This is a basic presentation regrading e-commerce

1. E- CommerceE- Commerce
Unit – IUnit – I
By:
Akhil Kaushik
Asstt. Prof., CSE Deptt, T.I.T&S Bhiwani

2. Table of ContentsTable of Contents
• Introduction of e-Commerce
• Internet & other Novelties
• Model for e-Commerce
Transactions
• Online Commerce Solutions

3. Introduction of e-Commerce
• E-Commerce stands for “Electronic
Commerce”. It initially started during the
Berlin Airlift, Germany in 1948 when big
corporate started taking order for goods
electronically with the help of
telephones and other private networks.

4. IntroductionIntroduction
• Definition
• What is E-Business?
• Key Drivers of E-Com
• Impact of E-Commerce
• Benefits of E-Commerce for
Organizations
• Benefits of e-commerce to
consumers
• Benefits of e-commerce to society
• LIMITATIONS OF E-COMMERCE

5. DefinitionDefinition
• E-Commerce is a very vast field and
can be applied in majority of
applications and areas. Hence, there is
no agreed upon definition of it. Its
definition may vary from context to
context.
• It also pertains to “any form of business
transaction in which the parties interact
electronically rather than by physical
exchanges or direct physical contact”.

6. What is E-Business?
• “E-business is the conduct of business
on the Internet, not only buying and
selling but also servicing customers and
collaborating with business partners”.
• “E-business includes customer service
(e-service) and intra-business tasks”.
• “The development of intranet and
extranet is part of e-business”.

7. Primary processesPrimary processes
are enhanced inare enhanced in
E-businessE-business
Production
processes
Customer-
focused
processes,
Internal
management
processes

8. Key Drivers of E-Com
• Technological factors
• Political factors
• Social factors
• Economic factors
Some others factors at organizational level:
Organizational culture
Commercial benefits
Skilled and committed workforce
Requirements of customers and suppliers

9. Impact of E-Commerce
Major areas that e-com has effected:
• Marketing
• Computer sciences
• Finance and accounting
• Economics
• Production and operations
management
• Production and operations
management (manufacturing)

10. Benefits of E-Commerce for
Organizations
• International marketplace
• Operational cost savings
• Mass customization
• Enables reduced inventories and
overheads by facilitating ‘pull’-type
supply chain management
• Lower telecommunications cost
• Digitization of products and
processes

11. Digitization of products and
processes
• 24/7 access
• More choices
• Price comparisons
• Improved delivery processes
• An environment of competition

12. LIMITATIONS OF E-
COMMERCE
• Lack of sufficient system security, reliability,
standards and communication protocols.
• Rapidly evolving and changing technology
• Under pressure to innovate
• Facing increased competition
• Problems with compatibility of older and ‘newer’
technology
• Computing equipment
• Cost of access to the Internet
• Cost of computing equipment
• A lack of trust because they are interacting with
faceless computers

13. INTERNET & OTHER
NOVELTIES
• Internet is the world wide network of computers that
help one assist in sharing resources, instant
messaging, emails, videoconferencing, social
networking, e-commerce applications, etc. Everyone
knows about the internet and I don’t think there is any
need to explain the internet.
The Intranet
The Extranet

14. The Intranet
• An intranet is a computer network that uses
Internet Protocol technology to securely
share any part of an organization's
information or network operating system
within that organization.
• An intranet can be understood as a private
analog of the Internet, or as a private
extension of the Internet confined to an
organization.

15. Benefits of Intranet
• Workforce productivity
• Time
• Communication
• Web publishing
• Business operations and management
• Cost-effective
• Enhance collaboration
• Cross-platform capability
• Built for one audience
• Promote common corporate culture
• Immediate updates

16. The Extranet
• An extranet is a computer network that
allows controlled access from the
outside, for specific business or
educational purposes. An extranet can
be viewed as an extension of a
company's intranet that is extended to
users outside the company, usually
partners, vendors, and suppliers.

