Database Management Based Business Models for Electronic Commerce

What is a business model for ECommerce or EBusiness?

• A business model is a process or framework for how an business enterprise seeks to realize its strategic plan or vision.
• Remember, processes can be patented.
• It’s purpose is to help achieve an unfair competitive advantage in the market.
• Your team project will identify or select one or more DBM-EC business models to use

A sample of EC/EB business models

• Stategic position or engagement techniques
• Central technique embodied in each business model
• Role and implications for DBM for each model.
• Discussion item: can you identify a company or Web site that embodies each business model?

Market Exclusivity

• Identify, capture and dominate a niche.
• Technique: Being first, being best, being the only choice, being able to easily defend one's market position.
• DBM: Develop, acquire, or possess unique database content, or more quality content than competitors

Encapsulation

• Surround, capture, divide, "cherry pick"
• Technique: Erect an intermediation structure that captures/controls access to customers and restricts access by existing competitors, in order to ingest or acquire them
• DBM: Create an all-encompassing DB service

Follow-and-Dominate

• Be "second to market", outflank first movers
• Technique: let the pioneers catch the arrows, then follow the path the pioneers have established, but at a larger scale and scope to discourage subsequent market entrants
• DBM: Build a bigger DB, add more types of data/content, provide more DB access points

Disintermediation or Reintermediation

• Remove or replace the legacy middle-man
• Technique: Encapsulate market niche, remove/erect (in)efficiency barriers to legacy competition
• DBM: Provide open Web access/transactions to DB services controlled by legacy vendors

Aggregate Supply or Aggregate Demand

• Make a new market where one did not exist
• Technique: Gather vendors products/services for targeted customers; gather potential customers for targeted vendors
• DBM: DB marketing using Ecatalogs or create "magnetic" DB-centered Web sites/portals

Transformation

• Do legacy business processes/services in new ways
• Technique: Streamline, reengineer or make business processes Web accessible
• DBM: Workflow automation via Web-based DBM services or process transactions

Confrontation: David vs. Goliath

• Taking on a larger established competitor
• Technique: "Judo" (find your opponents vulnerability/hinge points; use their "weight" to their disadvantage)
• DBM: Offer DB-driven product/service innovation

Integration

• Make a market niche from untapped fragments
• Technique: Pull together disparate capabilities/products into a coherent framework that realizes economies of scale and scope
• DBM: Create integrated views, access or transactions to disparate information sources

Open Source

• Advocate and exploit "open source" software development business practices to undercut competition
• Technique: Establish two communities: one for commerical customers who will pay for support and services, the other open for sharing software source code with others
• DBM: (1) use open source DBMS and support environment (e.g., LAMP -- Linux, Apache, MySQL, Perl) or (2) build commerical DBM-based application in both "supported" (proprietary, fee-based) and "open source" (public, no-fee or free) versions.

Peer-to-Peer (p2p)

• Advocate and exploit p2p technology for local/global sharing of information resources, contents, or workspace (e.g., a persistent or dynamic "view" into a database)
• Technique: Identify information sharing DBM applications that have a surrounding community of users, then target each community with a p2p DBM application service.
• DBM: Databases for Personal Digital Assistants (PDAs, wired/wireless Web phones), local/global object sharing (including objects that contain other objects), or shared workspaces are targets of opportunity for p2p DBM applications.