CHAPTER 7

CHAPTER 7

Electronic Commerce: Applications and Issues

n  CHAPTER OUTLINE

7.1  Overview of E-Business & E-Commerce

7.2  Business-to-Consumer (B2C) Electronic Commerce

7.3  Business-to-Business (B2B) Electronic Commerce

7.4  Electronic Payments

7.5  Ethical and Legal Issues in E-Business

Overview of E-Business and  E-Commerce

Definitions and Concepts

n  Electronic commerce (e-commerce, EC) describes the buying, selling, transferring or exchanging of products, services or information via computer networks, including the Internet.

n  E-business is a broader definition of EC, including buying and selling of goods and services,

n  Brick-and-mortar organizations are purely physical organizations.

n  Virtual organizations are companies that are engaged only in EC. (Also called pure play)

n  Click-and-mortar organizations are those that conduct some e-commerce activities

Types of E-Commerce

n  Business-to-consumer (B2C): the sellers are organizations and the buyers are individuals.

n  Business-to-business (B2B): both the sellers and buyers are business organizations.  B2B represents the vast majority of e-commerce.

n  Consumer-to-consumer (C2C): an individual sells products or services to other individuals.

n  Business-to-employee (B2E): An organization uses e-commerce internally to provide information and services to its employees. Companies allow employees to manage their benefits, take training classes electronically; buy discounted insurance, travel packages, and event tickets.

n  E-Government: the use of Internet Technology in general and e-commerce in particular to deliver information about public services to citizens (called Government-to-citizen [G2C EC]), business partners and suppliers (called government-to-business [G2B EC]),

n  Mobile Commerce (m-commerce) refers to e-commerce that is conducted in a wireless environment.

See video about  

Major Types of E commerce

E-Commerce and Search

Major E-Commerce Mechanisms

n  An auction is a competitive process in which either a seller solicits consecutive bids from buyers or a buyer solicits consecutive bids from sellers.

n  forward auction as a channel to many potential buyers.  Note that

     Sotheby’s uses forward auctions.

n  In reverse auctions, one buyer, usually an organization, wants to buy a product or a service. 

E-Commerce Business Models
Online direct marketing	Viral marketing
Electronic tendering system	Group purchasing
Name-your-own-price	Online auctions
Find-the-best-price	Bartering Online
Affiliate marketing	Product customization

Benefits of E-Commerce
organizations	Makes national and international markets more accessible
customers	Access a vast number of products and services around the clock
Society	Ability to easily and conveniently deliver information, services and products to people

Limitations of E-Commerce
Technological	Lack of universally accepted security standards
Non-technological	Perception that EC is unsecure

Online Service Industries

n  Cyberbanking         

n   Online securities trading

n  Online job market

n  Travel services

n  Online advertising

Disintermediation

Online Advertising

§  Advertising is an attempt to disseminate information in order to influence a buyer-seller transaction.

§  Banners are simply electronic billboards.

§  Pop-up ad appears in front of the current browser window.

§  Pop-under ad appears underneath the active window.

§  Permission marketing asks consumers to give their permission to voluntarily accept online advertising and e-mail.

§  Viral marketing refers to online “word-of-mouth” marketing.

Issues in E-Tailing

§  Order fulfillment involves finding the product to be shipped; packaging the product; arrange for speedy delivery to the customer

§  Channel conflict occurs when manufacturers disintermediate their channel partners, such as distributors, retailers, dealers, and sales representatives

§  Communitainment is the blending of community, communication, and entertainment into a new form of online activity driven by consumers. 

Declining usage of traditional media

See video about 

New Media VS Traditional Media

Eight Types of Web sites for Advertising

§  Portals: most popular; best for reach but not targeting

§  Search: second largest reach; high advertising value

§  Commerce: high reach; not conducive to advertising

§  Entertainment: large reach; strong targetability

§  Community: emphasize being a part of something; good for specific advertising

§  Communications: not good for branding; low targetability

§  News/weather/sports: poor targetability

§  Games: good for very specific types of advertising

Electronic Exchanges

v Vertical Exchanges

v Horizontal Exchanges

v Functional Exchanges

v Electronic Payments

Electronic checks (e-checks)

v Electronic credit cards

v Purchasing cards

v Electronic cash

Ethical Issues

v Privacy

v Job Loss

Legal Issues Specific to E-Commerce

§  Fraud on the Internet i.e. stocks, investments, business opportunities, auctions.

