Vodafone: Digital Business Advantages, Disadvantages, and Models

This report provides a comprehensive analysis of digital business, focusing on its advantages and disadvantages, along with a discussion of emerging models such as subscription and Freemium models, and their application in the context of a business like Vodafone. The report explores the impact of digital technology on collaboration, relationships, and strategic alliances. It also examines the principles of e-commerce relevant to the selected firm. The advantages of digital business include growth, efficiency, improved customer experience, innovation, and enhanced employee experience. However, it also faces disadvantages such as increased competition, privacy issues, lack of credibility, and high investment requirements. The report further evaluates new digital business models, particularly subscription models, in the context of business issues like cybersecurity and ethical considerations. The report emphasizes the importance of cybersecurity measures and ethical practices in digital business operations.

Assessment

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY ..................................................................................................................................1
TASK 1............................................................................................................................................1
Explain various advantages and disadvantages of digital business............................................1
Evaluate new and emerging model of digital business in context of business issues. ...............4
Evaluate impact of collaboration relationship and strategic alliances with digital technology.. 6
Explain various principles of e-commerce .................................................................................7
CONCLUSION ...............................................................................................................................8
REFERENCES .............................................................................................................................10

INTRODUCTION
Main objective of this report is to understand the concept of digital business. The concept
of digital business helps an organisation in effectively using technology which creates new
values in their business models and customers experiences. The term digital business includes
both digital-brands and traditional players who transform any business with the helps of digital
technology. Now a days people are more prefer online mode and they spend more money online.
This trend in society increase the growth of digital economy. This growth in digital economy
make people more familiar with digital products and services of an organisation. The growth in
digital market increase various opportunities for business but its also introduce new competition
for an organisation. For this report Vodafone company is taking into consideration. It is an
British multinational telecommunication company. Which is founded by Ernest Harrison and
Gerry Whent in 1991, headquarter is in Newbury, England, UK. It serves its services worldwide
and almost 93,000 number of workers are successfully working with it. This report includes
various advantages and disadvantages of digital business and subscription business model &
Freemium model of digital business related to key issue faced by selected company. Other than
this it includes impact of collaboration relationship and strategic alliances through digital
technology. It includes various principles of e-commerce related to selected firm.
MAIN BODY
TASK 1
Explain various advantages and disadvantages of digital business
Digital business refers to a mode of business which use technology for creating values in
their business models and enhance its internal capabilities which helps in effectively performing
its important operations and activities (Ali and et. al. 2018). A business use technology for
enhancing their customers experiences because better customer experience with company helps
in higher growth and development. Digital business includes digital players and traditional
player which will helps in changing their businesses through technology. According to current
scenario digital economy is develop at a faster rate because of customers are more spending their
money online. This change in trend helps businesses to grow their business at another level with
the help of technology. In context of selected firm, its transformation of traditional business to
digital business provide various new growth opportunities to business. This is because now a
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days customers are more aware about digital services. The concept of digital bus8inesas helps an
organisation in achieving competitive advantage with the help of unique combination of digital
and physical resources. Selected firm create new value chain and various growth opportunities
from its digital; business which they cannot achieve through their traditional business. Selected
firm use different technology which helps them in achieving higher growth, revenue and
performance in market. In context of Vodafone, various advantages and disadvantages of digital
business are mention below:
Advantages-
 Growth- One of the best importance of digital business is that it enable smaller
organisation to grow quickly with their new ideas and ambitions. For success of any
organisation its very important that a business efficiently utilized their resources. Digital
business use effective technology which create more values and helps an organisation in
achieving higher growth. In context of selected business, adopt the on-the-go digital
connectivity using Vodafone's Wi-Fi dongles, which helps its founder to effectively
operate its business from anywhere in the world without the need of expensive
infrastructure (Assar and Hafsi, 2019).
 Efficiency- With the increase in digital business the competition is also increase. So for
effectively facing competition in market its important that a business maximise its
productivity and efficiency. Increasing efficiency of organisation means using limited
resources as effectively as possible so that a company can reduce its cost of production
and wastage. In context of selected firm, they use artificial intelligence and internet-of-
things technology for automate process. Which saves time of organisation and also
reduce their service cost.
 Customers experience- A positive experience of customers play an essential role in
growth of any organisation. Using a unique technology helps in creating better customer
experience which helps achieving competitive advantage in market and enhance their
customer loyalty towards brand. In context of selected company, they use digital
technology to deliver an integrated end-to end solution through which selected company
is able to deliver richer customer experience. It also regularly updating its services and
providing new type of services to their customers which will cause positive experience of
customers (Corsaro, 2018).
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 Innovation- Digital business not only includes cost cutting and driving efficiency but it
also provide various growth opportunities for business to become more innovative and
offer new type of services. With the increase in digital economy it will open path of
success for digital business but it will also increase competition for a businessman. If a
company want to achieve higher growth in digital market they need to innovate new
types of services in their business so that they can achieve better customers experience
and create value. In context of selected company, it provide the connectivity and data
processing for insurance company Admiral's telematics solution. This innovative service
of selected company helps in analysing how people derive and also reward them for safe
driving.
