Fundamental E-Business Strategies for Small Businesses


Fundamental E-Business Strategies for Small Business

By: Troy Johnson

Argosy University

MSM program

Electronic Business Application

Date:  06/25/2010

To remain competitive in today’s marketplace managers and marketing professionals need to be familiar with E-business and EC electronic commerce strategies.    Peter Drucker understood the significance of EC “The truly revolutionary impact of the Internet Revolution is just beginning to be felt. But it is not “information” that fuels this impact. It is not “artificial intelligence.” It is not the effect of computers and data processing on decision making, policymaking, or strategy. It is something that practically no one foresaw or, indeed even talked about 10 or 15 years ago; e-commerce that is, the explosive emergence of the Internet as a major, perhaps eventually the major, worldwide distribution channel for goods, for services, and, surprisingly, for managerial and professional jobs. This is profoundly changing economics, markets and industry structure, products and services and their flow; consumer segmentation, consumer values and consumer behavior; jobs and labor markets. But the impact may be even greater on societies and politics, and above all, on the way we see the world and ourselves in it.” (Drucker 2002, pp. 3-4)  Business has quickly adopted EC technology because it improves communication, supply chains, customer service, customer acquisition, and profit margins.  Pervasive computing and behavioral computing programs help business identify customer’s needs and wants faster than ever before.  Users of the internet provide click stream data that help predict future purchases, trends, and other patterns.  This article examines how E-business and web marketing increase brand awareness, industry market share, operational efficiency, and customer satisfaction.


Originally businesses used the internet to display products and information about their services.  As technology advanced there was an increasing emphasis on collaboration.  The emergence of social media technologies has permanently changed the traditional autocratic decision making process to a far more democratic model.  Just as many hands make light work cloud computing makes better content, products, and applications by tapping the creative power of the billions of people using the internet.

The effects of the brave new digital world touch every industry and person.  Every action consumers make can be analyzed to create better products and more intelligent demographic advertising.  Even those who do not participate in the internet benefit from the improved technologies.  For instance, Wal-Mart uses sophisticated WMS warehouse management software to track its inventory using RFID’s radio frequency identification to track its inventory in real time.  The tracking system has vertically integrated its supply chains reducing inventory shelf time and the need for warehouse capacity.  Those savings are then passed on to all consumers regardless of whether they use the internet.

However, the global trend has been exponential growth in EC and online participation, so business leaders are continually looking to expand their online presence.  Large businesses justify significant capital in IT upgrades using business plans and cost benefit analyses. improves its E-procurement conversion rates by displaying consumer comments and they increase sales by suggesting other products similar to the one on the screen.  Websites often say “People who purchased x item also bought y item and z item.”  As invasive as this may seem most users appreciate the additional suggestions.

Small businesses including lawn companies, building companies, and other service contractors use social media websites, search engine marketing, and search engine optimization to improve their sales calls from their websites.  Entrepreneurs recognize that the internet is quickly replacing traditional phonebooks just as the automobile replaced the horse drawn carriage.  This underlines the importance of hiring an affordable website designer that will create search engine friendly content.  The prolific growth of personal and business websites make appearing on the first page results of Google and other search engines increasingly difficult.  This problem gave rise to the search engine optimization industry.  As defined byWikipedia .com, “Search Engine Optimization (SEO) is the process of improving the volume or quality of traffic to a web site from search engines.”  Marketing executives and SEO professionals use keywords and strategically placed links to improve traffic from search engines.  For example a vacation rental by owner website helps its clients advertise rentals by ranking well for the keyword seasonal rentals.  Search engines enable website owners to target customers that are already hunting for their services.

Facebook and Myspace helped introduce the web 2.0 revolution.  Their brand is woven into our society’s fabric and their annual traffic metrics are staggering.  Understanding the commercial aspects of advanced internet technologies will help any business.  Business owners can create profiles on Facebook and immediately improve customer communications.  With just a few friend requests a company can benefit from the well documented network effect.  “A primary reason why Facebook has expanded so rapidly is the network effect more users means more value. As more users become involved in the social space, more people are available to connect with each other.”  (Turban, 2010)

Businesses amass hundreds and thousands of friends by placing a link to their facebook page on their website’s pages.  Since Facebook already has healthy market penetration in The U.S. and abroad it is a great channel to maintain communications with current and prospective customers.

Human resource managers use the internet for nearly all of their activities.  The open structure makes head hunting faster than any other traditional method.  Popular websites like and help to quickly match employers with prospective applicants and vice versa.  Using my sql database and keyword filtration software employers are quickly able to scan applicants for the right qualifications.  The interview process remains in person, but finding qualified interviews early saves time and money.

Similarly, E-learning has transformed the way students attend class and employees receive training.  Universities offer online courses because they can reach far more students than a traditional onsite classroom.  Also, they are able to handle a larger student body without having to expand student housing or classroom capacity.  Cisco systems provides technologies that connect to the internet and other networks.  Using E-Learning and E-Training the company is able to train its employees faster and at a fraction of the previous cost.

Perhaps the most astonishing breakthroughs are coming from WIFI wireless technologies.  Developing countries with limited infrastructure have for the most part remained off the communications network.  Recently however, mobile computing has skyrocketed with nearly 600,000 cell phones and 60% market penetration in India.  Mobile computing continues to break down previous geographical barriers opening up new markets.  With each new innovation opens more possibilities.  For example, farmers use this same WIFI technology to protect the environment and improve productivity levels.  They are remotely installing intelligent nodes throughout their grounds to collect useful environmental data.  The technology is able to measure soil moisture, humidity, temperature, wind speed, rainfall, and a number of other metrics.  Each nodes data is not as significant as the picture painted by computing all of the sensors collectively.  By analyzing the data farmers or vineyard workers are able to schedule watering only in the areas that need water and conversely they can apply fungicide only in areas that are prone to the disease.  This will help to lower the fixed costs involved in vineyard management and this will have a positive effect on the environment.  Using wifi remote sensors farmers and vineyard owners are able to track and record key statistics without having to lay thousands of feet worth of wiring.  Ultimately, this new technology will mean better land use and increased food supply, which is positive for conservation efforts and the overall price of groceries.

EC strategies are essential to modern business.  E-business improves communications, supply chains, warehouse management, land use, retailing, E-tailing, logistics, customer satisfaction, and much more.  In order to create and maintain a durable competitive advantage businesses should implement EC strategies that foster customer repurchase loyalty.


Drucker, P. Managing in the Next Society. New York:

Truman Talley Books, 2002.

Turban, E., Lee, J. K., King, D., Liang, T. P., & Turban, D. (2010). Electronic commerce 2010: A managerial perspective, 6/E. Prentice Hall. ISBN-10: 0136100368.

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