This document provides an overview of e-commerce systems and concepts from a lecture given by Dr. Zainab Khalloff. It discusses the history of Amazon.com, definitions of e-commerce and e-business, major types of e-commerce like m-commerce and f-commerce. It also covers electronic payment systems, shipping strategies, carriers and provides an example of the WooCommerce e-commerce toolkit for WordPress. The document concludes with advantages like ubiquity and interactivity, as well as technical and non-technical disadvantages of e-commerce.

1. e-Commerce Systems
Dr.Zainab KHALLOUF
Lecture1
e-Commerce Systems: Basic Concepts and Terminology
Fall 2016

2. Lecture References
E-Commerce: Business, Technology, Society. By Keneth C. Laudon and Carol Guercio
Traver, Prentice Hall, 3rd Edition (2006). The first sample chapter available on the site
of the book.
Electronic Commerce: Principles and Practice, Hossein Bidgoli, School of Business and
Public Administration, California State University, Bakersfield, California.
E-Commerce Tutorial, http://www.tutorialspoint.com/e_commerce/index.htm
http://wordpress.org/plugins/woocommerce/
http://go.magento.com/support/kb/entry/name/understanding-shipping-methods/

3. Main Topics
1 Part 1: E-commerce systems: basic concepts and terminology.
2 Part 2: Implementing multi-tiered e-commerce application using
Java EE 7.
3 Part 3: Implementing multi-tiered e-commerce application using
AngularJS and Java EE 7.
4 Part 4: Implementing multi-tiered e-commerce application using
ASP.NET MVC.

4. e-Commerce Systems: Basic Concepts and Terminology
The Story of Amazon.com from:
E-Commerce: Business, Technology, Society. By Keneth C. Laudon and Carol Guercio
Traver, Prentice Hall, 3rd Edition (2006). The first sample chapter available on the site
of the book.
E-Commerce Systems 4

5. The Story of Amazon.com
Amazon.com a large Internet retailer.
The Amazon story represents the story of e-commerce
environment...Started in a ”400-square-foot office” in 1995,
it has since grown to become one of the Internet ”Big
Four” companies, along with Yahoo, eBay and Google.
Amazon.com’s first web site.
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6. The Story of Amazon.com (cont.)
In 1994, Jeff Bezos, then a 29-year-old read that Internet
usage was growing at 2,300% per year. To Bezos, that
number represented an extraordinary opportunity.
He investigated what products he might be able to sell
successfully online. He quickly hit upon books.
Amazon.com offered consumers four compelling reasons to
shop there:
Selection.
Convenience. (The 1-Click patent)
Price: discounts on bestsellers.
Service: e-mail and telephone customer support, automated
order confirmation, tracking and shipping information...
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7. The Story of Amazon.com (cont.)
In 1998, Amazon expanded its product line, first adding
music CDs and then videos and DVDs.
From 1997-2000, revenues increased from $148 million to
$2.7 billion but so did losses, to $1.4 billion in 2001-2002.
New focus on cost-cutting and achieving profitability leads
to profit. In 2004 Amazon reported profits of $588 million.
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8. E-commerce Defined
E-commerce involves digitally enabled commercial transactions,
like:
Purchasing, online payment, and customer support (e.g.
Customer relationship management (CRM)), among others.
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9. E-commerce vs. E-business
Debate among consultants and academics about meanings
and limitations of terms e-commerce and e-business.
e-Business does not include commercial transactions that
generate revenue for the firm from outside businesses or
consumers, as e-commerce, by definition, does. For
example, a company’s online inventory control mechanisms
are a component of e-business.
E-Commerce: Business, Technology, Society. By Keneth C. Laudon and Carol Guercio
Traver, Prentice Hall, 3rd Edition (2006). The first sample chapter available on the site
of the book.
E-Commerce Systems 9

10. Major Types of e-Commerce
E-Commerce: Business, Technology, Society. By Keneth C. Laudon and Carol Guercio
Traver, Prentice Hall, 3rd Edition (2006). The first sample chapter available on the site
of the book.
E-Commerce Systems 10

11. M-commerce
Conducting commercial transactions via wireless mobile devices
such as PDAs (personal digital assistants) or cell phones.
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12. F-commerce
Buying and selling of goods or services through Facebook.
Example from ecwid ecommerce facebook application. www.ecwid.com
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13. Some Electronic Payment Systems
Credit Card: Issued based on the customer’s credit history,
income level, and total wealth. The customer is supposed
to pay his or her debts during the payment period;
otherwise interest will accrue.
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14. Some Electronic Payment Systems (cont.)
Debit Card: Similar to checks in that the charges will be
deducted from the customer’s checking account.
Smart Card: Is about the size of a credit card, made of a
plastic with an embedded microprocessor chip that holds
important financial and personal information. A popular
example of a disposable smart card is the one issued by
telephone companies. After using the prespecified amount,
the card can be discarded.
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15. Some Electronic Payment Systems (cont.)
Electronic money (e-money or e-cash): Standard currency
converted into an electronic format to pay for online
purchases. The following steps explain how a typical
e-Cash system works:
The customer of a bank receives specific software to install
on his or her computer. The software allows the customer
to download (electronic coins) to his or her desktop. The
software manages the electronic coins. The initial purchase
of coins is charged against the customer’s bank account or
against a credit card.
When buying goods or services from a web site that accepts
e-cash, the merchant’s software generates a payment
request. When the customer accepts the payment request,
the software residing on the customer’s desktop subtracts
the payment amount from the balance and creates a
payment that is sent to the bank or or the financial
institution of the merchant, and then is deposited to the
merchant’s account.
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16. Some Electronic Payment Systems (cont.)
Electronic Fund Transfer (EFT): It is one of the oldest
EPSs and is used for transferring money from one bank
account directly to another. The most popular application
of EFT is the direct deposit option used by millions of
workers, instead of receiving a paycheck and depositing it
into an account, the money is deposited to an account
electronically.
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17. Some Electronic Payment Systems (cont.)
Paypal: PayPal is an online payment processing website
that simplifies the electronic exchange of money. It acts as
an intermediary between two parties, eliminating the need
for either party to divulge credit card numbers or bank
account details to the other over the Web.
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18. Some Electronic Payment Systems (cont.)
Electronic Payment Systems Reference:
Electronic Commerce: Principles and Practice, Hossein Bidgoli, School of Business and
Public Administration, California State University, Bakersfield, California.
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19. Some Shipping Strategies
Free shipping.
Variable rate shipping: Charge what you get charged, this
ecommerce shipping strategy is ideal for heavy shipments
on which free shipping could drain your profits away. Using
a real time calculator can help you win the trust of
customers that shows you are not inflating your shipping
charges.
Flat shipping rates: Refers to a pricing structure that
charges a single fixed fee for a service, regardless of usage.
This approach is recommended when the items have almost
similar costs like that of t-shirts.
How To Choose a Shipping Strategy For Your eCommerce Business?
http://www.insync.co.in/how-to-choose-a-shipping-strategy-for-your-ecommerce-business/
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20. Some Shipment Strategies: Free Shipping
http://www.forever21.com/
E-Commerce Systems 20

