1. Electronic Commerce Mr. John Dobbs Colorado Mesa University
CSCI 100 Computers in Our Society

2. Electronic Commerce (E-Commerce)
Business transactions over the Internet/World Wide Web
Built on top of the Internet protocols (TCP/IP) we discussed last week
Electronic payments (financial transactions) underlie all E-Commerce
Business to business (B2B)
Business to consumer (B2C)
Some history
See The History of Ecommerce: How Did It All Begin?

3. Business to Business (B2B) E-Commerce
Focus is on supplying other businesses
Earlier emergence than B2C
Tends to be high volume
Business supply chain is a good example
Any manufacturing business needs raw materials
As product proceeds down assembly line, it consumes raw materials
As material inventory dwindles, automatically order resupply from a vendor with whom you already have a relationship
E-Commerce can enable just-in-time inventory practices
Inventory costs money and requires space
The closer you get inventory compared to when you need it, the cheaper it is
Shelf life also a concern in food industry

4. Business to business (B2B) E-Commerce
Business purchasing tends to be in larger volumes
More emphasis on shipping and delivery
B2B web presence is more about process and less about marketing
Purchasing business knows what it needs
Orders could be quite complex
Need a prior agreement between a vendor and a consumer
Transactions often involve standardized messages – see EDI next slide

5. Business to business (B2B) E-Commerce
Government (especially Defense) is a really large part of B2B E-Commerce
“I’d like to order 1,000,000 gallons of gasoline please”
Orders and logistics can be large and complex
Think Operation Desert Storm
Defense acquisition rules can be complex and lengthy
Need to protect against fraud, abuse, and favoritism
Early adopters of Electronic Data Interchange (EDI)
XML-based standard document exchange
See X12 about EDI standards
See Department of Defense DIRECTIVE
Widely used in other industries such as Health Care
Basis of electronic medical records

6. Business to consumer (B2C) E-Commerce
Finding stuff to buy (marketing – web design – moving stuff into your electronic shopping card)
Paying for stuff online (paying for the stuff that's in your shopping cart)
Credit card transaction processing
See Electronic Payment below
Electronic wallet
Free shipping
Armies of delivery vans for free!
Automated route finding algorithms – Operations Research
How a van can make deliveries to 12 destinations without making a left turn?
Packing a cargo ship in Taiwan that will make 12 stops in a way that cargo for that stop is on top!

7. Business to consumer (B2C) E-Commerce
Online services
Music
Downloads, streaming services
What has this done to artists income?
Independent production
Video
Streaming
Changing the way we watch TV
Piracy

8. Business to consumer (B2C) E-Commerce
Online services
Books
Amazon books lead the way for consumer purchases
First as physical books
Then as electronic books
See Pew Research article: E-Reading Rises as Device Ownership Jumps < jumps/>
See Timeline History Amazon.com amazon-com/
Technology base is Linux operating system and Oracle database

9. E-Commerce Electronic Payment
Paying for stuff online (buying the stuff that's in your shopping cart)
Credit card transaction processing
See What You Need to Know About Credit Card Processing
Network needs to be secure and processing needs to be fast
Pharmacy benefit transaction processing is a similar process with different companies involved
Internet payment systems
PayPal
Electronic wallet
Android pay, Apple Pay, Google Wallet, Samsung Pay
Electronic (crypto) currencies
Bitcoin

10. E-Commerce
With all this electronic commerce happening faster and faster, what could possibly go wrong?
In-class discussion