Pearson BTEC HNC/D Diploma Computing Systems and Development – Unit 1 : Business Skills for E-commerce
This Business skills for E-commerce assignment given in UK college, this assignment reveiwed the e-commerce giant amazon.
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E-commerce has become a popular name in last decade. Starting an e-commerce requires proper planning and development. It is an easy way of enhancing the business. It involves the trading of products and services through the internet network. E- Commerce is considered as the sales aspect of electronic business. United Kingdom is the biggest E- Commerce market in the world. The assignment will have the details about the e–commerce site Amazon and various factors attached to that.
1.1 Businesses generally have a variety of business functions in order to run successfully. You are required to investigate a named business organisation & assess its core business functions
Amazon.com was founded in Seattle, Washington by Jeff Brothers (Byers, 2006). It is the first retail company to sell the products with the use of internet. The business of Amamzon.com started with online book store and with its success the owners diversified the business and added the wide range of consumer product to their e-commerce website like toys, electronics, music stores etc. The first public offering of Amamzon.com was made on May 15, 1997. It got registered with NASDAQ stock exchange.
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The Amazon.com now has the global footprints with its business operations in United Kingdom, India, Canada, Germany, Japan, China, Austria and France. They brought the new revolution in the e-commerce and for selected areas shipping and handling fees is also waved that makes the online shopping more realistic (Spector, 2002). Amazon was the first online store that raised the donations for Red Cross to help the victims of 9/11 attack.
Currently it has 28,300 employees
Global Leader in e – commerce
It follows the mass customisations
It has worldwide network of fulfilment
Mission: To leverage the technology and experience of the customers by providing the best online shopping experience
Vision: To become a customer centric company and to build an online market place where customers can buy anything they desire.
Objective: To offer the discounts and low prices every day and apply these to the entire product range rather than applying the discounts for limited time period.
Core Values: It consists of price, convenience and selection
amazon strategy for e-commerce
Amazon’s Business Model: In 1995 it started with online book store and by 1999, the company added the auctions and zShops to their web site. In 2001, they partnered with the logistic companies and developed the extensive e-commerce platform and web services. Currently, they have added the e-books and kindle on their e-commerce website. Their business model is made up of nine building blocks:
The company has transformed the earning into profits through inventory turnover, capital efficiency and cash generation cycle. The company’s online domain for different countries are:
Asia: amazon.cnor z.cn (China), amazon.in (India), amazon.co.jp (Japan).
Europe: amazon.de(Germany), amazon.es (Spain), amazon.fr (France), amazon.it (Italy), amazon.co.uk (UK).
North America: amazon.ca(Canada), amazon.com.mx (Mexico).
South America: amazon.com.br(Brazil).
Core Business Functions:
Retail Goods: Amazon deals online with wide array of retail goods like books, music CD’s, DVD’s, software, baby products, apparel, kitchen appliances, electronics, beauty products, jewellery, accessories, grocery, gourmet food, garden items, toys, sporting goods, home products and many more.
Consumer Electronics: In 2007, Amazon launched kindle which is an e-book reader and downloads the content from Whispernet. The screen uses the e-ink technology that reduces the battery consumption and provides the better display.
Digital Content: This was launched in 2001 that allows the customers to make the online donations by buying the digital content. This is replaced by Amazon payment now.
Amazon Games: This studio continued to develop games for PC, Mac and Kindle eReaders under the brands Reflexive and Amazon Digital Services
Computing Services: This is launched under the name of Amazon Web Services that allows the programmatic access to the latent features on the website.
Amazon Prime Air: This is the future delivery services with the use of Drones within 30 minutes by flying the short distance from the local Amazon centres.
1.2 Evaluate your chosen organisation’s business aims and show how they relate to stakeholders
Stakeholders are a group of people that are affected by the actions of company. Stake holders are internal as well as internal to the company (Shiller, 2003). They contribute to the company either voluntarily or involuntarily to the wealth related activities. To protect them is the corporate social responsibility of the company.
