Building an E-commerce Presence

Lesson Objectives

At the end of the lesson, the students should be able to:

 Describe the questions and the steps that should be taken in
developing an e-commerce presence.
 Explain the process that should be followed in building an e-
commerce presence.
 Describe the major issues surrounding the decision to
outsource site development and/or hosting.
 Identify additional tools that can improve Web site
performance.
 Explain the important considerations involved in developing a
mobile Web site and building mobile applications.
2
 Imagine Your
E-commerce Presence
 Imagine Your
E-commerce Presence

Things to consider:
 What’s the idea?
 Where’s the money?
 Who and where is the target audience?
 Characterize the marketplace
 Where is the content coming from?
 Know yourself—SWOT analysis
 Develop an e-commerce presence map
 Develop a timeline: Milestones
 How much will this cost?
4
 Imagine Your
E-commerce Presence

 What’s the idea?

– Vision – Strategic analysis
– Mission statement – Marketing matrix
– Target audience – Development timeline
– Intended market – Preliminary budget
space

5
 Imagine Your
E-commerce Presence

 Where’s the money?

– Business model(s):
• Portal, e-tailer, content provider, transaction broker,
market creator, service provider, community provider
(social networks)
– Revenue model(s):
• Advertising, subscriptions, transaction fees, sales, and
affiliate revenue

6
 Imagine Your
E-commerce Presence

 Who and where is the target audience?

– Describing your audience
• Demographics
– Age, gender, income, location
• Behavior patterns (lifestyle)
• Consumption patterns (purchasing habits)
• Digital usage patterns
• Content creation patterns (blogs, Facebook)
• Buyer personas

7
 Imagine Your
E-commerce Presence

 Characterize the marketplace

– Demographics
– Size, growth, changes
– Structure
• Competitors
• Suppliers
• Substitute products
 Where is the content coming from?
– Static or dynamic?

8
 Imagine Your
E-commerce Presence

 Know yourself—
SWOT analysis
– Once you have
conducted a SWOT
analysis, you can
consider ways to
overcome your
weaknesses and build
on your strengths.
9
 SWOT Analysis

A SWOT analysis describes your firm’s strengths, weaknesses, opportunities, and threats.
 Imagine Your
E-commerce Presence

 Develop an e-commerce presence map

– Your potential customers use various devices at
different times during the day, and involve
themselves in different conversations depending on
what they are doing—touching base with friends,
tweeting, or reading a blog. Each of these are “touch
points” where you can meet the customer. You have
to think about how you develop a presence in these
different virtual places

11
 E-commerce Presence Map

An e-commerce Web presence requires firms to consider the four different kinds of
Web presence, and the platforms and activities associated with each type of presence.
 Imagine Your
E-commerce Presence

 Develop a timeline: Milestones

– Where would you like to be a year from now?
– It’s a good idea for you to have a rough idea of the
time frame for developing your e-commerce
presence when you begin.

13
E-commerce Presence Timeline

14
 Imagine Your
E-commerce Presence

 How much will this cost?

– Simple Web sites: up to $5000
– Small Web start-up: $25,000 to $50,000
– Large corporate site: $100,000+ to millions

15
 Components of a Web Presence Budget

While hardware and software costs have fallen dramatically, web sites face significant
design, content development, and marketing costs.
16
 Building an
E-commerce Presence:
A Systematic Approach
Building an E-commerce Site:
A Systematic Approach

 Most important management challenges:

– Developing a clear understanding of business
objectives
– Knowing how to choose the right technology to
achieve those objectives

18
 Pieces of the E-commerce Site-building Puzzle

Building an e-commerce Web site requires that you systematically consider the many factors that go
into the process.

19
 Systems Development
Life Cycle (SDLC)

 Systems development life cycle (SDLC)

– methodology for understanding business objectives of a
system and designing an appropriate solution

 Five major steps:

– Systems analysis/planning
– Systems design
– Building the system
– Testing
– Implementation

20
 Web Site Systems
Development Life Cycle
 SDLC – Phase 1:
Systems Analysis/Planning

Systems Analysis/Planning – identify business objectives,

system functionality, and information requirements. “What
do we want this e-commerce site to do for our business?”

