (Supply Chain Management)

Business categories

4.1 Business Categories

Electronic business (e-business). The extensive use of business

information system through an organization is commonly referred to as

electronic business or e-business.

There are two common definition of e-business concept:

“all electronically mediated information exchange, both within an

organization and with external stakeholders supporting the range of

business processes”;

“the use of Internet and other digital technology for organizational

communication and coordination and management of the firm”.

Electronic commerce (e-commerce). Electronic commerce (e-

commerce) is the process of buying and selling goods and services

electronically with computerized business transactions using Internet,

networks, and other digital technologies.

4.1 Business Categories

Figure 4.1 Intranet

4.1 Business Categories

Private industrial network. A private industrial network or

net marketplace (or e-hubs) is a web-enabled network

linking systems of multiple enterprises (firms, companies,

organizations etc) for the coordination of enterprises trans-

organizational business processes.

4.1 Business Categories

Figure 4.3 The extended company and management of customers and suppliers

relationships

4.1 Business Categories

Figure 4.5 e-commerce is a part of e-business

( source [PG-07] )

4.1 Business Categories

CRM (Customer Relationship Management). CRM focuses on

managing all of the ways that a firm deals with its existing and

potential new customers.

A starter definition of customer relationship management

(CRM) is ” The infrastructure that enables the delineation of an

increase in customer value, and the correct means by which to

motivate valuable customers to remain loyal - indeed, to buy

again[1]. ”

[1] CRM Handbook, The: A Business Guide to Customer Relationship Management,

by Jill Dyché, Addison Wesley Professional,

4.1 Business Categories

Figure 4.6 Business categories

Figure 4. 7 The electronic business value chain

4.2 Business Models

A business model describes how the enterprise delivers a

product or service, showing how the enterprise creates

wealth. Business models have been defined and categorized

in many different ways, the models are implemented in a

variety of ways, and they are perhaps the most discussed and

least understood aspect of the web.

4.2 Business Models

”An e-business model is a description of the roles and

relationships among a firm's consumers, customers, allies,

and suppliers that identifies the major flows of product,

information, and money, and the major benefits to

participants.”

Figure 4. 8 Electronic marketplace for B2B commerce

4.2.1 Classification of e-business models

In determining an appropriate e-business model, several

criteria can be used, such as [PG-07]:

Involved parties, such as business-to-business, business-

to-consumer, and/or consumer-to-consumer;

Revenue sources, such as transaction fee, product price,

and/or exposure fee;

Value configuration, such as value chain, value shop,

and/or value network;

Integration with customers and/or partners;

Relationships, such as one-to-many, many-to-many, and/or

many-toone;

Knowledge, such as know-how, know-what, and know-why.

4.2.1 Classification of e-business models

Online marketplace: Provides a digital environment where

buyers and sellers can meet, search for products, display

products, and establish prices for those products (eBay.com,

Priceline.com, ChemConnect.com, Pantellos.com)

Content provider: Creates revenue by providing digital content, such

as digital news, music, photos, or video, over the Web (WSJ.com,

CNN.com, TheStreet.com, Gettyimages.com, MP3.com)

Online service provider: Provides online service for individuals and

businesses. Generates revenue from subscription or transaction fees,

from advertising, or from collecting marketing information from users

(@Backup.com, Xdrive.com, Employease.com, Salesforce.com)

Virtual community: Provides online meeting place where people with

similar interests can communicate and find useful information

(Motocross.com, iVillage.com, Sailnet.com)

Portal: Provides initial point of entry to the Web along with specialized

content and other services (Yahoo.com, MSN.com, StarMedia.com)

4.3 The E-Commerce Development And Functional

Architecture

Figure 4.9 The Market Evolution and Complexity of e-Commerce / e-Business Development

Source: e-Business Management Models: A Services Perspective and Case Studies, Revere Group,

Todd Miller, Matthew L. Nelson, Stella Ying Shen and Michael J. Shaw