Electronic Commerce

1
Electronic Commerce

• Week 2 Chapter 3

2
Principles and Learning Objectives

• E-commerce is a new way of conducting business,
  and as with any other new application of
  technology, it presents both opportunities for
  improvement and potential problems.
• Identify several advantages of e-commerce.
• Outline a multistage model that describes how
  e-commerce works.
• Identify some of the major challenges companies
  must overcome to succeed in e-commerce.
• Identify several e-commerce applications.

3
Principles and Learning Objectives

• E-commerce requires the careful planning and
  integration of a number of technology
  infrastructure components.
• Outline the key components of technology
  infrastructure that must be in place for
  e-commerce to succeed.
• Discuss the key features of the electronic
  payments systems needed to support e-commerce.

4
Principles and Learning Objectives

• Users of the new e-commerce technology must take
  safeguards to protect themselves.
• Identify the major issues that represent
  significant threats to the continued growth of
  e-commerce.
• Organizations must define and execute a strategy
  to be successful in e-commerce.
• Outline the key components of a successful
  e-commerce strategy.

5
An Introduction to Electronic Commerce
6
Introduction to Electronic Commerce

• Business-to-consumer (B2C)
• Business-to-business (B2B)
• Consumer-to-consumer (C2C)
• Government- to-Consumer (G2C)

7
Multistage Model for E-commerce

• Search and identification
• Selection and negotiation
• Purchasing products and services electronically
• Product and service delivery
• After-sales service
• Activity Search one of the local and
  international EC site. Identify what are the type
  of the EC from the above activity.
• http//www.blooming.com.my/blooming/default.asp
• www.bn.com

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Multistage Model for E-commerce
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Product and Service Delivery
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E-Commerce Model
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E-Commerce Challenges

• Change distribution systems work processes
• Split-case distribution
• Integrate web-based order processing with
  traditional systems
• security
• technology

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The E-Commerce Supply Chain (add)

• Supply chain management
• Demand planning
• Supply planning
• Demand fulfillment
• Increased revenues and decreased costs
• Improved customer satisfaction
• Inventory reduction across the supply chain

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The E-Commerce Supply Chain(add)
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Supply Chain Management(add)
15
Business-to-Business

• Allows manufacturers to buy at low price
  worldwide
• Enterprise can sell to a global market

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Global E-Commerce (add)

• Steps in localization
• recognizing and conforming to the nuances,
  subtleties, and tastes of local cultures
• supporting basic trade laws such as each
  countrys currency, payment preferences, taxes,
  and tariffs
• ensuring that technological capabilities match
  local connection speeds

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Global E-Commerce(add)

• Determine which global markets make the most
  sense for selling products or services on-line
• Decide whether Web content should be generated or
  updated centrally or locally

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E-Commerce Applications
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Retail and Wholesale

• Electronic retailing
• Cybermalls
• Wholesale e-commerce B2B

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Manufacturing
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Marketing

• Market segmentation
• Technology-enabled relationship management

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Investment and Finance

• On-line stock trading
• On-line banking
• Electronic bill presentment

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Example

• E- Auction
• E- tailing
• E-banking
• E publishing
• Activity For each of the following example,
  find any related website and present your finding

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Technology Infrastructure
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Technology Infrastructure

• E-commerce requires an extensive and reliable
  technology infrastructure.
• The technology includes the hardware, software
  and related technology underlying the business.
• The performance of the technology infrastructure
  can make or break an online business.
• Your competition is just a mouse click away
  its easy to lose customers if your web site is
  loading slowly or if you lose customer orders.

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Technology Infrastructure
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Hardware

• Storage capacity
• Software
• Volume of e-commerce transactions
• Website hosting
• Eg TMNET netmyne

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A Web server platform

• a combination of hardware and operating system
  software is the base of the technology
  infrastructure.
• The applications software the server will run, as
  well as the expected volume of e-commerce
  transactions, determines the computing power and
  capacity of the server.
• Since its hard to predict website traffic, a
  scalable platform one that can be easily
  upgraded is the best solution.
• Many new companies, especially small ones, choose
  not to host their own website, but to outsource
  it. They pay a monthly fee to a third-party,
  who provides web server capacity and a high-speed
  Internet connection.
• Not only does this decrease the firms initial
  capital outlays, but it also means that
  high-priced technical staff to keep the web
  server running 24 hours a day, every day, dont
  need to be hired.
• In addition to a reliable platform and staff,
  the web server should be fault tolerant that
  is, there should be an adequate hardware backup
  to avoid business disruptions if problems develop
  in the primary hardware.

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Web Server Software

• Security and identification
• Denial of service attack
• Web site tracking
• Web log file
• Example Apache UNIX , Apache, IIS -Microsoft

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Web Server Software

• Web site development tools
• Retrieving and sending Web pages
• Web page construction software
• Static Web page
• Dynamic Web page

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E-Commerce Software

• Catalog management
• Product configuration
• Shopping cart
• Eg http//www.monstercommerce.com/
• Go to storefront demo
• Web Traffic Data Analysis

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E-Commerce Transaction Processing

• Automates transaction processes from order
  placement to reconciliation
• Web traffic data analysis

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Electronic Shopping Cart
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Electronic Payment Systems
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Electronic Payment Systems

• Electronic cash-
• Electronic wallets-
• Smart cards -
• Credit cards -
• Charge cards -
• Debit cards -

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Malaysia Contect

• Electronic payments are an important and rapidly
  growing part of the e-commerce infrastructure.
  Payments are made in a variety of ways, including
  electronic cash and credit cards. Security is
  handled through user authentication and
  encryption.
• Eg Malaysia credit card, online banking, FPX
  /Financial process exchange (E-debit), Mobile
  Money, Post pay.

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Threats to E-Commerce
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Threats to E-Commerce

• E-commerce incidents
• Theft of intellectual property
• Patents on business processes

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Fraud

• On-line auction fraud eg credit card fraud
• Spam - email
• Pyramid schemes member find member
• privacy

40
Invasion of Consumer Privacy

• On-line profiling
• Clickstream data
• Safe harbor principles

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TRUSTe Seal
Browse the website
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BBB On-line Privacy Seal
Browse the website
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How to Protect Your Privacy While On-Line
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Strategies for Successful E-Commerce
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Developing an Effective Web Presence

• Visitors to a web site should be able to
• Obtain general information about the organization
• Obtain financial information for making an
  investment decision
• Learn the organizations position on social
  issues
• Learn about the products or services that the
  organization sells

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Putting up a Web Site

• Web site hosting services
• Storefront brokers

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Building Traffic to Your Web Site

• Domain names
• Meta tags
• Traffic data analysis

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Maintaining and Improving Your Web Site

• Be alert to new trends
• Be prepared to take advantage of new
  opportunities
• Personalization
• Explicit
• Implicit

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Summary

• E-commerce - enables consumers and companies to
  gain access to worldwide markets
• Electronic retailing (e-tailing) - the direct
  sale from business-to-consumer through electronic
  storefronts designed around an electronic catalog
  and shopping cart model
• E-commerce shoppers - must be on constant guard
  to protect their rights, security, and personal
  privacy

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Exercise-lab

• Creating Business Card - handout