Amazon’s stake holders are incorporated in the following table:
Stake Holders Related Concerns
Government VAT, taxation, Legislation, diversities, externalities and legalities
Employees Compensation, Job Security, respect and appropriate communication
Customers Quality, value, ethical products and customer care services
Suppliers Payments and equitable business opportunities
Creditors Credit Scores
Community Jobs, environment protection, truthful communication and shares
Owners Profit, market share, longevity, succession planning and growth
Investors Income and Return on Investment
The aim of Amamzon.com is to leverage the technology and experience of the customers by providing the best online shopping experience and to become a customer centric company and to build an online market place where customers can buy anything they desire.
Stake holders are the people that matters most to an organisation. Amamzon.com has the considerable good reputation among the stakeholders due to its quality services. They have built the corporate reputation and deliver the corporate brand equity. The company is very truthful towards the government and their laws. Their quality services towards their customers have made them the nest online shopping site. They ensure the appropriate working conditions for the employees. All this has led to increased profits for the owners and increased returns on investment for the investors.
Amazon.com works continuously towards the feedback from the stakeholders. Their corporate values have maximised the joint outcomes. The company works as per the principle of stakeholder’s fairness and have the strong moral foundation for the stakeholders. They engage their stakeholders in the required decisions and this facilitates them to align their business practices with societal expectations and needs. Their core values have also helped them to maintain the shareholder value and long term sustainability.
To summarise, Amazon.com is the first retail company to sell the products with the use of internet. The business of Amamzon.com started with online book store and with its success the owners diversified the business and added the wide range of consumer product to their e-commerce website like toys, electronics, music stores etc. The aim of Amamzon.com is to leverage the technology and experience of the customers by providing the best online shopping experience and to become a customer centric company and to build an online market place where customers can buy anything they desire. Amamzon.com has the considerable good reputation among the stakeholders due to its quality services. They have built the corporate reputation and deliver the corporate brand equity.
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P2.1 Analyse the impact, including the risks, of introducing an e-Commerce system to a recently open College (London Institute of Management, London) or Hotel (Zodiac Lake Hotel, London) both situated inside London and they currently do not have a website or an e-commerce system, and they are currently running their day to day business manually. Or your intending business organisation
Zodiac Lake Hotel, London is operating there functions manually till date. They do not have any e-commerce system or website. The management is planning to establish a website for the hotel which will include the online booking, information about available rooms and fare and other facilities operations by the hotel to their customers. The use of internet is growing rapidly in hotel industry.
This will be done with the help of e-commerce which means an electronic platform for buying and selling of the products and services. The growth of internet has contributed to the growth of e-commerce. Adopting the e-commerce within the Zodiac Lake hotel will reduce the cost of operation and increase the market potential and it can also gain the new business opportunities. E-commerce has shrunk the world and has opened the doors of flawless trading among different countries of the world.
The benefits to Zodiac Lake Hotel include the following:
Convenience: E-commerce provides an opportunity to provide convenience to the customers. Customers in the current market condition expect the 24*7 access to the products and services (Castell, 2006). E-commerce provides the ability to make the electronic purchases. This is efficient and cost effective. With the website, tourist can easily make the online booking to the Zodiac Lake hotel and also choose from their various services.
Larger Market Place: With a website, the access to hotel will become available to the customers from around the world. E-commerce provides the locally operated business access to the bigger market place. London is a big tourist attraction and the hotel with all the facilities incorporated on the website can attract more tourists and increase their market share. This is the best way to overcome the geographical limitations.
Cost Effectiveness: E-commerce lowers the cost of operation and marketing. The reduction in costs is passed to the customers in the form of discounts. It has the organic search engine facility that helps in reducing the cost of traditional advertising methods (Chaffey, 2007). The computerization of checkout, billing, payments, inventory management, and other operational processes, lowers the number of employees required to run hotel
Abundance of Information: On E-commerce website Zodiac Lake Hotel can incorporate the entire information about the cost, facilities, food menu, transport facilities etc. This information makes the customer aware about the services and persuades them to make the bookings. It also enables many deals, bargains and group buying options.
Target Communication: Customers at the time of online registration fill in the information. The hotel management can extract the information and send them the personalised information about the future deals and packages.
The e-commerce website has lots of benefits from the business perspective but there are certain barriers to its adoption. The basic problems with the e-commerce implementation in hotel are:
Loss of Management Control: The e-commerce has made the end users more independent and capable of collecting and handling the software. Due to this the need and control of management is reduced considerably.
