Compare revenue model

Google’s yearly income is generated from advertisement fees. Google’s design, Google AdWards is a pay per click advertising program to allow advertiser to present advertisement to people online. Information related to the advertiser has being offered instantaneously to people who are looking for it through Google AdWards. An advertiser has to pay every time his ad receives a click. Google generate most of the revenue from Google AdWards. Besides, Google AdSense is an ad serving program that allow Website owner to enroll in this program to enable text, image and video advertisement in this site. Advertisers are required to pay Google a fee each time user click on one of their ads displayed on Google site. This is known as affiliate fees. Furthermore, Google also offer a research service called Google Answers. When customers ask questions, offer a price for the answer and researcher will answer them. The researcher is not Google’s employee but Google will keep 25% of the payment and the balance will subject to the researchers. Of all the revenue for Google, AdWords generates the most, which is more than 90% of the revenue. Currently, Google is testing a new revenue model that pay site owner based on a Cost-Per-Click model. It is a new way offered to advertiser to earn revenue from their Websites that are compensated based on Cost-Per-Action (CPA) basis.

E-bay earned transaction fees from each successful transaction made by the bidders or seller in an auction. It has built a streamlined and globalized person-to-person trading community on the Internet through World Wide Web. This facilitates easy exploration for buyers and allows the seller to immediately list those items for sale. Sellers and buyers are brought together in a manner where sellers are allowed to list items for sale and buyers can bid on the items interested. In the meanwhile, all eBay users can browse through the listed items in a fully automated way. Sellers are charged with two kinds of charges. First charge is charged on an item that are being listed on eBay which is called as nonrefundable Insertion fee which ranges between 30 cents and $3.30, depending on the seller’s opening bid on the item. . A fee is charged for additional listing options to promote the item, such as highlighted or bold listing. Secondly, a fee is charged at the end of the seller’s auction which ranges between 1.25% and 5% of the final sale price.

Amazon.com is an American electronic commerce company in Seattle, Washington. It is one of the first major companies involved in selling of goods by Internet. It was started as an online bookstore but later was diversified to product lines of DVDs, VCDs, computer software, video games, furniture, food and etc. In 2001, Amazon.com has launched the Honor System that allowed customers to make donations or buy digital content. With that, Amazon has collected 2.9% of the payment plus a flat free of $0.30 USD. For example, after 2004 earthquake and tsunami in the Indonesia Ocean, Amazon has set up an online donation channel to the American Red Cross, waiving its processing fee. Besides, Amazon has also launched an online storage service called Amazon Simple Storage Service. The service charges monthly fees for data stored and data transferred. Using Amazon technology, Webstore, allows businesses to create e-commerce websites. Merchants can customize their websites using their own photos and even branding. Sellers have to pay a commission of 7% to Amazon.com, which includes credit card processing fees and fraud protection fee; subscription fee of $59.95 per month for an unlimited numbers of webstores and listings. Moreover, Amazon has launched Associates affiliate programme which run like this way: associate drive internet traffic to Amazon.com through links that allows user to track sales and other activity. Then, associates can earn up to 10% in referral fees on all qualifying revenue made via their links.

How E-commerce reduce cycle time, improve employees' empowerment and facilitate customer support.

No doubt, internet usage has been more and more popular. Almost every single man on the streets including the aunty next door is using internet to carry out online activities such as searching for information. The wide usage of internet had caused a revolutionary business phenomenon, which is the electronic commerce(E-commerce). Nowadays, thousands and millions of companies regardless of their firm's size use e-commerce as one of their business strategy. They create websites in order to promote and sell their products online. These companies allow business transactions to be carried out electronically. E-commerce makes them more competitive and stands out among the others. Now, let us have a peek on the benefits of the E-commerce.

Cycle time is basically the period of time from the order take place to the end of the transaction. Time is always precious to human beings as well as a business. If a business manage to reduce its cycle time, it has greater advantage over others. By implementing E-commerce, it helps to eliminate some unnecessary business transaction processes. For example, without the intermediaries, E-commerce speeds up the purchasing process as customers place their order directly to the producer after viewing the online catalogues. The producer on the other side will receive the order almost instantaneously and starts to respond and process it. By having E-commerce, there will be no purchasing order that are needed to be transfered from one department to another for authorisation which will take up time. Therefore, the process can be done within seconds. This does not only reduce the cycle time, it also helps to cut down the cost.

