Chapter 1

Brick-and-mortar VS. click-and-mortar

Brick-and-mortar stores are physical stores where customers can make
purchases in person. Brick-and-mortar Businesses can accept both
traditional cash and digital payment methods in person.
Click-and-mortar stores, also known as click-and-bricks, combine
brick-and-mortar and online retail, allowing customers to make
purchases both in-store and online. Click-and-mortar businesses operate
online, take orders, and deliver products to customers, primarily
accepting digital payment methods like credit cards or bank transfers for
remote transactions.
Digital business transformation is Significant changes to
organizational processes, structures and system implemented to improve
organizational performance through increasing the use of digital media
and technology platforms is called Digital business transformation.
There are two key opportunities for digital transformation open to most
businesses: inbound marketing and mobile marketing.
Inbound marketing
The consumer is proactive in actively seeking out information for their
needs, and interactions with brands are attracted through content, search
and social media marketing which known as inbound marketing. It can
include brand-owned content such as blog posts, webinars, infographics,
and newsletters. It is online based markating
Outbound marketing
Outbound marketing is a traditional form of marketing in which an
organization initiates contact with potential customers, or leads.
Examples of outbound marketing methods include cold calling, cold
emailing or spamming, direct mail, billboards, event sponsorships and
tradeshow presentations. It is offline based marketing.
Zero Moment of Truth (ZMOT) is A summary of today’s
multichannel consumer decision- making for product purchase where
they search, review ratings, styles, prices and comments on social media
before visiting a retailer.
Social media marketing refers Monitoring and facilitating customer–
customer interaction and participation throughout the web to encourage
positive engagement with a company and its brands. Interactions may
occur on a company site, social networks and other third-party sites.
Social media is A category of media focusing on participation and
peer-to-peer communication between individuals, with sites providing
the capability to develop user-generated content (UGC) and to exchange
messages and comments between different users is called social media.
Mobile commerce (m-commerce) is electronic transactions and
communications conducted using mobile devices such as smartphones
and tablets, and typically with a wireless connection. The mobile
commerce vertical is growing rapidly, with the percentage and share of
digital purchases that are taking place on mobile increasing each year.
Mobile apps are A software application that is designed for use on a
mobile phone, typically downloaded from an app store refers mobile
app. iPhone Apps are best known, but all smartphones support the use of
apps which can provide users with information, entertainment or
location-based services such as mapping.
What is the difference between digital business (e-
business) and e-commerce?
1. Electronic commerce (e-commerce): Electronic commerce
(e-commerce) is All electronically mediated information exchanges
between an organization and its external stakeholders. The scope of
electronic commerce (e-commerce) is narrower than digital business (e-
business). Kalakota and Whinston (1997) referred to a range of different
perspectives for e-commerce:
1. A communications perspective – the delivery of information, products
or services or payment by electronic means.
2. A business process perspective – the application of technology
towards the automation of business transactions and workflows.
3. A service perspective – enabling cost cutting at the same time as
increasing the speed and quality of service delivery.
4. An online perspective – the buying and selling of products and
information online.
These definitions show that electronic commerce is not solely restricted
to the actual buying and selling of products, but also includes pre- sale
and post- sale activities across the supply chain. E commerce has two
side: Buy-side and sell-side e-commerce
Buy-side e-commerce refers E-commerce transactions between a
purchasing organization and its suppliers. Buy side is where the
organization purchases from suppliers.
Sell-side e-commerce refers E-commerce transactions between a
supplier organization and its customers. sell side is when that
organization sells it on to its customers.
2.digital business (e-business): Digital business is broader in its scope
than e-commerce. e-business is the transformation of key business
processes through the use of Internet technologies. The key -businesses
include research and development, marketing, manufacturing, and
inbound and outbound logistics. The buy-side e-commerce transactions
with suppliers and the sell-side e-commerce transactions with customers
can also be considered to be key digital business processes.
Intranet: A private network within a single company using Internet
standards to enable employees to access and share information using
web publishing technology is called Intranet.
Extranet: A service provided through Internet and web technology
delivered by extending an intranet beyond a company to customers,
suppliers and collaborators referred as extranet.
Internet is a global network of billions of computers and other
electronic devices. With the Internet, it's possible to access almost any
information, communicate with anyone else in the world, and do much
more.
Different types of sells-side e-commerce
Sell-side e-commerce involves selling products online and using digital
technologies to market services. There are five main types of online
presence:
1. Transactional e-commerce sites: These enable purchase of
products online. The site's primary business is selling products and
providing offline purchasing information through retail, travel, and
online banking services.
2. Services-oriented relationship-building websites:
Provide information to stimulate purchase and build relationships,
particularly where products are not suitable for sale online. The
company uses website and e-newsletters to inform purchase decisions,
primarily focusing on offline sales and lead generation to generate
potential customer inquiries.
3. Brand-building sites: Provide an experience to support the
brand. Products are not typically available for online purchase. Their
main focus is to support the brand by developing an online experience of
the brand. They are typical for low-value, high-volume fast-moving
consumer goods (FMCG brands).
 4. Publisher or media sites: Provide information, news or

