1. e-Business & e-Commerce
Trends & Technologies
ICS622- Internet Technologies & Applications
April 21, 2017

2. Objectives
To understand how the Internet and World Wide Web are revolutionizing business processes.
To introduce various business models used on the Web.
To explore the advantages and disadvantages of creating an online business.
To examine marketing, payment, security and legal issues that affect e-businesses.
ICS622- Internet Technologies & Applications
April 21, 2017

3. Introduction
We are in the Age of Knowledge
In short history of e-business &commerce; demonstrated that successful e-businesses are those that recognize needs of target audiences and match them with relevant content
The terms e-business and e-commerce, often used interchangeably, have different meanings
ICS622- Internet Technologies & Applications
April 21, 2017

4. E-Commerce and E-Business
E-commerce refers to aspects of online business involving exchanges among customers, business partners and vendors.
For example, suppliers interact with manufacturers, customers interact with sales representatives &shipment providers interact with distributors
E-business encompasses these elements, but also includes operations handled within the business itself
For example, production, development, corporate infrastructure and product management are aspects of e-business not included under the category of e-commerce.
ICS622- Internet Technologies & Applications
April 21, 2017

5. E-Commerce and E-Business
E-business &e-commerce have increased speed &ease with which business can be transacted, resulting in intense competition among online vendors
To remain viable, e-businesses must adjust to evolving technologies, continually integrate new systems and satisfy wide variety of consumers
Its customers do not have to go far to buy from competitors
Online medium enables people to pay bills, write &cash cheques, trade stocks, take out loans &mortgage homes
Money as we now know it has begun to be augmented by such technologies as smart cards and digital cash.
ICS622- Internet Technologies & Applications
April 21, 2017

6. e-Business Models
Transition of business into e-business provides many benefits
An e-business can offer personalization, effective customer service and streamlined supply-chain management
Although “e-commerce” is relatively new, large corporations have used it for decades by networking their computing systems with those of business partners &clients
For example, banking industry uses EFT to transfer money
In addition, many companies employ EDI
EDI facilitates standardization of business forms as purchase orders and invoices allowing companies to share information with customers, vendors &business partners electronically
ICS622- Internet Technologies & Applications
April 21, 2017

7. Storefront Model One of the most common models used in the Internet
Storefront model enables merchants to sell products online by providing a combination of transaction processing, security, online payment and storage
In this model buyers and sellers interact directly
To conduct storefront e-commerce, merchants must:
organize online product catalogs, take orders through their Web sites, accept payments securely, send merchandise to customers and manage customer data
Must also market their sites to potential customers
Examples include
ICS622- Internet Technologies & Applications
April 21, 2017

8. Shopping-Cart Technology
Shopping Cart -most commonly used e-commerce enablers
Most web sites that conduct e-business over the Internet today use shopping-cart technology
Order-processing technology that allows customers to accumulate items they wish to buy as they browse
Support provided by a product catalog, which resides on the merchant server in the form of database
The merchant server is the data storage and management system employed by the merchant
Often, network of computers performs all functions necessary to run a Web site
ICS622- Internet Technologies & Applications
April 21, 2017

9. Shopping-Cart Technology …
A database is a section of the merchant server designed to store and report on large amounts of information
For example:
database for online clothing retailer would include product specifications as item description, size, availability, shipping information, stock level and on order information.
Databases also store customer information, including:
names, addresses, credit-card data and past purchases
ICS622- Internet Technologies & Applications
April 21, 2017

10. Auction Model
 Web offers wide variety of auction sites to pinpoint lowest prices on available items
Auction sites act as forums through which Internet users can assume role of either seller or bidder
Sellers can:
post items they wish to sell, the minimum prices to sell items and deadlines to close the auctions
Bidders may:
Search site for items they are seeking, view current bidding activity and place bids—usually in designated increments.
ICS622- Internet Technologies & Applications
April 21, 2017

11. Auction Model…
Reverse-auction model allows buyers to set prices that sellers compete to match, or beat.
Faster bidding option available to sellers willing to set reserve prices – minimum selling price
Auction unsuccessful if not bid meets reserve price
When auction complete, seller and winning bidder notified, and decide on methods of payment and delivery
ICS622- Internet Technologies & Applications
April 21, 2017

