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Lecture Strategic management - Chapter 8: The internet and e-commerce: Creating value through e-business strategies

Chapter 8 "The internet and e-commerce: Creating value through e-business strategies". After studying this chapter, you should have a good understanding of: Why use of Internet technologies is more important to achieving competitive advantage than the technologies themselves, how internet technologies are affecting the five competitive forces, how e-business capabilities are affecting industry profitability,. | Chapter Eight The Internet and E-Commerce: Creating Value through E-Business Strategies After studying this chapter, you should have a good understanding of: Why use of Internet technologies is more important to achieving competitive advantage than the technologies themselves. How Internet technologies are affecting the five competitive forces. How e-business capabilities are affecting industry profitability. How firms can improve their competitive position vis-à-vis the five forces by effectively deploying e-business strategies. Why e-business technologies are changing the way firms use overall low cost, differentiation, and focus strategies. The pitfalls in each competitive strategy that may endanger a firms attempts to deploy Internet technologies or implement e-business strategies. Learning Objectives TRANSPARENCY-69 Exhibit 8.1 Growth in Internet Activity Data: Forrester Research Inc. TRANSPARENCY-70 25 125 50 0 (a) Number of U.S. Citizens Online 150 100 75 ‘95 ‘96 ‘97 ‘98 | Chapter Eight The Internet and E-Commerce: Creating Value through E-Business Strategies After studying this chapter, you should have a good understanding of: Why use of Internet technologies is more important to achieving competitive advantage than the technologies themselves. How Internet technologies are affecting the five competitive forces. How e-business capabilities are affecting industry profitability. How firms can improve their competitive position vis-à-vis the five forces by effectively deploying e-business strategies. Why e-business technologies are changing the way firms use overall low cost, differentiation, and focus strategies. The pitfalls in each competitive strategy that may endanger a firms attempts to deploy Internet technologies or implement e-business strategies. Learning Objectives TRANSPARENCY-69 Exhibit 8.1 Growth in Internet Activity Data: Forrester Research Inc. TRANSPARENCY-70 25 125 50 0 (a) Number of U.S. Citizens Online 150 100 75 ‘95 ‘96 ‘97 ‘98 ‘99 ‘00 9% OF POPULATION 44% OF POPULATION Millions Data: Jupiter, Media Metrix Inc., Commerce Dept., Bureau of Labor Statistics (b) B2B E-Commerce: Historical and Projected Growth $4 3 2 1 0 Trillions of Dollars ‘99 ‘00 ‘01 ‘02 ‘03 Estimated 25 E-Commerce Spending by Category 36.7 Toys 36.7 Fitness/sports equipment 40.7 Video 65.8 Flowers, gifts, and cards 77.1 Home and garden 82.0 Health/beauty 93.0 Music 100.9 Computer software 111.1 Electronics 204.4 Books 253.0 Computer hardware/peripherals 335.4 Auction 367.7 Clothing/apparel $1,032.4 Travel services Estimated Online Monthly Revenue (millions of $) Category E-Commerce Spending March 2001 Source: Nielsen/Net Ratings & Harris Interactive Exhibit 8.2 TRANSPARENCY-71 Internet Use Worldwide Geographic Region PC Users (in millions) Per 1,000 People North America Western Europe Asia-Pacific South/Central America Eastern Europe Middle East & Africa 148.7 86.6 57.6 10.8 9.5 7.5 479.1 217.5 16.5 21.1 32.7 7.2 Source: Adapted from .