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Added Value-based Approach to Analyze Electronic Commerce and Mobile Commerce Business Models

Pousttchi, Key and Weizmann, Moritz and Turowski, Klaus (2003): Added Value-based Approach to Analyze Electronic Commerce and Mobile Commerce Business Models. Published in: International Conference Management and Technology in the New Enterprise (2003): pp. 414-423.

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In this contribution we propose to apply the theory of informational added values (IAV) on electronic commerce (EC) and mobile commerce (MC). We state that for the success of electronic and mobile offers it is not sufficient to merely make a conventional offer available with new media. Instead, the use of electronic and mobile communication technology is only remunerative if it results in obtaining distinct supplementary IAV. This depends on the exploitation of certain faculties of the used technology. For EC, we call these the four electronic added values (EAV): reduction of temporal and certain spatial limitations, reduction of technical limitations, multi-mediality of access and egalitarian access. For MC, we call these the four mobile added values (MAV): ubiquity, contextsensitivity,identifying functions and command and control functions. We can find EAV and MAV as typical properties of EC or MC applications. EAV are the basis for the superiority of Internet applications compared with offline solutions. The relationship between the separate EAV and IAV will be explained and analyzed. Proceeding analogously for mobile applications, we analyze the relationship between MAV and resulting IAV. The outcome is an extension of the theory of informational added values with the concept of electronic and mobile added values. This allows for an application of the theory to both EC and MC in order to analyze and qualitatively evaluate any given business model. For determining its crucial added value we have to identify the EAV/MAV which are capitalized and can deduce the IAV resulting for each party involved. The concept put forward is a suggestion to approach business models, with the focus on typical evaluation criteria for Internet/mobile business models. It is also suitable to compare different business models and to put their added value for the involved parties in a context. In this way, objective criteria are established reducing subjectivity and allowing to make certain predictions. The paper ends with a critical review and the perspective for further research.

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