1.
Mobile Commerce
1. Drivers of the mobile commerce
● Attribute: Mobile devices are portable and equipped with touchscreens, cameras, and
internet access, enabling transactions anywhere.
● Availability of Apps: Numerous user-friendly apps for shopping, banking, and
booking make mobile transactions easy.
● Increasing Bandwidth: Faster, reliable internet ensures smooth browsing and
transactions.
● The Service-oriented Economy: Growing demand for online shopping, food
delivery, and ride-hailing boosts mobile usage.
• Vendor’s Push: Mobile-friendly websites, exclusive deals, and targeted ads
attract more M-commerce users.
2. The factors hindering mobile commerce
● M-commerce:
• Security: Personal data is exposed.
• Performance: There are hardware and OS specifications for mobile apps;
• Cost-Benefit: Customer engagement is key but this may increase the cost of operation;
•Difficulty in customizing application: A customized application requires advanced
techniques, which in turn raises careful cost-benefit analysis.
3. The benefits of mobile commerce to stakeholders
The benefits of M-Commerce:
- To organization:
+ Increases sales due to ease of ordering by customers from anywhere, anytime.
+ Provide an additional channel for advertising and distribution of coupons; and among
others.
- To individuals and customers:
+ Provide rich media entertainment anytime and anywhere;
+ Assist in shopping by providing real-time information and other shopping aids; and
among others.
- To society:
+ Reduce energy expenses by using smart grid.
+ Avoid traffic jams by using wireless sensors; and among others.
II. Social commerce
1. The social marketing process (5 phrase)
- Definition: Social marketing process - a structured approach businesses use to engage
with their audience on social media platforms to build a brand, generate sales, and
achieve specific marketing goals.
- Fan acquisition: This phrase involves many activities, such as displaying ads to news
feeds and page pop-ups. A potential customer can obtain a coupon and/ or obtain free
services.
- Engagement: This phrase aims to encourage users to interact with your content and
brand. To this end, fans can talk about your content; businesses post many attractive photos,
interesting text content; firms often turn to influencers.
- Amplification: This phrase is all about encouraging users to tell their friends by
clicking a Like button, sharing a post, sending a message.
- Community and Brand strength: Marketers have a number of tactics, such as
including inside information on new products, price breaks for loyalty, and free gifts for
bringing a new member. The process ends with strengthening the brand and additional
sales.
2. Drivers of social commerce (major roots)
- E-Commerce as the Foundation
• E-Commerce (Electronic Commerce) is at the top, representing all digital buying
and selling activities.
• It serves as the main category under which specialized forms of commerce emerge.
- Evolution into Mobile and Location-Based Commerce
• M-Commerce (Mobile Commerce): A subcategory of E-Commerce that focuses on
transactions via mobile devices (smartphones, tablets).
• Example: Shopping apps, mobile banking.
• L-Commerce (Location-Based Commerce): A specialized form of M-Commerce
that leverages GPS and location tracking for marketing and transactions.
• Example: Google Maps advertising, food delivery apps using geolocation.
- Role of Web 2.0 in Social Commerce
• Web 2.0 refers to interactive and social web technologies that enable user-generated
content, leading to the rise of social networks.
• Social Networks (Facebook, Instagram, TikTok, etc.) play a major role in
influencing consumer behavior.
- Social Media Marketing and Its Connection to Social Commerce
• Social Media Marketing is an extension of Web 2.0 and social networks, where
businesses use social media to promote products.
• This leads to the rise of Social Commerce, where transactions happen directly
through social media platforms (e.g., Facebook Marketplace, TikTok Shop).
- Virtual Worlds as an Emerging Trend
• The diagram also shows a connection between Social Commerce and Virtual
Worlds, indicating the emergence of Metaverse-based commerce.
• Example: Buying virtual goods, in-game purchases, VR shopping experiences.
3. The benefits of social commerce
The benefits of S-Commerce:
- To Customers:
+ Get recommendations from friends and other customers.
+ Being exposed to special deals.