entertainment about a range of topics. Media sites generate revenue

through advertising, commission-based sales, and customer data sales
through links to other sites.
5. Social network sites (SNS): Social networks could be
considered to be in the previous category since they are often supported
by advertising, but the influence of social networks such as Facebook,
LinkedIn and Twitter on company and customer communications
suggests they form a separate category.
Digital marketing, e-marketing or Internet marketing has a similar
meaning to ‘electronic marketing’ both describe the management and
execution of marketing using electronic media such as the web, email,
IP TV and mobile media in conjunction with digital data about
customers’ characteristics and behavior.
Podcasts is Individuals and organizations post online media (audio and
video) which can be viewed in the appropriate players (including the
iPod which first sparked the growth in this technique).
A Social network is a site facilitating exchange of text, audio or video
content.
Options for companies to reach their audience online:
1.Paid media: These are bought media where there is investment to
pay for visitors, reach or conversions through search, display advertising
networks or affiliate marketing. Offline, traditional media like print and
TV advertising and direct mail remain important, accounting for the
majority of paid-media spend.
2.Earned media: Traditionally, earned media has been the name
given to publicity generated through PR invested in targeting influencers
to increase awareness about a brand. Earned media encompasses word-
of-mouth, viral and social media marketing, conversations in social
networks, blogs, and other communities.
3.Owned media: This is media owned by the brand. Online, this
includes a company’s own websites, blogs, email list, mobile apps or
their social presence on Facebook, LinkedIn or Twitter. Offline, owned
media may include brochures or retail stores. This highlights the need
for organizations to become multichannel publishers.
Affiliate marketing is an advertising model in which a company
compensates third-party publishers to generate traffic or leads to the
company's products and services. The third-party publishers are affiliates
Supply chain management (SCM) is the coordination of all supply
activities of an organization from its suppliers and partners to its
customers. the supply chain deals with building the product and getting
it to the consumer.
Value chain refers A model for analysis of how supply chain activities
can add value to products and services delivered to the customer. the
value chain looks for ways to enhance the product’s value as it moves
along that supply chain.
transaction alternatives between businesses,
consumers and governmental organizations
1.Business-to-Business (B2B)
When a business sells and purchases products and services from other
businesses, it’s called a B2B (business-to-business) e-commerce model.
For example, businesses that provide digital or software services like
Customer Relationship Management (CRM) to other businesses or an
app development company selling their apps to other businesses to
improve their operations will be called a B2B business model.
2. Business-to-Consumer (B2C)
This type of e-commerce takes place when a customer buys a product or
service from another business for direct consumption. The Business-to-
Consumer model is quite popular these days and most people carry out
purchases through this model. Various examples of e-commerce
platforms, under this model, are Amazon, Daraz, Khaas Food,
Rokomari, Ajkerdeal etc. This model covers a range of goods including
electronics, clothing, appliances, furniture, and books.
3.Consumer-to-Consumer (C2C)
C2C Also referred to as the ‘customer to customer’ e-commerce model,
C2C fosters commerce between private individuals in an online
environment. Example: Bikroy.com, Clickbd.com etc. It is a type of
trade relationship where both the sellers and buyers are consumers
instead of businesses.

