E-commerce and Website Development: Hype … and Reality Ka-Neng Au Rutgers University 30 March 2002

Introduction National IT policy Investment in network infrastructure Emphasis on human resource development for IT

E-commerce hype … E-commerce is profitable … Shopping is easy … E-commerce is secure … M-commerce is the future …

E-commerce is profitable … $32.6 billion in 2001 U.S. sales % annual growth all retail sales only %

… but only for the few Only 1% of retail sales High cost of acquiring new customers Low click-through rate for banner ads Inefficient supply chain management

Successful strategies “bricks and clicks” Online partnerships Technology upgrades

Shopping is easy … just point and click

… but paying is hard Forms, forms, forms Privacy concerns Security fears Shipping costs

Successful strategy: Digital wallets Acceptable to buyers and sellers Easy to understand and use Low overhead per transaction Secure and resistant to fraud

E-commerce is secure … … for consumers

… but not for merchants Break-ins Distributed denial of service bombing

Necessary strategies Firewalls to restrict access Frequent password changes Re-routing of network traffic Removal of abused services

M-commerce is the future … … everyone has a hand phone

… but not the near future Limited screen display Limited speed of transmission Limited services available Limited size of keyboard

Successful strategy: m-cash Small purchases Brief transactions Charged to phone bill

Necessary strategy: Privacy policy Notice – of a privacy policy on the site Choice – for the use of personal information Access – to your own information Security – of information storage

Promising technology: e-markets Online intermediary between buyers and sellers Trading hubs for vertical markets Potential for cost savings