report for digital business

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Digital Business

Table of Contents
INTRODUCTION ..........................................................................................................................1
Question 1: LO1...............................................................................................................................1
Key trends, advantages and disadvantages of managing virtual business in global environment
along with importance of technology and its impact on Alibaba.com and MakeMyTrip.com. .1
Question 2: LO4...............................................................................................................................3
Comparing & contrasting native apps against web apps along with the impact of ROI on
digital businesses in general and specifically of PWA on Alibaba.com.....................................3
Question 3: LO2...............................................................................................................................5
Emerging digital business models and challenges associated with IS threats and ethics in
general.........................................................................................................................................5
Question 4: LO3...............................................................................................................................7
Dealing with situation at both companies differently if held responsible...................................7
Question 5: LO5...............................................................................................................................7
Comparing & contrasting digital business and e-commerce along with E-Commerce
principles and their application to digital businesses..................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Digital business can be referred to as the business that makes use of technology in a bid
to facilitate creation of new value within the business models, improvement of customer
experience and capitalisation on internal capabilities (Senyo, Liu and Effah, 2019). This provides
support to the core operations, enabling a boost to the efficiency of businesses functioning within
the economy. Digital businesses include digital only companies along with the traditional players
that transform the business with the utilisation of digital technology. The current report seeks to
gain an insight into the key trends, merits and demerits associated with management of virtual
businesses. Along with this, it includes a comparison and contrast between native apps and web
apps along with the influence of ROI on digital businesses. Further, the report explores the
different kinds of digital business models together with issues linked to information security and
ethics. Additionally, comparison and contrast is presented between e-commerce and digital
businesses. At last, e-commerce principles along with their application to digital businesses are
discussed in a comprehensive manner.
Question 1: LO1
Key trends, advantages and disadvantages of managing virtual business in global environment
along with importance of technology and its impact on Alibaba.com and MakeMyTrip.com
A virtual business can be said to be any business which conducts majority or all of its
transactions and activities by leveraging internet. The key trends of managing virtual businesses
in the global environment are:-
Technology:
Technology is one of the main trends pertinent to management of virtual businesses.
Virtual businesses are able to function properly within an economy because of technology. In the
absence of technology, the chances of a virtual business functioning gets lessened (Park and
Mithas, 2020).
Internet:
It is the main trend or essence of managing virtual businesses. Internet allows these
businesses to carry out information exchange and thereby facilitate quicker execution of the
business transactions (Chaffey, Hemphill and Edmundson-Bird, 2019). It is considered as the
prerequisite for ensuring the functioning and management of a virtual business.
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Mobile Communication:
Virtual businesses do not just facilitate exchange of important business information by
way of mails or fax, but also through the usage of mobile communication apps. These allow
quicker exchange of data among the employees and management so as to ensure quicker
execution of business activities and decision making process.
Advantages of managing virtual businesses Brick-and-mortar cost savings: The reduction of need for carrying out business
transaction by way of physical format saves investment made in terms of money upon
overheads. Such brick and mortar cost saving may include expenses such as building
lease, utility bill, insurance premium, and many more. Flexibility: The virtual businesses are acknowledged to be much more flexible than
traditional businesses in terms of showing response to the changes taking place within the
confines of market. Happy staff: When employees get the opportunity to work from their homes or any
remote location, they are more motivated and are able to create a better work – life
balance. Larger employee base: Since the individuals pertinent to virtual businesses are provided
with the access to work from any remote location, these organisations are able to retain
and maintain a wider staff base.
Disadvantages of managing virtual businesses Lack of institutional cohesiveness: As the employees are situated in diverse locations
and work from there only, this tends to imply least or negligible cohesiveness among
them. Potential communication barrier: It is often noted that virtual businesses encounter the
issue of lack of face to face communication between management and employees as well
as among the employees themselves. This can lead to confusions, misinterpretations or
delay of procedures. Lost track of staff productivity: It is difficult for the management of virtual businesses to
make sure that the employees are working in a productive manner as per the expectations
and requirements of the company (Ziyadin, Suieubayeva and Utegenova, 2019). This
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leads to lack of discipline within the workforce towards working in the direction of
accomplishment of organisational goal.