17. Advantages
• Exchange large volumes of data using Electronic
Data Interchange (EDI)
• Share product catalogs exclusively with trade
partners
• Collaborate with other companies on joint
development efforts
• Jointly develop and use training programs with other
companies
Disadvantages
• Extranets can be expensive to implement and
maintain within an organization (e.g., hardware,
software, employee training costs), if hosted
internally rather than by an application service
provider.
• Security of extranets can be a concern when hosting
valuable or proprietary information.

18. MODEL FOR E-COMMERCE
TRANSACTIONS
• E-commerce transactions can be modeled by
identifying the partners directly involved in the
transaction. This is the most convenient and useful
way of building models for e-com transactions. Some
significant models are as follows:
• Business-to-Business e-Commerce (B2B)
• Business-to-consumer (B-to-C)
• Business-to-Government (B-to-G)
• Consumer-to-Consumer (C-to-C)
• Consumer-to-Government (C2G) model
• Consumer-to-Business (C-to-B)
• E-Government

19. Business-to-Business e-Commerce
(B2B)
• It is companies buying from and selling to each other
online. But there's more to it than purchasing. It's
evolved to encompass supply chain management as
more companies outsource parts of their supply chain
to their trading partners. Business- to- business
commerce includes a broad range of intercompany
transactions, including wholesale trade as well as
company purchases of services, resources,
technology, manufactured parts and components,
and capital equipment.
• Examples:
Intel selling microprocessor to Dell.
Heinz selling ketchup to McDonalds.

20. Web-based
B-to-B
includes:
Direct selling
and support
to business
E-procurement Information sites

21. Business-to-consumer (B-to-C)
• It is defined as the exchange of products,
information or services between business and
consumers in a retailing relationship. Some of
the first examples of B-to-C e-commerce
were amazon.com and dell.com in the USA
and lastminute.com in the UK. In this case,
the ‘C’ represents either consumer or
customer. The B2C model involves
transactions between business organizations
and consumers.

22. The major benefits of B2C are as follows:
• B2C e-commerce reduces transactions costs.
• Model the cost of the product is reduced as
we can eliminate the middle men.
• Major thing in B2c model is customer care.
Pre-Cautions of B2C E-commerce:
• Check for digital certificates of the site and it
hacker free.
• Check for shipping price.
• See the previous service going through the
reviews of the old customers
• Purchasing with the appropriate cards.

23. Business-to-Government (B-to-G)
• It is the exchange of information, services
and products between business organizations
and government agencies on-line. It refers to
the use of the Internet for public procurement,
licensing procedures, and other government-
related operations. This may include:
• E-procurement services
• A virtual workplace
• Rental of on-line applications and
databases

24. Consumer-to-Consumer (C-to-C)
• In this category consumers interact
directly with other consumers. C2C is
simply commerce between private
individuals or consumers. They
exchange information such as:
• Expert knowledge
• Opinions

25. Consumer-to-Government (C2G)
model
• In this model, an individual consumer
interacts with the government. For example, a
consumer can pay his income tax or house
tax online. The transactions involved in this
case are C2G transactions. Examples where
consumers provide services to government
have yet to be implemented. It is not that
popular approach and is quite rare. A possible
example could be when a hacker is offering
his services to the government for defence
against cyber terrorism.

26. Consumer-to-Business (C-to-B)
• This is the exchange of products,
information or services from individuals
to business. A classic example of this
would be individuals selling their
services to businesses. Consumer-to-
business (C2B) transactions involve
reverse auctions, which empower the
consumer to drive transactions.