12. Portal Model
Portal sites give chance for visitors to find anything they are looking for in one place.
Provide news, sports, weather and ability to search Web
Search engines are horizontal portals - aggregate information on abroad range of topics.
Vertical portals - other portals more specific, offering information pertaining to a single area of interest
Online shopping popular feature of many major portals
Examples:
About.com, Altavista.com and Yahoo.com
ICS622- Internet Technologies & Applications
April 21, 2017

13. Name-Your-Price Model
Empowers customers by allowing them to state price they are willing to pay for products and services
e-businesses that offer this service form partnerships with leaders of industries: travel, lending and retail etc
Online business passes customer’s price request to an appropriate industry partner, who decides whether to sell the product or service at stated price
Customer whose price is rejected can offer another price
If price accepted, customer obligated to make purchase
ICS622- Internet Technologies & Applications
April 21, 2017

14. e-Marketing Competition is intense in e-business & commerce world
Solid e-marketing strategy can give a company an advantage
There are various components of marketing campaign such as:
Marketing research,
Advertising,
Promotions,
Branding and
Public relations (PR)
ICS622- Internet Technologies & Applications
April 21, 2017

15. Branding
Brand is typically defined as a name, logo or symbol that identifies a company’s products or services
Should be unique, recognizable and easy to remember
Brand equity includes value of tangible and intangible items, such as:
brand’s monetary value over time, customer perceptions and customer loyalty to a company and its products or services
Businesses that already have a solid brand may find it easier to transfer their brand to the Internet
Internet-only businesses must strive to develop a brand that customers trust and value.
ICS622- Internet Technologies & Applications
April 21, 2017

16. Marketing Research
Can help company develop its marketing mix, includes:
product/service details and development, effective pricing, promotion and distribution.
Traditionally, marketing research consisted of focus groups, interviews, surveys, questionnaires & secondary research
Research can now be performed over the Internet
A faster channel through which to find and analyze industry, customer & competitor information
Internet also provides anonymous setting to hold focus group discussions and distribute questionnaires
ICS622- Internet Technologies & Applications
April 21, 2017

17. Marketing
marketing provide an inexpensive and effective method of targeting potential customers
Marketer should define span of people they are targeting including geographic locations & demographic profiles
Should determine level of personalization of campaign
Personalized direct targets consumers:
Using their names, offering right products at the right time and sending special promotions on basis interests
ICS622- Internet Technologies & Applications
April 21, 2017

18. Marketing …
Mailing lists can help marketers target customers through personalized
However, it is important to avoid flooding customers with promotional .
Excessive correspondence can decrease effectiveness of an campaign
ICS622- Internet Technologies & Applications
April 21, 2017

19. Promotions Can attract visitors to a site & influence their purchasing
Promotions can also be used to increase brand loyalty through reward programs
Examples:
Frequent-flyer miles, point based rewards, discounts, sweepstakes, free trials, free shipping and e-coupons
Promotions are an effective way to establish contact with potential customers; but
Important to ensure customers are becoming loyal to company, rather than to promotion/rewards program
ICS622- Internet Technologies & Applications
April 21, 2017

20. Electronic Advertising
E-business advertising conducted through such media as television, movies, newspapers and magazines and online
Establishes & strengthens e-business branding
Publication of URLs on mailings, business cards, billboards, printed materials & other media increase brand awareness, bringing more visitors to a site
Internet quickly becoming important medium through which to market companies, products and services
Online advertising include the placement of links and banners on other companies’ Web sites and registration of sites with search engines and directories
ICS622- Internet Technologies & Applications
April 21, 2017

21. Search Engines
Search engine is a program that scans Web sites for desired content, listing relevant sites on basis of keywords or other ranking criteria
Ranking an important way to bring new visitors to a site
Method used by a search engine to rank a site determine how close to the top a site appears on search results
Businesses can customize and register their sites to improve their positions in search-engine results
ICS622- Internet Technologies & Applications
April 21, 2017

22. Online Payments Secure EFT is crucial to e-commerce
Methods for conducting online transactions include:
Credit-card payments,
Digital cash and e-wallets,
Smart cards,
Micropayments and
Electronic bill presentment
ICS622- Internet Technologies & Applications
April 21, 2017

23. Credit-Card Payment Credit cards are a popular form of online payment
Many people resist them because of security concerns
Customers fear fraud by merchants and third parties
However, most cards, like Visa Master Card & American Express, have features that allow secure online payments
To accept credit-card payments, a merchant must have an account with a bank
Traditional accounts accept only POS transactions
However, growth of e-commerce has resulted in creation of specialized Internet merchant accounts that handle online credit-card transactions
ICS622- Internet Technologies & Applications
April 21, 2017