Importance of technology and its impact on Alibaba.com and MakeMyTrip.com
Technology is an inevitable and inseparable part of civic and commercial lives. This can
be said because every sphere of the modern era is largely influenced by technology. It brings
forth tools to facilitate quicker communication, information exchange, logistics, supply chain
management, and many other aspects (Ansong, and Boateng, 2019). Thus, businesses have
largely evolved because of technology. Especially the digital businesses running within the
global environment have undergone tremendous growth and development because of the
evolutions in technology. Two of the biggest examples of companies who have evolved with the
application of technology are acknowledged to be MakeMyTrip.com and Alibaba.com
Question 2: LO4
Comparing & contrasting native apps against web apps along with the impact of ROI on digital
businesses in general and specifically of PWA on Alibaba.com
Native Mobile Apps
Native apps are especially developed for a specific mobile device and thus are installed
upon the device directly (Scuotto and et. al., 2017). In this case, users can directly download
these apps via the app store. There are certain pros and cons of native apps and these are
discussed beneath:-
Pros: These apps can be used in the offline mode. This ensures speed in accessing and
opening them any time (Holotiuk and Beimborn, 2017). These apps enable the users to make use
of device specific hand gesture. In case of native apps, mostly safety and security is guaranteed.
Cons: These are relatively more expensive for development, especially whereby these
apps are required to be compatible with more than one operating system. This leads to increment
of development cost. The cost of maintaining native apps is also higher (Berghaus and Back,
2016). The app usage is totally dependent upon the will of the user to download it from app store
and install it into the device.
Mobile Web Apps
Mobile web apps are acknowledged to be internet enabled applications which can be
accessed via the web browser of the mobile device. In the case of these apps, the users are not
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asked to download the app from app store and install it for gaining access to them (Weill and
Woerner, 2018). These apps are written in the form of web page in CSS and HTML, alongside
interactive part being within JavaScript, Jquery, or any other coding language. This implies that a
single web app can be easily used upon several devices, if they have the capacity to surf the web,
irrespective of the operating system. The pros and cons of these apps are briefly discussed as
follows:-
Pros: These apps can be instantly accessed through the usage of browser in several
devices, irrespective of the operating system within them. Mobile web apps have relatively easier
maintenance. In case the content or design of app needs to be changed, the update has to be
published upon the servers and the alterations are instantly visible (Libert, Beck and Wind,
2016). The development of mobile web apps is acknowledged to be more cost and time effective
than native apps as this makes use of programming language and technology that can be easily
comprehended.
Cons: Mobile web apps are not present in app stores. Further, they are acknowledged to have
limited scope in terms of accessing the features of a mobile device (Zhang, Lichtenstein and
Gander, 2015). In case of these apps, there is no regularized QC system which increases the risks
related to security and safety of the apps. These apps cannot be accessed in offline modes, not
even in the form of a basic version.
Impact of PWA on Alibaba.com
The management of Alibaba team took the decision to develop their mobile website as a
Progressive Web App in order to effectively appeal to the audience and impress the first time
visitors. The execution of PWA made Alibaba, encounter some tremendous results which are
enlisted beneath:-
 76 % more conversion across all the browsers
 14 % more number of active users in a month upon iOS and 30 % upon Android
 4 time more interaction rates from Add to Homescreen prompt
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Question 3: LO2
Emerging digital business models and challenges associated with IS threats and ethics in general
Digital businesses have become a substantial part of the corporate world. There are
various kinds of digital business models that are currently running and constantly emerging with
the passage of time (Márquez and Lev, 2019). These are briefly discussed as follows:-
Emerging digital business models
Freemium Model:
This is one amidst the most widely used business models. Hereby, the user receives an
item or service without payment of any charges. For the basic functions, no funds have to be
invested (Ismagilova and et. al., 2017). However, for gaining access to premium functions, users
have to incur money. By leveraging this model, businesses can rapidly reach to a larger base of
audience, expand the business in new territories and generate higher income while carrying out
conversion of users to paying ones. Such digital business model is most likely to be applicable
upon offerings having lower marginal cost. The key to success of this digital business model is
acknowledged to be 'conversion'. A business just needs to identify a free solution which seems
appealing to customers, but at the same time not totally satisfactory in order to influence users to
incur money for premium features. The examples of this model include Spotify, Linkedin, Xing,
Canva.com, MailChimp (Homburg, Wielgos and Kühnl, 2019).
