Download Chapter 2

Defining Your E-Business Idea
Chapter 2
The Entrepreneur
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Someone who assumes the risks of starting and
running their own business
An entrepreneur needs
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Leadership abilities
High energy personality
Self-confidence
High levels of organizational skills
Ability to act
Will working for yourself allow you to work less?
The Entrepreneurial Process
E-Business Success Factors
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The network effect
Scalability
Innovative Web marketing ideas
Ease of entry into (electronic) markets
Adaptability to change
The Network Effect
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The greater the number of nodes
(participants) the greater the value of the
network
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Metcalf law of network power
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Telephone example
Internet example
Power of the network = number of nodes2 or N2
NetMind, NetZero, ThirdVoice
Scalability
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The ability of your idea to continue to
function regardless of size
Big problem, both technically and general
business
Can refer to the ability of a server or
Internet service to support increased loads
AllAdvantage
Innovative Web Marketing Ideas
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Use the power of the Web and Internet to
leverage new ideas.
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Hotmail gave away free e-mail accounts that
used a Web interface and was linked to a
site. (p. 46)
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Viral Marketing
Hotmail
Ease of Entry Into Markets
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The Internet opened up access to markets by
lowering barriers to entry.
Good ideas can be cloned.
Advantage frequently goes to first mover (first
to market).
Ebay was a “first mover.”
Ebay Auction Site
Adaptability to Change
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Internet and Web Technologies facilitate rapid
change in business models.
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New products or services
New features
Amazon.com started in books, added other
products and more recently added auctions to
their product/service mix
Amazon.com
Exploiting E-Business Advantages
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Expand the market
Acquire greater business visibility
Maximize customer relationships and improve
responsiveness
Create new services
Reduce costs
Expand the Market
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Reach more customers
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Lower location and time barrier
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Ticketmaster
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Does your idea take advantage of the Internet
to expand your market?
Acquire Greater Visibility
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Early days, simply an online brochure
The Internet allows companies to get their
name, products, or services exposed to more
customers than ever before.
Use or outsource distribution to others.
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Find distributors for eToys and Pier1
Half.com – what did they do?
How your e-business idea could use the
Internet to gain greater business visibility?
Maximize Customer Relationships
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Build one-on-one relationships with
customers.
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What are your regular sites? Why?
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Use technology to build and sustain links with
customers.
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Southwest Airlines
Improve Responsiveness
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Use technology to respond more quickly or
effectively to customer needs and inquiries.
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Use services such as parcel tracking and delivery
confirmation
Allow for on-line purchases
Create New Services
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The Web allows for expansion and refinement
of traditional business
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Add new products quickly
TrailBreaker – gone!
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Does your business idea provide a new,
unique or revamped product/service suited to
the Internet environment?
Reduce Costs
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The Internet can lower costs of doing
business by lowering…
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Reduce info gathering costs - $1 to 1 cent
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Distribution costs
Marketing costs
Thoughts on info gathering (phone #, please?)
Tech support online
Foodlocker.com
Grocery Works.com