Integration Problems: For implementing the e-commerce site, the hotel has to upgrade its IT infrastructure. It requires the compatible network and standards for successful implementation. Also the staff needs to be trained in order to operate the website efficiently.
Organisational Change: The implementation of the e-commerce website leads to entire organisational change. The entire organizational structure requires the change to adapt to the e-commerce website in an effective manner. This change is at times not acceptable by the employees and leads to stress in management.
Other barriers such as payment method, insecure credit cards billing and insufficient knowledge of the service cost contends with the technological advances in e-commerce adoption (Odedra-Straub, 2003).
To summarise, the Zodiac Lake Hotel, is planning to establish a website for the hotel which will include the online booking, information about available rooms and fare and other facilities provided by the hotel to their customers. For implementing this plan they need to look out for benefits and limitations of the ecommerce adaptation to the hotel. There are many benefits attached to the ecommerce to the society. The positive impacts includes – cost effectiveness, convenience to customers, access to global market etc. On the other hand there are many negative impacts that include the unemployment, wrong information etc. So it is advisable that the technology should be used in a way that it reduces the negative impacts on business as well as on society.
P3.1 Investigate market potential for an e-Commerce opportunity for your chosen organisation
Zodiac lake Hotel has decided to implement the e-commerce website for their hotel. The e-commerce will provide the larger market potential. The e-commerce can provide the value that is significant to the business by improving the market efficiencies and reducing the operational costs. With its various supply chain benefits, the market potential is further increased. The e-commerce and online auction arena grew 10.4% from 2007 to 2012, with 8.8% more growth expected annually through 2017, according to industry research firm IBIS World. I will enable the global market reach for the hotel. The customers will become more interested through website access as the message is targeted personally and indiscriminately (O’Conner, 1999). The web site is not affected by the constraints of capacity and it also facilitates the two way communication. It empowers the customers to get the rapid information and make the required comparison among other hotels in the same region.
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E-Commerce helps in generating the leads, presenting the information about the tourism product to the customers and facilitates the electronic transaction processing. It will include all the functions and service provided by the hotel that can be processed over the internet. E-commerce provides an opportunity to provide convenience to the customers. Customers in the current market condition expect the round the clock access to the products and services. E-commerce provides the ability to make the electronic purchases. This is efficient and cost effective. With the website, tourist can easily make the online booking to the Zodiac Lake hotel and also choose from their various services. On E-commerce website Zodiac Lake Hotel can incorporate the entire information about the cost, facilities, food menu, transport facilities etc. This information makes the customer aware about the services and persuades them to make the bookings. It also enables many deals, bargains and group buying options. It will allow the following:
Business to Consumer Transaction: This will include the airline reservation system, online hotel reservation and other business to customer interactions
Business to Business Transaction: This includes the arrangement between hotel and a travel agency. The customer can make the booking with the travel agency as a whole package and can avail the discount. This will boost the business of both travel agency as well as Zodiac Lake Hotel. E – Commerce will provide the long term growth and competitive advantage to the hotel. The hotel can make the profit while pulling the foreign currency in the country. The hotel can also incorporate the virtual tour as their leading hotels already have in their website. This feature facilitates a site visit to prospective guests without having to travel to each property. And as a recent trend, many well-known hotels are also providing this promotion feature in order to stand top of the roles to catch the attention of potential customers.
business to business transaction graph for Business skills for E-commerce assignment
The above graph clearly shows the growing trend of e-commerce in the hotel industry. The online reservations and bookings are increasing considerably. So the implementation in the Zodiac Lake Hotel will definitely increase the business opportunities.
P3.2 As a part of your project in implementing e-Commerce for your chosen organisation above, evaluate current e-Commerce systems in use by other business organisations of that type.
For implementing the E-commerce system, the Zodiac Lake hotel has evaluated the e-commerce system of Starwood Resorts in United Kingdom. Below are features of Starwood resorts’ website:
Website Layout: The Starwood resort’s website has the interactive web layout that enables the guest to choose from the range of hotels as per their preferred check- in and check out details. The homepage is also inclusive of the current offers and deals open for the customers. They have given the membership opportunities to the customers that will allow them to earn the rewards against the online booking made by them.