§  Domain Names problems with competition.

§  Cybersquatting refers to the practice of registering domain names solely for the purpose of selling them later at a higher price.

§  Domain Tasting is a practice of registrants using the five-day "grace period" at the beginning of a domain registration to profit from pay-per-click advertising.

§  Taxes and other Fees when and where (and in some cases whether) electronic sellers should pay business license taxes, franchise fees, gross-receipts taxes, excise taxes, …etc.

§  Copyright protecting intellectual property in e-commerce and enforcing copyright laws is extremely difficult.

CHAPTER 6

CHAPTER 6

Networks

Chapter Outline

  6.1 What Is a Computer Network?

  6.2 Network Fundamentals

  6.3 The Internet and the World Wide Web

  6.4 Network Applications

•        A computer network is a system that connects computers and other devices via communications media so that data and information can be transmitted among them.

Size of Computer Networks

•               Home computer network
•               National computer network
•              Global computer network

•       A local area network connects two or more devices in a limited geographical region so that every device on the network can communicate with every other device.

Enterprise Network

Network Fundamentals

Analog and Digital Signals

Communications Media and Channels

Twisted-pair wire

Fiber optics

Coaxial cable

Transmission Technologies

•          Digital Subscriber Line: a high-speed, digital data transmission technology using existing analog telephone lines.
•          Asynchronous Transfer Mode: data transmission technology that uses packet switching and allows for almost unlimited bandwidth on demand.
•          Synchronous Optical Network: an interface standard for transporting digital signals over fiber optic lines that allows users to integrate transmissions from multiple vendors.
•         T-Carrier System: digital transmission system that defines circuits that operate at different rates, all of which are multiples of the basic 64 Kbps user to transport a single voice call.

The Four Layers of the TCP/IP Protocol

Packet Switching

See video about  

Circuit switching & Packet switching

Accessing the Internet
Connecting via an online service	Cable Modem
Internet kiosks	Satellite
Dial-up	Wireless
DSL	Fiber to the Home

Addresses on the Internet

See video about

IP Address - Internet Protocol Addres

•       Domain names consist of multiple parts, separated by dots, which are red from right to left.
•       Top-level domain: the rightmost part of an Internet name; common top-level domains are .com, .edu, .gov.
•       Name of the company: the next section of the Internet name.
•       Name of the specific computer: the next section of the Internet name.
•      World wide web: A system of universally accepted standards for storing, retrieving, formatting, and displaying information via a client/server architecture.

Browser Competition

Network Applications

Discovery

•          Discovery allows users to browse and search data sources, in all topic area on the Web.
•        Search engines are computer programs that search for specific information  by key words and report the results.
•        Metasearch engines search several engines at once and integrate the findings of the various search engines to answer queries posted by users

.

Portals

n  Commercial (public) portals

n  Affinity portals

n  Mobile portals

n  Corporate portals

n  Industry wide portals

     Communication

•       Electronic mail (e-mail) is the largest-volume application running on the Internet.

        

•         Web-based call centers (customer call center) are services that provide effective personalize customer contact as an imporant part of Web-based customer support.

•        Electronic chat room is a virtual meeting place where groups of regulars come to “gab”.
•        Virtual collaboration is the use of digital technologies that enable organizations or individuals to collaboratively plan, design, develop, manage and research products, services and innovative applications.
•        Workflow technologies facilitate the movement of information as it flows through the sequence of steps that make up an organization’s work procedures.
•        Groupware refers to software products that support groups of people who share a common task or goal and who collaborate to accomplish it.
•        Web conferencing is videoconferencing conducted over the Internet.
•       Real-time collaboration tools support synchronous communication of graphical and text-based information i.e. computer-based whiteboards.

E-Learning and Distance Learning
Benefits	Drawbacks
Self-paced learning increases content retention.	Instructors may need training to be able to teach electronically.
Online materials deliver high-quality, current content.	The purchase of additional multimedia equipment may be necessary.
Training costs can be reduced	Students must be computer literate and may miss the face-to-face interaction with instructors.

Telecommuting
	Benefits	Disadvantages
For Employees	Reduced stress, improved family life. Employment opportunities for single parents.	Feelings of isolation No workplace visibility
For Employers	Increased productivity. Ability to retain skilled employees	Difficulties in supervising work Additional training costs