4.Consumer-to-Business (C2B)
When a consumer creates value for a business, that’s known as C2B e-
commerce model. There’s a mutually beneficial relationship in this
model for both consumers and businesses. The referral programs, paid
testimonials, or data sharing activities that you come across are all C2B
e-commerce model methods that help improve customer
relationships.C2Bs such as Google AdSense and Shutterstock allow
consumers to generate revenue by selling blogs, photographs or writeups
to businesses across the world.
6.Business-to-Administration (B2A)
This e-commerce model is also known as Business-to-Government
model. In this, a private firm exchanges services and products with a
public agency. A variety of services, such as fiscal, social security,
employment, legal documents and registers, are involved in this model.
For example, a data protection business can provide maintenance
services to government websites to make sure they are secure for users.
7.Consumer-to-Administration (C2A)
C2A e-commerce refers to transactions carried out between individual
customers and public administration or government authorities. Unlike
government authorities, consumers utilize e-commerce methods to make
transactions across various industries, including education, healthcare,
and retail sectors. Some examples include electronic tax filing, e-health
services, and utility bill payments.
E-government defined
E-government refers to the application of e-commerce technologies to
government and public services. E -government involves transactions
with customers, suppliers, and internal communications, with a broad
range of applications:
1. Citizens – facilities for dissemination of information and use of
online services at local and national levels. For example, at a local level
you can find out when refuse is collected and at national level it is
possible to fill in tax returns.
2. Suppliers – government departments have a vast network of
suppliers. The potential benefits (and pitfalls) of electronic supply chain
management and e-procurement are equally valid for government.
3. Internal communications – this includes information collection and
dissemination and email and workflow systems for improving efficiency
within government departments.
Drivers of business Internet adoption
Why business adopt Internet
Business adoption of e-commerce and digital business is driven by
benefits to different parts of the organization. The two main ways in
which this can be achieved are:
1.Potential for increased revenue arising from increased reach to a
larger customer base and encouraging loyalty and repeat purchases
among existing customers.
2.Cost reduction achieved through delivering services electronically.
Reductions include staff costs, transport costs and costs of materials
such as paper, sales and purchasing costs, operating costs.
Risks and barriers to digital business adoption
Risks to digital business adoption
1. Websites that fail because of a spike in visitor traffic after a peak-
hour TV advertising campaign.
2. Hackers penetrating the security of the system and stealing credit card
details.
3. A company emails customers without receiving their permission, so
annoying customers and potentially breaking privacy and data protection
laws.
4. Problems with fulfilment of goods ordered online, meaning customer
orders go missing or are delayed.
5. Email customer service enquiries from the website don’t reach the
right person and are ignored.
barriers to digital business adoption
consumer barriers to adoption of the Internet included:
1.No perceived benefit: Many potential users do not see how the
Internet can be useful or beneficial to their daily lives.
2.Lack of trust: Concerns about privacy, data security, and the potential
for fraud make some consumers hesitant to use the Internet.
3.Security problems: Fears of malware, phishing, and other cyber
threats deter people from going online.
4.Lack of skills: Some individuals lack the technical knowledge or
skills needed to effectively use the Internet.
5.Cost: The expenses associated with purchasing devices and
maintaining Internet access can be prohibitive for some consumers.
This lack of demand for Internet services still present in every country
needs to be taken into account when forecasting future demand.
Chapter 3
Digital business infrastructure: refers to the architecture of
hardware, software, content and data used to deliver e-business services
to employees, customers and partners. Infrastructure can also be
considered to include the methods for publishing data and documents
accessed through applications. Through the digital business
infrastructure, we can connect with a group of people (employees,
customers, and partners).
For exam
Five layer model of digital business insfrastrue
/
the information system function chain
Kampas (2000) describes an alternative five- level infrastructure model
of what he refers to as ‘the information system function chain’:
1. Storage/physical: Memory and disk hardware components
(equivalent to Level IV in Figure 3.3).
2. Processing: Computation and logic provided by the processor
(processing occurs at Levels I and II).
3. Infrastructure: This refers to the human and external interfaces and
also the network, referred to as ‘extrastructure’. (This is Level III,
although the human or external interfaces are not shown there.)
4. Application/content: This is the data processed by the application
into information. (This is Level V.)
5. Intelligence: Additional computer- based logic that transforms
information to knowledge (Level I).
Client– server: The client– server architecture consists of client
computers, such as PCs, sharing resources such as a database stored on
more powerful server computers.
A local area network (LAN) is a collection of devices connected
together in one physical location, such as a building, office, or home. A
LAN can be small or large, ranging from a home network with one user
to an enterprise network with thousands of users and devices in an office
or school.
Internet service provider (ISP): A provider providing home or
business users with a connection to access the Internet. They can also
host web- based applications. Management issues in creating a new
customer- facing digital service
Backbones are High- speed communications links used to enable
Internet communications across a country and internationally.
URL: Uniform (universal) resource locator (URL) is A web address
used to locate a web page on a web server.
Domain name registration: refers the process of reserving a unique
web address that can be used to refer to the company website.
cybersquatting: Domain name disputes can arise when an individual or
company has registered a domain name which another company claims
they have the right to. This is sometimes referred to as cybersquatting.
Enterprise resource planning (ERP): refers an applications Software
providing integrated functions for major business functions such as
production, distribution, sales, finance and human resources
management.
what are the benefits that ERP brings organization
ERP software simplifies reporting, allowing companies to respond to
complex data requests more efficiently, improving productivity,
completing processes faster, and closing projects without long wait
times.
1. Improved Process Efficiency: ERP platforms streamline business
processes, improving productivity and preventing inaccurate data.
2. Accurate Forecasting: Enterprise resource planning software enables
users and managers to create accurate forecasts, enabling businesses to
plan ahead and reduce costs. This proactive approach increases
profitability and reduces costs.
3. Department Collaboration: ERP software, which is centralized and
consistent, allows departments to work together, share information, and
collaborate whenever needed.
4. Cost Savings: Enterprise resource planning software is a valuable
tool for businesses to manage their finances effectively and avoid costly
mistakes. It provides real-time information, reduces administrative and
operational costs, and enables proactive operations management.
5. Increased Productivity: ERP is designed for ease-of-use, allowing
users to work easier and save time. This helps businesses avoid delays in
production and improve customer service experience.
6. Flexible Systems: Modern ERP software platforms are robust,
flexible, and configurable, allowing businesses to adapt to their unique
needs. They can be customized to fit daily operations and can be
implemented in cloud or on-premise environments.
A legacy application, or legacy app, is a software program that is
outdated or obsolete. Although a legacy app still works, it might be
unstable because of compatibility issues with current operating systems
(OSes), browsers and IT infrastructures.
Key differences: web server vs. application server