27. E-GovernmentE-Government
E-Government (short for electronic government, also
known as e-gov, digital government, online government,
or connected government) is digital interactions
between a government and citizens (G2C),
government and businesses/Commerce (G2B),
government and employees, and also between
government and governments /agencies (G2G).
The e-Government delivery models can be briefly
summed up as:
• G2C (Government to Citizens)
• G2B (Government to Businesses)
• G2E (Government to Employees)
• G2G (Government to Governments)

28. Disadvantages of e-gov
The main disadvantages concerning e-government is the lack of
equality in public access to the internet, reliability of
information on the web, and hidden agendas of government
groups that could influence and bias public opinions,
impacts on economic, social, and political factors,
vulnerability to cyber attacks, and disturbances to the status quo
in these areas.
• Hyper-surveillance - Once e-government begins to
develop and become more sophisticated, citizens will be forced
to interact electronically with the government on a
larger scale. This could potentially lead to a lack of
privacy for civilians as their
government obtains more and more information on them.

29. •Cost - Although “a prodigious amount of money has been
spent” on the development and implementation of e-
government, some say it has yielded only a mediocre
product.
•Digital divide - An e-government site that provides web access
and support often does not offer the “potential to reach many users
including those who live in remote areas, are homebound, have low
literacy levels, exist on poverty line incomes”. It is the division
between people having or not having communication technology.
• False sense of transparency and accountability - Opponents of
e-gov online governmental transparency is dubious because it is
maintained by the themselves. Information can be added or
removed from the public eye.

30. Advantages of e-gov
• E-democracy - One goal of e-government will be greater
citizen participation. Through the internet, people from all over
the country can interact with politicians or public servants
and make their voices heard. Blogging and interactive
surveys will allow politicians or public servants to see the views
of the people they represent on any given issue. Chat rooms can
place citizens in real-time contact with elected officials,
their offices or provide them with the means to replace them by
interacting directly with public servants, allowing voters to have a
direct impact and influence in their government.
• Paperless office - Proponents of e-government argue that
online government services would lessen the need for hard copy
forms.

31. • Speed, efficiency & convenience - E-
government allows citizens to interact with
computers to achieve objectives at any time
and any location, and eliminates the
necessity for physical travel to government
agents sitting behind desks and windows.
• e-participation - Recent trials of e-
government have been met with acceptance
and with increasing frequency, and young
people, who traditionally display minimal
interest in government affairs, are drawn to e-
voting procedures.

32. Government-to-Government (G2G)
model
This model involves transactions between 2 governments. For
example, if the American
government wants to by oil from the Arabian government,
the transaction involved are categorized in the G2G model. It
may also be defined as the electronic transactions between two
governments within a nation like centre & state govt. or state &
state information sharing, not commerce in most of the occasions.
• Vertical Govt. Integration – e-commerce among govt. agencies
up and down and local levels. Example: County Councils –
dealing with the Dept. of the Environment.
• Horizontal Govt. Integration – e-commerce among agencies
within one level. Example: National Roads Authority dealing with
the Heritage council.

33. Government-to-Consumer
(G2C) model
In this model, the government transacts with an
individual consumer. For example, a government
can enforce laws pertaining to tax payments on
individual consumers over the Internet by using the
G2C model.
• Does not fit well at all within the traditional supply-
and-demand e-commerce notion.
• Paying taxes, registering vehicles, grant
applications, CAO applications, etc.
• Big drive to get all local government services on
web.

34. Government-to-Business
(G2B) model
This model involves transactions between a government and
business organizations. For example, the government plans to
build a fly over. For this, the government requests for tenders from
various contractors. Government can do this over the Internet by
using the G2B model.
• Not a large e-commerce market.
• Example – Govt selling research services through
Universities and Institutes of Technology to SMEs (Small and
Medium sized Enterprises).
• Holding auctions and selling off used / confiscated items
(most times, you must be a
“business” to participate in these auctions).
• Ordinance Survey selling detailed survey data to businesses.

35. Business-to-Government
(B2G) model
In this model, the business houses transact with the government
over the Internet. For example, similar to an individual
consumer, business houses can also pay their taxes on the
Internet.
• Lockheed Martin providing aviation products, satellites,
naval systems, and services to US Dept of Defence (80% of
its revenue).
• Fairly large e-commerce model in terms of revenue.
• Most U.S. government entities (for sure at the federal level)
won’t do business with your business if you can’t do it
electronically.
• In Europe – governments use e-tenders to get companies to
supply goods and services.

