CHAPTER 7 E-Commerce: Applications and Issues CHAPTER OUTLINE 7.1 Overview of E-Business & E-Commerce 7.2 Business-to-Consumer (B2C) E-Commerce 7.3 Business-to-Business (B2B) E-Commerce 7.4 Electronic Payments 7.5 Ethical and Legal Issues in E-Business 7.1 Overview of E-Business and E-Commerce The dot-com era Over 3 billion people are now connected to the Internet More than 130 million people are buying online E-commerce began in 1995 Marketplace → Marketspace * Overview of E-Business and E-Commerce E-Commerce (EC): describes the process of buying, selling, transferring or exchanging of products, services or information via computer networks, including the Internet. E-business: is a broader definition of EC, including buying and selling of goods and services servicing customers collaborating with partners conducting e-learning conducting electronic transactions within an organization. * Pure versus Partial EC depends on the degree of digitization involved:The product can be physical or digital.The process can be physical or digital.The delivery agent can be physical or digital Brick-and-mortar: purely physical organizations Click-and-mortar: organizations are those that conduct some EC activities, yet their business is primarily done in the physical world [multichannneling] Pure Play: organizations that are engaged only in EC Overview of E-Business and E-Commerce * Bricks and Mortar, Partial EC, and Pure EC Buy books at Family Bookshop bricks and mortar Order physical book from Amazon: partial EC Order and download book from Amazon: pure EC Types of E-Commerce Business-to-Consumer (B2C): the sellers are organizations and the buyers are individuals Business-to-Business (B2B): both the sellers and buyers are business organizations Consumer-to-Consumer (C2C): both the sellers and buyers are individuals * Types of E-Commerce Business-to-Employee (B2E): An organization uses e-commerce internally to provide information and services to its employees. E-Government (E-Gov.): the use of Internet technology to deliver information about public services to citizens (Government-to-Citizen [G2C]), business partners and suppliers (called government-to-business [G2B]) and between governments [G2G]. Mobile Commerce (m-commerce): e-commerce that is conducted using a mobile phone * E-Commerce Business ModelsOnline Direct Marketing: manufacturers sell directly to customers Electronic Tendering System: businesses (or governments) request quotation from suppliers [uses B2B or G2B] -[Example: e-tendering The Tender Board ] E-auction – an auction which is held over the Internet www.ebay.com Forward Auction: the highest bidder wins the auction Reverse Auction: the lowest bidder wins the auction * E-Commerce Business ModelsName-your-own-price: customers decide how much they want to pay www.priceline.com Find-the-best-price: customers specify a need and an intermediary comp.

1. CHAPTER 7
E-Commerce: Applications and Issues
CHAPTER OUTLINE
7.1 Overview of E-Business & E-Commerce
7.2 Business-to-Consumer (B2C) E-Commerce
7.3 Business-to-Business (B2B) E-Commerce
7.4 Electronic Payments
7.5 Ethical and Legal Issues in E-Business
7.1 Overview of E-Business and E-Commerce
The dot-com era
Over 3 billion people are now connected to the
Internet
More than 130 million people are buying online
E-commerce began in 1995
Marketplace → Marketspace

2. *
Overview of E-Business and E-Commerce
E-Commerce (EC): describes the process of buying, selling,
transferring or exchanging of products, services or information
via computer networks, including the Internet.
E-business: is a broader definition of EC, including
buying and selling of goods and services
servicing customers
collaborating with partners
conducting e-learning
conducting electronic transactions within an organization.
*
Pure versus Partial EC depends on the degree of digitization
involved:The product can be physical or digital.The process can
be physical or digital.The delivery agent can be physical or
digital
Brick-and-mortar: purely physical organizations
Click-and-mortar: organizations are those that conduct some EC
activities, yet their business is primarily done in the physical
world [multichannneling]

3. Pure Play: organizations that are engaged only in EC
Overview of E-Business and E-Commerce
*
Bricks and Mortar, Partial EC, and Pure EC
Buy books at Family Bookshop
bricks and mortar
Order physical book from Amazon:
partial EC
Order and download book from Amazon: pure EC
Types of E-Commerce
Business-to-Consumer (B2C): the sellers are organizations and
the buyers are individuals
Business-to-Business (B2B): both the sellers and buyers are
business organizations
Consumer-to-Consumer (C2C): both the sellers and buyers are
individuals
*

4. Types of E-Commerce
Business-to-Employee (B2E): An organization uses e-commerce
internally to provide information and services to its employees.
E-Government (E-Gov.): the use of Internet technology to
deliver information about public services to citizens
(Government-to-Citizen [G2C]), business partners and suppliers
(called government-to-business [G2B]) and between
governments [G2G].
Mobile Commerce (m-commerce): e-commerce that is conducted
using a mobile phone
*
E-Commerce Business ModelsOnline Direct Marketing:
manufacturers sell directly to
customers
Electronic Tendering System: businesses (or governments)
request quotation from suppliers [uses B2B or G2B] -
[Example: e-tendering The Tender Board ]
E-auction – an auction which is held over the Internet
www.ebay.com
Forward Auction: the highest bidder wins the auction
Reverse Auction: the lowest bidder wins the auction
*

