Principles of Information Systems, Sixth Edition Electronic Commerce Chapter 8

Principles of Information Systems, Sixth Edition Principles and Learning Objectives E-commerce is a new way of conducting business, and as with any other new application of technology, it presents both opportunities for improvement and potential problems. –Identify several advantages of e-commerce. –Outline a multistage model that describes how e- commerce works. –Identify some of the major challenges companies must overcome to succeed in e-commerce. –Identify several e-commerce applications.

Principles of Information Systems, Sixth Edition Principles and Learning Objectives E-commerce requires the careful planning and integration of a number of technology infrastructure components. –Outline the key components of technology infrastructure that must be in place for e-commerce to succeed. –Discuss the key features of the electronic payments systems needed to support e-commerce.

Principles of Information Systems, Sixth Edition Principles and Learning Objectives Users of the new e-commerce technology must take safeguards to protect themselves. –Identify the major issues that represent significant threats to the continued growth of e-commerce. Organizations must define and execute a strategy to be successful in e-commerce. –Outline the key components of a successful e- commerce strategy.

Principles of Information Systems, Sixth Edition An Introduction to Electronic Commerce

Principles of Information Systems, Sixth Edition Introduction to Electronic Commerce Business-to-consumer (B2C) e-commerce Business-to-business (B2B) e-commerce Consumer-to-consumer (C2C) e-commerce

Principles of Information Systems, Sixth Edition Multistage Model for E-commerce Search and identification Selection and negotiation Purchasing products and services electronically Product and service delivery After-sales service

Principles of Information Systems, Sixth Edition Multistage Model for E-commerce

Principles of Information Systems, Sixth Edition Product and Service Delivery

Principles of Information Systems, Sixth Edition E-Commerce Model

Principles of Information Systems, Sixth Edition E-Commerce Challenges Change distribution systems & work processes Split-case distribution Integrate web-based order processing with traditional systems

Principles of Information Systems, Sixth Edition The E-Commerce Supply Chain Supply chain management –Demand planning –Supply planning –Demand fulfillment Increased revenues and decreased costs Improved customer satisfaction Inventory reduction across the supply chain

Principles of Information Systems, Sixth Edition The E-Commerce Supply Chain

Principles of Information Systems, Sixth Edition Supply Chain Management

Principles of Information Systems, Sixth Edition Business-to-Business Allows manufacturers to buy at low price worldwide Enterprise can sell to a global market The world become a village market

Principles of Information Systems, Sixth Edition Global E-Commerce Steps in localization –recognizing and conforming to the nuances, subtleties, and tastes of local cultures –supporting basic trade laws such as each country’s currency, payment preferences, taxes, and tariffs –ensuring that technological capabilities match local connection speeds

Principles of Information Systems, Sixth Edition Global E-Commerce Determine which global markets make the most sense for selling products or services on-line Decide whether Web content should be generated or updated centrally or locally

Principles of Information Systems, Sixth Edition E-Commerce Applications

Principles of Information Systems, Sixth Edition Retail and Wholesale Electronic retailing Cybermalls Wholesale e-commerce: B2B

Principles of Information Systems, Sixth Edition Manufacturing

Principles of Information Systems, Sixth Edition Marketing Market segmentation Technology-enabled relationship management

Principles of Information Systems, Sixth Edition Investment and Finance On-line stock trading On-line banking –Electronic bill presentment

Principles of Information Systems, Sixth Edition Investment and Finance

Principles of Information Systems, Sixth Edition Investment and Finance

Principles of Information Systems, Sixth Edition Technology Infrastructure

Principles of Information Systems, Sixth Edition Technology Infrastructure

Principles of Information Systems, Sixth Edition Hardware Storage capacity –Software –Volume of e-commerce transactions Website hosting

Principles of Information Systems, Sixth Edition Web Server Software Security and identification –Denial of service attack Web site tracking –Web log file