21. Some Shipment Strategies: Variable Rate Shipping
An example of shipping calculator from: Simple Sugars.
How To Choose a Shipping Strategy For Your eCommerce Business? https:
//www.shopify.com/blog/8343330-how-to-choose-a-shipping-strategy-for-your-online-store
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22. Some Shipment Strategies: Flat Shipping Rates
http://www.cabelas.com/
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23. Some Shipping Carriers
UPS: United Parcel Service offers domestic and
international shipping services by land and air to more
than 220 countries.
USPS: The United States Postal Service is the independent
postal service of United States government. USPS offers
domestic and international shipping services by land and
air.
FedEx: Offers domestic and international shipping services
by land and air to more than 220 countries.
DHL: Offers integrated international services and tailored,
customer-focused solutions for managing and transporting
letters, goods and information.
http://go.magento.com/support/kb/entry/name/understanding-shipping-methods/
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24. Some Shipping Carriers (cont.)
Many shipping carriers provide API to integrate theirs
services in your application.
http://www.ups.com/content/us/en/bussol/browse/online_tools_shipping.html
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25. Example of eCommerce Toolkit
WooCommerce - a free eCommerce toolkit for WordPress.
http://www.woothemes.com/woocommerce/
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26. Example of eCommerce Toolkit (cont.)
WooCommerce - Setup.
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27. Example of eCommerce Toolkit (cont.)
WooCommerce - Settings (General).
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28. Example of eCommerce Toolkit (cont.)
WooCommerce - Settings (Flat Rate Shipping).
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29. Example of eCommerce Toolkit (cont.)
WooCommerce - Products.
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30. Example of e-Commerce Website with WooCommerce
From: Create An Ecommerce WordPress Website In 3 Hours! (Woothemes Wootique) 2013
http://www.youtube.com/
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31. Example of e-Commerce Website with WooCommerce
Product details.
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32. Example of e-Commerce Website with WooCommerce
(cont.)
Cart and checkout.
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33. The Features of e-Commerce Technology and Their
Significance
Is ubiquitous.
In traditional commerce, a marketplace is a physical place
you visit in order to transact. E-commerce, in contrast, is
characterized by its ubiquity: It is available just about
everywhere, at all times, making it possible to shop from
your desktop, at home, at work, or even from your car using
mobile commerce.
Information richness.
Which refers to the complexity and content of a message. It
enables an online merchant to deliver marketing messages
with text, video, and audio to an audience of millions. Prior
to the development of the Web, there was a trade-of
between richness and reach: the larger the audience
reached, the less rich the message.
E-Commerce Systems 33

34. The Features of e-Commerce Technology and Their
Significance (cont.)
Is interactive.
Can simulate face-to-face experience, but on global scale.
Permits personalization/customization.
Personalization: merchants can target their marketing
messages to specific individuals by adjusting the message to
a person’s name, interests, and past purchases.
Customization: changing the delivered product or service
based on a user’s preferences or prior behavior
The Features of e-Commerce Technology and Their Significance
E-Commerce: Business, Technology, Society. By Keneth C. Laudon and Carol Guercio
Traver, Prentice Hall, 3rd Edition (2006).
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35. E-Commerce Disadvantages
Technical disadvantages.
Non-Technical disadvantages.
Reference: E-Commerce Tutorial. http://www.tutorialspoint.com/e_commerce/index.htm
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36. E-Commerce Disadvantages: Technical
disadvantages(cont.)
There can be lack of system security owing to poor
implementation of e-Commerce, lack of reliability or
standards .
Software development industry is still evolving and keeps
changing rapidly.
In many countries, network bandwidth might cause an
issue as there is insufficient telecommunication bandwidth
available.
Special types of web server or other software might be
required by the vendor setting the e-commerce environment
apart from network servers.
E-Commerce Systems 36

37. E-Commerce Disadvantages: Non-Technical
disadvantages (cont.)
The cost of creating and building E-Commerce application
may be very high. There could be delay in launching the
E-Commerce application due to mistakes, lack of
experience.
User may not trust the site being unknown faceless seller.
Lack of touch or feel of products during online shopping.
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