Learning Objectives

Identify

the major categories and trends of e-commerce applications.

Identify

the essential processes of an e-commerce system, and give examples of how they are implemented in e-commerce applications.
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Learning Objectives
(Contd)
Identify

several key factors and Web store requirements needed to succeed in ecommerce. the business value of several types of e-commerce marketplaces.

Identify

Learning Objectives
(Contd)

Discuss

the benefits and trade-offs of several ecommerce clicks and bricks alternatives.
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Section I
Electronic Commerce Fundamentals

Electronic Commerce Fundamentals

Few

concepts have revolutionized business more profoundly than e-commerce. Ecommerce is changing the shape of competition, the speed of action, and the streamlining of interactions, products, and payments from customers to companies and from companies to suppliers. Ravi Kalakota
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Electronic Commerce Fundamentals

E-commerce

(Contd)

The online process of developing, marketing, selling, delivering, servicing, and paying for products & services transacted on internetworked, global marketplaces of customers, with the support of a worldwide network of business partners.
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The Scope of e-commerce

Study Figure 7.2, p 220. the correspondence between the Sell side panel on top and the buy side panel below it. technologies are the

Note

Internet-based

key.
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The Scope of e-Commerce

Three

Basic Categories Business-to-Consumer (B2C) Business-to-Business (B2B) Consumer-to-Consumer (C2C)

The Scope of e-Commerce

Electronic

(Contd)

Commerce Technologies

The Internet, intranets, and extranets are the network infrastructure or foundation Customers must be provided with a range of secure information, marketing, transaction processing, and payment services
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The Scope of e-Commerce

(Contd)
Electronic

commerce technologies (continued) Trading and business partners rely on the Internet and extranets to exchange information and accomplish secure transactions
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The Scope of e-Commerce

(Contd)

Company employees depend on a variety of Internet and intranet resources to communicate and collaborate
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The Scope of e-Commerce

(Contd) Electronic commerce technologies (continued)

IS professionals and end users can use a variety of software tools to develop and manage the content and operations of the websites and other e-commerce resources
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Essential e-Commerce Processes

Nine

key components of an ecommerce process architecture Access control and security Profiling and personalizing Search management Content management Catalog management
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Essential e-Commerce Processes (Contd)

Key

components (continued) Payment Workflow management Event notification Collaboration and training
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Essential e-Commerce Processes

Access

(Contd)

control and security Processes MUST establish mutual trust and secure access Authenticating users Authorizing access Enforcing security features
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Essential e-Commerce Processes (Contd)

Must protect the resources of e-commerce sites from threats Hackers Theft of passwords or credit card numbers System failures
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Essential e-Commerce Processes

(Contd) Profiling and personalizing One-to-one marketing strategy Personalized view of the website Based on Personal data Website behavior and choices
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Essential e-Commerce Processes (Contd)

Used to help authenticate your identity for account management and payment purposes
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Essential e-Commerce Processes

Search

(Contd)

management Helps customers find the specific product or service they want
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Essential e-Commerce Processes (Contd)

Software may include a search engine component or a company may acquire a customized ecommerce search engine
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Essential e-Commerce Processes (Contd)

Content

and catalog management Content management software helps companies develop, generate, deliver, update, and archive text data and multimedia information
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Essential e-Commerce Processes (Contd)

Frequently takes the form of multimedia catalogs of product information Works with profiling tools to personalize the content of the website
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Essential e-Commerce Processes (Contd)

Content

and catalog management (continued) May be expanded to include product configuration processes that support mass customization of a companys products
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Essential e-Commerce Processes (Contd)

Workflow

management Workflow software engine Predefined sets of business rules Roles of stakeholders Authorization requirements Routing alternatives Databases used Sequence of tasks
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Essential e-Commerce Processes (Contd)

Workflow

management (continued) Workflow systems ensure that.. Proper transactions, decisions, & work activities are performed Correct data and documents are routed to the right employees, customers, suppliers, and other business stakeholders
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Essential e-Commerce Processes (Contd)

Event

notification Most applications are event driven New customers first visit Payment and delivery processes Customer relationship & supply chain management activities
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Essential e-Commerce Processes

Event

(Contd)

notification (Contd)

Notifies those concerned when an event occurs that might affect their status in a transaction
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Essential e-Commerce Processes (Contd)

Collaboration

and training Supports the collaboration arrangements & trading services needed by customers, suppliers, & other stakeholders May be provided by Internetbased trading services
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Electronic Payment Processes

Processes are complex Near anonymous nature of transactions Security issues Wide variety of debit and credit alternatives Wide variety of financial institutions and intermediaries
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Electronic Payment Processes(contd)

Web

payment processes Credit cards Purchase orders Electronic shopping cart

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Electronic Payment Processes (Contd)

Electronic

funds transfer (EFT) Uses a variety of IT to capture and process money and credit transfers between banks and businesses and their customers ATMs
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Electronic Payment Processes (Contd)

Pay-by-phone Web-based PayPal & Bill Point (cash transfers) CheckFree and PayTrust (automatic bill paying services)

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Electronic Payment Processes (Contd)

Electronic

funds transfer (continued)

Electronic bill payment Point-of-sale terminals linked to bank EFT systems

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Electronic Payment Processes (Contd)