Principles of Information Systems, Sixth Edition Web Server Software Web site development tools Retrieving and sending Web pages Web page construction software –Static Web page –Dynamic Web page

Principles of Information Systems, Sixth Edition E-Commerce Software Catalog management Product configuration Shopping cart

Principles of Information Systems, Sixth Edition E-Commerce Transaction Processing Automates transaction processes from order placement to reconciliation Web traffic data analysis

Principles of Information Systems, Sixth Edition Electronic Shopping Cart

Principles of Information Systems, Sixth Edition Network and Packet Switching All e-commerce depends on a type of network to securely transmit data –Internet –Extranet –Value-added network (VAN) –Virtual private network (VPN) All approaches rely on packet switching and use routers Cost, availability, reliability, security, and redundancy must be considered when choosing a network

Principles of Information Systems, Sixth Edition Electronic Payment Systems

Principles of Information Systems, Sixth Edition Electronic Payment Systems Digital certificate Certificate authority Secure sockets layer (SSL) Electronic cash Electronic wallets Smart, credit, charge, and debit cards

Public Key Certificate In cryptography, a public key certificate (or identity certificate) is an electronic document which utilizes a digital signature to bind together a public key with an identity — information such as the name of a person or an organization, their address, and so forth. The certificate can be used to verify that a public key belongs to an individual.cryptographydigital signaturepublic key Principles of Information Systems, Sixth Edition

Public Key Infrastructure In a typical public key infrastructure (PKI) scheme, the signature will be of a certificate authority (CA). In a web of trust scheme, the signature is of either the user (a self-signed certificate) or other users ("endorsements"). In either case, the signatures on a certificate are attestations by the certificate signer that the identity information and the public key belong together.public key infrastructure certificate authorityweb of trustself-signed certificate Principles of Information Systems, Sixth Edition

Contents of a Typical Digital Certificate Serial Number Used to uniquely identify the certificate. Subject The person, or entity identified. Signature Algorithm The algorithm used to create the signature. Issuer The entity that verified the information and issued the certificate. Valid-From The date the certificate is first valid from. Valid-To The expiration date. Public Key The public key to encrypt a message to the named subject. Thumbprint Algorithm The algorithm used to hash the certificate.hash Thumbprint The thumbprint itself. Principles of Information Systems, Sixth Edition

Threats to E-Commerce

Principles of Information Systems, Sixth Edition Threats to E-Commerce E-commerce incidents Theft of intellectual property –Patents on business processes

Principles of Information Systems, Sixth Edition Fraud On-line auction fraud Spam Pyramid schemes Investment fraud Stock scams

Principles of Information Systems, Sixth Edition Invasion of Consumer Privacy On-line profiling Clickstream data Safe harbor principles

Principles of Information Systems, Sixth Edition TRUSTe Seal

Principles of Information Systems, Sixth Edition BBB On-line Privacy Seal

Principles of Information Systems, Sixth Edition How to Protect Your Privacy While On-Line

Principles of Information Systems, Sixth Edition Strategies for Successful E-Commerce

Principles of Information Systems, Sixth Edition Developing an Effective Web Presence Visitors to a web site should be able to: Obtain general information about the organization Obtain financial information for making an investment decision Learn the organization’s position on social issues Learn about the products or services that the organization sells

Principles of Information Systems, Sixth Edition Putting up a Web Site Web site hosting services Storefront brokers

Principles of Information Systems, Sixth Edition Building Traffic to Your Web Site Domain names Meta tags Traffic data analysis

Principles of Information Systems, Sixth Edition Maintaining and Improving Your Web Site Be alert to new trends Be prepared to take advantage of new opportunities Personalization –Explicit –Implicit

Principles of Information Systems, Sixth Edition Summary E-commerce - enables consumers and companies to gain access to worldwide markets Electronic retailing (e-tailing) - the direct sale from business-to-consumer through electronic storefronts designed around an electronic catalog and shopping cart model E-commerce shoppers - must be on constant guard to protect their rights, security, and personal privacy