Web services’ or ‘Software as a Service (SaaS)’

The web services model involves managing and performing all types of
business processes and activities through accessing web-based services
rather than running a traditional executable application on the processor
of your local computer. EXAMPLE: GOGGLE DRIVE
Cloud computing has three main cloud service
models: IaaS (infrastructure as a service), PaaS (platform as a
service), and SaaS (software as a service).
What software and hardware are required to access the Internet
from home?
IaaS: Infrastructure as a service, or IaaS, delivers on-demand
infrastructure resources to organizations via the cloud, such as compute,
storage, networking, and virtualization. Customers don’t have to
manage, maintain, or update their own data center infrastructure, but are
responsible for the operating system, middleware, virtual machines, and
any apps or data. As per our choice ,we have the control

PaaS: Platform as a service, or PaaS, delivers and manages all the

hardware and software resources to develop applications through the
cloud. Developers and IT operations teams can use PaaS to develop, run,
and manage applications without having to build and maintain the
infrastructure or platform on their own. Customers still have to write the
code and manage their data and applications, but the environment to
build and deploy apps is managed and maintained by the cloud service
provider. As per our choice half ,we have half control

SaaS: Software as a service, or SaaS, provides the entire application

stack, delivering an entire cloud-based application that customers can
access and use. SaaS products are completely managed by the service
provider and come ready to use, including all updates, bug fixes, and
overall maintenance. Most SaaS applications are accessed directly
through a web browser, which means customers don’t have to download
or install anything on their devices. No control not as per choice
Differences among IaaS, PaaS, and SaaS

How do APIs work?