Subscription Model:
In this digital business model, offerings are basically offered as subscription. Hereby, an
amount that normally only occurs just once is split or a new service is developed which is billed
in a periodical manner (Matt, Hess and Benlian, 2015). The purpose is to keep the customers
glued to the business for a long period of time. As against the one time purchases, the users
herein benefit from the improvement as well as extension of services. In this regard, non
divisible items can also be duly transformed in to subscription. Hereby, Amazon acts as one of
the best examples of this digital business model by delivering products regularly. Other examples
of this digital business model include Internet Provider and Netflix (Liu, 2020).
Marketplace Model:
Hereby, a digital market is leveraged by businesses in order to set connection with the
customer base. In this digital business model, income is generated through commission, fixed
transaction cost, brokerage fee, etc. (Schwertner, 2017). In this model, possibility is also thereby
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to make use of membership fee upon the platform or generate income via premium positioning
or advertisement facilities. Some examples of this model comprise of Amazon, Alibaba, eBay,
Uber, etc.
Sharing Economy – Access over Ownership Model – Renting & Leasing:
The sharing economy is also commonly called letting. Offerings which can basically only
be bought are lent to other persons for a certain time period. Car sharing is an example of this
digital business model. Hereby, the car is made accessible for a fixed time period and distance to
other individual in exchange of a certain amount (Nadeem and et. al., 2018). Basically, this
model can be applicable in context of all the items and services. Some of the best examples of
businesses leveraging this digital business model consist of AirBnB, Sharoo, Mobility, Lyft etc.
(Park, and Mithas, 2020).
On-Demand Model:
“Time is Money” is the principle on which this digital business model is developed.
Hereby, the immediate access to a product or service is sold. Thus, the offering or the delivery
can be called at any time. Video on demand and taxi on demand are the concepts emerging from
this digital business model (Kane and et. al., 2015). Some of the exemplary companies making
use of on demand model are acknowledged to be Upwork, Cloud Services, UBER, Amazon
Prime, etc.
Challenges associated with information security threats and ethics in general
Even though the digital business models are quite beneficial in a number of ways, it is
often seen that such models are posed to information security threats. This happens because of
hacking, sabotage, virus attack, information extortion, identity theft, data theft and so on. These
threats should be duly taken into consideration by businesses in order to prevent any kind of
discrepancy in the business operations (Kraus, Roig-Tierno and Bouncken, 2019). Further, it
also becomes important for digital businesses to consider ethical values such as fairness, trust,
confidentiality, honesty, accountability and transparency in order to ensure existence in market
place for a long period of time. All the business decisions should be taken in an ethical way by
considering these values.
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Question 4: LO3
Dealing with situation at both companies differently if held responsible
The case studies of Alibaba.com and MakeMyTrip.com witnessed that PWA helped both
the organisations to derive positive benefits. The usage of PWA allowed both of these digital
businesses to drive success by augmenting the revenues as well as profits in the long run
(Urbach, Drews and Ross, 2017). They leave a better impression upon the users, persuading
them to effectively get engaged with the businesses for a longer period of time in future context.
Had I dealt with the situation in both the companies, I would have considered doing the same.