Other than reducing cycle time, E-commerce improves employees' empowerment as well. As we know, employees' empowerment means giving employees the authority to act and make decisions on their own. In firms that are using E-commerce, customers are put directly in touch with the staffs. The employees are given authority to deal with customers' needs and enquiries directly. They can also receive and responds to customers' comlpains in a short period. These enable the companies to build strong relationship with customers and maintain customers' loyalty. Besides, the companies' website is the most vital asset. It serves as a platform that introduce goods and services to all the potential customers. It is equals to the traditional shop lots or counters. Therefore, it is important for the employees to have authority to access and retrieve the companies' lastest information in order to update the website.

These days, most of the companies which are using E-commerce offers services in assisting their customers to make cost effective and correct use of a product. Customer support can be facilitated by a wide range of technological solutions. Customers can send enquiries to the websites and there will be a quick response. E-commerce also enables customers to shop online through out the day as it operates 24hours per day, 7 days per week. This will be more convenient to the customers as they do not need to rush to the shops or complexes before they closed. Besides, having full range of options or products attached with description facilitates the customers in understanding the products well and eventually made the right decision.

In short, E-commerce not only benefits the organization but also provide a better place for customers to shop in.

History and Evolution of E-commerce

Have you ever go to shopping with your pajamas in the midnight?
May be you may think of whether any shopping center is operating in the midnight. Even if there is, you will feel very embarrass shopping with your pajamas. But with the evolution of Internet, we can go for online shopping anytime and anyplace as you like even is at home with pajamas.




" Shop with anything you like even with

your pajamas and at anyplace!! "




E-commerce (also known as Electronic Commerce) referred to any transaction of products or services over any electronic system. In other word, E-commerce is the buying and selling of products or services over the Internet or others. Today, when we need to buy something, no necessary we have to go to the shopping mall or any place. What we need to do is, switch on computer and connect to Internet. We can purchase anything we want through Internet.

Many of us think that, E-commerce is a new creation that emerges in this new era. Actually, E-commerce has been appeared few decades ago. However, it is not common. Until the early of 1970, the first extended use of form of E-commerce was introduced and it was Electronic Fund Transfer (EFT). EFT allows us to transfer money from one bank account to another account without the transfer of money from hand to hand. For instance, instead of queuing up so long to pay bill, you can actually go for online bill payment. It can save you a lot of time!

In the late 70s, Electronic Data Interchange (EDI) was devised. It enables companies to exchange documents such as purchase order and invoices electronically. With EDI, suppliers can also notice the stock level of their customer. When the stock level is running low, suppliers will ready to deliver stocks to their customer. It builds a paperless environment and helps companies to save up the cost for printing various documents.

Automated Teller Machines (ATM) that is very familiar to us was emerges in the 1980s. It is also forms of E-commerce. At the same time, financial institutions introduced new service which is known as telephone banking. It operates like the ATM, just that customers no need to go to ATM to perform transaction. They can perform any transaction over the telephone.

The term “E-commerce” is expanding broadly. From the 1990s onwards, E-commerce included Enterprise Resource Planning (ERP), data mining and data warehouse. Basically, ERP is referred to a comprehensive set of systems used in an organization that allow every department to operate as a whole. Integration achieved among departments and it helps the company to perform more effectively and efficiently.

According to world-gazetteer and Malaysian Communications and Multimedia Commission, the total population of 2007 in Malaysia was amounted to 28,294,120 and the total Internet users as at September/06 were 13,528,200. www.internetworldstats.com/asia/my.htm It indicates that there is more than 45 % of Internet user in Malaysia. There is a bright future for the growth and acceptance of E-commerce. May be few decades later, the traditional purchasing process will be very weird to our next generation. If possible, they will perform every transactions over the Internet.


Amazon.com
Amazon.com Inc is the American company which is the first company that engaged in e-commerce. It was formed and launched in 1995. It was started by selling book over the Internet. Later it diversified its business. Now, Amazon.com serves as a global shopping mall. We can buy any products we want from anyplace over the world at anytime.

eBay
eBay Inc. is another Internet company. It is also a worldwide shopping center. Besides, it also provides online auction. In eBay, we can bid for any product that we like.