 Business objectives:
– List of capabilities you want your site to have
 System functionalities:
– List of information system capabilities needed to achieve
business objectives
 Information requirements:
– Information elements that system must produce in order to
achieve business objectives
22
 SDLC – Phase 2:
System Design

 System Design – “How can all the functionality

and information requirements be delivered?”

 System design specification:

– Description of main components of a system and their
relationship to one another
 Two components of system design:
 Logical design – data flow diagrams, processing
functions, databases
Physical design – specifies actual physical, software
components, models, and so on 24
Logical Design for a Simple Web Site

(a) Simple Data Flow Diagram

This data flow diagram describes the flow of information requests and responses
for a simple Web site.
 Physical Design for a Simple Web Site

(b) Simple Physical Design

A physical design describes the hardware and software needed to realize the logical design.
 SDLC – Phase 3:
Building the System
Building the System: In-House vs. Outsourcing
 Outsourcing – hiring vendors to provide services involved in
building site
 Build own vs. outsourcing
– Build your own requires team with diverse skill set; choice of
software tools; both risks and possible benefits
 Host own vs. outsourcing
– Hosting: Hosting company responsible for ensuring site is
accessible 24/7, for monthly fee
– Co-location: Firm purchases or leases Web server (with
control over its operation), but server is located at vendor’s
facility
27
 SDLC – Phase 3:
Building the System

Building the System: In-House vs. Outsourcing

Advantages of building a site in-house include:

 The ability to change and adapt the site quickly as the
market demands
 The ability to build a site that does exactly what the
company needs

28
 SDLC – Phase 3:
Building the System
Disadvantages of building a site in-house include:
 The costs may be higher.
 The risks of failure may be greater, given the complexity
of issues such as security, privacy, and inventory
management.
 The process may be more time-consuming than if you had
hired an outside specialist firm to manage the effort.
 Staff may experience a longer learning curve that delays
your entry into the market.

29
 Choices in Building and Hosting

You have a number of alternatives to consider when building and hosting an e-commerce site.
The Spectrum of Tools for Building our Own E-commerce Site

31
 Costs of Customizing E-commerce Packages

While sophisticated site development packages appear to reduce costs and increase speed
to market, as the modifications required to fit the package to your business needs rise, costs
rise rapidly.

32
Key Players: Hosting / Co- location / Cloud Services

Global Business Services

 SDLC – Phase 4:
Testing
Testing is required whether the system is outsourced or built in-house.

 Unit testing
– involves testing the site’s program modules one at a time.
 System testing
– involves testing the site as a whole, in the same way a typical user would
when using the site.
 Final acceptance testing
– requires that the firm’s key personnel and managers in marketing,
production, sales, and general management actually use the system as
installed on a test internet or intranet server.
– This acceptance test verifies that the business objectives of the system as
originally conceived are in fact working.

34
 SDLC – Phase 5:
Implementation & Maintenance

Implementation and maintenance:

 Maintenance is ongoing
 Maintenance costs = similar to development costs
 Studies of traditional systems maintenance have found that out
of the total maintenance time:
 20% = debugging code and responding to emergency situations
 20% = changes in reports, data files, and links to backend
databases
 60% = general administration (making product and price changes
in the catalog) and making changes and enhancements to the
system
35
 SDLC – Phase 5:
Implementation & Maintenance

 Web Team Tasks:

1. Listen to customers’ feedback on the site and respond to
that feedback as necessary
2. Develop a systematic monitoring and testing plan to be
followed weekly to ensure all the links are operating, prices
are correct, and pages are updated.
3. Benchmarking and keeping the site current on pricing and
promotions.

