Other Way of Making Business: A Virtual e-Commerce

Community / CVN Platform

Roberto Naranjo, Jorge Moreno, Luz Marina Sierra, Martha Mendoza

Researcher Information Technologies Group (GTI), University of Cauca, Sector de

Tul

can Popayan, Colombia South America

Abstract. This article describes the current problem in the business

environment from the department of Cauca – Colombia (South America), and

the proposed solution called Project CVN (Spanish initials) “Business Virtual

Community - for the department of Cauca - Internet Commercial Platform or

BVC”. Based on a markets research, the architecture of the added value

conceived by the project is described; these values support advertising,

collaboration, B2C, and B2B, activities framed within the virtual environment

of the community. Below, the business model proposed for the community and

the logic architecture of the software is described. Lastly the experiences and

the learnt lessons throughout the implementation of the project are exposed.

1 Introduction

CVN is a Research [12] University [1] and Enterprise [4] cooperation initiative,

which adapts the IT (Information Technologies) to the specific commercial needs of

the department of Cauca (Colombia). Three aspects of the problem stand out: firstly,

the lack of the associability and collaboration among the enterprises; secondly, the

distance between costumer and enterprise on account of the deterioration of the

communication channels, and finally, the unawareness about the advantages of the

use of the IT [1]. There are similar initiatives in Colombia, among others, such as:

Plaza Orbita [l5] (Orbital Market) that attempts to promote products and services of

the city of Medellin (Colombia); De Remate [6], Latin-American leader selling

products through auctions, and TAMPU [7] focused on promoting the tourist image

of city of Popayán and department of Cauca region (Colombia). Facing the mentioned

initiatives, CVN proposes a business concept that brings together the region

enterprises, through a virtual environment that offers added value services directed to

the

advertising, the B2C (Business to Consumer) and B2B (Business to Business), as

an alternative to the suggested problem. The CVN will benefit cultural and

technological conditions that motivate the associativity and collaboration among

enterprises, as well as the formulation of strategies for the promotion of products and

services that benefit the effective approach of these enterprises with their customers.

Naranjo R., Moreno J., Marina Sierra L. and Mendoza M. (2005).

Other Way of Making Business: A Virtual e-Commerce Community / CVN Platform.

In Proceedings of the 2nd International Workshop on Computer Supported Activity Coordination, pages 141-148

DOI: 10.5220/0002567501410148

 SciTePress

2 Project Development

CVN has been developed as a project in different stages, from the conception of the

research idea, going through the markets research, the elicitation of the requirements

and the harmonization of the service outline, up to the design of the logical

architecture of the software, the business model view and the sustainability –

continuity strategies. These stages are described as follow:

2.1 Markets Research

The carried-out markets research intended, first to identify and quantify the regional

and national supply - demand over product-services supported on the CIT [9] through

the CVN, and second, to establish profiles and entrepreneurial tendencies, that allows

identifying opportunities and threats of the environment with the purpose of designing

commercialization and sensibilization strategies of the transactions through the

Internet.

2.1.1 Hypothesis

The following hypotheses were proposed for the markets research:

1. There is an unsatisfied Internet service and E-Commerce demand in the department

of Cauca.

2. There is a lack of knowledge of the business, opportunities, and risks derive from

the commercialization through Internet in the department of Cauca.

3. There are limitations and/or technical-economical barriers in the department of

Cauca that oppose the commercialization through the Internet.

4. Inexistence of Internet integral solution offers and electronic commerce in the

department of Cauca.

2.1.2 Execution

The critical needs of information identified to validate the hypotheses during the

execution of the markets research, were:

1. To validate the execution of the project with the evidence that there are enough

enterprises which request an E-Commerce alternative such as CVN.

2. To identify the treats and opportunities of the project from a study of the current

use of the CIT (Communication and Information Technologies).

3. Finally, to estimate the supply of products and services and its possibilities of

commercialization on a national or international market.

