E-commerce 2021-2022: Business. Technology. Society., Ebook, Global Edition

HOW E-COMMERCE CHANGES BUSINESS: STRATEGY, STRUCTURE, AND PROCESS

Now that you have a clear grasp of the variety of business models used by e-commerce firms, you also need to understand how e-commerce has changed the business envi­ronment in the last decade, including industry structures, business strategies, and
industry and firm operations (business processes and value chains). We return to these concepts throughout the book as we explore the e-commerce phenomenon. In general, the Internet is an open standards system available to all players, and this fact inher­ently makes it easy for new competitors to enter the marketplace and offer substitute products or channels of delivery. The Internet tends to intensify competition. Because information becomes available to everyone, the Internet inherently shifts power to buy­ers who can quickly discover the lowest-cost provider. On the other hand, the Internet presents many new opportunities for creating value, for branding products and charg­ing premium prices, and for enlarging an already powerful offline physical business such as Walmart.
Recall Table 1.2 in Chapter 1 that describes the truly unique features of e-commerce technology. Table 2.8 suggests some of the implications of each unique feature for the overall business environment-industry structure, business strategies, and operations.

TABLE 2.8 EIGHT UNIQUE FEATURES OF E-COMMERCE TECHNOLOGY