Dell.com - ecommerce success

An example of an e-commerce success and its causes

Dell.com is an example of e-commerce success. Dell.com very success nowadays because it convenient buyers to buy their computers through internet instead of buying through counter. Today, Dell is a leader in the global technology industry. More and more businesses are relying on Dell to help them simplify IT. There are some customer success stories. For futher information, have a visit to Dell.com. Dell's success is built on a foundation of personal and professional integrity. The Soul of Dell includes several key characteristics: trust, integrity, honesty, judgement, respect, courage and responsibility. Dell direct sales operations are currently in 13 markets in the region which are Australia, Brunei, China, Hong Kong, India, Japan, Korea, Macau, Malaysia, New Zealand, Singapore, Taiwan and Thailand. With Dell's Global Customer Program, Dell is able to provide a specific suite of services to its Asian customers with worldwide operations. Advantages are given to local buyers and local onsite service. Dell.com has manufactured desktops, workstations, notebooks, servers and storage product for customers throughout Asia Pacific (excluding China and Japan). Dell established the China Customer Center (CCC) in Xiamen, Fujian Province, in August 1998. Revenue in the quarter of Dell has increased by 19% on a 31% increase in units. China market led the region with an increase of 30% in revenue.

Dell is supported by many people nowadays. Dell’s global supply network improves the product quality at the lower costs. The reason is because there is no intermediation cost incurred between Dell Company and customers which been called customer-focused direct business model. Through network, customers can know more about their preferable products. All relevant information related to Dell’s products has been publicly available in its website. Customers can easily obtain products’ information and any details about the particular products. Customers just have to enter the e-value codes that are printed in those catalogs, flyer, or any advertisement to find the product online. Dell provide data achieving and backup function. Data will not get lose easily as a result from computer virus, human error and so on. Dell.com able to responding to customer needs in a timely and reasonable manner, fostering open communications and building effective relationships with customers and suppliers using e-commerce. With e-commerce, Dell able to improve IT support in a bid to make IT services more cost effective and driving greater overall business agility. Dell procurement system is efficient for 24 hours per day 7 days per week and providing order status as well as just 30 seconds ordering process. E-commerce helps Dell.com a lot as Dell doing their business through network that connects people around the world. Furthermore, sales through internet can eliminate sales tax that collected from tax payer. This is also one of the causes that lead to the lower price of the products.

ETOYS.COM

The meaning of the term "electronic commerce" has changed over time. Originally, "electronic commerce" meant the facilitation of commercial transactions electronically, usually using technology like Electronic Data Interchange (EDI, introduced in the late 1970s) to send commercial documents like purchase orders or invoices electronically. After that, it came to include activities more precisely termed "Web commerce" -- the purchase of goods and services over the World Wide Web via secure servers with e-shopping carts and with electronic pay services, like credit card payment authorizations. Afterwards, many professionals predicted that there will be a big success in E-Commerce. However, part of the success, there are some failures on E-Commerce. One of the Top 10 dotcom failures is Etoys.com

Etoys.com launched in 1997, co-founded by CEO Toby Lenk, COO Frank Han and idealab founder Bill Gross. Etoys seemed like the perfect idea for busy parents. It offered a chance to order thousands of toys by just a click from computer a

t home. Etoys.com considered as a great competitor as they featured articles and newletters for new and expectant mothers, were popular and formed a loyal customer base. Besides that, editorial content also help distinguish itself from competitors and try to avoid the seasonality of the toy industry. As the result, Etoys had a successful IPO on May 20, 1999. The offer price was $20 and it closed at $76 on the day. This helped generate praise for the online toy category.

However, the good views do not long lasting. In year 1999, it failed to deliver some orders in time for Christmas which ruined critical first impressions for new customers and made many wary of using the site again. Many people had critique on the poor customer services by Etoys.com which is an essential part of E-Commerce businesses. In addition, the top management of the company was too fast in expanding company’s operation such as putting heavy advertising and spent a lot of money in building two warehouses in order to keep the inventories. These had resulted in Etoys not being able to adequately meet the need of its customers. Besides that, Toys “R” and Amazon.com formed a partnership in August 2000 has made Etoys.com into more difficult situation. As a result, Etoys sold its inventories which worth $5.4 million and also trade’s name, logos, url’s and trademarks for $3.5 million to KB Toys.