Q10-5 How Does E-commerce Improve Processes in an Industry? Flashcards
What is e-commerce?
E-commerce is a multi-firm process of buying and selling goods and services using internet technologies. It supports both B2C and B2B transactions.
How does e-commerce improve processes in an industry?
By streamlining supply chain operations, enabling direct interaction between firms and customers, and using interorganizational IS for efficient transactions.
What is the role of interorganizational IS in e-commerce?
These systems support processes like fund transfers, inventory management, and transaction processing across multiple firms.
What are merchant companies in e-commerce?
Merchant companies own the goods they sell and include:
B2C (Business-to-Consumer).
B2B (Business-to-Business).
B2G (Business-to-Government).
What are nonmerchant companies in e-commerce?
Nonmerchant companies arrange the purchase and sale of goods without owning them.
They include:
Auctions.
Clearinghouses.
Exchanges.
How do web storefronts support B2C e-commerce?
They allow customers to browse, order, and manage purchases online, as seen with companies like Amazon and LLBean.com.
What differentiates B2B and B2G e-commerce?
B2B: Transactions between companies (e.g., raw material suppliers to manufacturers).
B2G: Companies selling to government agencies.
How does e-commerce enable collaborative consumption?
By promoting shared use of resources, reducing underuse, and providing participants with flexibility and control over how they engage with services.
Why is trust essential in e-commerce?
Trust ensures reliability and smooth transactions, supported by IS gathering data like customer ratings, photos, and reviews.
What are the two main types of nonmerchant e-commerce companies?
Auctions: Match buyers and sellers through a bidding process (e.g., eBay).
Clearinghouses: Provide goods and services at a stated price, arrange delivery, and transfer payments without taking ownership (e.g., Amazon’s used bookstore division).
What is an electronic exchange in e-commerce?
A type of clearinghouse that matches buyers and sellers like a stock exchange, facilitating transactions and taking a commission (e.g., Priceline.com).
How does e-commerce improve market efficiency?
Disintermediation: Eliminates middle layers in the supply chain, reducing inventory and shipping costs.
Improved data flow: Provides buyers and sellers with better access to price and vendor information.
Enhanced software tools: Improves customer data sharing and marketing efforts.
What is disintermediation in e-commerce?
The removal of inefficient intermediaries in the supply chain, allowing customers to purchase directly from manufacturers.
How does e-commerce improve price transparency?
By allowing customers to compare prices across vendors, sort results by price and reputation, and find cost-saving options like reduced shipping fees.
What role does Google AdWords play in e-commerce?
AdWords is a pay-per-click advertising tool where companies pay for targeted keyword visibility on search engines, driving traffic to their websites.