 Employee experience- Another important advantage of digital business is that it provide
better employee experience along with customers experience. In context of selected firm,
they spread artificial intelligence throughout their all departments. Reason behind
spreading AI throughout enterprise is to build new and improved model of business with
the appropriate technology moving from specialist data scientist to all work department
of organisation. Because of this their all employees are efficiently interacting with their
technology (Frishammar and et. al. 2018).
Disadvantages-
 High competition- Digital business use unique technology for creating higher values for
its business but the growth in digital business will increase the level of competition. With
the increase in digital economy customers are more prefer online services because of
which all companies are transform their tradition business into digital business which will
enhance competition in market. In context of selected firm, they face many competitors
in the path of their success such as Liberty global company, Tata communication,
Telefonica company and so on which will reduce revenue in market.
 Privacy issue- The concept of digital business is based on technology. More efficient
technology helps organisation in creating values and positive customers experience. But
there is a fear of hackers and crackers who can easily hack important information of
company. This mode of business will be not safe in case of privacy and security of
information. In context of selected firm, because of increase in cyber crime their
customers feel unsafe while doing any transaction with selected company. But Vodafone
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use effective cyber security system for their business which helps in protecting all
necessary information of business and its customers (Gobble, 2018).
 Lack of credibility- According to customers preferences they want that they can see the
process of their service which they buy from any organisation but it is not possible
through digital business which will reduce their customers experience. In context of
selected firm for reducing the effect of this factor they regularly interact with their
customers and timely solve if they have any problem which will provide them better
customer experience.
 High level of investment- Another disadvantage of digital business is that it require high
and regular investment in business. This is because the digital business is based on the
technology and because of increase in competition a business need to use most effective
technology so that they can provide better services to their customers and achieve better
customers experience and higher values. In context of selected firm, they need to analysis
their customers and competitors in a better way so that they can use effective technology
(Lind and et. al. 2021).
Evaluate new and emerging model of digital business in context of business issues.
Digital business is based on technology which helps an organisation in providing better
customers experience but this type of business has a fear of privacy and security. This is because
when a digital business online operates its business through technology and all necessary data are
stored on these their computer they use. When a digital business operate its business operations it
face many hackers and crackers who steel important information from company because of it
company bear a huge amount of loss. This is also a reason because of which customers are not
ready to buy online services and not want to share their personal information with company.
Which will affect the growth of digital business. If a company wants to achieve better customer
experience then they need to use effective and safe technology so that they can achieve customer
trust related to their personal information is fully safe with company. In context of selected
company they use various digital business model in context of business issues such as cyber
security and ethics (Popkova, 2020).
Cyber security- It refers to a practice of an organisation which defend company computers,
servers, mobile device, electronic system company networks, data from malicious attack and so
on. Cyber security is also known as information technology security and electronic information
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security. Digital business are increase at a global level and the global cyber threats will
continuously evolve at faster rate. The cyber threats which are counted by cyber security is
cybercrime which includes single actors system for financial gain. While cyber-attack involve
politically motivated information gathering and last one is cyberterrorism which is intended to
undetermined electronic system to cause fear. In context of selected firm, they regularly update
their software and operating system & also use anti-virus software which helps in protecting their
information from hackers and crackers. In context of selected firm they use subscription digital
business model which is discuss below:
Subscription business model- It refers to a business model which is used by an
organisation through which a customer will needs to pay a recurring price at regular interval for
access the product and services of company (Pramanik and et. al. 2019). This model is developed
by a publishers of books & periodicals in 17th century and now this model is used by many
businesses and websites. The subscription business model is one of the predominant business
model used for modern software. It is an powerful tool for achieving higher growth for company.
By effective selecting a pricing strategies and applying this model in business an organisation
can build the foundation of success. The recruiting and subscription fee charges from customers
can be for a month or for a year. In context of selected firm, they use this model in their
organisation which increase their revenue from subscription and also provide protection from
cyber crime. This model play an important role in selected business.
 Benefits- In context of selected firm if they use this business model in their organisation
then its customers can access their services after paying the subscription price. The fake
customers cannot access in the system because it they need to pay for subscription. This
will provide better services to their customers because of less unwanted traffic on their
system. In context of selected company this model provide protection to company from
hackers and crackers (Schneider, 2019).
 Limitation- One of the biggest limitation of this model is that a hacker can simply enter
into the system of organisation only by paying a little amount for subscription.
Ethics- It refers to a system which includes the moral principles. These principles affect the
decision making of a person and also affect the way of living. Ethics is mainly concerned with
what is good for an individual and society. The concept of ethics describe the moral philosophy.
An organisation is only achieve success when they do not only aware related to ethical values
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such as trust, honesty, fairness, confidentiality and accountability but they also need to
effectively adopt these values in their business. Which will helps in making right decisions and
effective working environment. In context of selected firm, they digital operate its business
activities so they are responsible for protecting their customers from cyber crime, ensure safety
of customers personal information and so on. For this they use Freemium model of business in
their company which is discuss below:
Freemium business model- This model is depend on two important words that is 'free'
and 'premium' which is an pricing strategy used by an organisation. According to this model
product and services of an organisation are provided free of cost but company charge extra
money for additional features or services. In context of selected firm, they allow their users to
use basic features of their software, or services and after that charge extra pay for upgraded
service through basic package (Sun, 2018).
