Home-based e-business - an
option for the self-employed?
Chapter 4 – Essential components of e-business
4.3. Requirement of essential elements for different e-businesses
Different types of e-business required different level and combination of essential elements:
| |
Web site Design
|
Web site Hosting |
Web site Maintenance |
Carting System |
Payment Gateway |
Promotion |
Customer Service |
| Affiliate Programs
|
Low to
High |
Low to
High |
Low to Medium |
N.A |
N.A
|
Low to High |
N.A |
| Physical products
• Auction Sites
• Online Shop
|
N.A
Medium to High |
N.A
Low to Medium
|
N.A
Medium to High |
N.A
Medium to High |
Low
High |
Low
Medium to High
|
Low
High |
| Soft Products
|
Low to Medium
|
High to Very High |
Low to Medium |
Low |
Very High |
Meidum to High |
High |
| Services
|
Low |
Medium to High
|
Low to Medium |
Low |
Low to Medium |
Medium to High |
Very High |
(Exhibit 23)
Source: By the Author's research and analysis
4.3.1. Web Design – web sites that sell physical products require the products to be presented in an attractive manner with good images and descriptions. Nowadays, many shop-front programs are available thus making the task simpler. However, the software is often expensive and could be a deterrent for beginners. Sites that sell soft products are generally not as demanding in terms of presentation but would require a more complicated set-up in order only to allow those who have paid to access the product. Sites that sell services are even less demanding in terms of presentation but may require very complicated set-up as there may be a need to connect to other external database e.g. that of the travel agency. The demands of publishers in terms of web site design are variable. However, those that generate a high volume of visitor traffic tend to have their contents refreshed at regular intervals.
4.3.2. Web hosting – web sites that sell physical products do not require a lot of resources in terms of web space or bandwidth. However, sites that sell soft products require a lot of web space and bandwidth, and therefore much more expense. The requirements of sites that sell services are much more variable and depend very much on the service provided. Publisher sites that are successful generate a lot of traffic and are thus very demanding in terms of web space and bandwidth. It is because new content is added to these sites all the time, and these sites often provide services such as chat rooms, forums and free e-mail accounts that consume a lot of resources.
4.3.3. Carting System – a carting system is almost obligatory for web sites selling physical products, and optional for sites selling soft products and services. It is not required for publisher web sites.
4.3.4. Payment Processor – with the exception of publisher web sites, all other e-business web sites require a means of accepting online payments, preferably through a payment gateway. Sites that sell soft products would require a much high degree of fraud screening and protection than others.
4.3.5. Promotion - although promotion is required for all four different types of e-businesses, it is much harder for some than others. Those businesses with a lot of existing competitors will find it much more difficult to promote than other e-businesses. These businesses are generally the ones that are widely perceived to offer high rewards such as adult sites, or those that require little skill or investments such as reselling web hosting.
4.3.6. Customer Service Management – with the exception of businesses that derive their income from publishing, all online businesses including those that sell their products through auction sites require some degree of customer service. Obviously, the requirements would be greatest in those offering services.
Summary
Different e-business opportunities have different requirements in terms of technical and strategic aspects. It is now quite clear that Hong Kong has closed the gap considerably with N. America and Europe in terms of technical aspects, especially the processing of payments. Promotion is critical to the success of any e-business and there are many methods available. In the next chapter, the different types of home-based e-business opportunities will be compared in terms of risk, investment and reward. Conclusions will be reached as to whether and which type of e-business is most suitable for Hong Kong residents.
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