API architecture is usually explained in terms of client and server. The
application sending the request is called the client, and the application
sending the response is called the server. So in the weather example, the
bureau’s weather database is the server, and the mobile app is the client.

Challenges of deploying SaaS

1. Downtime or poor availability if the network connection or server
hosting the application or server fails.
2. Lower performance than a local database.
3. Reduce data security since traditionally data would be backed up
locally by in-house IT staff.
4. Data protection – since customer data may be stored in a different
location it is essential that it is sufficiently secure and consistent with the
data protection and privacy laws.
Single Tenancy and Multi Tenancy
Single tenancy means that there is only one instance of a cloud software
solution running on its supporting hardware and infrastructure
components. There is no sharing with multiple customers involved in a
single-tenancy environment.
In a multi-tenant environment, cloud infrastructure is shared among
multiple customers or accounts. No single customer has control over
how resources are allocated or consumed.
What are the advantages of single-tenant hosting?
There are multiple advantages of single-tenant hosting that include:
1.Enhanced security - Running a SaaS solution on dedicated hardware
improves security by eliminating potential malware infections and
unauthorized data access from other tenants.
2.Improved performance and reliability - Customers in a single-tenant
environment have full access to infrastructure resources that can lead to
better and more consistent performance.
3.Customization options - Customers can customize the infrastructure
without being concerned with the needs of other tenants.
4.Dedicated systems services: There is better control of system
capacity planning and monitoring since the client knows the traffic
workload characteristics.
Benefits of SaaS Multi-Tenant Architecture
1.Lower costs through economies of scale: With multi-tenancy,
scaling has far fewer infrastructure implications than with a single-
tenancy-hosted solution because new users get access to the same basic
software.
2.Shared infrastructure leads to lower costs: SaaS allows companies
of all sizes to share infrastructure and data center operational costs.
There is no need to add applications and more hardware to their
environment. Not having to provision or manage any infrastructure or
software above and beyond internal resources enables businesses to
focus on everyday tasks.
3.Ongoing maintenance and updates: Customers don’t need to pay
costly maintenance fees to keep their software up to date. Vendors roll
out new features and updates. These are often included with a SaaS
subscription.
4.Configuration can be done while leaving the underlying codebase
unchanged: Single-tenant-hosted solutions are often customized,
requiring changes to an application’s code. This customization can be
costly and can make upgrades time-consuming because the upgrade
might not be compatible with your environment.
Issues in management of ISP and hosting relationships
1.Speed of access: A site or digital business service fails if it fails to
deliver an acceptable download speed for users. Research supported by
Akamai (2006) suggested that content needs to load within 4 seconds,
otherwise site experience suffers. However, for sites perceived to have
poor performance, many shoppers said they would not be likely to visit
the site again (64%) or buy from the e-retailer (62%).
2. Availability: The availability of a website is an indication of how
easy it is for a user to connect to it. In theory this figure should be 100
per cent, but sometimes, for technical reasons such as failures in the
server hardware or upgrades to software, the figure can drop
substantially below this.
3.Service level agreements: To ensure the best speed and availability a
company should check the service level agreements (SLAs) carefully
when outsourcing website hosting services.
Service level agreement (SLA): A contractual specification of service
standards a contractor must meet.
4.Security: Security is another important issue in service quality.
Intranet applications
1.Employee incentive scheme: Companies reward the best employees
according to anonymous voting by their peers. At the end of each
quarter, prizes such as DVD players and televisions are awarded.
2. Text messaging: A distribution company keeps in touch with its sales
staff and drivers through enabling staff to contact colleagues who are ‘on
the road’ using SMS text messaging.
3. Holiday booking: A workflow system forwards holiday requests to
the relevant manager and informs the applicant automatically. Team
managers can also check on the intranet to see when people within their
group have booked holidays.
4. Resource booking: Viewing and making bookings of meeting rooms
is another simple application that can save time.
5. News screen: Displaying the company’s latest news and most recent
achievements on a dedicated screen can give a focal point to a waiting
room or foyer area.
6. Integrated external resources: Route planning, mapping or traffic
news sites can be integrated into the intranet to save time for staff. One
example of this is a housing authority that stores its list of properties on
the intranet. Each house has a link to a mapping site (e.g. Multimap
www.multimap.com), which will display the location of the property
based on its postcode.
Benefits of Extranets
Any network connected to another network for the purpose of sharing
information and data. An extranet is created when two businesses

