E-business As the Present and the Future of Business Models - Term Paper Example

E-business as the present and the future of business models Introduction E-business is the present and the future of business models. There are a variety of different e-business models. Some of these models rely on customer to customer, some on business to business and some on business to customer. Among these models are e-procurement, which is a business to business model, in which businesses may sell to one another and deal with everything that is focused upon procurement in one site; e-auctions, in which a site brings together buyers and sellers of products; e-commerce, in which there is a bricks and mortar store, along with the e-business model; and e-malls, which is a virtual mall, where customers can visit the site and visit all their favorite stores on the site. These are some of the models which Seatwave may use. Some of these models are appropriate and some are not. This report will delineate which e-business models are appropriate for Seatwave, which is a customer to customer model, and the site itself acts as a go-between. This report will also describe how web pages and websites work, as well as state what are qualities of a good web page. Seatwave The company which is going to be subject of this report is Seatwave. According to the Wikipedia site, Seatwave is a ticket exchange site, in which buyers and sellers can purchase tickets. The site acts as a middleman, much like E-Bay or other auction sites. This is how Wikipedia describes the organisation – “Seatwave is an online ticket exchange service operating in the European market.[1] It was founded by Joe Cohen in 2006, and allows the purchase and sale of tickets to live events including music, theatre and sport. Seatwave acts as the middleman, with buyers and sellers never having contact with one another, but the site guarantees all tickets. If a buyer pays for tickets that never arrive, the company will find replacement tickets or issue a full refund. The company also guarantees that all tickets come from legitimate sources. Sellers are not paid for their ticket sales until after the event has occurred and buyers have gained entrance” (Wikipedia.org). Understanding the Scope of E-Business The Seatwave is a fan to fan site, so the most relevant business model would be the customer to customer model. That said, there are also value chain issues with even a fan to fan site, so this implicates the business to business models, as well as the business to consumer and consumer to business models. Most of the models today would be considered to be customer to customer, customer to business, or business to customer. Good examples of the customer to business and business to customer models would be several of the models described by Tvrdikova&Koubek (2010), which are described below. E-procurement is the one business to business model described Tvrdikova&Koubek (2010), and this is where businesses use the Internet to obtain or provide products and services to one another. Usually these procurement models use an integrated approach, such as combining procurement and value chain into one model (Niles, 2008), or combining products, services and activities into one model (Zott, 2010). This is echoed by Jovarauskiene and Pilinkiene (2009), who see business to business as two partners dealing with one another, as opposed to dealing with discrete tasks, such as just value-chain or just procurement. Stockdale and Standing (2004) enumerate some of the benefits and barriers to e-marketplace participation. They state that one of the benefits is that the business can keep up with changing business landscapes, so that they are flexible and nimble, which are two excellent advantages. The changes that they cite include global market access facilitation, changed production costs and methods, enhanced communication, stimulated competition and reduce transaction costs. They also cite lower transaction costs, improved product differentiation, improved ability to enter supply chain for larger companies, improved customer service, a great potential for partnerships, access to more markets, and convenience as also being benefits of being part of the e-marketplace. The barriers to e-market participation, according to Stockdale and Standing (2004) is that some industry sectors are not e-commerce ready, and other e-commerce sites may lack knowledge and resources. Moreover, there might be a lack of trust for the IT industry. They also cite lack of standards, in that the buyer and seller do not have a common framework; a lack of understanding of the environment, in that many online businesses do not know how the Internet interacts with trading methods, and that their businesses should use the Internet as a complement to their current business, not as the sole method of doing business; a lack of supply chain integration, in that larger chains can integrate their supply chain by sharing information, using electronic ordering and electronic fulfillment, whereas smaller firms may not be able to have this level of integration; global trading introduces pitfalls, such as language and cultural barriers, and a lack of knowledge regarding import and export legislation; and that credit lines are not matched to buyer/supplier relationships, whom are frequently changing (Stockdale & Standing,2004). Benefits of E-Commerce The business can keep up with changing business landscapes, so that they are flexible and nimble, which are two excellent advantages. Lower transaction costs Improved product differentiation. Improved ability to enter supply chain for larger companies. Improved customer service. Great potential for partnerships. Access to more markets. Convenience Barriers to E-Commerce Some industry sectors are not e-commerce ready, and other e-commerce sites may lack knowledge and resources. There might be a lack of trust for the IT industry. Lack of standards, in that the buyer and seller do not have a common framework. A