The Future of e-Commerce
Georgios Georgiou
Business Innovation Services
IBM Global Services
IBM Cyprus
Understanding the promises of e-commerce
Ready for the New Frontier
How Do You Dominate
Our Objectives
Electronic Commerce Is ... Buying and selling across the supply chain Another way of doing business electronically Integrating with systems, applications and processes
Manufacture/Distributors
Seller WCS
Web Browser
XML/Program
Web Browser
Business-to-business
Supplier
Supplier
Supplier
Buyer
Buyer
Buyer
WCS
Buy-side/ Sell-side
Tools
e-Marketplace
Consumers
Seller WCS
Web Browser
Web Browser
Web Browser
Business-to-consumer
New global opportunities
New rules of engagement
New competition
New customers
e-commerce ... A Whole New World!
Business to Consumer Growth
$7.7B
$35B
1999 2000 2001 2002
e-commerce Growth WW
1999 2000 2001 2002
$48B
$1.3Te-commerce Growth WW
Business to Business Growth
e-commerce Growth
e-commerce Drivers
Business
Improvedefficiencies andcycle times
Customer loyaltyNew opportunities
for revenue growth
Customers
ConvenienceEffectivenessValue
Integrated Product Development
Integrated Supply Chain
Procurement Production Fulfillment
Customer Relationship Management
Human Resources Finance
ibm.com
e-procurement e-care
e-commerce
Suppliers Customers
Employees
Wave 1
Wave 2
Wave 3
Since 1993 IBM has:
Improved efficiencies and cycle timesSaved $3.6 billion in materials acquisition cost Cut overall logistics costs by 24% Reduced annual IT costs by 45% Improved on-time shipment to 90%-98% Shortened delivery cycle time by 55% Improved inventory turn by 44% Put 80% of parts on consumptive pull Shortened demand/supply planning cycle from 60 to 20 days
Customer loyaltyReduced supplier listNew opportunities for revenue growthCustomer Relationships
One Proof Point
B2B Trends: e-marketplaces
More than 8 million participants expected by 2002 and more than 3 million sellers participating in e-Marketplaces by 2002
0
500
1000
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2000 2001 2002 2003 2004
Bilateral Trade e-Marketplaces
E-Marketplaces are:Neutral Internet based intermediariesFocused on specific industry verticals or specific businesses processesHost electronic marketplacesMediate any-to-any transaction among businesses.
Horizontal- focused on reducing the inefficiencies of spot purchasing
Vertical- facilitate the exchange of manufactured inputs to specific vertical industries
Vertical Exchanges
Horizontal ExchangesA
ero
spac
e
Uti
litie
s
Ele
ctro
nic
s
Au
tom
oti
ve
Insu
ran
ce
Hea
lth
care
Pet
roch
emic
als
Fin
ance
CP
G
Tra
vel &
Tra
nsp
ort
.
e-Marketplaces Are Here
ContentManagement
Commerce Community
Advertising /Promotion
BuyerServices
TechnicalFunctions
SellerServices
Support Services
E-MARKET
What functionality do e-markets provide?
Content ManagementPersonalisationSearchMulti-language
CommerceCatalog ManagementPrice Discovery- RFQ, Fixed Pricing, Auction, ExchangeTransaction ProcessingPayment Processing
AdvertisingTargeted AdvertisingCampaign Mgt.Ad performance monitoring
CommunityDiscussion ForumsBulletin BoardsChatMessaging
SupportMember registrationMember SupportLogisticsSite Analysis
Buyer ServicesRegistrationCatalog populationIntegration
Seller ServicesRegistrationCatalog populationIntegration
Technical FunctionsAny to any connectivitySecurity
eMarketPlaces
Expand to New Markets or Geographies
OlympicsLargest quadrennial event in the worldProvide intranet for 260,000 members of the Olympic family (athletes, coaches, officials and media)
Deployed e-commerce for merchandise andTicket Sales!
Expand to New Markets or Geographies
Olympics: Business ValueHandled 11.3 billion hits during the GamesEntire Olympic Web hosting complex was 100 percent available from start to finish
IBM results system carried times and scores of every event from every venue to more than 20,000 broadcasters and world news press agencies
Transaction that is partially or completely facilated by the use of mobile wireless means and takes
place between 2 or more parties and involves the 2-way exchange of
goods/services for monetary consideration
Mobile: Business to Everywhere!
— Aberdeen Group, August 2000
“
”
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100
200
300
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1998 2001 2003
Mobile Devices
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1998 2001 2003
IT Revenue
The Market Is Real!
— Forrester, 2000
Th
ou
sa
nd
s
Bil
lio
ns
wirelessPDA
Personal Digital Assistant w/modem smaller screen, often no keyboard HTML browser PALM VII, Psion, PocketPC, ....
cellphonew/SMS
Short Message Service == 160 character text messages
like pager or instant messages receive-only or receive & send
laptop w/wireless modem standard browser no special application considerations
laptop w/wireless
modem
cellphonew/WAP
cellphone with tiny or small screen Wireless Application Protocol (WAP) with
Wireless Markup Language (WML) browser Japan: i-mode & cHTML limited keyboard
Mobile Devices
B2B/B2C Purchase and receive notification via cell phone/PDAOrder from downloaded interest listObtain price quotesLead Management / Distribution
AuctionsRegistration via browserEvent notification via SMS/WAP
MarketplacesDynamic marketplace functions (e.g., RFQs)Exchanges
Vertical MarketsHealthcare: Patient Tracking and reportingPharmaceuticals: Samples and signature management
Mobile Scenarios!
e-commerce
e-commerce is Just the Beginning
93% of CEOs view customer retention as most critical
success factor!
It costs 5-10X more to acquire a new client than retain your
current customers
Companies lose 50% of their Customers every 5 years
Know Thy Customer
Explicit - Registration/Q & A - Legacy data - Third party sourceImplicit - Past history - Current activity on site
- Usage analysis- User analysis- Commerce
analysis- Data mining
- Ads- Promotions- Up-sell- Cross-sell- Configurations- Customization- Editorial (content)- Updates- Reminders- Loyalty programs- Service and support
Business Intelligence
Customerdata
Content
PersonalizationFramework
Business Manager
What'sdelivered
POS
Callcenter
Web
Relationship MarketingProcess
Product Creatives Editorial Images
Customization Targeting Prediction
e-commercee-commercee-commercee-commerce
e-commerce Integrates Everything
Getting Started Develop a corporate-wide, customer-driven strategy
m-commerce integral part of any e-biz strategy
Define Measureable GoalsImproved EfficienciesCustomer LoyaltyNew Revenue
Determine your requirements
Degree of e-Commerce functionality
Data warehousing and data mining
Integration of e-Commerce and legacy apps
Web site hosting
Web site design
e-commerce skills assessment or consultant costs
Requirements
Gartner Group, The Real Cost of E-Commerce Sites, May 1999
$20M
$1 million to $5 million
$300,000 to $1 million
Get on the Map Run with the Pack Market Differentiator0
5
10
15
20
Future Cost of an E-Commerce Site (Circa 2000)
"Increasing efficiency through Internet transactions will result in an estimated $57 billion in cost savings."
Executive commitment
Cross-functional Internet team
Experience (Start simple, grow fast!)
Customer-centric seamless experience
Customer intimacy
Fanatical customer service
What works
What works Experienced web developers
Integrated with existing systems, processes
Robust, secure, and available environment
Accessible to your audience
Be prepared for the unexpected!
“e-businesses promise to create the richest, most diverse marketplace the world has ever seen.
Now is the time to exploit this opportunity, or be exploited by those who do!”
Plan for Success!
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