24. Credit-Card Payment
These consist of card-not-present (CNP) transactions
For example:
When users make credit-card purchases through Internet, they can provide card numbers and expiration dates, but merchant does not see actual cards involved in transactions
Merchant account established through either a bank or a third-party service
ICS622- Internet Technologies & Applications
April 21, 2017

25. Digital Cash and e-Wallets
Digital cash is one example of digital currency
Stored electronically & can be used to make online electronic payments
Digital-cash accounts are similar to traditional bank accounts; consumers deposit money into digital-cash accounts for use in digital transactions
Often, digital cash used in conjunction with other payment technologies, such as digital wallets
Provides payment alternative for customers with security concerns regarding online credit-card transactions
Digital cash also allows people without credit cards to shop online
ICS622- Internet Technologies & Applications
April 21, 2017

26. Micropayments Merchants required to pay fee for each card transaction
Costly when customers purchase inexpensive items
Sometimes, cost of item is lower than standard transaction fee, causing merchant to incur losses
Micropayments enable ways for nominally priced products and services to be sold profitably over the Web
Examples:
music, pictures, texts or videos
To offer micropayment processing some companies form partnerships with telephone carriers & utility companies
ICS622- Internet Technologies & Applications
April 21, 2017

27. Smart Cards Smart card generally looks like a credit card
Can serve many different functions, from authentication to data storage.
Most popular are memory cards & microprocessor cards
Memory cards are similar to floppy disks
Microprocessor cards are similar to small computers, with operating systems, security and storage
ICS622- Internet Technologies & Applications
April 21, 2017

28. Smart Cards
Smart cards also have different interfaces with which they interact with reading devices
One type of interface is contact interface, in which a smart card is inserted into a reading device and physical contact between the device and the card is necessary.
Alternative is contactless interface: data transferred to a reader via an embedded wireless device in the card, without card and device having to make physical contact
ICS622- Internet Technologies & Applications
April 21, 2017

29. Legal Issues
 Internet has posed significant challenges to legal system of many counties
For example:
file-sharing technology enables widespread copyright infringement while
Website personalization mechanisms threaten consumers’ privacy
ICS622- Internet Technologies & Applications
April 21, 2017

30.  Privacy
 Internet companies collect personal information from users as they navigate through a site
Privacy advocates argue that such efforts violate individuals’ privacy rights
Online marketers and advertisers disagree, suggesting that recording of user behavior & preferences helps online companies to better serve customers
ICS622- Internet Technologies & Applications
April 21, 2017

31. Also affects companies’ relationships with employees
 Privacy …
 Also affects companies’ relationships with employees
Many businesses are implementing systems that regulate employee efficiency in the workplace
One of the newest surveillance technologies, keystroke cops, monitors employee activities on corporate and communications equipment.
Keystroke software is loaded onto hard drive of an employee’s computer, or can be sent to an unsuspecting employee as an attachment.
Once activated, software registers each keystroke before it appears on the screen.
ICS622- Internet Technologies & Applications
April 21, 2017

32.   SPAM
Spamming is sending mass s to people who have not expressed interest in receiving such s.
Today, typical Internet user or er may receive hundreds of spam s per day
Work in progress to construct legislation that puts an end to these unsolicited s
Spam has privacy concerns based not only on sheer volume but also the content of the s
Consumers and businesses are affected by decrease in e- mail server productivity due to mass s received
ICS622- Internet Technologies & Applications
April 21, 2017

33. Copyright and Patents
Copyright is protection given to author of an original work, including:
“literary, dramatic, musical, artistic and intellectual works”
Whether the work has been published or not
Copyright protects only the expression or form of an idea, not the idea itself.
Copyright protection provides incentive to creators of original material by guaranteeing them ownership of their work for a given time
ICS622- Internet Technologies & Applications
April 21, 2017

34.   Copyright and Patents
Concerns raised regarding ability of traditional law to protect IP owners from online infringement
This is because of the ease with which material can be reproduced on the Internet.
To complicate the issue, digital copies are perfect duplicates of digital originals, making it difficult to differentiate authorized copies from pirated ones.
One of most heavily debated areas of infringement and protection lies in sharing and distribution of music files (MP3s) and movies over Internet
ICS622- Internet Technologies & Applications
April 21, 2017