Online software downloads Travel e-ticket purchases Insurance

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1 1. What types of business processes are well suited to electronic commerce? Businesses that are well suited for electronic commerce are those that have low transaction costs versus traditional forms of commerce. Items that are small, light, and not of extraordinary value are the best candates. Good examples of these are CD's and DVD's. While these are small and light, they are valuable enough that the shipping costs don't put the transaction costs too high to make the transaction efficient. Larger items that are difficult and expensive to ship, as well as those with special value like antiques and designer clothing that need to be inspected by the buyer, and products in which a salesperson's influence is necessary do not lend themselves well to e- commerce. Some examples are: Online software downloads Travel e-ticket purchases Insurance 2. Discuss the importance of transaction costs. Transaction costs are the costs incurred by both the buyer and seller to take part in a transaction. If transaction costs are high, less margin is made on products, therefore the price will either need to be made higher or the seller will take a profit cut. When the price goes up, people will be less likely to purchase the products, and therefore, it will hurt business. If transaction costs are low, people can save money by participating in electronic commerce. By selling through e- commerce, costs can be cut because you do not have to have a traditional store with salespeople that require pay; however, unless transaction costs are lower, it is not financially efficient to do so. 3. List the primary and support activities that are implemented in strategic business unit value chains. Primary: Identify Customers Design Purchase Materials and Supplies Manufacture product or create service Market and Sell Deliver Provide after-sale service & Support Secondary: Finance and Administration Human Resources Technology Development

2 4. When conducting a SWOT analysis, what are some of the questions that one should ask to identify strengths and weaknesses? Strengths: What does the company do well? Is the company strong in its market? Does the company have a strong sense of purpose and culture to support its purpose? Weaknesses What does the company do poorly? What problems could be avoided? Does the company have any serious financial liabilities? 5. Describe the three categories of electronic commerce that are most commonly used. The most common types of ecommerce are: B2C: Consumer shops for goods provided by a business (ex. Amazon.com) B2B: Business sells to another business through electronic commerce. It can also be a transfer of data or other information exchange. Business to Government: Business interactions with the government 6. As an individual packet travels from one network to another, the computers through which the packet travels determine the best route for getting the packet to its destination. Describe this process. The packet is sent from a computer and goes to a router / routing computer / gateway that then applies routing algorithms (set of rules to determine best path for the data to take) using data stored in its routing / configuration tables. When the packet is sent, it is sent in a standard format determined by a protocol that other routers can read, and the data is received by another router on the receiving end and can interpret the data. 7. Identify the four key rules for message handling. 1. Independent networks should not require any internal chanage to be connected to the [internet] network 2. Packets that do not arrive at their destinations must be retransmitted by their source network 3. Router computers act as recieve-and-forward devices; they do not retain any information about the packets that they handle

3 4. No global control exists over the network 8. What is the difference between TCP and IP? Internet Protocol (IP) is what is responsible for moving data. It forwards to an address (IP Address). IPv4 is 4 sets of decimal representations of 2 hex digits, while IPv6 is eight sets of four hex digits. These can be addresses through the internet or local (within a company network, for example). IPv4 is currently the most common, but because of the limited number of addresses available, IPv6 was created. The Transfer Control Protocol (TCP) handles error detection. It gives instructions of how to tell if a packet didn't get to the location in tact and what to do if this case occurs. 9. What is the difference between a public network and a private network? Public Network: any computer network or telecommunication network available to the public (internet included) Private Network: Connection (can be through leased lines) that connects one intranet to another, but is not available to the public. These are used by companies with multiple locations to keep security while being able to transfer data between chains. The high cost of leased lines can be avoided by using VPN's, which emulate a private network by restricting connections while using the internet as its method of transportation. 10. What are the advantages of Bluetooth technology? The technology is wireless and inexpensive. This means that the technology can be implemented in many devices without putting the cost sky-high. The connections are automatic; when you pair a mouse with a computer or set up a personal area network, it automatically connects whenever the connection is available. Plus, there is very low interference, and it does not consume much power. 11. An effective site is one that creates an attractive presence that meets the objectives of the business or organization. List at least five common objectives. Attract visitors to the site Make site interesting enough for users to explore Convince users to follow site's links to obtain information Create an impression consistent with the organization's desired image Build trusting relationship with visitors Reinforce positive images that the visitor may already have had about the organization Encourage visitors to return to the site