connect their respective intranets for business communication and

transactions. Vlosky et al. (2000) refer to these business benefits of an
extranet:
1.Information sharing in secure environment: An extranet allows for
the sharing of business information with various partners. Vlosky et al.
(2000) give the example of Saatchi's advertising agency, where
advertisers can access draft advertising material during projects, and
suppliers can access product demand information through a database.
2 Cost reduction: Operating processes can be made more efficient
through an extranet. The example given by these authors is Merisel, a
$3.5 billion computer hardware reseller reducing its order processing
costs by 70%. Such cost reductions are achieved by reducing the number
of people involved in placing orders and the need to rekey information
from paper documents.
3. Order processing and distribution: The authors refer to an
‘electronic integration effect’. For example, an extranet can connect a
retailer’s point of sales terminals to a supplier’s delivery system,
ensuring prompt replenishment of goods sold. This potentially means
fewer lost sales because of out-of-stock items and a lower inventory
holding is needed.
4. Customer service: Improving levels of service is one of the main
benefits of the Premier. Dell.com extranet described above, although it
also has the other benefits listed above. Distributors or agents of
companies can also find information such as customized pricing or
advertising materials. For example, 3M provides open web access to
individual customers to find information about its office products such
as Post-it notes and transparent films (www.3m.com/uk/office), but it
also offers an extranet for distributors such as Spicers (www.spicers.net)
and Euroffice (www.euroffice.co.uk).
IPTV (Internet Protocol television): Digital television service is
delivered using Internet Protocol, typically by a broadband connection.
IPTV can be streamed for real-time viewing or downloaded before
playback. IPTV is sometimes referred to as non-linear TV or on-demand
broadcasting. IPTV is also used to deliver standard channels available on
satellite.
Voice over IP (VOIP): Voice data is transferred across the Internet – it
enables phone calls to be made over the Internet. Voice over IP (VoIP)
can be used for transmitting voice over a LAN or on a wider scale. VoIP
(pronounced ‘VOIP’) is proving increasingly popular for reducing the
cost of making phone calls within an office and between offices,
particularly internationally.
Widgets are tools made available on a website or on a user’s desktop.
They either provide some functionality, like a calculator, or they provide
real-time information, for example on news or weather.
Chapter 06
Supply chain management (SCM) is the coordination of all supply
activities of an organization from its suppliers and partners to its
customers. In other words, the design, planning, execution, control, and
monitoring of supply chain activities with the objective of creating net
value, building a competitive infrastructure, leveraging worldwide
logistics, synchronizing supply with demand, and measuring
performance globally. There are two types of supply chain management:
1. Upstream supply chain is Transactions between an organization and
its suppliers and intermediaries, equivalent to buy-side e- commerce.
2. Downstream supply chain is Transactions between an organization
and its customers and intermediaries, equivalent to sell-side e-
commerce.
How digital business solve supply chain management
problem

Benefits of supply chain management:

To improve service
Cost cutting
To increase profits
Getting products to market faster
Increase New clients
Improve New products
Competitive pressures
To improve management decisions
Create New channels to market
To increase shareholder value
Add New suppliers
Logistics is the time-related positioning of resource, or the strategic
management of the total supply chain. The supply chain is a sequence of
events intended to satisfy a customer. It can include procurement,
manufacture, distribution, and waste disposal, together with associated
transport, storage and information technology.
Inbound logistics is the management of material resources entering an
organization from its suppliers and other partners.
Outbound logistics is the management of resources supplied from an
organization to its customers and intermediaries.
Push supply chain management is A supply chain that emphasizes
distribution of a product to passive customers. The push model is
illustrated by a manufacturer who perhaps develops an innovative
product, identifies a suitable target market and creates a distribution
channel to push the product to the market.
Pull supply chain management is an emphasis on using the supply
chain to deliver value to customers who are actively involved in product
and service specification. pull model, which is focused on the
customer’s needs and starts with analysis of their requirements through
market research and close cooperation with customers and suppliers in
new product development.

Value Chain is A model that considers how supply chain activities

can add value to products and services delivered to the customer.
How does the traditional value chain model work?
A tradition value chain
model was proposed by
Porter in 1980. The
traditional value chain
model has divided its
activities into two parts: Primary value chain activities and secondary
value chain activities: primary value chain activities first collect the raw
material from the supplier, then produce a new product through the
production process and sell the new products. Secondary value chain
activities are required to help the primary value chain activity.
Secondary value activities include human resources, finance, and
information systems, which support the primary value chain activities.
Secondary value activities are known as factional activities.
How the revised value chain model works?
A new value chain model was proposed by Deise et all in 2000.At
present, the most used value chain model is the revised value chain
model. This method is based on a research survey and tries to learn
about the customer's needs. In this model, the first step is to conduct
market research, then develop a new product, and finally provide it to
the market. revised value chain model Can make changes or correction
at any stage.Again, they include materials to revise the mistake based on
customer feedback. If the customer wants any additional changes, then
they procure materials according to customer preference, produce a new
product, and sell the product in the market.

difference between traditional and revised value chain

model
Traditional value chain model Revised value chain model
in this model there is no scope of This method is based on a
market research or investigation research, survey.
there is no way to make any If the customer wants any
changes after a product is additional changes, then they
produced. produce products according to
customer preference
Virtual organization is an organization which uses information and
communications technology to allow it to operate without clearly
defined physical boundaries between different functions. different
characteristics of virtual organizations, including:
● Lack of physical structure: virtual organizations have little or no
physical existence.
● Reliance on knowledge: the lack of physical facilities and contacts
means that knowledge is the key driving force of the virtual
organization.
 ● Use of communications technologies: it follows that virtual
organizations tend to rely on information technology.
● Mobile work: the reliance on communications technologies means that
the traditional office or plant is no longer the only site where work is
carried out.
● Boundaryless and inclusive: virtual companies tend to have fuzzy
boundaries.
● Flexible and responsive: virtual organizations can be pulled together
quickly from disparate elements, used to achieve a certain business goal
and then dismantled again.
restructuring the supply chain/ Divided from control
perspective
Supply chain management options can be viewed as a continuum
between internal control (‘vertical integration’) and external control
through outsourcing (‘virtual integration’). Vertical integration is the
extent to which supply chain activities are undertaken and controlled
within the organization. Virtual integration is the majority of supply
chain activities are undertaken and controlled outside the organization
by third parties.
Benefits of e-supply chain management
reduced cycle time and cost per order
reduced cost of channel distribution and sale
reduced cost of paper processing
Reduced cost through outsourcing.
better customer responsiveness.
Typical benefits with respect to a B2B company
include:
1 Increased efficiency of individual processes: If the B2B company
adopts e-procurement this will result in a faster cycle time and lower
cost per order. Benefit: reduced cycle time and cost per order.
2 Reduced complexities of the supply chain: Here the B2B company
will offer the facility to sell direct from its e-commerce site rather than
through distributors or retailers. Benefit: reduced cost of channel
distribution and sale.
3 Improved data integration between elements of the supply chain:
The B2B company can share information with its suppliers on the
demand for its products to optimize the supply process. Benefit: reduced
cost of paper processing.
4 Reduced costs through outsourcing: The company can outsource or
use virtual integration to transfer assets and costs such as inventory
holding costs to third-party companies. Benefits: lower costs through
price competition and reduced spend on manufacturing capacity and
holding capacity.
5 Innovation: E-SCM should make it possible to be more flexible in
delivering a more diverse range of products and to reduce time to
market.
Chapter: 09
The stages each customer will pass through in a long- term relationship
through selection, acquisition, retention and extension is called
Customer life cycle. The four marketing activities that comprise CRM
involve the following:
1.Customer selection means defining the types of customers that a
company will market to. It means identifying different groups of
customers for which to develop offerings and to target during
acquisition, retention and extension.
2. Customer acquisition refers to marketing activities intended to form
relationships with new customers while minimizing acquisition costs
and targeting high-value customers. Service quality and selecting the
right channels for different customers are important.
3. Customer retention refers to the marketing activities taken by an
organization to keep its existing customers. Identifying relevant
offerings based on their individual needs and detailed position in the
customer life cycle is key.
4. Customer extension refers to increasing the depth or range of
products that a customer purchases from a company. This is often
referred to as ‘customer development’.

