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Electronic Commerce
         – Buying and Selling over a network
         – Business Strategy
         – Relies On
            •   Global Communications Infrastructure
            •   Secure Payment System
            •   Multimedia Publishing Infrastructure
            •   Social Acceptance
Electronic Commerce

Business to Consumer (B-to-C,B2C)
  – Home Shopping, Banking
Business to Business (B-to-B,B2B)
  – Information gathering, financial information, supply chain
Consumer to Consumer (C-toC, C2C)
  – Auction
Business to Employee (B-to-E, B2E)
  – Intranet
E-business terms
                      Clicks and Mortar

         Bricks and
Why Sell Online?

Money – billions of $
Relatively new – put in stake
Lowers operating costs
Worldwide business instantly
Affluent customers shop online
  – 65% of those who shop online have household incomes
    of more than $52,000 per year
24/7 shopping
       How are E-commerce transactions conducted?

Primarily through desktop
Wirelessly using handheld
 Web-enabled devices

                  Mobile commerce
                  E-commerce that
                  takes place using
                   mobile devices
   E-commerce Spending Trends

By the end of 2010, worldwide e-commerce is
expected to exceed $14 trillion.

More 2010 expectations:
-71% of US consumers will use
the Internet to shop
-50% of ALL retail sales will be
influenced by the Internet
Business Models
B2C (Business to Consumer)

               Sale of goods &
                services to the
                general public
               Personalize offerings
                to a consumer’s
               Target Advertising
Business Models
C2C (Consumer to Consumer)
             Consists of individuals using
              the Internet to sell products
              and services directly to other

             An online auction is similar to
              negotiating, in which one
              consumer auctions goods to
              other consumers

             eBay is a popular online
    Business Models
    B2B (Business to Business)
Most common & major
 form of e-commerce
Businesses selling to
Relaying info across the
 supply chain
Direct integration of data
 into back office systems
4 types - Vendor (E-
 procurement sites),
 brokerage, service,
     Business Models
     B-2-E (Business to Employee)

 The use of intranet
  technology to handle
  activities that take place       intranet
  within a business
                                  An internal
 Also called intrabusiness    network that uses
  e-commerce                        Internet
 Increases profits by
  reducing expenses within a
  Business Models P2P
  (Peer to Peer)
 A form of e-commerce that enables
  users with the same networking
  software to connect to each other’s
  hard disks and exchange files
 A consumer can pay another
  consumer to copy a file
 Music Sharing
    May 2006 – average of 9.7
      million simultaneous file sharers
      online at any one time.
    2/3 were from the US
    Jan 2008 – Pirate Bay reaches
      10 million simultaneous users
      online seeding over 1 million
      (2.1 million in May 2006)
Advantages of doing business on the

   Global market – 24 hours a day
   Access to multiple suppliers and prices
   Information available immediately – short
    turnaround time
   Reduce Middleman Costs, direct buying / selling
   Distribution costs are reduced
   Can places orders from anywhere
   Easier to comparison shop
   Immediate feedback
   E-Commerce Revenue Streams
                        direct sales                rentals
                        of a product
 The method a           or service
  business uses
  to generate                 electronic
  income                     distribution
 A single Web                                  Web
  site may use     subscriptions               hosting
  more than one
  method of
                   online               Internet
  generating      storage                access
  revenue         services
Prevents access to the system by unauthorized users
Often used for transaction services where credit card
 information is entered
Data is encrypted over network
                               Secure sites have
                                URLs that begin
                                 with https://
                               instead of http://
Consumer Concerns

 A recent poll of Americans Found that
   – 13% had no fears about E-Commerce
   – 75% are wary of ID theft when buying online
   – 53% had concerns of privacy and security
   – 20% cited the inability to inspect products closely over the
   – 3% do not like to wait for delivery
Common Questions
 What do I need to do to start an E-Commerce Site
  – Product/Service
  – Website
 Can I do it myself?
  – Depends on scope
 How do I accept payments by credit card
  – Secure collection
  – Process transactions
  – Merchant Account
   What will it cost
      Cost of running the site

      Processing Payments

   Must I accept Credit Cards
      Generally “YES”

      Low volume sites have other options

   How do I attract customers?
      That’s tough

      Search engines, banner ads, various advertising
Common Customer Complaints

Shoddy search engines
Odd navigation schemes
Long pages to download
Jakob Nielsen's

 Top Design Mistakes of 2007
      Bad search
      PDF files for online reading
      Not changing the color of visited links
      Non-scannable text
      Fixed font size
      Page Titles With Low Search Engine Visibility
      Anything That Looks Like an Advertisement
      Violating Design Conventions
      Opening New Browser Windows
      Not Answering Users' Questions
E-Commerce Sites

 Establish the organization as an expert
 Evaluate your on-line competition
 Differentiate yourself from the competition
 Usable Site (easy to navigate)
 Site should convey the brand
 Provide comprehensive product and service
Limitations of the WWW

 Bandwidth or data capacity
 Comfort Factor
 Security
 Privacy

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