Types of ecom.doc
- 1. 1.6 TYPES OF E-BUSINESS: Broadly speaking, E-commerce can be categories into two types. 1.6.1 E-Business based Traditional Model (B2B, B2C) 1.6.2 E-Business based upon Contemporary Model (Retail Commerce) 1.6.1 E-Business based upon Traditional Model As seen in Fig 1.3. E-Business in addition to encompassing E-commerce includes both front and back- office applications that form the engine for modern E-commerce. E-business is not just about E-commerce transactions; it's about re-defining old business models, with the aid of technology to maximize customer value. E-Business is the overall strategy and E-commerce is an extremely important facet of E-Business. B 2 B B 2 C G 2 B E 2 B G 2 C E 2 C B − Business C – Consumer G – Government E – Enterprise Fig 1.3 E-Business based upon Traditional Model 1.6.2 E-Business based upon Contemporary Model As seen in Fig 1.4 and 1.5 this model is based upon Smarter Commerce for Retail. Retailers recognize that in today’s world, the consumer—connected, informed and empowered through mobile technologies and social media are in charge. Market leaders are gaining competitive edge with an integrated approach that extends brand value, deepens customer relationships and drives operational efficiency.
- 2. E - C o m m e rc e M - C o m m e r c e T - C o m m e r c e E le c tr o n ic C o m m e r c e M o b ile C o m m e r c e T V . C o m m e rc e E - G o v E - R e ta il E -R e s e r v a tio n D 2 H D is h M -L e a r n in g M - M a r k e tin g Fig 1.4 E-Business based upon Contemporary Model E -B a n k in g E -G o v e r n a n c e E -R e s e r v a tin E -S h o p p in g E -E n te r t a in m e n t Fig 1.5 Showing Types/Services/Application of E-Commerce and M-commerce Model M -B a n k in g M -G o v e r n a n c e M - R e s e r v a t io n E -S h o p p in g M - E n te r ta in m e n t 1.7 TYPES OF E-COMMERCE As shown in Fig 1.6, Traditional model of conducting business via online/real time. E-Commerce transactions can be segmented into four broad categories or modes, based on participants involved in the transaction. Here the term business may be used as Enterprise for Micro Small and medium Enterprise (MSME) 1. Business to Business (B2B) Business Model (IITF,PITEX) 2. Business to consumer (B2C) (Flipcart, Snapdeal, Myntra, Amazon etc.), 3. Business to Government (B2G) (FICCI,CII, ASSOCHAM ) 4. Consumer to Consumer (C2C) (OLX, Quickr)
- 3. The e-commerce matrix Business Consumer Government Business B2B Supply Cain, Wholesalers B2C Retailers (Goods or Services) B2G Contract bidding, Privatization Consumer C2B Public Bidding marketplaces, Auctioneers C2C Public flea markets C2G Public Government auctions Government G2B Tax and fee collection G2C Tax and fees collection G2G Budget allocation Fig 1.6 E-Commerce Based on B2B and B2C E-Commerce models Leading companies* B2C e-Commerce marketplace Snapdeal.com, FirstCry.com, Zavi.com B2C e-Commerce Inventory Led BigBasket.com, FirstCry.com, Zovi.com B2C e-Commerce Aggregator Uber.com, olacabs.com C2C e-Commerce Cloudacar.com, quickr.com, olx.in B2B e-Commerce mujunction services limited (metalijunction, coljunction, buyjunction, etc.), cloudBuy.com, tolexo.com, inddustrybuying.com, power2sme. Com, Amazonbusiness.com Omni-channel Retailer s Shoppers Stop Ltd., Infiniti Retail Limited Croma, Raymond Limited Table 1: Indicative list of current leading e-Commerce models in India Source: Deloitte Research *Note: Domain names Fig 1.6.1 E-Commerce Based on B2B and B2C Verticals Leading companies* Online Travel Makemytrip.com, , cleatrip.com, goibibo.com Online Real Estate Magicbricks, 99acres, common floor, Housing.com Online Fashion Jabong.com, Myntra.com, Zovi.com, yeppme.com limeroad.com Online Furniture Fabfurnish, Pepperfry, urbanladder.com Online Education Purple Squirrel Eduventure, plancess.com Online Education Purple Squirrel Eduventures, Plancess.com Online Food and grocery Zomato, Foodpanda.in, TinyOwl., BigBasket, Grofers.com
