2 E-commerce Describe E-Commerce Identify benefits and risks of E-CommerceDescribe E-Commerce business modelsDescribe E-Commerce Security and EncryptionDescribe EDI (Electronic Data Interchange)Describe trends and projections for E-CommerceDescribe issues related to E-CommerceDescribe order and payment processingDescribe E-Commerce solution options
3 What is E-Commerce?The integration of communications, data management, and security technologies to allow individuals and organizations to exchange information related to the sale of goods and services.Major functions of E-Commerce include:the buying of goods,the selling of goods, andperformance of financial transactions on the Internet.
4 E-Commerce Issues Intellectual Property Security Fraud Taxation International Commerce
5 e-Business solutions Customers ERP, CRM, Database Internet / WWW Mobile UsersWeb EDIIntranetInternal UsersSuppliers, public
6 E-Commerce Advantages for Businesses Reduced CostsIncreased Customer SatisfactionMore Effective Data ManagementPotentially Higher Sales
7 E-Commerce Advantages for Consumers ConvenienceEasier Comparison ShoppingWider Selection of Goods
8 E-Commerce Risks for Businesses Need for a robust, reliable web siteFraudulent transactionsCustomer reluctance to purchase onlineIncreased competition
9 E-Commerce Risks for Consumers Possible Security IssuesPossible Privacy IssuesPurchasing from photos & descriptionsPossible difficulty with returns
12 Electronic Data Interchange (EDI) EDI is the transfer of data between different companies using networks.This facilitates the exchange of standard business documents including purchase orders and invoices.EDI is not new; it has been in existence since the 1960s.Organizations that exchange EDI transmissions are called trading partners.Newer technologies such as XML and Web Services are replacing traditional EDI by allowing trading partners virtually unlimited opportunities to customize their information exchange over the Internet.
13 QuestionsDescribe three advantages of e-commerce for an entrepreneur just starting a business.Describe three risks that businesses face when engaging in e-commerce.
14 Order & Payment Processing E-Commerce Payment Models:CashCheckCreditSmart CardMicropayments
16 E-Commerce Storefront Solutions Instant Online StorefrontYahoo!, Bigstep, Earthstores, FreeMerchantOff-The-Shelf Shopping Cart SoftwareMiva Merchant, MercantecCustom Built SolutionIBM's WebSphere Commerce Suite, Microsoft's Commerce ServerVisual Studio.NET, Macromedia Dreamweaver MX, IBM’s WebSphere Commerce StudioSemi-Custom Built Solutions on a BudgetE-Commerce add-ons for FrontPage and DreamweaverPaypal order processingFree shopping cart scripts
17 QuestionsList three payment models commonly used on the Web. Which one is the most popular, why?Have you purchased online? If so, think of the last item that you purchased.Why did you purchase it online instead of at a store?Did you check to see if the transaction was secure? Why or why not?How will your shopping habits be different in the future?Describe three types of e-commerce solutions available. Which provides the easiest entry to e-commerce? Explain.
18 Application Service Provider What is ASP?Application Service Provider(not the ASP from microsoft)A company offers individuals or enterprises to host their applications or services on this ASP company. (low budgets for small companies, outsourcing for large companies)
20 TerminologyDedicated line – A point-to-point, hard wire connection between two service locations.Leased line – A telecommunications line dedicated to a particular customer along predetermined routers.Outsourcing – The transfer of components or large segments of an internal IT infrastructure, staff, processes or applications to an external resource such as Application service provider (ASP).
