Chapter 2 E-Commerce Business Models and Concepts
1. What are the eight key components of an effective business model? (Question 3, p.103)
- Value proposition
- Revenue model
- Market opportunity
- Competitive environment
- Competitive advantage
- Market Strategy
- Organizational development
- Management team
2. Besides music, what other forms of information could be shared via peer-to-peer sites such as Kazaa? Are there legitimate commercial uses for P2P commerce? (Question 6, p.105)
Video, Picture (image file) and any types of document.
Company can efficiently distribute massive amounts of information across an organization and also make it searchable.
3. What are the major differences between virtual storefronts such as Drugstore.com and bricks-and-clicks operations such as Walmart.com? What are the advantages and disadvantages of each? (Question 13, p.106)
Major difference:
Virtual storefronts do not have any ties to a physical location.
Advantages of virtual storefronts are:
Low barriers to entry into Web e-tail market
Do not bear the costs associated with building and maintaining physical stores.
Disadvantages of virtual storefronts are:
Must build a brand name from scratch quickly and become profitable with no prior brand name or experience
Major advantage of bricks-and-clicks operations are:
4. What are four generic business strategies for achieving a profitable business? (Question 21, p.106)
Differentiation
Setting your firm or product apart from the competition
Cost
Unique set of business processes, a unique resource, or a low cost supplier
Scope
A scope strategy sets out to compete in all markets around the glose, rather than just locally or regionally
Focus
A plan to compete within a narrow market segment or product segment
5. How has Priceline (and similar online services) impacted the travel services industry? (Question 3, p.103)
Introducing price sensitivity signal into the industry which segments the market
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