Thursday, December 15, 2011

History of Ecommerce part 04

Identifying the Business Potential

The developments in communications and standardisation over the past 20 years will undoubtedly continue, and will lead to improvements in the ways industry trades. We now have a range of communications options: telephone networks. ISDN, X.-IOO, the Internet, satellite and mobile communications, and others, such as digital radio, will doubtless become popular. What is important, is how these options are used.

Ii is vital from outsite for any organisation looking to move into E-commerce. particularly business-to-consumer. to clearly understand whether the products and services they offer are suitable for st-Ling online. Some general guidance on the potential for E-commerce can be gauged by asking the following questions:

• Is the organisation looking to sell to the correct demographic group in terms of geography (where the potential customers are located) and the type of person (is the potential customer likely to have access to Internet services and the ability to pay for transactions online)?

• Can the products be delivered digitally (for example, software, music, videos, books) or services accessed digitally (e.g. train tickets, airline tickets, holidays)?

• Can value be added to specific services by making them available online (e.g. online auctions or stockbroking can significantly change the existing business models)?

• Does the organisation have products that can be sold from a Web site, even though they may need to be delivered and paid for conventionally (e.g. cars, household electrical goods, even houses)?

•   Are they very specialist products, where the web can increase their exposure to (perhaps) overseas markets, or standard products that can easily be sold via a catalogue?

The decision to proceed with an E-commerce project would probably require a 'yes' to many (although not all) of these questions.

In any event, whether the potential application is business-to-business or business-to-consiuner, the key requirement is to develop a clear business case that supports the decision to proceed. This business case should address a variety of key issues including:

• statement of business benefits to be achieved;
• projected sales and overall revenue over 1, 3 and 5 years;
• level of investment required (both in terms of IT. staffing levels and other resources);
• projected profitability;
• unique selling points of the new venture;
• a clear evaluation of the risks in moving forward with such a venture (and indeed the risks associated with not moving forward);
• systems and resources required to handle integration with back-office systems such as order processing, order fulfilment, stock control etc.)


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