This document defines e-commerce and discusses its various types and applications. It outlines the key components of an e-commerce system, including the three main types (B2C, B2B, C2C), benefits and challenges, and how mobile commerce is impacting the industry. The implementation of an e-commerce system requires investment in infrastructure, hardware, networking, and security to support online transactions and build customer trust.

1. Web Commerce Rev 7/20/07 rdm

2. Objectives Define e-commerce and understand its role as a transaction processing system Define the three types of e-commerce and mobile commerce, listing the benefits and challenges associated with each Discuss several examples of how e-commerce and mobile commerce are being used to provide services List the components of an e-commerce system and explain how they function together to provide e-commerce services

3. Types of E-commerce Business-to-consumer e-commerce (B2C) Connects individual consumers with sellers Business-to-business e-commerce (B2B) Supports business transactions across private networks, the Internet, and the Web Consumer-to-consumer e-commerce (C2C) Connects individual sellers with people shopping for used items

7. E-commerce from the Seller’s Perspective Sellers business practices Market research to identify customer needs and behavior (Omniture) Manufacturing products or supplying services that meet customer needs Marketing and advertising to make customers aware of available products and services

8. E-commerce from the Seller’s Perspective (Continued) Sellers business practices Providing a method for acquiring payments Making arrangements for delivery of the product Providing after-sales support

9. M-commerce Technology Mobile commerce (m-commerce) E-commerce that takes place over wireless mobile devices Technologies and standards Wireless Application Protocol (WAP) Wireless Markup Language (WML) Bluetooth

10. Benefits and Challenges of E-commerce Buyers enjoy the convenience of shopping from their desktop B2C e-commerce Levels the playing field between large and small businesses Challenges Established businesses must alter systems and business practices Social concerns

11. E-Commerce Applications E-tailing provides customers with Product information The ability to comparison shop E-tailing options Set up an electronic storefront Lease space in a cybermall

12. Online Clearing Houses, Web Auctions, and Marketplaces Provide a platform for businesses and individuals to sell their products and belongings Online clearinghouses Manufacturers can liquidate stock Consumers can find a good deal

13. Online Clearing Houses, Web Auctions, and Marketplaces (Continued) Most popular auction/marketplace eBay.com Auction houses Usually only accept limited liability for problems that buyers or sellers may experience

14. B2B Global Supply Management and Electronic Exchanges Global supply management (GSM) Businesses can find the best deals on the global market Electronic exchange Provides convenient centralized platform for B2B e-commerce Normally industry specific Promotes cooperation between competing companies

15. Marketing Web is used for Unsolicited advertising Access to product information through business Web sites Market research

16. M-commerce Applications M-commerce between Cell Phone and Web Applications accessible with mobile Web browser M-commerce through SMS Text Messaging Texting can be used to order merchandise Mobile spam over SMS texting is raising concerns in the United Kingdom M-commerce through Short-Range Wireless Data Communications Smart phones with Bluetooth technology

18. E-Commerce Implementation Implementing e-commerce Requires expertise May require large investment E-commerce host Business that takes responsibility for setting up and maintaining an e-commerce system

20. Infrastructure E-commerce Requires significant infrastructure changes Changes may be required in Personnel, manufacturing processes, storage, shipping, information systems, etc. Organizations expanding to the Web All areas of business are affected Manufacturing, finance, sales, customer service

21. Hardware and Networking Underestimating the amount of Web traffic Leads to network stalls and long wait times Typical e-commerce Web site Employs one or more server computers and a high-speed Internet connection Outsourcing to a Web hosting company Can operate 24 hours a day, 7 days a week

22. Software Web Server Software Responds to requests for Web pages Web Server Utility Programs Provide statistical information about server usage and Web site traffic patterns (i.e. Omniture) E-commerce Software Supports e-commerce activities Includes catalog management, electronic shopping cart, and payment software

23. Software (Continued) Web Site Design Tools What see is what you-get (WYSIWYG) applications or wizards Graphics Applications Design and create graphic elements of Web sites Web Site Development Tools Application programming interfaces (API’s) Allow software engineers to develop Web-driven programs

24. Software (Continued) Web services Programs that automate tasks by communicating with each other over the Web Systems developers can provide tools for automating trivial or repetitive tasks Important in transaction processing

26. Building Traffic The 3Cs Approach Content, community, and commerce Keywords and Search Engines Choose name and product names that best describe business purpose and features Select descriptive domain names Business-related keywords can be listed in the HTML meta tag

27. Building Traffic (Continued) Partnerships Online e-tailers often form partnerships and advertise each other’s Web sites Marketing Online advertising methods include banner ads, pop-up ads, and e-mail Offline advertising methods include magazines, newspapers, radio, and television

28. Electronic Payment Systems Electronic cash (e-cash or digital cash) Provides a private and secure method of transferring funds PayPal Best-known e-cash provider E-cash benefits Privacy - hides account information from vendors Convenient if seller cannot process a credit card

29. Electronic Payment Systems (Continued) Electronic wallet, or e-wallet Encrypts and stores credit-card information, e-cash information, etc., securely on your computer Smartcards Credit cards with embedded microchips

30. International Markets Internet users of all nationalities will have access to your products First consideration of a global e-commerce strategy Visitors of all nationalities and cultures should feel comfortable while viewing your Web content Costly approach Create multiple versions of your Web site, each in a different language

31. E-commerce Security Issues Digital certificate A type of electronic business card Attached to Internet transaction data Verifies the sender of the data Provided by certification authorities Encryption Uses high-level mathematical functions and computer algorithms to encode data

32. E-commerce Security Issues (Continued) Digital certificates combined with Secure Sockets Layer (SSL) technology Allow for encrypted communications to occur Spoofing Used to impersonate others on the Internet

33. E-commerce Security Issues (Continued) Denial of Service Attacks Use many computers to request Web pages from the same Web server, at the same time Zombie computers Computers that are either hacked into or under the influence of a virus or worm

34. Business Resumption Planning Takes into account Every conceivable disaster that could negatively impact the system Goal To protect data and keep key systems operational until order is resumed

35. What’s New in E-Commerce? Phishing Threatens the Future of E-commerce Phishing scams involve hackers that use e-mail and Web sites to impersonate an authentic business in an effort to get unsuspecting customers to type in personal and private information.

36. What’s New in E-Commerce? The Rise of the Mobile Web Web access can be added to most cell phone services for only a few dollars per month .mobile and .phone iPhone

37. What’s New in E-Commerce? Mobile Commerce Comes of Age Most cell phones include a menu area for shopping Verizon’s “Get It Now” RFID-reading Cell Phones Royal Philips Electronics researchers are working on RFID-reader technology for cell phones.

38. Summary E-commerce Systems that support electronically executed transactions Transaction processing system (TPS) Supports and records transactions Three main types of e-commerce Business-to-consumer (B2C) Business-to-business (B2B) Consumer-to-consumer (C2C) Mobile commerce, or m-commerce Takes place over wireless mobile devices

39. Summary (Continued) Retail Web sites Allow consumers to comparison shop E-commerce Makes market research easier and less intrusive Requires investment in networking, hardware, and a wide variety of software Requires changes in infrastructure Hardware and networking services for e-commerce Must be robust and trustworthy