- 4. Fig 1.6.2 E-Commerce Based on Verticals 1.7.1 Business-to-Business (B2B) Model A seen in Fig 1.7 The most common users of B2B online classifieds are micro, small and medium enterprises (MSMEs). These small businesses lack the requisite financial resources and, therefore, find it difficult to market their products and services to potential clients through traditional media such as newspapers, banners, and television. Trade through online B2B portals increases the visibility of MSMEs in the marketplace and helps them overcome barriers of time, communication, and geography. R a w M a te r ia ls M a n u fa c tu r in g W h o le s a le r s R e ta ils G o v e r n m e n t T ra n s p o r t a t io n C o m m u n ic a tio n s B a n k s Market Chains Intermediaries B2B E-commerce B 2 B e C o m m e rc e a v e r a g e o r d e r v a lu e is 3 x h ig h e r th a n B 2 C M o r e th a n 3 0 p e r c e n t o f B 2 B e C o m m e rc e r e v e n u e w ill b e in c r e m e n ta l B 2 B e C o m m e rc e w ill a c c o u n t fo r 1 0 p e r c e n t o f a ll B 2 B s a le s th is y e a r a n d is g r o w in g . L a rg e O r d e r S iz e In c r e m e n t a l R e v e n u e O p p s R o o m T o G ro w K e y B 2 B e C o m m e r c e F a c t s : Fig 1.7 Business- to-Business (B2B) Model The graphic shown below in Fig 1.8, illustrates the network model of B2B. Your business is represented as the “Enterprise” connecting with the Service using a single communications protocol. Likewise, each trading partner is connected to the Service Provider as well using their varying preferred protocols.
- 5. P a r tn e r E n te r p r is e M a p p in g T ra n s la tio n , ... . P a r tn e r P a r tn e r P a r tn e r Fig 1.8 Network Model of B2B The Three Basic Models of B2B As seen in Diagrams 1.9,1.10 and 1.11 shown below, when your company exchanges business documents electronically with your trading partners – your customers, suppliers, logistics providers and banks – one of the decisions you need to make is what type of communications you will need to connect to each one. To help you decide, described below are the four basic approaches for connecting to your trading partner community and the issues and benefits of each. 1. Network Model (IITF) 2. Direct Distribution Model (PITEX) 3. Hybrid (Collaborate) Model
- 6. Fig 1.9 Network Model Source: The India Trade Promotion Organization (ITPO) Home Page (www.iitf.in) Fig 1.10 Direct Distribution Model Source: PITEX-Punjab International Trade Expo 2014 (www.pitex.co.in) Hybrid B2B Integration With integration technology converging and the continuing need for companies to focus on highly differentiated business processes, a new model for B2B Integration has emerged. Fig 1.11 Hybrid Model 1.7.2 Business-to-Consumer (B2C) Model As seen in Diagrams 1.12, shown below, the B2C market in India generates the bulk of revenues across the consumer-facing modes of e-Commerce. Furthermore, though online travel has typically held a major share of the B2C market, online retail is also growing rapidly and is expected to significantly increase its share.