2.1.3 Technical Specifications and Sample

The complete sample consisted on productive enterprises and associations from the

department of Cauca with a regional, national and international coverage. The sample

consisted on 54 enterprises of 12 different business areas. The type of sampling was

“Non probabilistic”.

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2.1.4 Conclusions of the Markets Research

The conclusions of the research, allowed the designing of the service portfolio and the

elicitation of the technical and functional requirements of the CVN. The markets

research has focused its study and subsequent conclusions on aspects related to the

Internet, specifically: use, experience, problems, shopping, sale, associability,

advertising, interest, and/or conditions of entrepreneurial participation in the

execution of CVN project. Here, here are some of the main conclusions found:

• The enterprises need a technological platform that permits the association among

them.

• The enterprises guess that the CVN is an important E-Commerce project that will

permit them to offer an integral solution of products at the costumers and

advertising through the association among the entrepreneurial members of the

community.

• Increased sales, improved knowledge of the market, improved costumer service,

achievement discounts by amount of purchase, among others are the main reasons

that the association of their relationships will bring to entrepreneurial members of

the community.

• The CVN added value services platform will allow the entrepreneurial members of

the community to promote and to sell their products and/or services on a national

and/or international market.

• There are favorable conditions for the execution, continuity, and sustainability of

the CVN, in each one of the aspects mentioned above.

3 A Business Model

The business model [11] of the CVN relies on two basic parts: A service model [9]

and a sustainability model. Together, they will allow the start up of the CVN as an E-

Commerce platform. These two concepts are explained briefly below.

3.1 A Service Model

The service model is conformed by three components: Publicity and collaboration

component, B2C Component and B2B Component.

3.1.1 Advertising and Collaboration Component.

Also called “Advertising and Collaboration Virtual Environment”, it is responsible of

supporting the approaching between the enterprises and their customers through

stimulus strategies related to the promotion of products/services and the cooperation

and information interchange among the enterprises. The main on-line services that

this component offers are: catalogues of products and services, personalized

consumption profiles, search engine, adds, information about events, supply and

demand of products and services, information managing, and chats moderated by

experts.

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3.1.2 B2C Component

Also called “B2C Virtual Environment”, it is responsible of supporting the

communication channel between costumers and enterprises, it provides the following

on-line services: Shopping Cart, Information recovery and analysis according to the

customer’s shopping habits, and auctions-drop/auctions among users of the

community. CVN will offer an evaluation of the quality for every service provided.

3.1.3 B2B Component

Also called “B2B Virtual Environment”, it is responsible of supporting the

cooperation among enterprises with the purpose of promoting a higher power of the

entrepreneurial negotiation, the acquisition of better prices through on-line value

services, the addition of the supply/demand of products-services and finally, provides

commercial information from Popayán.

3.2 Sustainability Model

It defines the valued cost over the provision of the services of the CVN that will allow

in a long term, to guarantee the sustainability of the community (over five years).

Two income sources are proposed: the first one consists of memberships that are

obtained by those people or customers whom interest is to actively participate in the

CVN, and the second one consists of the selling of added valued services that through

the profit of the commercial information provide the enterprises with competitive

advantages that impulse the capacities of negotiation and communication. CVN

proposes 3 kinds of memberships for the users according to their needs. These

memberships have been defined according to the identified needs in the markets

research (see Number 2.1).

3.2.1 Free Entrepreneurial Membership

This one allows access to the CVN platform for the entrepreneurial members of the

community, in order to show them basic services such as: yellow pages,

Entrepreneurial Webpage, search about products and services of the CVN,

participation in auctions, and drop auctions, among others.

3.2.2 Standard Entrepreneurial Membership

This one allows to the entrepreneurial members of the community, to have access to

added valued services such as: electronic chats lead by specialists, Evaluation

information gathering that the Customers do about the enterprises on aspects related

with: Products and Services, client service, fulfillment and support post-selling;

configuration of integral solutions of services for costumers, among others.

3.2.3 Plus Entrepreneurial Membership

Additionally to the free and standard subscription services, this one includes on line

support, addition of the supply/demand service for major suppliers and customers,

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configuration of integral solutions of services for costumers, and inter-entrepreneurial

purchasing orders value, among others.