 Benefits- This will helps organisation in increasing their number of customers and
encourage them to pay for extra services which will increase their loyalty towards
company. By providing free services to customers company fulfil its ethical value which
create a good image of company in market.
 Limitation- By using this model selected company is facing a problem of heavy traffic
on their system because of free service which reduce the quality of service of company
(Thite, 2018).
From above discussion it is evaluated that selected company needs to adopt freemium
business model because it helps in attracting more and more customers towards company service
and selected company is also fulfil its corporate social responsibility by providing free services.
This model helps company to do work under ethics.
Evaluate impact of collaboration relationship and strategic alliances with digital technology.
Collaboration relationship- It occur when two or more people are working together for
achieving a common goal. While in terms of digital technology collaboration relationship refers
to the practice of people working together with the help of online means such as software as a
solution platforms. In context of selected firm, instead of teams only communicating and
working together in person. They are able to rely on digital tools for addressing their
collaboration needs.
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 Benefits- Digital technology provide various tools to team members which helps them to
perform their task from any location. Which will increase their level of productivity and
efficiency towards achievement of common goal (Van and Black, 2019).
 Limitation- because of digital technology the personal contact is reduce which will
create confusion regarding what team members are expected form each other.
Strategic alliances- It refers to an arrangement between two parties for undertaking a
mutually beneficial project and both the parties retain their independence. In context of digital
technology strategic alliances helps organisation in effectively utilized its software with other
organisation and achieve higher growth and objective (Vega and Chiasson, 2019)
 Benefits- In context of selected firm it allows both digital business organisation to reach
their goal faster and helps company to access greater level of innovation.
 Limitation- This will create a clash of culture because of company partner up with
another organisation.
From above discussion it is evaluated that selected company needs to adopt collaboration
relationship in terms of digital technology which provide various tools to team members to
effectively communicate and perform their task form any location.
Explain various principles of e-commerce
E-commerce or electronic commerce refer to buying and selling of goods and services
over the medium of internet (Wang and Wang, 2020). It is also known as internet commerce.
Now a days with the development of technology a producer can directly sell its product and
service with the help of internet to its customers. According to current scenario people are more
prefer to buy online product and service because it provide a 24 hour service and also it save
time and money of customers. This mode of business provide better customers experience and a
organisation can easily operates its business at worldwide. Their are various types of e-
commerce business such as business to customers which means the sale is take place between
business to customers, business to business e-commerce means the sales of goods and services is
take place between one business to another. Other type of e-commerce is direct to consumers in
which manufacturer directly sell its product or services to its final customers. E-commerce helps
a business to offer its product and services at low cost. This is e-commerce reduce the cost of
warehouse and transportation. This will helps company in enhancing their sales of product and
customers loyalty. In context of selected firm with the help of e-commerce they globally operate
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its business and efficiently provide their service to its customers. Various principle of e-
commerce used by Vodafone company is discuss below:
 Data capture- According to this principle of e-commerce a business need to design its
business in such a way that they can easily achieve their customers information. In
context of selected firm for effective e-commerce business they need to design a
appropriate Vodafone portal through with they can easily access relevant information
related to its customers and provide better experience to its customers.
 Express delivery- According to this principle of e-commerce selected company needs to
adopt effective strategies and technology through which they can quickly provide their
services to its customers. Now a days with the increase in digital business customers are
expect that they can get their service with just one click and for faster service the
customers are also able to pay extra. Selected company needs to adopt this principle of e-
commerce for providing faster services to their customers so that they can achieve
positive customers expectation (Winkelhake, Winkelhake and Schilgerius, 2018).
 Digital payment- Now a days with the increase in digital technology customers wants
easy online payment mode. They don't want to use their card for payment. According to
this principle of e-commerce a company needs to provide effective and time saving
payment mode which give better customer experience and increase their loyalty towards
company. In context of selected firm, their provide various digital options to their
customers through which a customer is able to pay by using mobile phone or even
watches.
CONCLUSION
From above discussion on this report it is concluded that digital business helps an
organisation in creating values achieving competitive advantage in market. For digital business a
company needs to use an efficient technology so that they can provide better services to their
customers and achieve better customer experience. It is also analysed that digital business
provide growth opportunities to business but it also increase competition for business. From this
report it is analysed that a digital business have a biggest issue related to privacy and security of
its data. In this report subscription and freemium digital business model is included which helps
in understanding that how an organisation can resolve its issues related to cyber security and
ethics because these both play an essential role in any digital business. E-commerce helps an
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organisation in selling its products and services to its customers with the help of internet.
Electronic commerce provide various principles such as data capture, express delivery system,
digital payment option which helps a digital business in providing effective services to its
customers and achieving competitive advantage in market.
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