The website also contains the detailed information about the resorts and the organisation as a whole. There is a gallery that has wide array of the photographs of resort.
Customer Services: The Website contains the link towards the customer service. The customer can contact by email or online chat. It also has the p home numbers where customers can call and get the required information or provide the feedback.
Payment System: The website has the online payment system for the bookings and reservations. They have partnered with various leading banks and made the online payment portal easy and effective. The payment system is also secured and the customers are protected from the potential threat or loss. After the payment, the reservation and payment details are sent to the customers via email.
Apart from the above features there are many other features incorporated like – reporting the missing stay, feedback, cancellation facilities, and other information that is relevant for the international travellers.
The website is very comprehensive and the management of Zodiac Lake Hotels have got the perfect idea for getting their website designed. The services provided by the Starwood resort are quite similar to them, so they can also make the website by adding up these features and make it customer friendly. This is a kind of business upgrade that will facilitate the more sales and booking over the internet.
P3.3 Discuss and present the financial implications of your chosen e-Commerce solution
Aggressive approach towards the e – commerce is growing rapidly among the entrepreneurs. Getting the e-commerce solution has the huge cost attached to it. So before implementing it to Zodiac Lake Hotels they require to consider the following points:
Cost of Website hosting and Design: It is important to find the affordable website hosting company. There are many hosting companies that provide the best features in affordable prices. The quality management services with affordable prices will support the steady profit margins.
Cost for Increasing the Visibility: For increasing the visibility on the search engine, the hotel management has to pay an additional cost to website designing company. They need to pay for Search Engine Optimisation.
Lower the cost of direct sales: Traditional means of selling on the internet involves the lower direct cost and hence it provides a cheaper mean.
There is lots of cost attached to the development of the e-commerce solution for Zodiac Lake hotel. But this is the one time cost and has lots of benefits as a return (Lauden, 2007). However there is also a maintenance cost that the hotel finances has to bear every year, but on the same hand the cost for hiring large number of personnel’s is also reduced. E-commerce lowers the cost of operation and marketing. The reduction in costs is passed to the customers in the form of discounts. It has the organic search engine facility that helps in reducing the cost of traditional advertising methods (Chaffey, 2007). The computerization of checkout, billing, payments, inventory management, and other operational processes, lowers the number of employees required to run hotel.
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P3.4 Using Google Sites, design an e-Commerce solution for your chosen business above. Your design should include the business Objectives, business aim(s), Key processes of e-Commerce I.e. payment systems, delivery options, standard web layout, list of items, etc.
For Zodiac lake Hotel Website design the following features will be included:
It will be built on the ASP.net platform that will enable the full integration with other web based applications
The site will have the SQL database that will facilitate the unsurpassed data integrity and it will also facilitate the compatibility with third party report
The site will have the remote website access.
It will have the backend operator
It will have the custom promotions, packages and facility for creating own packages
It will have the details of reservations
It will have the colour coded room rack
It will have the room prices, its availability as per date and room type
It will facilitate the group bookings
The site will have integration with banks that will enable the online payment.
The online payment system will be supported by the secured 3D systems.
The website will have the details of hotel, its aim and milestones.
proposed design for ecommerce website
P3.5 Upon completion of your design evaluate the suitability of the e-Commerce solution.
The above mentioned design is suitable for making the Zodiac Lake’s business online as it has all the features that are necessary for the successful online business. The use of latest technology will make the website faster and easier for both the business as well as consumers. It will increase the business in following ways:
With greater access through internet
Consumers will get the benefits from online reservation and secured payment system
It has the option for group bookings and creating the own personalised trip.
The entire process of reservation will be faster as compared to manual booking system
The customer can get the entire information about the facilities and availability
This will reduce the cost of traditional advertising
The customer’s data will be stored in the database that will facilitate the future communication with them.
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To summarise, the e-commerce solution will increase the market potential for the Zodiac Lake hotel and increase the global customers. However there is cost attached to the implementation of e-commerce solution. But this cost is beneficial as it will generate the higher revenue and ease out the business operations. Before getting the design for the hotel website it is advisable to look out the design of other hotels to get the idea. After that a comprehensive design can be created and the aim of increasing the business can be achieved.