lack of understanding of the environment, in that many online businesses do not know how the Internet interacts with trading methods, and that their businesses should use the Internet as a complement to their current business, not as the sole method of doing business. A lack of supply chain integration, in that larger chains can integrate their supply chain by sharing information, using electronic ordering and electronic fulfillment, whereas smaller firms may not be able to have this level of integration Global trading introduces pitfalls, such as language and cultural barriers, and a lack of knowledge regarding import and export legislations. Credit lines are not matched to buyer/supplier relationships, whom are frequently changing There are also security and legislative issues which might face Seatwave at this time. Perhaps the largest security issue that they face is that they might have a data breach, which means that the personal information that they collect may be used in ways that the consumer did not expect nor consent to (Sprague, R. &Ciocchetti, C. 2009). These breaches may lead to fraud and identity theft. It may also lead to theft of social security numbers, which is a much more serious problem than accessing somebody’s credit cards. This is because, if a thief has a social security number, that thief might be able to open up new accounts, and the virtual keys to the financial life of the victim (Citron). This may lead to substantial fines for the company (Romanosky&Acquisti, 2009). As for legislative hurdles, the main problem that Seatwave faces is that, if they operate in different countries, they might not know the different legislative issues that they might face. This is a problem with globalization, as Seatwave is going to have to understand the laws in different countries (Stockdale & Standing,2004). Learning Outcome 2: Understand How the Internet Works The technology which is used by website designs is the Hypertext Markup Language (HTML). According to Lemay & Colburn (2006), HTML refers to the structure of the page. It does not describe the actual layout of the page. The HTML sets a definition for the web page styles, which includes the paragraphs, headings, lists and tables. It also defines the character styles, such as code examples and boldface. It does not, however, dictate how the page looks when viewed. According to Lemay & Colburn (2006), the current standard for HTML is the XHTML. XHTML is similar to HTML, in that they use the same tags and attributes. XHTML stands for Extensible HyperText Markup Language, which means that it is a kind of subset of the HTML. XHTML requires a value for its attributes, and with HTML, values are not required. Riordan (2008) simplifies the differences between XHTML and XML, stating that XHTML is a flavor of XML. This means that the XHTML is a specific implementation of XML, with certain attributes and elements which are defined. The XHTML uses elements like html and p and div, and these elements are used with the text values and attributes. With XML, explains Riordan (2008), flavors are defined and XML is extended, according to the needs of the user. XML can change the match the data that it represents, according to Riordan (2008). Next, an analysis of the client server, browsers and the search engine must be defined and analyzed. The client server is important, as they provide the Internet service to the actual physical computer. Levine (2007) states that servers should be physically proximal, because these servers are less likely to lag, which is important if the machine is slow.The browser, according to Levine (2007), is what actually displays Web pages. Among the most popular browsers are Internet Explorer and Firefox. Levine (2007) also states that a search engine is a program that a user might use to search for information. This includes Google, which is the most popular one. Therefore, the functions of the server, browser and search engine are that that server provides the service to the physical machine; the browser is what displays all the web pages, so that is the function for this; and the search engine enables the user to find web pages that he or she is interested in. Without the search engine, the user would not be able to find any page that he or she desires, as there are just too many pages. As for the intranets verses extranets, there are fundamental differences between these two types of networks. According to Levine (2007), the intranets are set up within a company, and allows them to exchange data only amongst themselves. This is a kind of private internet. The main advantage to the intranet, according to Levine (2007), is that the information is more secure than that which is in the larger extranet. The extranet would simply be another word for the Internet as is commonly known. In other words, the extranet is not private, but is public, and individuals are able to browse as much information as they want. The problem is that this is less secure, according to Levine (2007). Learning Outcome 3: Be Able to Use Different E-Business Models These models include e-businesses, which are businesses which use the Internet to communicate and for commerce. Hanafizadeh&Nikabadi (2011) describe e-auctions, which are evinced by E-Bay and penny auctions and other auctions sites, and this would be a good example of an e-business. Another model proposed to by Tvrdikova&Koubek (2010) is the e-commerce. Unlike the e-business, which operates mainly on the Internet, the e-commerce model might be brick and mortar, but it also uses the Internet to communicate and for commercial purposes. The e-marketplace is another model, and a good example of this would be an e-mall, which brings together a variety of different e-business concepts under one umbrella, and the consumer can choose which e-business to patronize. In this case, the Seatwave would be an example of the e-auctions model, because, as noted above, it is similar to E-Bay and penny auctions. Like