Scribd
Upload
18 views2 pages

E-Commerce Economic Value Analysis

The document compares the costs for a company before and after adopting e-commerce. Before e-commerce, the company's customer service, selling, and internet advertising costs totaled $32,800. After adopting e-commerce, those costs were reduced to a total of $20,600. The economic value gained by the company through e-commerce is calculated to be the original total costs minus the new total costs, which is $32,800 - $20,600 = $12,200. The document then provides another example of calculating the economic value of adopting SaaS using similar cost comparisons.

Uploaded by

Sounak
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
18 views2 pages

E-Commerce Economic Value Analysis

The document compares the costs for a company before and after adopting e-commerce. Before e-commerce, the company's customer service, selling, and internet advertising costs totaled $32,800. After adopting e-commerce, those costs were reduced to a total of $20,600. The economic value gained by the company through e-commerce is calculated to be the original total costs minus the new total costs, which is $32,800 - $20,600 = $12,200. The document then provides another example of calculating the economic value of adopting SaaS using similar cost comparisons.

Uploaded by

Sounak
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Economic Value For An E-Commerce Client

Costs for company X without using E-Commerce

Customer service cost                                                               $10,000

Selling costs                                                                              $15,000

Internet advertising cost                                                             $7,800

Total                                                                                          $32,800

Cost for company X after using E-Commerce

Customer service cost                                                                  $7,900

Selling cost                                                                                 $6,800

Internet advertising                                                                      $5,900

Total cost                                                                                     $20,600

The economic value that E-Commerce offers to customer X is calculated by adding the cost
before using E-Commerce and then subtracting the total from cost after using E-commerce. If
the value is positive, it means that the system has positive economic value to the company. In
this case, the economic value offered to company X is 32,800-20,600=$12,200

SaaS provides an organization with reduced time to benefit. This means that the online
customer service under SaaS does not only provide customers with an opportunity to interact
with the organization but also an opportunity to acquire goods and services. This is done by
providing proper red directs and hierarchies of site that directs customers to the specific
websites where they can obtain specific relevant information. The following is an example of
how the economic value of a company applying SaaS can be calculated as follows:

Cost before application of SaaS

Customer service cost                                                                 $14,400

Selling costs                                                                               $12,000

Internet advertising cost                                                              $9,800


Total                                                                                          $36,200

You might also like