PWAs are obviously powerful and have a tremendous impact upon the business if employed
(Park and Mithas, 2020). However, as a second alternative, I would have even considered the
option of leveraging new collaborative relationships and strategic alliances through digital
technology which have a positive impact upon PWA. This would have further helped
Alibaba.com and MakeMyTrip.com to enhance their financial performance.
Question 5: LO5
Comparing & contrasting digital business and e-commerce along with E-Commerce principles
and their application to digital businesses
Digital business and e-commerce have a lot in common and at the same time, have a
number of things that make them different from one another (Kreutzer, Neugebauer and Pattloch,
2017). Both of them are compared and contrasted beneath:-
Similarities:
As e-commerce is a subset of digital business, thus the basic business model is alike.
Both the businesses work with the help of technologies and internet. In both the business types,
interaction with the customers takes place in online mode only (Sousa and Rocha, 2019). There
is no face to face communication with the customer base at any point of time. Both the
businesses foster the development of partner relationships in order to provide the customers with
add-ons, accessories, and other essential services during or after sale.
Differences:
The most important difference lies in both the concepts, even when often people use both
the terms interchangeably. E-commerce can be said to be the outward facing process involving
interaction with the customers mainly in terms of purchase and sales (Bican and Brem, 2020).
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On the other hand, digital businesses can be said to be behind the scene digital machinery
employment to streamline the operations of a business entity and help it conduct transaction via
online format. It may include e-commerce.
Principles of E-commerce and application to digital businesses
User friendliness:
An e-commerce website or application needs to be easy for navigation because easier
searches enable the users to explore several products and pages, instilling within them an urge to
purchase. Also, the platform should provide users with large information base along with
pictures to provide intricate details about products (Xu and Koivumäki, 2019). The more realistic
a product or service looks; the more is the probability of a user purchasing it. This principle can
also be applied to a digital business as this also runs with the help of technologies and thus the
business should be easy to be accessed and comprehended by the consumers.
Emphasis on security:
The users who make purchases on e-commerce platforms require proper security to be
present on these platforms so as to make sure that their personal and financial details are not
exposed to third party or wrong hands. The payment gateway thus needs to be secure and safe,
allowing quick checkout (Urbach and Röglinger, 2019). This results in a boost to the
organisational sales. This principle can also be applied to a digital business as they also carry an
element of information security threat. Thus, the digital businesses can also follow this principle
to make sure that a safe and secure platform is provided to people.
Efficient call to action:
The main goal of an e-commerce platform is to increase the conversion rates, thereby
implying generation of more revenues (Bharadwaj and et. al., 2013). Hereby, Call to Action has
a crucial role to play. The audience comes to these platforms seeking a particular solution, thus it
is very important that the words used by e-commerce businesses upon the call to action button
are aligned with the probable questions in the minds of users. These buttons should take the users
to exactly what they are seeking. For creation of highly efficient CTAs, it is important that the
words used are moreover focused upon action driven verbs. Some of the most common examples
of successful trigger words that possess the capability to grab the attention of users to click upon
them include “Get Instant Access”, “Join Now”, “Hurry, it’s the last day!!”, “It’s that hour of the
day!!!!”, Claim high discounts”, and many more (Kane and et. al., 2015). This principle can also
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be applied to digital businesses in order to grab the attention of people in a very short span of
time and persuade them to make a purchase or consumption.
CONCLUSION
On the basis of above discussion, it can be stated that technology has transformed the
manner in which businesses are run and operated in today's world. In addition to this, it has been
acknowledged that digital businesses are largely prevalent in the modern era. Further, mobile
communication, internet and technology are the key trends that shape the management of virtual
businesses. Besides this, it has been determined that there are certain similarities and differences
between digital businesses are e-commerce and they should be duly noted. The similarities
include similar business model, online interaction with the customers and development of partner
relationships. The differences between both of them include the concepts of both the businesses.
Along with this, there are various principles of e-commerce businesses such as user friendliness,
security emphasis and efficient call to action. These principles can be duly applied to digital
businesses in order to drive conversion in a quick period of time.
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REFERENCES
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