E-Bay and other auctions, there are buyers and sellers on Seatwave, and Seatwave brings them together. As E-Bay has shown, this model can be extremely profitable if it is run well. The other model described above, e-commerce, would not be appropriate for Seatwave, as the e-commerce model assumes that there is a brick and mortar store that backs up the e-business model. That is not the case here. With e-mall, however, there is a possibility that Seatwave could take advantage of this. In the e-mall, as noted above, individuals can go to the site and find different business models under one umbrella. This would be a good place for Seatwave to be, because that would be one way that they could market themselves. Most of the stores which are in the e-mall are stores like Nieman Marcus and other stores which have an actual mall presence, but this does not mean that this would not be right for Seatwave, and it would give individuals options when they visit the e-mall. E-marketing would be another customer oriented business model described by Tvrdikova&Koubek (2010), and this is where the businesses sell their products through a network. This would encompass social networks, which are horizontal, peer to peer, and are increasingly replacing the traditional hierarchical business models (Van Dijck&Nieborg, 2009). Wirzet al. (2010) states that social networks can be further broken down into two categories – virtual communities and user-added value communities. The virtual communities are social networks such as Facebook and Twitter –the users spread the word about companies through word of mouth. In user-added value communities, such as YouTube, the users generate the site’s content. These sites would mainly be considered customer to customer, although, increasingly, businesses are using these sites to reach new customers, so these sites may also be considered customer to business or business to customer sites. Again, this kind of business model might be appropriate for Seatwave. It should take advantage of social networks, because this could be another avenue for selling their tickets and bringing people together. It could be an excellent way to market their products, as with the e-mall, while it could also be a way to sell the product itself. They could have a social marketing platform, where people on Facebook can go the Seamarket Facebook page and actually buy and sell tickets there. They could also use YouTube and Twitter to market their products, even if they cannot necessarily use them as a platform for selling their products. E-procurement is the other business model, which was described earlier. With e-procurement, there are businesses selling to other businesses. This would not be appropriate for Seatwave, because Seatwave is, by definition, a customer to customer site. The business itself only acts as a middleman, and does not actually provide anything directly to customers. Therefore, any business to business model would not be a model which would be used by Seatwave. As for the future of e-business opportunities, according to Durgin and Sherif (2008), the semantic web is the wave of the future. According to them, the semantic web is “web technology will work with extensible mark-up language, which will enable electronic commerce by: defining languages that provide support in defining, mapping, and exchanging product data; functioning from the development of standard ontology that will cover various business areas; and utilizing efficient translation services that will require areas of standard ontology” (Durgin&Sherif, 2008, p. 50). Learning Outcome 4: Be Able to Use Good Website Design A website is successful if it is easy to use, otherwise it will be rejected by users (Sireteanu). One of the main aspects of a easy to use page is response time and the time that the pages take to load it should be three seconds or less. (Sireteanu).Color is another consideration. Websites should use color sparingly, and they also should not use too many different colors. Less than five is generally considered to be ideal. Moreover, the website should stick with muted colors and stay away from more saturated colors. The colors also should not be flashy.(Sireteanu). Websites should also keep scrolling to a minimum – vertical scrolling should be minimized, and horizontal scrolling should not be used. The content on the page should be able to be read top to bottom and left to right (Sireteanu). There should be linear navigation and little to no animation (Hong et al. p. 61). Moreover, as sites are global, symbols should not be used, because symbols are culturally sensitive, and one symbol that means one thing in a culture may mean something completely different, and offensive, in another (Sireteanu). Most of all, the website needs to be attractive, interesting and fun (Jiang &Benbasat 2007 p. 12). Interactivity is another way that websites can be successful. By this, it means that the users may be able modify the form and content in real time (Jiang &Benbasat 2007, p. 5). Websites should also be vivid, which means that they provide, in a rich manner, the information to the users’ senses (Jiang &Benbasat 2007, p. 5). A vivid website is emotionally engaging, provocative of emotions, and concrete (Jiang &Benbasat 2007, p. 6). Interactivity may enable the user to enlarge a picture, or look at a picture from different angles, or to give them a chance to sample the product’s features (Jiang &Benbasat 2007 p. 6). Conclusion Seatwave, being a go-between site for customers and other customers, much like E-Bay or other E-Auction sites, should use the e-auction model, as well as the e-mall and the e-marketing model. Its site should follow the advice of the Sereteneau and others, who state that the page should be quickly loading, and should have only a few colors and minimize the flashing and other distractions. Seatwave has done this, as the webpage itself loads quickly and only has a few colors. 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