MODULE 3 – BUILDING AN E-COMMERCE PRESENCE 16

MODULE 3 –BUILDING AN E-COMMERCE PRESENCE:

A SYSTEMATIC APPROACH

INTRODUCTION

Building a successful E-commerce presence requires a keen

understanding of business, technology and social issues as well as s systematic
approach. E-commerce is just too important to be left totally to technologies and
programmers. The two most important management challenges are (1)
developing a clear understanding of your business objectives and (2) knowing
how to choose the right technology to achieve those objectives. The first
challenges require you to build a plan for developing your firm’s presence. The
second challenge requires you to understand some of the basic elements of e-
commerce infrastructure. Let the business drive the technology.

In this module you will examine the important factors that a manager
needs to consider when building an e-commerce presence. The focus will be on
managerial and business decisions you must make before you begin, and you
will continually need to make.

LEARNING OUTCOMES
After reading this module, the learner should be able to:
1. Explain the process in building e-commerce presence
2. List important factors in developing a website
3. Create a simple website

TIME

The time allotted for this module is six (6) hours.

LEARNER DESCRIPTION

The participants in this module are BSBA third year students.

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MODULE CONTENTS

LESSON 3.1. Process in Building an E-commerce Presence

Before you begin to build a website, there are some important factors to
consider in the development and implementation of your e-commerce presence.

The Visioning Process

Before you can plan and actually build an e-commerce

presence, you need to have a vision of what you hope to
accomplish and how you hope to accomplish it. These
includes not just a statement of mission, but also
identification of the target audience, characterization of
the market space, a strategic analysis, a marketing
matrix and a development timeline. It starts with a dream
of what’s possible and concludes with a timeline and
preliminary budget for development (Laudon & Traver,
2018).

Business and Revenue model

Once you have defined a mission and vision statement,

you need to start thinking about where the money will
be coming from. You will need to develop a preliminary
idea of your business and revenue models. You need a
general idea of how your business will generate
revenues. Most of the firms have multiple models. The
basic revenue models are advertising, subscriptions,
transaction fees, sales and affiliate revenue.

Target audience

There are two questions here: (1) who is your target

audience; and (2) where can you best reach them?
Your target audience can be described in a number of
ways such as demographics, behavior patterns
(lifestyle), current consumption patterns (online versus
offline purchasing), digital usage patterns, content
creation preferences (blogs, social networks) and
buyer personas (profile of your typical customers).
Demographics information includes age, income,
gender and location.

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Characterize the Marketplace

The chances of your success will depend greatly on

the characteristics of the market you are about to enter
and not just your entrepreneurial brilliance. Features of
the marketplace to focus on include the demographics
of the market and how an e-commerce presence fits
into the market. In addition, you will need to know
about the structure of the market which describes in
terms of direct competitors, suppliers and substitute
products.

Content

Websites composed of a lot of pages ranging from

text, to graphics, photos and videos. The content is
why customers visit your site and either purchase
things or look at ads that generate revenue for you.
Therefore, the content is the single most important
foundation for your revenue. There are two kinds of
content: static and dynamic. Static content is text
and images that do not frequently changes such
product descriptions, photos or text that you create to
share with your visitors. Dynamic content is content
that changer regularly (daily or hourly).

Conduct a SWOT analysis

This is a simple but powerful method for strategizing

about your business and understanding where you
should focus your efforts. In a SWOT analysis, you
describe the strength, weaknesses, threats and
opportunities. Once you have conducted a SWOT
analysis, you can consider ways to overcome your
weaknesses and build on your strengths.

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Develop an e-commerce presence

map

The four (4) different kinds of e-

commerce presence are websites, e-
mail, social media and offline media.
For each of these types, there are
different platforms that you will need to
address. And for each type of e-
commerce presence, there are related
activities you will need to consider.
(Source: Laudon & Traver, 2018 )

Develop a timeline (milestones)

It is a good idea to have a rough idea

of time frame for developing your e-
commerce presence when you begin.
You should break your project down
into a small number of phases that
could be completed within a specified
time. The six (6) phases are enough to
a one-year timeline for the
development of a start-up e-commerce
company (Table 4.1) (Source: Laudon & Traver, 2018 )

Budget

You need to develop a preliminary idea

of the costs involved in developing e-
commerce presence. How much you
spend on a website depends on what
you want it to do, how much you can
afford and, of course, the size of the
opportunity. Figure 4.3 provides some
idea of the relative size of various
website costs. In, general the cost of the
hardware, software and
telecommunications for building and
operating a website has fallen (Source: Laudon & Traver, 2018 )
dramatically, making it possible for very

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small entrepreneurs to build fairly sophisticated sites. While technology has

lowered the costs of system development, the costs of marketing, content
development and design have risen to make up more than half of typical website
budget. The long term costs would also have to include site and system
maintenance which are not included.