- 7. The Three Basic Models of B2C 1. Online Retail (Flipkart, Snapdeal, Myntra ) 2. Online Travel (Yatre, MakeMyTrip ) 3. Online Banking (HDFC Bank, SBI Bank, AXIS Bank ) Fig 1.12 Businesses to Consumer (B2C) Model Source: Image Captured Logo of individual retailers 1.7.3 Consumer to Consumer (C2C) As seen in Fig 1.13. Customer-to-customer or consumer-to-consumer is a business model that facilitates the transaction of products or services between customers. An example of C2C would be the classifieds section of a newspaper or an auction. In both of these cases, a customer, not a business, sells goods or services to another customer. The goal of a C2C is to enable this relationship, helping buyers and sellers locate each other. Customers can benefit from the competition for products and easily find products that may otherwise be difficult to identify. C2C e-commerce differs from a business-to-business model or a business-to-consumer model because consumers interact directly with each other. Image Captured Fig 1.13 Consumer to Consumer (C2C) Model
- 8. Source: Logo of individual retailers 1.7.4 E-Governance Business Model (G2B, G2C) As seen in Fig 1.14, E-Governance Business Model, Interaction takes place between Govt. and citizens. These models can also be characterized by the following terminology. E−Administration— It is the use of ICT to modernize the state; the creation of data repositories for MIS, computerization of records. E−Democracy—It is the use of ICT to facilitate the ability of all sections of society to participate in the governance of the state. E-Governance -It means is Easy governance, Effective governance and Economic governance for digital India. E-Governance is the first step towards Digital India and IBharat business model. The basic objective of e-governance is Minimum Government and Maximum Governance. E-Governance means Inclusive Growth for Inclusive Development. B u s in e s s N G O s C iv il S o c ie ty G 2 BG 2 CC it iz e n C e n tra l G o v e r n m e n t L o c a l G o v e r n m e n t G 2 G G 2 G G 2 G Fig 1.14 E-Governance Business Model (G2B, G2C) Model WHAT IS DIFFERENCE BETWEEN E-COMMERCE AND E-BUSINESS As seen in table 1.15 (Difference between B2B and B2C), E-Commerce and E-Business are two completely different terms, but unfortunately, they are always used interchangeably by many of us. The reason behind this lies in the meanings of “business” and “commerce” in the English language. However, there is a difference between e-commerce and e-business. Many people understand the subtle differences between the two, and there had always been a debate among these two groups about the differences and similarities between e-commerce and e-business. Table 1.15 B2B and B2C B2B B2C transaction between Business partners Transaction between buyers and consumers Based on VAN Based on Internet Fully Integrated EDI Semi/Non-EDI
- 9. Business Models G2B and E2B Business Models G2C and G2C More secure Less secure Higher Willingness to pay Lower willingness to pay Greater lifetime value to the consumer Faster product iteration feedback Longer sale cycle Shorter sale cycle Difficult to manage Easier to manage Less flexible More flexible Subset of MSME Subset of E-Business Limited scope for Customer feedback Larger scope for customer value chain Less freedom to expand More freedom to expand Difference between E-Commerce and Traditional Commerce: As seen in Table 1.16, Table 1.17 and Table 1.18 comparison has been made between Traditional Commerce v/s E-Commerce on various levels. Traditional Commerce v/s E-Commerce Table 1.16 Traditional Commerce Vs. E-Commerce Sr. No. Traditional Commerce E-Commerce 1 Heavy dependency on information exchange from person to person. Information sharing is made easy via electronic communication channels making little dependency on person to person information exchange. 2 Communication/ transaction are done in synchronous way. Manual intervention is required for each communication or transaction. Communication or transaction can be done asynchronously. Electronics system automatically handles when to pass communication to a required person or do the transactions. 3 It is difficult to establish and maintain standard practices in traditional commerce. A uniform strategy can be easily established and maintain in e-commerce. 4 Communications of business depend upon individual skills. In e-Commerce or Electronic Market, there is no human intervention. 5 Unavailability of a uniform platform as traditional commerce depends heavily on personal communication. E-Commerce website provides the user a platform where all information is available in one place. 6 No uniform platform for information sharing as it depends heavily on personal communication. E-Commerce provides a universal platform to support commercial/business activities across the globe. The diagram is shown below: Changing the Rules of the Game, causing a fundamental change in the nature of business.
- 10. L ife tim e C u s to m e r R e la tio n s h ip C u s to m e r A c c e s s V a lu e C h a in P ro d u c tio n P la n n in g M a n u fa c tu r in g C a p a b ility B a s is o f C o m p e titio n In n o v a tio n K e y P ro d u c t Te c h n o lo g y M u ltip le C h a n n e ls N e tw o r k s M a k e to O rd e r M s s C u s to m iz a tio n S o lu tio n s C o n tin u o u s E x p e r im e n ta tio n D ig ita l Tra n s a c tio n a l D e a le rs V e r tic a lly In te g ra te d M a k e to S to c k M a s s P ro d u c tio n P ro d u c ts P ro d u c t C y c le s M e c h a n ic a l F ro m To Lifetime Customer Relationship Customer Access ValueChain Production Planning Manufacturing Capability Basisof Competition Innovation KeyProduct Technology MultipleChannels Networks MaketoOrder MssCustomization Solutions Continuous Experimentation Digital Transactional Dealers VerticallyIntegrated MaketoStock MassProduction Products ProductCycles Mechanical From To Table 1.17, 1.18 showing E-Business: Traditional Commerce v/s E-Commerce