 Benchmarking – a process in which the site is compared with

those of competitors in terms of response speed, quality of
layout, and design
36
 Factors in Web Site Optimization

Web site optimization requires that you consider three factors: page content, page generation, and
page delivery.
Other E-commerce
Site Tools
 Basic Considerations

 Web site design: Basic business considerations

– Enabling customers to find and buy what they need

 Tools for Web site optimization

– Search engine placement
• Metatags, titles, content
• Identify market niches, localize site
• Offer expertise
• Links
• Buy ads
• Local e-commerce
39
E-commerce Web Site Features That Annoy Customers
The Eight Most Important Factors In Successful E-commerce Site Design
Tools for Interactivity &
Active Content

 Common Gateway Interface (CGI) scripts—a set of

standards for communication between a browser and a
program on a server that allows for interaction
between the user and the server

 Active Server Pages (ASP)—a Microsoft tool that also

permits interaction between the browser and the
server

 Java applets—programs written in the Java

programming language that also provide interactivity

42
Tools for Interactivity &
Active Content

 JavaScript—used to validate user input, such as

an e-mail address

 ActiveX and VBScript—Microsoft’s version of

Java and JavaScript, respectively

 Cookies—text files stored on the user’s hard

drive that provide information regarding the user
and his or her past experience at a Web site

43
Tools for Interactivity &
Active Content

Other tools:
 ColdFusion
 PHP, Ruby on Rails, Django
 Web 2.0 design elements:
– Widgets, mashups

44
Personalization Tools

 Personalization
– Ability to treat people based on personal qualities
and prior history with site
 Customization
– Ability to change the product to better fit the
needs of the customer
 Cookies
– Primary method to achieve personalization
45
Information Policy Set

 Privacy policy
– Set of public statements declaring how site will
treat customers’ personal information that is
gathered by site

 Accessibility rules
– Set of design objectives that ensure disabled users
can effectively access site

46
Developing a Mobile Web Site
& Building Mobile Applications
Developing a Mobile Web Site
& Building Mobile Applications

 Three types of m-commerce software

– Mobile Web site
• Responsive Web design
– Mobile Web app
– Native app
– Hybrid app
• Runs inside native container
• App distribution
• Based on HTML5, CSS, Javascript

48
 Planning & Building
a Mobile Presence

 Identify business objectives, system

functionality, and information requirements
 Choice:
– Mobile Web site or mobile Web app
• Less expensive
– Native app
• Can use device hardware, available offline

49
Systems Analysis for Building a Mobile Presence

50
 Mobile Presence
Design Considerations

 Platform constraints
– Graphics, file sizes
 Mobile first design
– Desktop Web site design after mobile design
 Responsive Web design (RWD)
– CSS site adjusts layout of site according to device screen
resolutions
 Adaptive Web design (AWD)
– Server delivers different templates or versions of site optimized
for device

51
Unique Features That Must Be Taken Into Account
When Designing a Mobile Web Presence
Cross-Platform Mobile
App Development Tools

 Objective C, Java
 Low cost, open-source alternatives
– Appery.io
– Codiqua
– PhoneGap
– MoSynch
– Appcelerator

53
Performance and Cost
Considerations

 Mobile first design: Most efficient

 Mobile Web site:
– Resizing existing Web site for mobile access is
least expensive
 Mobile Web app:
– Can utilize browser API
 Native app:
– Most expensive; requires more programming

54
Lesson Summary

55
 Lesson Summary

 E-commerce presence -- things to consider:

– What’s the idea?
– Where’s the money?
– Who and where is the target audience?
– Characterize the marketplace
– Where is the content coming from?
– Know yourself—SWOT analysis
– Develop an e-commerce presence map
– Develop a timeline: Milestones
– How much will this cost?

56
 Lesson Summary

 SDLC phases:
– Systems analysis/planning
– Systems design
– Building the system
– Testing
– Implementation

 Other e-commerce site tools

– Tools for web site optimization
– Tools for interactivity & active content
– Personalization tools
– Information Policy Set
57
 Lesson Summary

 Important considerations involved in developing a

mobile Web site and building mobile applications
– It is important to understand the difference between a
mobile Web site, mobile Web apps, and native apps.
– The first step is to identify business objectives, since they
help determine which type of mobile presence is best.
– Design should take into account mobile platform
constraints.
– Developing a mobile Web site is likely to be the least
expensive option; mobile web apps require more effort
and cost; native apps are likely to be the most expensive to
develop.
58
 Reference

Laudon, K. C., & Traver, C. G. (2017).

E-commerce. Business. Technology.
Society. (Global / 13th ed.). Harlow, UK:
Pearson Education Limited.

59