5. E-Commerce Business ModelsName-your-own-price: customers
decide how much they want to pay www.priceline.com
Find-the-best-price: customers specify a need and an
intermediary compares providers and shows the lowest price
*
E-Commerce Business ModelsAffiliate marketing: Vendors ask
partners to place logos or banners on partner’s site. If customers
click on logo, go to the vendor’s site, and buy, then the vendor
pays commission to partners.
Note the Sony logo at the top of this Web page
www.howstuffworks.com
*
E-Commerce Business ModelsViral marketing: receivers send
information about your product to their friends.
Group purchasing: small buyers aggregate demand to get a
large volume discount [E-Coops]
Product customization: customers use the Internet to self-
configure products or services. Sellers then price them and
fulfill them quickly.
www.dell.com
www.bluenile.com

6. *
E-Commerce Business ModelsDeep discounters: company offers
deep price discounts. Appeals to customers who consider only
price in their purchasing decisions
Membership: only members can use the services provided,
including access to certain information, conducting trade, etc.
*
Benefits of E-CommerceBenefits to organizationsMakes
national and international markets more accessibleLowering
costs of processing, distributing, and retrieving
informationBenefits to customersAccess a vast number of
products and services around the clock (24/7/365)Benefits to
SocietyAbility to easily and conveniently deliver information,
services and products to people in cities, rural areas and
developing countries

7. Limitations of E-CommerceTechnological LimitationsLack of
universally accepted security standardsInsufficient
telecommunications bandwidthExpensive accessibility
Non-technological LimitationsPerception that EC is
unsecureUnresolved legal issuesLacks a critical mass of sellers
and buyers
7.2 Business-to-Consumer B2C
Electronic retailing (E-tailing): the direct sale of products and
services through the Internet
E-marketplace: a central, virtual market space on the Web
where many buyers and sellers can conduct E-commerce and E-
Business activities
E-storefront: a Web site that represent a single store
www.dell.com
E-mall/ Cybermall: a collection of individual shops under one
Internet address http://www.e-mall.com.sa/
- Referral Mall www.bing.com/shopping
*
Online Service Industries
A key issue is disintermediation
The removal of intermediaries in a supply chain

8. *
Online Service Industries
Cyberbanking: involves conducting banking activities from
home, a place of business or on the road instead of at a physical
bank location.
E-Bank / virtual Bank/ Cyber Bank: a bank that is dedicated
only to Internet transactions
www.firstib.com
Online securities trading
*
Online Service Industries
Online job market
The internet offers promising new environment for job seekers
and for companies searching for hard-to-find employees.
Travel services
The internet is an ideal place to plan, explore and arrange
almost any trip economically

9. Real Estate http://www.findaproperty.com/
*
Issues in E-Tailing
Channel conflict: occurs when manufacturers disintermediate
their channel partners such as distributors, retailers, dealers,
and sales representatives, by selling their products directly to
consumers, usually over the Internet through e-commerce.
[Ford allows customers to configure a car online but requires
them to pick it up from a dealer, where they arrange financing,
warranties and services]
Multichanneling: is a process in which a company integrates its
offline and online channels.
Order fulfillment: finding the product to be shipped; packaging
the product; arrange for speedy delivery to the customer; and
handle the return of unwanted or defective products.
*
Online Advertising
Advertising : an attempt to disseminate information in order to

10. influence a buyer-seller transaction.
Online Advertising methodsBanner: simply electronic billboard
[can be customized]Pop-up ad : appears in front of the current
browser window.Pop-under ad: appears underneath the active
window.Permission marketing: asks consumers to give their
permission to voluntarily accept online advertising and e-mail.
[sometimes customers are paid to view online
advertisements] Viral marketing: refers to online “word-of-
mouth” marketing.
*
7.3 Business-to-Business (B2B)
In B2B e-commerce, the buyers and sellers are organizations
There are several business models for B2B applications:
B2B Sell-Side Marketplace
B2B Buy-Side Marketplace
Electronic Exchanges
B2B Sell-Side Marketplace
Key mechanisms: electronic catalogs and forward auctions
In the sell-side marketplace, organizations sell their products or
services to other organizations electronically from their own
Web site and/or from a third-party Web site.