- To Retailers:
+ Get feedbacks from customers;
+ Gain better understanding of customers through insights from data.
III. Viability of e-firm
1. Strategic analysis
• Barriers to Entry – High capital costs, intellectual property (patents, copyrights),
and brand loyalty can prevent new firms from entering the industry. If barriers are
low, more competition arises.
• Power of Suppliers – If suppliers have control over pricing and availability of
essential inputs, they can increase costs for the firm. A business benefits when there
are many suppliers to choose from, reducing dependence on any single supplier.
• Power of Customers – Customers influence pricing and demand. If they have
many alternatives, they can force firms to lower prices, affecting profitability.
• Existence of Substitute Products – Alternative solutions that serve the same
purpose can reduce demand for the firm’s offerings. A high number of substitutes
increases competition
2. Financial analysis
• Revenues: Are revenues growing and at what rate? Many e-commerce
companies have experienced impressive, even explosive, revenue
growth as an entirely new channel is created.
• Cost of sales: What is the cost of sales compared to revenues? Cost of sales
typically includes the cost of the products sold and related
costs. The lower the cost of sales compared to revenue, the higher the gross
profit.
• Gross margin: What is the firm's gross margin, and is it increasing or
decreasing? Gross margin is calculated by dividing gross profit by net sales
revenues. Gross margin can tell you if the firm is gaining or losing market
power vis-a-vis its key suppliers.
• Operating expenses: Operating expenses for a firm typically include costs
related to marketing, technology, and administrative overhead, as well as
stock-based compensation for employees and executives, amortization of
goodwill and other intangibles, and impairment of investments. In e-
commerce, these expenses are particularly significant, as many firms use
stock options for employee compensation and often acquire other
companies at high valuations, which can lead to substantial financial
impacts if those acquired firms decline in value.(Chi phí hoạt động của một
công ty thường bao gồm các chi phí liên quan đến tiếp thị, công nghệ và chi
phí hành chính, cũng như tiền lương dựa trên cổ phiếu cho nhân viên và
giám đốc điều hành, khấu hao thiện chí và các tài sản vô hình khác, và suy
giảm đầu tư. Trong thương mại điện tử, các chi phí này đặc biệt đáng kể, vì
nhiều công ty sử dụng quyền chọn cổ phiếu để trả lương cho nhân viên và
thường mua lại các công ty khác với mức định giá cao, điều này có thể dẫn
đến tác động tài chính đáng kể nếu các công ty được mua lại đó giảm giá
trị.)
• Net margin: Net margin tells us the percentage of its gross sales revenue
the firm was able to retain after all expenses are deducted. Net margin is
calculated by dividing net income or loss by net sales revenue. Net margin
sums up in one number how successful a company has been at the business
of making a profit on each dollar of sales revenues. Net margin also tells us
something about the efficiency of the firm by measuring the percentage of
sales revenue it is able to retain after all expenses are deducted from gross
revenues, and, within a single industry, it can be used to measure the relative
efficiency of competing firms. Net margin takes into account many non-
operating expenses such as interest and stock compensation plans.
IV. EC Business Model
1. Type of Transaction
• B2C, C2C, G2C, G2B, C2B: some examples of C2B
● B2(Business-to-Consumer):
Businesses provide products or services directly to consumers.
Example: Buying from Amazon, Walmart.
● C2C(Consumer-to-Consumer):
Consumers trade directly with each other, often via an intermediary platform.
Example: Selling second-hand items on eBay.
● G2C(Government-to-Citizen):
Governments provide services or information directly to citizens.
Example: Paying taxes online, applying for government services.
● G2B(Government-to-Business):
Governments offer services or information to businesses.
Example: Public procurement, online corporate tax filing.
● C2B(Consumer-to-Business):
Consumers provide value or services to businesses.
Example: Freelancers selling graphic design services to companies.
2. List some source at Revenue
• Sales
• Transaction Fees
• Subscription Fees
• Advertising Fees
• Affiliate Fees