4 12. List at least five reasons why people visit Web sites. Learn about products or services that the company offers Buying products or services that the company offers Obtaining information about warranty, service, or repair policies for products purchased Obtaining general company or organization information Obtaining financial information for making an investment in the compnay or organization Identifying the people that manage the organization Obtaining contact information for a person or department in the organization 13. List five goals that businesses should meet when constructing a Web site, so that it successfully conveys an integrated image and offers information to potential customers. Offer easily accessible information about hte organization Allow visitors to experince the site in different ways / at different levels Provide vistors with a meaningful two-way (interactive) communication link with the organization Sustain visitor attention and encourage return visits Offer easily accessible information about products and services and how to use them 14. What are the guidelines that must be followed by Web designers when creating a Web site that is intended to meet the specific needs of customers? Design the site around how visitors will navigate the links, not based on company's organization structure Allow visitors to access information quickly Avoid using inflated marketing statements in product or service descriptions Avoid using business jargon and terms the user may not understand Build the site to work for visitors who are using the oldest browser software on the oldest computer connected through the lowest bandwidth connection--even if this means creating multiple versions of webpages Be consistent in the use of design features Make sure the navigation controls are clearly labeled or otherwise recognizable Test text visually on smaller monitors

5 Check to make sure that color combinations do not impair viewing clarity for color-blind visitors Conduct usability tests by having potential site users navigate through several versions of the site. 15. What is the difference between the personal contact model of communicating on the Web and the mass market approach? Mass media is typically used for smaller items that do not require much personal contact for a sale. The mass market approach requires less expense on the part of the seller because there is no need for direct salesperson interaction with one customer. However, this method is not personal at all and is not well suited for bigger transactions where interaction is required. On high margin and expensive items, personal contact is influential in the sale, so the personal method has more return for its extra cost. 16. When would you use a product-based marketing strategy? Product based marketing strategy is good for those who sell items and services that customers are able to determine which they need and order themselves. Staples and Sears are given as examples, but Newegg.com is another huge model of the product based marketing. Users are presented with deals for the day, and can browse by category to select whatever components they need. 17. When does technology-enabled relationship management occur? Technology-enabled relationship management occurs when a firm obtains detailed information about a customer's behavior, preferences, needs, and buying patterns, and uses that information to set prices, negotiate terms, tailor promotions, add product features, and otherwise customize its entire relationship with that customer. 18. Brands can lose their value if the environment in which they have been successful changes. Show how this is possible by giving an example. With the recent health craze and fight against obesity, McDonalds now has to fight against its image as a supplier of fatty foods and try to promote an image with healthy alternatives. Many commercials that would have once advertized a Big Mac are now promoting their new salads and other healthy alternatives. 19. A study conducted by McKinsey & Company examined the online behavior of 50,000 active Internet users and identified six different groups. Provide a brief description of the following categories: Simplifiers, Surfers, Connectors, and Sportsters. Simplifiers - Need end-to-end convenience and simplicity Surfers - Want to know what's new Connectors - Use internet to connnect to people and business, can be through , and represent most of the online buying population

6 Sportsters - Use internet to research, but typically do their buying traditionally, in stores rather than online 20. Identify and describe the three techniques used by companies to arrange for other Web sites to display their banner ads. Banner ads are very commmon on web sites and link back to the site sponsoring the ad. These are paid for by view or by click, and are typically animated or interactive. The purpose of these is to attract the suer's attention and link them to the sponsor site. Pop-up and pop-under ads are much more aggressive. These ads open a new window when a user browses to a website, and the ad usually promotes a product or links back to the sponsor site. These are capable of ovewhelming computers' resources because they can keep popping up even when users don't want them to. Many companies have products out to block pop-up ads from displaying. targeted ads are another method for companies to advertise. They can be sent to past customers or others on mailing lists. These can be sent ethically to those who opt in to the mailing lists or purchased and sent as spam (unwanted) s. is extremely low cost to send out, so it cuts back majorly on advertising cost. Plus, if it is targetted to a current customer base, the users are already familiar with the product and it can be a very valuable target group.