customer extension techniques for CRM

(a) Re-sell are Selling similar products to existing customers –
particularly important in some B2B contexts as re-buys or modified re-
buys.
(b) Cross-sell refers Sell additional products which may be closely
related to the original purchase.
(c) Up-sell is A subset of cross-selling, but in this case, selling more
expensive products.
(d) Reactivation refer Customers who have not purchased for some time,
or have lapsed, can be encouraged to purchase again.
(e) Referrals are Generating sales from recommendations from existing
customers.
Marketing applications of CRM
A CRM system to support the four activities is made up of different
marketing applications:
1.Salesforce automation (SFA). Sales representatives are supported in
their account management and phone-based sales through tools to
arrange and record customer enquiries and visits.
2. Customer service management. Representatives in contact centers
respond to customer requests for information by using an intranet to
access databases containing information on the customer, products and
previous queries.
3. Managing the sales process: This can be achieved through e-
commerce sites, or in a B2B context by supporting sales representatives
by recording the sales process (SFA).
4. Campaign management. Managing ad, direct mail, email and other
campaigns.
5 Analysis. Through technologies such as data warehouses and
approaches such as data mining, which are explained later in the chapter,
customers’ characteristics, their purchase behavior and campaigns can
be analyzed in order to optimize the marketing mix
Electronic customer relationship management (e-CRM) defined as Using
digital communications technologies to maximize sales to existing
customers and encourage continued usage of online services.
Benefits of e-CRM
Using the Internet for relationship marketing involves integrating the
customer database with websites to make the relationship targeted and
personalized. Through doing this marketing can be improved as follow:
1.Targeting more cost-effectively. A company will only aim to build
relationships with those who have visited a website and expressed an
interest in its products by registering their name and address. The
company's approach to acquiring new customers involves attracting
them to their website, where they are offered an opportunity to register.
2. Achieve mass customisation of the marketing messages:
Technology makes it possible to send tailored emails at much lower
costs than is possible with direct mail and also to provide tailored web
pages to smaller groups of customers (micro-segments).
3. Increase depth, breadth and nature of relationship. The internet
allows for more personalized customer interactions, allowing companies
to adjust their frequency of contact. Customers can visit personalized
pages or be contacted via email, adjusting their communication
preferences to better serve their needs.
4. A learning relationship can be achieved using different tools
throughout the customer life cycle. Online feedback forms, customer
service inquiries, questionnaires, and new product development
evaluations are used to gather information, gather opinions on
competitors, and evaluate product category interests and prototypes.
5. Lower cost. Email or web-based customer contact is cost-effective
and requires only information to those who have expressed a preference,
reducing mailouts. Personalization technology allows for automatic
targeting and communication, reducing mailing frequency.