11. This model is similar to the B2C model in which the buyer
comes to the seller’s site, views catalogs, and places an order.
In the B2B sell-side marketplace, the buyers are organizations.
*
B2B Buy-Side Marketplace
Key mechanism: reverse auctions
The buy-side marketplace is a model in which organizations buy
needed products and services from other organizations
electronically.E-procurement
*
Electronic Exchanges
Exchanges independently own by a third party and connect
many buyers and many sellers
Vertical Exchanges: connects buyers and sellers in a given
industry
www.plasticsnet.comwww.papersite.com
Horizontal Exchanges: connects buyers and sellers across many
industries, and are used mainly for MRO materials
www.alibaba.com
Functional Exchanges: needed services
such as temporary help or extra office

12. space are traded on an “as-needed” basis
www.employease.com
*
7.4 Electronic PaymentsImplementing EC typically requires E-
payment E-payment systems enable you to pay for goods and
services electronically.
E-check: encrypted check with digital signature that is similar
to a paper check, and is used mostly in B2B.
E-credit card: allows customers to charge online payments to
their credit card account, and is used mostly in B2C.
*
How E-Credit Cards Work
Electronic Payments
Purchasing card: is the B2B equivalent of electronic credit cards
and is typically used for unplanned B2B purchases.
Electronic cashStored-value money cards allow you to store a
fixed amount of prepaid money and then spend it as

13. necessary.Smart cards contain a chip called a microprocessor
that can store a considerable amount of information and are
multipurpose – can be used as a debit card, credit card or a
stored-value money card.Person-to-person payments are a form
of e-cash that enables two individuals or an individual and a
business to transfer funds without using a credit card.E-wallet
*
7.5 Ethical and Legal IssuesPrivacy: ecommerce provides
opportunities for businesses to track online consumers using
cookies or special spywareFraud on the Internet
*
Ethical and Legal IssuesDomain Name Competition
www.delta.com
*

14. Cybersquatting refers to the practice of registering domain
names solely for the purpose of selling them later at a higher
price.
www.ou.edu.om
The original owner of www.tom.com received $8 million for the
name Taxes and other Fees: when and where (and in some cases
whether) electronic sellers should pay taxes
Copyright: protecting intellectual property in e-commerce and
enforcing copyright laws is extremely difficult
Ethical and Legal Issues
*
http://www.registry.om/
What you may buy Online?
Male 6 month old – R.O 400
Replica GUCCI Handbag
High Quality – R.O. 24
6 seater dining table in very good condition 30rial.
*
Sultan Qaboos UniversityCollege of Economics and Political
ScienceIntroduction to Management Information
SystemsINFS2412 - SPRING 2020Case Study Individual Project

15. (20% of Final Grade)BackgroundThe COVID-19 Coronavirus
pandemic is spreading around the world at a rapid pace,
affecting every aspect of how we live, how we study, how we
work and how we shop. While the coronavirus brought many
challenges and threats for some businesses, it created new
opportunities for others across all industries. Due to the
outbreak, quarantine measures have been implemented in
countries around the world (including Oman), forcing
companies, government organizations, schools and universities
to shift large part of their operations online.RequirementsYou
(as an individual - not in a group) are required to:· Read chapter
7 in the textbook and watch the provided online lecture on the
chapter. This will give you enough idea about the concepts of
E-commerce and E-business.· Research and describe how
information and communication technologies are playing a vital
role during COVID-19 pandemic in enabling many of us to
carry out our regular duties from the comfort of our homes. This
may involve researching the current business situation and
related issues on how this pandemic is disrupting every
industry, creating new challenges and opportunities.· You are
also required to highlight the key issues (ethics, privacy, and
security), as discussed in chapters 3 and 4, as well as in section
7.5 in chapter 7. · Use trustworthy resources in your research
form the Internet, social media, mobile applications, and also
the Website of SQU main library.SubmissionPrepare and submit
a report using the below template. A soft copy of the report
must be submitted to the lecturer via email no later than 12pm
on Thursday 4th of June 2020. Late submission will attract 3%
per day.0. Title PageInclude a title that describes the content of
your report, your name, student ID, section number and your
instructor’s name1. Executive Summary 150-200 words that
provide a general summary of the report 2. Introduction 200-250
words that give general exploratory remarks and highlight the
main sections of the report. 3. Business during COVID-193.1
Overview250-300 words that provide a general description
of COVID-19 impact on businesses. 3.2 E-Commerce 400-450

16. words that analyze the current status of e-commerce as
follows3.2.1 Definition 3.2.2 Benefits 3.2.3 Case Study from
Oman 3.2.4 Challenges/Risks 3.3 E-Learning and E-training
400 – 450 words describing e-learning and e-training
sectors during COVID-193.3.1 Definition 3.3.2 Benefits 3.3.3
Case Study from Oman 3.3.4 Challenges/Risks 3.4
Teleworking400 – 450 words explaining how jobs in different
sectors have been transformed3.4.1 Definition 3.4.2 Benefits
3.4.3 Case Study from Oman 3.4.4 Challenges/Risks 4.
Conclusion 150-200 words describing your own opinion and
views about the above experiences5. References List all the
references and resources you have used in your report in APA
format. You may use an online APA citation generator, click
here.