Secure

electronic payments Credit card info is vulnerable to network sniffers. Basic security steps: Encrypt data passing between customer and merchant Encrypt the data passing between the customer and the company authorizing the credit card transaction Take sensitive info offline
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Electronic Payment Processes (Contd)

Secure Socket Layer (SSL) Digital Wallet Secure Electronic Transaction standard
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Section II

E-Commerce Applications and Issues

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e-Commerce Application Trends

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e-Commerce Application Trends

(Fig 7.12, p 234 Let us focus on Sectors and Key Value Drivers) Six major e-comm-erce sectors: Infrastructure Applications Portals Content Services Exchanges
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Business-to-Consumer eCommerce

Location Must

is not a factor

build customer satisfaction, loyalty, & relationships

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e-Commerce Success factors

Selection and value Offer a good selection of attractive products and services Build a reputation for high quality, guaranteed satisfaction, and top customer support
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Success factors (continued)

Performance and service Site must be efficiently designed for ease of access, shopping, and buying (less wait time while browsing) Service must be friendly and helpful Products should be available in inventory

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Success factors (contd)

Look and feel Attractive storefront, shopping areas, and multimedia product catalogs
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Success factors (contd)

Advertising and incentives Targeted, personalized ads Incentives include Coupons Discounts Special offers Vouchers for other web services (i.e., cross-link)
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Success factors (contd)

Personal attention Encourages customers to buy and make return visits Welcomed by name Greeted with special offers Guided to the parts of the site that you are most interested in Relationship building
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Success factors (contd)

Community relationships Giving customers with special interests a feeling of belonging to a unique community

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Success factors (contd)

Community relationships (contd)
Virtual communities Discussion forums Newsgroups Chat rooms Message boards Cross-links to related web communities
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Success factors (contd)

Security and reliability Customers must feel confident regarding the security of their Credit card Personal information Transaction details
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Success factors (contd)

Security (contd) Must feel that you are dealing with a trustworthy business. Reliability Orders filled and shipped as you requested Orders shipped in the timeframe promised Good customer support
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Web Store Requirements

Developing

a Web Store

Build Website design tools Site design templates Custom design services Website hosting
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Web Store Requirements

Developing

a web store

(Contd)

(continued) Market Web page advertising E-mail promotions Web advertising exchanges with affiliated sites Search engine registrations
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Web Store Requirements

(Contd)
Serving

Your Customers

Serve Personalized web pages Dynamic multimedia catalog Fast catalog search engine Integrated shopping cart
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Web Store Requirements

Serving

your customers (continued) Transact Flexible order process Credit card processing Shipping and tax calculations E-mail order notifications
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(Contd)

Web Store Requirements

Serving

your customers (continued) Support Website online help Customer service e-mail Discussion group and chat rooms Links to related sites

(Contd)

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Web Store Requirements

(Contd)
Managing

a Web Store

Manage Website usage statistics Sales and inventory reports Customer account management Links to accounting system
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Web Store Requirements

Managing

a web store (continued) Operate 24/7 website hosting Online tech support Scalable network capacity Redundant servers and power

(Contd)

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Web Store Requirements

(Contd) Managing a web store (continued) Protect User password protection Encrypted order processing Encrypted website administration Network fire walls and security monitors
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B2B e-Commerce
The

wholesale and supply side of the commercial process Businesses buy, sell, or trade with other businesses Includes Electronic catalog systems Electronic trading systems Electronic data interchange Electronic funds transfer
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e-Commerce Marketplaces
One-to-Many

Sell-side. Host one major supplier who dictates product catalog offerings & prices.

Many-to-One

Buy-side. Attract many suppliers that flock to these exchanges to bid on the business of a major buyer.
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Web Store Requirements

(Contd)
Some-to-Many

Distribution marketplaces. Unite major suppliers who combine their product catalogs to attract a larger audience of buyers.

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Web Store Requirements

(Contd)
Many-to-Some

Procurement marketplaces. Unite major suppliers who combine their purchasing catalogs to attract more suppliers. More competition, lower prices

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e-Commerce Marketplaces
(Contd)
Many-to-Many

Auction marketplaces. Used by many buyers and sellers that can create a variety of buyers or sellers auctions to dynamically optimize prices.
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Clicks and Bricks

Continuum of alternatives): (Fig 7.21, p 245)

Seperation Spinoff [Strategic JV [In-house Integration partnership] Division]

E-Commerce Integration E-commerce is integrated into the traditional business operations of a company.
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Clicks and Bricks

(Contd)

Capitalizing on unique strategic capabilities that exist in a companys traditional business operations
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Clicks and Bricks

Alternatives

(continued) Gaining strategic benefits such as.. Sharing established brands Sharing key business information Joint buying power Distribution efficiencies
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(Contd)

Clicks and Bricks

Alternatives

(continued) Partial e-commerce integration using joint ventures and strategic partnerships

(Contd)

Complete separation via the spin-off of an independent ecommerce company

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Clicks and Bricks

E-Commerce

(Contd)

Channel Choices An e-commerce channel is the marketing or sales channel created by a company to conduct and manage its chosen ecommerce activities
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Clicks and Bricks (Contd)

e-Commerce

Channel choices Additive channel New offer channel Subscription Advertising Sponsorship Licensing Portaling Commission Tolling
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