21 Example e-Business Storefront model Auction model Portal Model Dynamic Pricing ModelsB2B ExchangesB2B Service Providerse-Learning
22 Storefront ModelThe storefront model combines transaction processing, security, online payment which allows merchants to sell their products to the customers on the Web.Many famous storefront model companies are Business-to-Consumer (B2C) companies.Sell tickets
23 Storefront ModelAllow companies to conduct business 24-by-7 (all-day, everyday).One of the most commonly used model is “shopping cart”An order-processing technology that allows user to accumulate the shopping list and continue shopping.Supported by product catalog, merchant server and database technology.(international)
25 Shopping CartsTemplates for shopping carts in dreamweaver at ecommercetemplates.com (you host solution)Many other providers (http://www.fortune3.com)Managed SolutionsMake your own
26 Shopping Cart SWSometimes will also include Product pages –that are created from statically entered in product information (not stored in databases)
27 Comparisons of Shopping Cart SW Search online to see what is popularCheck out wiki page (http://en.wikipedia.org/wiki/Comparison_of_shopping_cart_software)
28 Free Shopping Cart SW Do a search Check out www.free-carts.com PHP:This does cart + product pagesInstall on a Web ServerAs part of install of SW must specify a MySQL database and give the admin name and a password to it.Finish install of OpenCart SW – will include creation the database tables to support OpenCartUsing Interface of opencart: Setup categories of products, product info with images, etc.Java:
29 Shopping Cart Payment Processing Services Google CheckoutPayPallAmazonpaymentsOthers: (search yourself)- 2checkout.com, authorize.net, itransact, cyberbit, and moreDirect Credit Card
30 Storefront ModelAnother model is “online shopping mall” which provides a wide selection of products and services.Customers can purchase items from many stores in a single transaction.Offer speed and add convenience
32 Auction ModelInternet User can login to the online auction sites, either bidder or seller.Sellers post their items and wait for the buyers to bid.Auction sites get commission on every successful auction.E.g. most profitable:International: auction.timway.comReverse Auction modelAllow buyer to set the price,
34 Portal Model Allow visitors to find everything within the website. Horizontal PortalWide-ranged of topicsE.g.Vertical PortalOffer specific information on a single area of interest.E.g. (medical information)
35 Dynamic Pricing Model Name-your-price Business Model Customers choose their price for the products or services (www.priceline.com).Comparison Pricing ModelCustomers poll some merchants and find the lowest prices (www.bottomdollar.com)Demand-Sensitive Pricing ModelEnables customers to get better services and prices. (www.mobshop.com)Bartering ModelExchange items (www.ubarter.com)
37 Group Pricing ModelCustomers get group pricing if enough purchase the offer (www.groupon.com).
38 B2B ExchangesDefine as buying, selling, partnering, bartering or trading conducted between two or more business (B2B).Allow Business to buy, sell, auction, barter and distribute products and services.Examples:(Exchange employee)(Industry to Industry)(Business to Business)
40 B2B Service ProvidersB2B service providers make the B2B transactions easier.These e-Businesses help other businesses improve their policies, procedures, services and general operations.Solutions include supply chain management, logistics, procurement.
41 Chat online?Why? To solve your E-business problem via the Internet.
42 Loan Online A growing segment of E-commerce. Loan online at a lower rate than other traditional channels.E-loan –E-credit –Clients – HP, Intel, other businessesLoan direct –
43 Recruitment on the Web Effectively job searching on the Web. Improve the recruitment for both employer and seeker.Search International Jobs (www.monster.com)Focus on computer industry (www.dice.com)
44 Online News ServicesWeb is playing an important role in the publishing and news industries.The Wall Street Journal (www.wsj.com)Articles by leading investment analysts (www.barrons.com)Latest sports news (www.espn.com)Comprehensive news site (www.drudgereport.com)
46 Online Travel Services Customers can bypass the travel agents.Allow discount and low fare rate online.air-tickets, hostel, and car-rentals.“Last minutes” tickets offer low price.orbitz.com, expedia.com, ….www.travelocity.com
47 Online EntertainmentMultimedia rich websites provide Audio and Video, popular music and videos are available online for free.Internet Movie Databasenetflix.com, blockbuster.com,…
48 e-Learninge-Learning is growing rapidly as the number of Internet users increases.Universities and other training companies offer HQ distance education over the Web.wwwtools.cityu.edu.hkE-books –
49 M-Commerce What is Mobile Commerce? Mobile commerce is the term applied to online financial transactions - shopping or the electronic transfer of funds - using a mobile device.Mobile commerce transactions are being enhanced by developments in the world of mobile communication.
51 Build an e-Commerce site Register a Domain nameSearch for domain names (InterNIC)What is the criteria of selecting a good name?Find a Web HostSelect the suitable ISPWeb DevelopersHire a web designerCut cost and work with the designerIf your site is easy to use, the customers will stay longer and come more frequent.