LESSON 3.2. Hardware

Whether you host your own site or outsource the hosting and operation of
your site, you will need to understand certain aspects of the computing hardware
platform. The hardware platform refers to all computing equipment that the
system uses to achieve its e-commerce functionality. There are various factors
that affect the speed, capacity and scalability of an e-commerce site.

E-commerce platform: The Demand side

The most important factor affecting the speed of your site is the demand
that customers put on the site. Table 4.6 lists the most important factors to
consider when estimating the demand on a site. One of the important factors to
consider is the number of simultaneous users who will likely visit your site. A web
session initiated by the typical user is stateless, meaning that the server does
not have to maintain ongoing, dedicated interactions with the client.

Other factors to consider are user profile and the nature of the content. If
users request searches, registration forms, and order taking via shopping carts,
then demands on processors will increase.

(Source: Laudon & Traver, 2018 )

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E-commerce Platform: The Supply side

Once you estimate the likely demand on your site, you will need to
consider how to scale up your site to meet demand. Scalability is important
consideration if you want to host your own website. Scalability refers to the
ability of a site to increase in size as demand warrants.

Activity 3.2

 Watch the video lecture “Building an e-commerce presence: A systematic

approach”

 Watch the video “Winning in e-commerce warehousing with flexible and

scalable solutions” available from
[Link]

LESSON 3.3 Software

Along the telecommunications, software and hardware constitute the

infrastructure of an e-commerce presence. As a business manager in charge in
creating an e-commerce presence, you will know the basic information about
choosing the right software.

E-commerce Merchant Server Software Functionality

This provide the basic functionality needed for online sales including an
online catalog, order taking via online shopping cart and online credit card
processing.

Online Catalog. A company that wants to sell products online must have
a list of its products available on its website. Merchant server software typically
includes a database capability that will allow for construction of a customized
online catalog. The complexity and sophistication of the catalog will vary
depending on the size of the company and its product lines.

Shopping cart. Online shopping cart allows shoppers to set aside desired
purchases in preparation for checkout review what they have selected, edit their
selections as necessary and then actually make the purchase by clicking a
button.

Credit card processing. A site’s shopping cart typically works in

conjunction with credit card processing software, which verifies the shopper’s

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credit card and then puts through the debit to the card and the credit to the
company’s account at checkout. Integrated e-commerce software suites typically
supply the software for this function.

Merchant Server Software Packages (E-commerce Software Platforms)

It is easier, faster and generally more cost-effective to purchase merchant

server software package rather than build your site from a collection of disparate
software applications. Merchant server software offers an integrated environment
that promises to provide most or all of the functionality and capabilities you will
need to develop a sophisticated customer-centric site. E-commerce software
platforms come in three general ranges of price and functionality.

Open-source Software Options

Open source software is software developed by a community of

programmers and designers and is free to use and modify. The advantage of
using open-source software is that you customized unique website. The
disadvantage is that it will take several months for a programmer to develop a
site.

Choosing an E-commerce Software Platform

Evaluating these tools and making a choice is one of the most important
and uncertain decisions you will make in building an e-commerce site. The
following are some of the factors to consider: (1) functionality; (2) support for
different business models including m-commerce; (3) business process modeling
tools; (4) visual site management tools and reporting; (5) performance and
scalability; (6) connectivity to existing business systems; (7) compliance with
standards; (8) global and multicultural capability; and (9) local sales tax and
shipping rules.

LESSON 3.4 Developing a mobile website and building mobile applications

Building a website is just part of developing an e-

commerce presence. There are unique different
kinds of m-commerce platform, each with unique
advantages and costs. Generally, mobile websites
operate more slowly than traditional websites
viewed on desktop computer connected to a
broadband office networks. Most large firms today
have mobile websites.

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Terms to Remember

Mobile website – It is a version of

regular website that is scaled down in
content and navigation so that users can
find what they want and move quickly a
decision to purchase.