36. M-commerce
Mobile commerce is the buying and selling of goods and
services through wireless technology-i.e. handheld devices
such as cellular telephones and personal digital assistants
(PDAs). Mobile Commerce is any transaction, involving the
transfer of ownership or rights to use goods and services,
which is initiated and/or completed by using mobile
access to computer-mediated networks with the help of an
electronic device.
Mobile Ticketing – Tickets can be sent to mobile phones
using a variety of technologies. Users are then able to use
their tickets immediately, by presenting their phones at the
venue. Tickets can be booked and cancelled on the mobile
device with the help of simple application downloads, or by
accessing the WAP portals of various travel agents or direct
service providers. Example: People getting movie tickets or
getting boarding pass on mobiles.

37. Mobile vouchers, coupons and loyalty cards - Mobile ticketing
technology can also be used for the distribution of vouchers, coupons,
and loyalty cards. These items are represented by a virtual token that
is sent to the mobile phone. A customer presenting a mobile phone with
one of these tokens at the point of sale receives the same benefits as if
they had the traditional token. Stores may send coupons to
customers using location-based services to determine when the
customer is nearby.
Information Services – Example: Commuters getting PNR inquiry on
mobiles by doing sms on 139. Another example is getting tram arrival
time on their mobile through sms.
Examples of it are News, Stock quotes, sport scores, financial records,
traffic reporting, etc.
Mobile Banking – Banks and other financial institutions use mobile
commerce to allow their customers to access account information and
make transactions, such as purchasing stocks, remitting money. This
service is often referred to as Mobile Banking, or M-Banking.
Example: Account holders getting sms after every transaction from their
banks on their mobile.

38. Content purchase and delivery - Currently, mobile content purchase
and delivery mainly consists of the sale of ring-tones, wallpapers,
and games for mobile phones. The convergence of mobile phones,
portable audio players, and video players into a single device is
increasing the purchase and delivery of full-length music tracks and
video. The download speeds available with 4G networks make it
possible to buy a movie on a mobile device in a couple of seconds.
Mobile marketing and advertising - mobile marketing refers to
marketing sent to mobile devices. Companies have reported that they
see better response from mobile marketing campaigns than from
traditional campaigns. Mobile campaigns must be based on the
global Content Generation or what is called Generation C and four
other 'C's: Creativity, Casual Collapse, Control, and Celebrity.
Mobile Purchase - Catalog merchants can accept orders from
customers electronically, via the customer's mobile device. In some
cases, the merchant may even deliver the catalog electronically,
rather than mailing a paper catalog to the customer. Some
merchants provide mobile websites that are customized for the smaller
screen and limited user interface of a mobile device.

39. ONLINE COMMERCE SOLUTIONSONLINE COMMERCE SOLUTIONS
Domain Name - All online stores must have a unique web
address, which makes registering a domain name an important
ecommerce solution. When you buy a domain name, you become
the sole owner of that web address and your online business has
a place to call home. Your personal information will also be
provided to the WHOIS database, where it will be available to the
public. You can keep this information private by electing Private
Registration when you register your domain name.
Ecommerce Shopping Cart Software - Ecommerce shopping cart
software encompasses many aspects of online stores, including
setting up inventory, managing orders from customers, delivery of
products, and customer service. Choosing an ecommerce solution is a
difficult process - many different options exist, including open source,
licensed, and hosted solutions. Determine which ecommerce solution is
right for your business, instead of allowing the solution to determine your
business model.