The second sustainability source, relates to the selling of the added value services

such as: advertising (Banners among others), branding, direct and crossed marketing,

promotions and customers fidelization strategies that are the result of applied data

mining strategies to the CVN platform. Having in mind the offered services and the

entrepreneurial interest in participating in CVN, a presentation of the subscriptions

behavior in the first year (see fig 1) was carried out as well as a projection of the

community utilities in the first five years (see fig 2), in this one we can see that it is

evident that in the two first years the community does not present utilities due to the

high initial costs that implies to start it, however the outlook improves considerably,

after the second year.

Jan fe b ma

jun Jul

oct no

100

120

140

160

Subscriptions the First Year

Free

Standard

Complete

Month

Number of Subscriptions

Fig. 1. Number of subscription for the first year

1 2 3 4 5

-50,000,000

-40,000,000

-30,000,000

-20,000,000

-10,000,000

10,000,000

20,000,000

30,000,000

40,000,000

50,000,000

60,000,000

70,000,000

80,000,000

90,000,000

Utility per y ea r (Pesos)

Utility

Year

Pesos

Fig. 2. Five years forward

4 A Software Architecture for the CVN Platform

CVN offers a technological platform that permits to support the services model

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mentioned above. Fig.3 shows the logical architecture of the CVN, (it was modeled

using the UML Language [16]). This diagram specifically shows the domain layer

(following the Application-Domain-Services Architectural Pattern [8]). In this paper

we only explain the main software classes that implement some services in the virtual

environment of the CVN platform, such as: product/services catalogue, shopping cart,

orders, subscriptions, stands, among others.

4.1 Access Control Package

The main purpose of this one consists of providing all those services related to

member’s access control rules e.g.: user accounts creation and its maintaining, CVN’s

services assignment based on a membership model and other commercial

considerations.

Fig. 3. CVN software architecture

4.2 Shopping Cart Package

The main purpose of this consists of providing all those services related to remove

and store items (here are products and/or services) from and to the shopping cart and

the buy order making based on the shopping cart content and others.

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4.3 Products and Services Catalogue

The main purpose of this package consists of providing all those services related to

facilitate the search and retrieve of structured information from the products and

services catalogue, making products and services requests and getting prices, too.

5 Conclusions

Despite the difficult conditions of violence and ground communication in Cauca,

CVN proposes an alternative concept of promoting and commercializing the products

and services in Cauca, encouraging, at the same time, through added value services,

the asociativity and collaboration among entrepreneurial members of the community,

profiting the initial conditions to consolidate, throughout a virtual environment, an

agreement point among enterprises and customers, and finally promoting alternative

communication channels. From the Basic aspects in the advance and development of

CVN outstands the markets research that allowed dimensioning the expectation of the

services that had to be offered to the community; at the same time, it was outlined the

strategy of releasing them. Further more the CVN has conceived the mechanisms of

sustainability and its future regulation in the frame of the Colombian legislation

during its start up.

It is important to emphasize the technological support that the CIT offers like

support (internet, communication protocols, standardization, software development

tools, among others) to the CVN and the maturity level that CIT has at this moment;

in addition, there are very good software development tools such as Microsoft .NET

Framework and IDEs that offer many benefits in order to develop this kind of E-

Commerce platforms. This technological support, finally allows us to contribute in the

fortification of the communications channels between enterprises and between

enterprise-costumers.

We hope the CVN platform will be turned into a business alternative to Cauca

since it counts with a higher availability of the businessmen of the region, a software

tool adapted to the requirements of the Cauca region, and an adequate sensibilization

that shows the competitive advantages of the usage of the CIT, will guarantee the

successful starting up of the CVN.

Acknowledgements

We would like to thank COLCIENCIAS [12], UNIVERSIDAD OF CAUCA [13],

CYGNUS TECNOLOGY ENTERPRISE [4], who permitted the development this

project and HEXUM Digital Media [14], for supporting in web design.

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