Mobile web app – The term refers to an

application built to run on the mobile web
browser built into smartphone or tablet
computer. In the case of Apple, the native
browser is Safari. Mobile web apps
operate faster than mobile websites but
not as fast as native apps.

Native app – is an application designed specifically to operate using the mobile

devices hardware and operating system. These stand-alone programs can
connect to the Internet to download and upload data and can operate on this
data even when not connected to the Internet. Native apps are ideal for games,
complex interactions, on-the-fly calculations, graphic manipulations and rich
media advertising.

Hybrid app – This contains many features of both native app and a mobile web
app. Like native app, it runs inside a container on the mobile device and has
access to the devices of APIs, enabling it to take advantage of many of the
device features. It can also be packaged as an app for distribution from an App
store.

Planning and Building a Mobile Presence

Identify the business objectives. The first step is to identify the

business objectives you are trying to achieve. After you have identified the
business objectives, system functionality and information requirements are
needed. You need to consider which to develop: a mobile website, a mobile we
app or a native app. Mobile apps and mobile websites offer distinct benefits and
in most cases, the best strategy will be to plan to deliver compelling content
across all devices.

Design Considerations. Designing a mobile presence is different from

traditional desktop website design because of different hardware, software and
consumer expectations. Designers need to take mobile platform constraints into
account when designing for the mobile platform. Focus on a few, powerful

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graphics and minimize the number of images sent to the user. Other important
trends in the development of mobile websites include responsive and adaptive
web design.

Performance and Cost Considerations. Building a mobile web app that

uses mobile devices browser requires more effort and cost than developing a
mobile website and suffers from the same limitations as any browsed-based
application. The most expensive path to a mobile presence is to build a native
app because it requires more programming expertise. Nowadays, there are many
development packages that can build mobile native apps with minimal
programming expertise. Mobile web app offer some advantages such as better
graphics, more interactivity and faster local calculations.

Activity 3.4

 Watch the video “WordPress vs Weebly vs Sqaurespace” available from

[Link]

 Watch the video “Designing your website: Five (5) factors to consider”
available from [Link]

Individual Project

Go to the website of Wix, Weebly or another provider of your choosing

that allows you to create a simple e-tailer website for a free trial period. Create a
website. The site should feature at least four (4) pages including a home page
(introducing your company, products or services), about us, contact us and at
least three (3) product or service pages informing your customer with details.
Extra credit will be given for additional complexity and creativity. Prepare a pre-
recorded video of your e-tailer concept and website for the presentation. Upload
the video to the shared Google drive Website Project.

Rubric for Business Website Design

Exemplary Advanced Proficient Developing

Creativity Output show a Excellent Good use of Little evidence of
and Design large amount sense of graphics and/or original thinking.
20 points of original creativity and other design Minimal use of
thought. Ideas design. elements. design elements.
are creative Graphic Evidence of Lots of text, little
and innovative. elements originality and use of other
enhance and creativity elements such
support the enhance the as graphics or

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presentation of content pictures.

content. presented.
Navigation Links are Links are Links allow the Links seem to
10 points clearly labelled and reader to move missing and
labelled, allow the from page to don’t allow the
consistently reader to easily page but some ready to easily
placed and move form links seem to navigate.
allow the page to page. be missing.
reader easily
move from
page to page.
Layout The website The website The website The website has
10 points has an has an has a usable a cluttered or
exceptionally attractive and layout but may confusing layout.
attractive and usable layout. appear busy or It is often difficult
usable layout. It is easy to boring. to locate
It is easy to locate It is easy to important
locate important locate mist of elements.
important elements. the important
elements. elements.
Presentation Presenter was Delivery was Relatively Communication
10 points passionate clear. interesting with of the idea was
about the topic Communication a fairly smooth broken and hard
and confident of ideas was delivery that to follow.
with a clear good. usually holds
delivery. audience
attention.

MODULE REFERENCES

Laudon, K. C & Traver, C. G. (2018), E-commerce 2017: Business, Technology

and Society

Turban, E., King, D. Lee, J. K.,Liang, T.P. & Turban, D. (2015). Electronic
commerce: A Managerial and Social Network Perspective

“Winning in e-commerce warehousing with flexible and scalable solutions”

available from [Link]

“WordPress vs Weebly vs Sqaurespace” available from

[Link]

“Designing your website: Five (5) factors to consider” available from

[Link]

ELECTIVE 1 – E-COMMERCE AND INTERNET MARKETING