40. Ecommerce Web Hosting- Professional Web hosting for online stores is
an ecommerce solution that offers several benefits. When you work with
a web hosting company, you can choose an ecommerce Web hosting
package that satisfies your individual needs for space, bandwidth,
merchandising and even design. Another benefit a Web hosting
company should provide online stores: peace of mind that comes from
knowing customer support is available to assist you 24/7, should
problems or questions arise regarding your online store.
Professional Web Design - Looks may not be everything, but they
are definitely something to consider when starting online stores.
Ecommerce websites can be created with easy-to-use web design
templates or with the help of a professional web designer .
Merchant Account - No matter how impressive your site is in
terms of design and usability, you may lose customers if you cannot
accept credit card payments. Online stores that cannot process credit
card transactions are fighting an uphill battle, as the vast majority of
online shoppers favor credit card payments. In order to accept
credit card payments online, ecommerce websites need a merchant
account to take money from the bank, and an online gateway to take the
money from the merchant account.

41. Online Payment Gateway IntegrationOnline Payment Gateway Integration
A payment gateway is an e-commerce application service provider
service that authorizes payments for e-businesses, online retailers, bricks
and clicks, or traditional brick and mortar. It is the equivalent of a
physical point of sale terminal located in most retail outlets. Payment
gateways protect credit card details by encrypting sensitive
information, such as credit card numbers, to ensure that information
is passed securely between the customer and the merchant and also
between merchant and the payment processor. Payment Gateway is
a part of an e-commerce service that empowers the payment mode for
electronic-business. Payment Gateway encrypts confidential information
that transfers in a safe path between a customer and therespective
merchant. A payment gateway holds a soul of any e-commerce
application. Some famous payment gateways are: PayPal, Google
Checkout, Pay-Me-Now, iBill, etc.

42. Example of online payment gateway: WorldPay
(formerly RBS WorldPay) is a payment processing
company. It provides payment services for mail order
and internet retailers, as well as point of sale
transactions. Customers are a mix of multinational,
multichannel retailers, with the majority being small
business merchants. WorldPay started as an electronic
payment provider called Streamline in 1989 in the UK
but has extended into Mail Order/Telephone Order,
"unattended" payments and handling secure payments
over the internet through merger and acquisition of
several other companies.

43. Shipping Gateway IntegrationShipping Gateway Integration
Shipping gateway integration includes
organizations that are responsible for shipping.
Example: FedEx Corporation originally known as
FDX Corporation, is a logistics services
company, based in the United States with
headquarters in Memphis, Tennessee. The name
"FedEx" is a syllabic abbreviation of the name of
the company's original air division, Federal
Express, which was used from 1973 until 2000.

44. Inventory ManagementInventory Management
Inventory means a list compiled for some formal purpose, such as the
details of an estate going to probate, or the contents of a house let
furnished.
Inventory management is primarily about specifying the shape and
percentage of stocked goods. It is required at different locations within a
facility or within many locations of a supply network to proceed the
regular and planned course of production and stock of materials.
Scope of inventory management concerns the fine lines between
replenishment lead time, carrying costs of inventory, asset
management, inventory forecasting, inventory valuation, inventory
visibility, future inventory price forecasting, physical inventory,
available physical space for inventory, quality management,
replenishment, returns and defective goods and
demand forecasting.

45. Online Shopping cartsOnline Shopping carts
Shopping cart software is software used in e-commerce to
assist people making purchases online, analogous to the
American English term 'shopping cart'. In British English it is
generally known as a shopping basket, almost exclusively
shortened on websites to 'basket'. The software allows online
shopping customers to accumulate a list of items for
purchase, described metaphorically as "placing items in the
shopping cart". Upon checkout, the software typically
calculates a total for the order, including shipping and
handling (i.e. postage and packing) charges and the
associated taxes, as applicable.
Online shopping carts refer to the facility provided by the
e-com websites to purchase and add multiple items at the
same time.

