Chapter 4 Business-to-Business E-Commerce Learning Objectives 1. Describe the B2B field. 2. Describe the major types of B2B models. 3. Discuss the models and characteristics of the sellside marketplace, including auctions. 4. Describe sell-side intermediaries. 5. Describe the characteristics of the buy-side marketplace and e-procurement. 6. Explain how reverse auctions work in B2B. Learning Objectives 7. Describe B2B aggregation and group purchasing models. 8. Define exchanges and describe their major types. 9. Describe B2B portals. 10. Describe third-party exchanges. 11. Describe how B2B can benefit from social networking and Web 2.0. 12. Provide an overview of the major B2B support services. Concepts, Characteristics, and Models of B2B E-Commerce • Basic B2B Concepts and Process o *Business-to-business e-commerce (B2B EC) • The Basic Types of B2B Transactions and Activities 1. Sell-side 2. Buy-side 3. Marketplaces or exchanges 4. Supply chain improvements 5. Collaborative commerce Concepts, Characteristics, and Models of B2B E-Commerce • The Basic Types of B2B E-Marketplaces and Services o One-to-Many and Many-to-One: Private E-Marketplaces • *Company-centric EC o Many-to-Many: Public Exchanges (or E-Marketplaces) • Exchanges (trading communities or trading exchanges) • Public e-marketplaces o Supply Chain Improvers and Collaborative Commerce • Collaboration Five Types of B2B E-Commerce Concepts, Characteristics, and Models of B2B E-Commerce • Market Size and Content of B2B • B2B Components o Parties to the Transaction: Sellers, Buyers, and Intermediaries • *Online intermediary o Types of Materials Traded: What Do Firms Buy? • *Direct materials • *Indirect materials • *Maintenance, repair, and operation (MRO) o B2B Marketplaces and Platforms • *Vertical marketplaces • *Horizontal marketplaces Generations of B2B E-Commerce The Components of B2B Concepts, Characteristics, and Models of B2B E-Commerce • Service Industries Online in B2B o o o o o Travel and hospitality services Real estate Financial services Banking and online financing Other online services • Partner and Supplier Relationship Management o Partner relationship management (PRM) • The Benefits and Limitations of B2B One-to-Many: Sell-Side E-Marketplaces • Sell-Side Models o *Sell-side e-marketplace o B2B Sellers o Customer Service • Sales from Catalogs: Webstore o Distributors’ Catalogs o Self Service Portals o Benefits and Limitations of Online Sales from Catalogs • Comprehensive Sell-Side Systems • Selling via Distributors and Other Intermediaries Selling via E-Auctions • The Benefits of Auctions on the Sell Side o o o o Revenue generation Cost savings Increased “stickiness” Member acquisition and retention • Auctioning from the Company’s Own Site • Using Intermediaries in Auctions • Examples of B2B Forward Auctions Traditional (Manual) Procurement Process One-From-Many: E-Procurement at Buy-Side E-Marketplaces • *Buy-side e-marketplaces • Inefficiencies in Traditional Procurement Management o *Procurement management o *Maverick buying • Procurement Methods • E-Procurement Concepts o *E-procurement (electronic procurement) o The Goals and Process of E-Procurement o Types of E-Procurement One-From-Many: E-Procurement at Buy-Side E-Marketplaces • Types of E-Procurement o The Benefits of E-Procurement o The Limitations and Challenges of E-Procurement o E-Procurement and Strategic Sourcing E-Procurement Methods Reverse Auctions at Buy-Side E-Marketplaces (E-Tendering) • • • • *Reverse auction *Request for quote (RFQ) The Major Benefits of Reverse Auctions Conducting Reverse Auctions o E-Tendering by Governments • Group Reverse Auctions The Reverse Auction Process Other E-Procurement Methods • *Desktop Purchasing • *Group Purchasing o Internal Aggregation of Purchasing Orders o External Aggregation for Group Purchasing • Buying from Other Sources • Acquisition via Electronic Bartering o *Bartering exchange • Selecting an Appropriate E-Procurement Solution The Group Purchasing Process The Community of an Exchange: Flow and Access to Information B2B Exchanges (E-Marketplaces): Definitions and Concepts o Functions of and Services Provided by Exchanges o Functions and Services of B2B Exchanges • • • • Matching buyers and sellers Facilitating transactions Maintaining exchange policies and infrastructure Services provided by an exchange • Ownership of B2B Exchanges o Third-Party Independent Exchanges o *Consortium Trading Exchanges (CTE) B2B Exchanges (E-Marketplaces): Definitions and Concepts • Dynamic Pricing in B2B Exchanges o *Dynamic pricing • Advantages, Limitations, and the Revenue Model of Exchanges o Revenue Models B2B Portals and Directories • B2B Portals: An Overview o *B2B portals • Corporate (Enterprise) Portals o *Corporate (enterprise) portal o Types of Corporate Portals • • • • • Portals for Suppliers and Other Partners Customer Portals Employee Portals Executive and Supervisor Portals *Mobile Portals o The Functionalities of Portals • *Information portals • *Collaborative portals B2B Portals and Directories o Corporate Portal Applications and Issues o The Functionalities of Portals • *Information portals • *Collaborative portals o Corporate Portal Applications and Issues • Directory Services and Search Engines o International Trade Directories B2B in Web 2.0 and Social Networking • E-Communities in B2B • The Opportunities of Social Commerce in B2B • The Use of Web 2.0 Tools in B2B o B2B Games • *Gamification • Virtual Trade Shows and Trade Fairs o *Virtual trade show • Social Networking in B2B o Using Twitter in B2B B2B in Web 2.0 and Social Networking • Examples of Other Activities of B2B Social Networks o Location-based services o Corporate profiles on social networks o Success Stories • Strategy for B2B Social Networking • The Future of B2B Social Networking Some B2B Support Mechanisms • Organizational Buyer Behavior o A Behavioral Model of Organizational Buyers • The Marketing and Advertising Processes in B2B o *B2B marketing • Methods for B2B Online Advertising and Marketing o Targeting Customers o Affiliate Programs Some B2B Support Mechanisms • B2B Market Research • Other B2B Support Mechanisms o Collaboration Networks and Supply Chain Facilities o Payments • The Future of B2B A Model of Organizational Buyer ehavior Managerial Issues 1. Which B2B model(s) should we use for eprocurement? 2. Which B2B model(s) should we use for online B2B sales? 3. Which solutions and vendor(s) should we select? 4. What is the organizational impact of B2B? 5. What are some ethical issues in B2B? 6. Which type of social network should we use— private (proprietary) or public? 7. Which business processes to automate? Summary 1. The B2B field. 2. The major B2B models. 3. The characteristics and models of sellside marketplaces. 4. Sell-side intermediaries. 5. The characteristics of buy-side marketplaces and e-procurement. 6. B2B reverse auctions. Summary 7. B2B aggregation and group purchasing. 8. Exchanges defined and the major types of exchanges. 9. B2B portals. 10.Third-party exchanges. 11.B2B in Web 2.0 and social networks. 12.B2B Internet marketing and other support services.