52 Web Hosting It is a very important step in e-Commerce. Good uptime? Good technical support?Fast connection to the Net?Staffs are knowledgeable about e-Commerce?Compatibility with other e-Commerce providers?
53 Attract and keep customers e-Business AdvertisingBanner AdvertisingRecently, losing their effectivenessBuying and Selling advertisingYou can become a host, or an advertiserWebcasting and Interactive AdvertisingUse streaming media to broadcast information on the web.
54 Enterprise Resources Planning (ERP) An industrial term defines as the activities supported by application software that helps company to manage the important parts of the business.Product planning, parts purchasing, maintaining inventories, contacting suppliers, customer servicing.Integrated with database (such as Oracle) to provide other features, business process analysis, employee training, …
55 ERP example I have questions about billing, product availability, shippingand customer service.Finance:How can I help you?Fulfillment:Yes, Sir?Inventory:Which item?Customer Service:We’re ready to help.
56 Customer Relationship Management (CRM) All the customer services provided by the company form the CRM.CRM includesCall handling (in/out calls from customers and service representatives)…NuanceSales tracking (tracing and recording the sales made)Transaction support (the technology used for transactions)Improve customer satisfaction and maximize the profits
57 Electronic Data Interchange (EDI) Standard format to exchange business data.EDI message is a string of data that represents “price”, “product number”, “product name”, etc.EDI message can be encrypted.EDI is one form of E-commerce, also include , fax.
58 Electronic Data Interchange (EDI) Electronic Data Interchange (EDI)
59 Get Paid How to you pay on the website? Credit card transactions Cybercash:PayPal:Google CheckoutE-Wallets allows you to keep track your transactions,Digital Cash: store your money electricallyMore complex: B2B Transactions.
60 Manage the E-commerce business Have a good communication between the business production line (including the customer services team), and the IT development line.“Online transaction history log” and “Historical investment performance reports” also helps to decide and plan for the product and service trend.Migration of the traditional trading client to the new e-business.
61 Secure the site Customers fear for their online privacy. Make sure all transactions on your e-commerce site are protected.Security is provided by different kind of cryptography (encryption, digital signatures, digital certificates)Sometimes, you may provide your personal information for: member-only discounts, giveaway, sweepstakes, coupons. Beware!
62 Online shopping risks A list of safeguards to keep in mind. Shop with trusted merchants.Read the site’s delivery, return, and privacy policies.Only enter your details with the URL that begins with https:// and either a locked padlock or an unbroken key icon.Be careful not to hit the ORDER NOW button more than once.Never send credit card information via .Keep a record of your transactions until shipped.
63 Application Service Provider What is an Application Service Provider?Deliver and manage applications or computer services via the Internet.Provide a cost-effective solution from an outside supplier. (maintenance, upgrades and customization)It can be a commercial entity, a not-for-profit organization or government related.
64 ASP other names On-demand software or software as a service (SaaS). TYPES:A specialist or functional ASP delivers a single application, such as credit card payment processing or timesheet services;A vertical market ASP makes software for a particular (vertical) market –i.e. medical transcriptions/records;An enterprise ASP delivers wide set of solutions;A local ASP delivers small business services within a limited area.
65 Using ASP Benefits Speed to market Operational freedom ASP has the latest equipment, applications, ready to provide market access.Operational freedomThe customer can focus on their core business.Improved performanceASP provides vast experience on different issues.Financial flexibilityReduced fixed cost and overall expenditures.Reduced riskCustomers can test a new technology with minimal impact to their existing system.
67 What kind of application can be delivered? Citrix, GraphOn and SCOThe applications run on a central server managed by the ASP, but not the applications on the end-user desktop or company’s server.Portal means a gateway (starting point), for a WWW site, it is the starting site for user to browse.
69 Choosing ASP Shared Server Shared Server with Application Isolation SystemsServer Farm (Each company with its own server)Customer CostLowHighInitial Customer InvestmentMaintainance costModerateServer ArchitectureComplexSimpleSecurity Risk
70 Summary e-Commerce is defined as a company has an online presence. We have discussed different types of e-Commerce models.Discuss the important issues on developing e-Business.ASP provides very good supports to the e-Commerce development.