46. Shopping cart software can be generally categorized into two
main categories:
Licensed software: The software is downloaded and then installed on a
Web server. This is most often associated with a one-time fee,
although there are many free products available as well. The main
advantages of this option are that the merchant owns a license
and therefore can host it on any Web server that meets the server
requirements, and that the source code can often be accessed and
edited to customize the application.
• Hosted service: The software is never downloaded, but rather is
provided by a hosted service provider and is generally paid for on a
monthly/annual basis; also known as the application service provider
(ASP) software model. Some of these services also charge a
percentage of sales in addition to the monthly fee. This model
often has predefined templates that a user can choose from to
customize their look and feel. Predefined templates limit how much
users can modify or customize the software with the advantage of having
the vendor continuously keep the software up to date for security
patches as well as adding new features.

47. Customer Order Tracking systemsCustomer Order Tracking systems
Order Tracking Software is build to
improve customer service levels making
management of inquiries / orders more
easy and reliable. With Order Tracking
Software you can track your inquiries /
orders online. You can easily search old
orders and get the latest updated status
on it.

48. Features of Order Tracking
Software are:
• Easy management of daily inquiries /orders
• Up-to-date information on each and every inquiry
• User friendly Graphical User Interface
• Search any inquiry anytime and from anywhere
• Find old inquiries in milliseconds
• Reminder scheduler helps remember follow ups
• No paperwork involved
• Restricted number of intended users like User,
Management and Administrator
• Secured login and password for every user
• Different features for different users

49. Tailor Made Payment GatewayTailor Made Payment Gateway
Payment gateways protect credit card details by
encrypting sensitive information, such as credit
card numbers, to ensure that information is
passed securely between the customer and the
merchant and also between merchant and the
payment processor.
Payment gateways can be customized according to
the user’s needs. Hence providing more benefits &
flexibility to the user.

50. Tailor Made Payment GatewayTailor Made Payment Gateway

51. Security features of payment
gateways:
• Since the customer is usually required to enter personal
details, the entire communication of 'Submit Order' page
(i.e. customer - payment gateway) is often carried out
through HTTPS protocol.
• To validate the request of the payment page result, signed
request is often used - which is the result of the hash
function in which the parameters of an application
confirmed by a «secret word», known only to the merchant
and payment gateway.
• To validate the request of the payment page result,
sometimes IP of the requesting server
•has to be verified.

52. Secure TransactionsSecure Transactions
Secure Electronic Transaction (SET) was a standard
protocol for securing credit card transactions over insecure
networks, specifically, the Internet. Secure Electronic
Transactions (SET) is an open protocol which has the potential
to emerge as a dominant force in the securing of electronic
transactions.
SET is jointly developed by Visa and MasterCard, in
conjunction with leading computer vendors such as IBM, SET
is an open standard for protecting the privacy, and
ensuring the authenticity, of electronic transactions.

53. Key features to meet the business
requirements, SET incorporates the
following feature-
• Confidentiality of information
• Integrity of data
• Cardholder account authentication
• Merchant authentication

54. Auctioning and Online Shop
portals
Overstock - Why it’s good: Big traffic numbers
and a Verified Registered User policy that has
prevented fraud from Day 1 (are you listening
eBay?). Fees are value for money and the site
fosters a tight community. We also liked the fact
that payment options are more varied.
eBid - eBid has consistently kept its place as one of
the top alternatives to eBay since its launch in
1999. Available in 14 countries, traffic does vary
between sites, but in general, traffic is high.

55. BlueJay - BlueJay is extremely popular
with sellers and buyers for very good
reason. It’s 100% free and submits all
listings to Google shopping, from which the
majority of buyers come.
eCrater - We had difficulty deciding who
was better out of BlueJay and eCrater.
BlueJay won because of its superior design,
however we strongly encourage you to try
both.

56. Online Auction - Online Auction has one
low monthly fee with no listing or final value
fees. However, as part of the latest site
upgrade, sellers can page $10 to get their
auctions “featured” on Google shopping.
CQOut - CQOut is very big in the UK
and saw it’s listings grow by 100% in
2007. CQOut’s fees are significantly lower
than eBay and if you don’t make a sale, you
don’t need to pay anything.