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Using Information Technology in E-commerce

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Presentation on theme: "Using Information Technology in E-commerce"— Presentation transcript:

1 Using Information Technology in E-commerce
By, Ikhlaq

2 Chapter Preview In this chapter, we will study:
Importance and advantages of e-commerce. Understand integration of e-commerce in everyday businesses. Forms and uses of business-to-consumer electronic commerce Technical and non-technical requirements needed to make EC work

3 History of e-commrce History Scope Today Includes
Began in the early 1970s (long before the Internet was open to commercial use) Limited to large businesses initially Electronic Fund Transfer (EFT) and Electronic Data Interchange (EDI) Scope Today Includes advertising home banking shopping in electronic stores and malls buying stocks finding a job collaborating electronically with business partners around the globe providing customer service Virtual malls.

4 Frame work of e-commerce

5 E-Commerce / E-Business
Electronic Commerce: Buying and selling of products, services and information via computer networks, primarily the Internet Some people view this term of commerce as describing transactions conducted between business partners. Electronic Business: A broader definition that includes buying and selling, plus servicing customers collaborating with business partners conducting electronic transactions within an organization Global systems – systems connecting two or more companies in two or more countries Electronic data interchange (EDI) – electronic movement of business documents between business partners Electronic funds transfer (EFT) – transfer of money using telecommunications Extranets – extended Intranets that link business partners Shared databases – databases that business partners both have access to Integrated messaging – delivery of and fax messages through a single communication system.

6 Types of E-Commerce Business-to-business EC (B2B)
In which two or more businesses make transactions or collaborate electronically Collaborative commerce (c-commerce) In which business partners collaborate and this collaboration frequently occurs between and among the business partners along the supply chain. Business-to-consumer EC (B2C) In this case the sellers are organized, the buyers are individual. Global systems – systems connecting two or more companies in two or more countries Electronic data interchange (EDI) – electronic movement of business documents between business partners Electronic funds transfer (EFT) – transfer of money using telecommunications Extranets – extended Intranets that link business partners Shared databases – databases that business partners both have access to Integrated messaging – delivery of and fax messages through a single communication system.

7 Cont….. Consumer-to-businesses (C2B) Consumer-to-consumer (C2C)
In which the consumers make known a particular need for a product or service and organizations compete to provide the product or service to consumers. For example priceline.com, where the customer name the price and suppliers try to fulfill it Consumer-to-consumer (C2C) In which an individual sells the products (services) to other individuals Intrabusiness (intraorganizational) commerce In which an organization uses EC internally to improve its operations. An example known as business to employee EC

8 Cont…. Government-to-citizens (G2C) and others
In this case the govt. provides services to its citizens via EC technologies. Govt. can do business with other governments as well as with business Mobile commerce (m-commerce) When e-commerce is done in a wireless environment, such as using cell phones to access the internet, we call it m-commerce

9 Forms of EC B2B B2C B2E B2G C2C Hybrid
Business-to-business targets sales and services primarily to other businesses. B2C Business-to-consumer targets sales and services primarily to consumers. B2E Business-to-employee provides services other companies can use to interface with employees (like retirement funds management, health care management, and other benefits management). B2G Business-to-government involves companies who sell the bulk of their goods and services to state, local, and national governments. C2C Consumer-to-consumer sites primarily offer goods and services to assist consumers to interact (e.g., auctions). Hybrid Combines B2B and B2C models.

10 B2C Strategies for E-Commerce
DIGITAL PRODUCTS: The products and services that can be delivered via internet. Eg songs, software,movies,chat etc. PHYSICAL PRODUCTS: The products and services that can not be delivered via internet, instead they must be transported to the consumer by some physical means. VIRTUAL SALE Vs HYBRID SALE: Virtual stores do not operate with the physical store fronts, they completely operate with transections made online. Whereas Hybrid sale operate with the both web based and physical store fronts where customer can enter and purchase the products.

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12 EC Benefits to Organizations
Reduced cost of searching, purchasing and delivery. Broaden markets that helps small businesses compete against large companies Enables more individuals to work at home and to do less traveling and organizations have to bear less expenses. Choice Consumers can select from many vendors and many more products than they could locate otherwise Consumers can get customized products, from PCs to cars, at competitive or bargain prices Consumers can find unique products and collectors’ items through virtual auctions that might otherwise require them to travel long distances to a particular auction place at a specific time. Global systems – systems connecting two or more companies in two or more countries Electronic data interchange (EDI) – electronic movement of business documents between business partners Electronic funds transfer (EFT) – transfer of money using telecommunications Extranets – extended Intranets that link business partners Shared databases – databases that business partners both have access to Integrated messaging – delivery of and fax messages through a single communication system.

13 EC Benefits to Customers before ,during and after sale
Convenience Consumers can conduct online quick comparisons to find less expensive products and services Customers can shop or make other transactions 24 hours a day, year round, from almost any location Access to the Product information immediately available 24 hours a day, year round, from almost any location Relationships with the suppliers and financial community Consumers can interact with other consumers in electronic communities and can exchange ideas as well as compare experiences Global systems – systems connecting two or more companies in two or more countries Electronic data interchange (EDI) – electronic movement of business documents between business partners Electronic funds transfer (EFT) – transfer of money using telecommunications Extranets – extended Intranets that link business partners Shared databases – databases that business partners both have access to Integrated messaging – delivery of and fax messages through a single communication system.

