Electronic Commerce

1
Electronic Commerce

• Chapter 8

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
Is it getting better?
7
Introduction to Electronic Commerce

• Business-to-consumer (B2C) e-commerce
• Business-to-business (B2B) e-commerce
• Consumer-to-consumer (C2C) e-commerce

8
Online Activities
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Multistage Model for E-commerce

• Search and identification
• Selection and negotiation
• Purchasing products and services electronically
• Product and service delivery
• After-sales service

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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

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The E-Commerce Supply Chain

• 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
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Supply Chain Management
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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

• 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

• 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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Investment and Finance
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Investment and Finance
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Technology Infrastructure
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Technology Infrastructure
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Hardware

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

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Web Server Software

• Security and identification
• Denial of service attack
• Web site tracking
• Web log file

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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

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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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Network and Packet Switching

• All e-commerce depends on a type of network to
  securely transmit data
• Internet
• Extranet
• Value-added network (VAN)
• Virtual private network (VPN)
• All approaches rely on packet switching and use
  routers
• Cost, availability, reliability, security, and
  redundancy must be considered when choosing a
  network

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Electronic Payment Systems
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Electronic Payment Systems

• Digital certificate
• Certificate authority
• Secure sockets layer (SSL)
• Electronic cash
• Electronic wallets
• Smart, credit, charge, and debit cards

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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
• Spam
• Pyramid schemes
• Investment fraud
• Stock scams

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Invasion of Consumer Privacy

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

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TRUSTe Seal
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BBB On-line Privacy Seal
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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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Low Cost
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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