14 E-Commerce Constraints
High Cost for deploying EC setup Security concerns: prevention,protection,detection and recovery. Ethical issues: false order placing, hacking ,cracking, Web tracking, privacy, Immature or unavailable software Legal issues like trade mark, Taxes and fees, Copyright, IPR and licensing

15 The Internet History Architecture Intranet Extranet Understanding URL
Understanding IP What is web site, web page and Hyper text Protocols

16 Internet Architecture
Figure 7.6 A sample journey of information from one Internet computer to another.

17 Internet The largest computer network in the world (a network of networks), More than 200,000 networks are connected. The Internet is a global, interconnected network of millions of computers (hosts). Began in 1969 with the US DOD’s ARPANET. In 1985 NSF built NSFNET. Began as one net work called ARPANET (Advance research projects agency) using packet switching ARPA was the department of DARPA. Which was composed of govt, military, academics and scientists. Milnet was also military based network. Goals of internet

18 World Wide Web An increasingly popular method of accessing the Internet. Documents transmitted over the “web” are in HTML format (Hypertext Markup Language), or in any number of other compatible languages. HTML was created in 1989 by Tim Berners-Lee at CERN. Web browsers (Internet Explorer and Netscape,mozzila,opera,firefox) are commonly used tools for accessing the web.

19 The Operation of the Internet (continued)
New top-level domain zones: In November 2000, the first addition of a global top-level domains to the Internet since the 1980s occurred. .aero (for the air-transport industry) .biz (for businesses) .coop (for cooperatives) . Com .mil .edu .net .org .info

20 Understanding URL http//:www.software.ibm.com/home/index.htm
Consists of multiple parts separated by dots. Translated from right to left = indicates protocol used or how document is transmitted www = world wide web service Com=top-level specification or zone, domain name (not used for US based and international organizations

21 Ibm = name of company Software = name of particular machine Home = directory name Index = file name of web document .html =indicates that document has been prepared in hyper text markup language

22 More Nets Intranets, extranets, and virtual private networks (VPN’s) are other networks that use web technology. Intranet looks like the Internet but is used only internally by an organization (university, business, etc.). Extranet is similar to an intranet but includes access available to partners, or customers. VPN’s are used to connect private data using the public telecommunications system. VPN’s use tunneling.

23 E-mail is still largest use in this area.
Includes , instant messaging, Voice over IP (VoIP), point-to-point file transfers (FTP), and groupware. is still largest use in this area. ISP (Internet Service Provider) connects the user to the Internet.

24 Business Intelligence
Business intelligence refers to the analysis performed by DSS, ES, EIS, data mining and intelligent systems. BI describes a verity of activities to pull together all the data required to make a sound business decision, regardless of where the data originate. External databases: Commercial databases that provide information on virtually any subject. and are the examples.

25 Search Engines Search engines are used to index the contents of the Internet so that information about a specific topic can be located. They are special computer programs having large databases that ask a user for a key word or a group of words to launch a search strategy to reach a web content in cyberspace. Managers should pay attention to search engines for two reasons: They provide useful and extensive access to information. And, they can provide the visibility that becoming listed with them provides. Google, founded in 1991 by two Stanford Ph.D. students, is the most popular search engine. Other types of search engines include yahoo.com, excite.com, altavista.com, msn.com and askjeevs.com

26 What is IOS An IOS is a system in which all firms establish electronic linkage ,so that all of the firms work together as a coordinated unit, achieving benefits that each could not achieve alone. The participating firms are called trading partners, business partners or business alliances. Proactive (Usually this approach is taken by IOS sponsors) and reactive business partners (Participant responds are using reactive approach): A frequently used term with IOS is EDI. EDI (Electronic Data Interchange) is one of the oldest forms of e-business. EDI is the direct computer to computer transfer of business information, using a standard format. Software programs on different systems can exchange information without human intervention. Quote requests, order forms, etc. The communication lines, communication hardware and support services are generally provided by the telecommunication companies eg AT&T.

27 Benefits of IOS Comparative efficiency: By joining IOS firms can produce services and goods with greater efficiency than of other firms. Comparative efficiency may be in the terms of internal efficiency and inter-organizational efficiency. Bargaining power: The ability of the firm to resolve disagreements with the suppliers and the customers to its own advantage is known as bargaining power. This power is derived from the following bacis areas.

28 Cont…. Unique product feature: IOS enables firms to offer a USP to take competitive advantage. Reduced search–related cost: Belonging to IOS firm can reduce cost for searching supplier, searching the product at low price. Increased Switching cost: By using IOS firm deters its customers to switch to a competitor. An IOS achieves this benefit by providing customer with such an information, hardware, software and data communication channels that would have to replaced if the product were purchased from another firm. Vendor stock replenishment: A special IOS in that the customer trusts the supplier enough to allow the supplier to access its computer–based inventory system.

29 Cont….. Increased operational efficiency “both internal and inter-organizational” Increased ability to compete. In terms of reduces cost of product manufacture Improved relationships with the trading partners. Improved customer services.

30 Mobile Commerce As PDAs, cell phones, and tablet computers converge; people will ultimately be able to connect to any business every place they go.

31 Cyberspace and information super highway
A lucid /imaginary space that exists behind the computer screen where mind absorbed sensory experiences take place and people interact with this space while using different physical means. Information super highway is used in the same context, but there is no complete agreement concerning its eventual impact on society.


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