1. Topic 4: Online Goods & Services Press F5 to view!
GCSE ICT Revision
Topic 4: Online Goods & Services
Press F5 to view!

2. Features of Online Shops
Online shopping refers to the buying and selling of goods and services using websites accessed through the Internet.
Physical goods can be purchased online (books etc.) as well as non-physical goods like music downloads.
Some companies sell only online...
...whilst others have ‘real’ shops as well.

3. Advantages of Online Shopping
Greater choice of products available – people are not limited to one geographical area!
People can shop all day, everyday.
Price comparison sites mean that people can find better deals.
People do not need to leave the house.
People have the right to return goods within 7 days of delivery unless they are customised.
People can read reviews that others have written about products.

4. Disadvantages of Online Shopping
People need Internet access and computer skills to shop online.
Cash is not accepted.
People cannot see or touch products or try on clothes.
Delivery is usually an added expense.
People have to submit personal information through a website to shop online.
Greater risk of fraud as people risk not receiving goods or having personal details stolen on fraudulent websites.

5. Impact on businesses
Online businesses can be located anywhere so they do not have to pay expensive High Street rents.
Online businesses often need less staff, again saving money.
Online businesses can have a greater range of products because they do not have to have anything on display.
Online businesses can attract custom from all over the world.

6. Online Auctions
Online auctions are very similar to traditional auctions but buyers and sellers can be all over the world.
Users can search for products easily.
Users can see feedback from other users so they can make judgements about their purchase.
Users often get better deals online because they can search for cheaper products and could win auctions at low prices.
Rare items can be found easier.

7. Online Auctions - Disadvantages
Users who bid on an online auction have to wait for the auction to end before they know they will have definitely made a purchase.
Users can be open to fraudulent behaviour when buying and selling, though online auctions work hard to reduce this happening.
Users have to be registered and often have to sign up to a third party online payment system (like PayPal).

8. Online Services
You need to understand how online services are provided for education, news and banking.
Education
Students can have online accounts on school websites or VLEs where they can access teaching materials and submit assignments.
The website you have accessed to get to this PowerPoint is an example of how online services have helped in education.

9. Online Services
You need to understand how online services are provided for education, news and banking.
News
News reports are now not just printed in the newspapers but also published online.
These sites are usually free but some offer users a subscription.
Users can use RSS feeds (automatic updates on webpages) to get up-to-date information.

10. Online Services
You need to understand how online services are provided for education, news and banking.
Banking
Online banking now makes it easy for users to check their balances and transfer money.
Customers can now access their account securely using mobile phone apps too.

11. Online Gaming
Online gaming enables players to connect via the Internet and interact with each other.
A central server runs the game software and streams each player’s position and actions to all players over the Internet.
Players need a high bandwidth and low latency Internet connection to avoid lag when gaming.
Some games store data such as graphics and sound locally on players’ computers.

12. Streaming vs Downloading
On demand video services now mean that streaming media is very popular.
Spotify allows users to stream music compared to iTunes which is a service for downloading music.
iPlayer is a service that allows users to stream TV programmes from the BBC.
Streaming is better for live performances and shows.
Streaming also saves disk space.
Downloading doesn’t need an internet connection, however, and ‘buffering’ isn’t an issue.

13. Transactional Data
A transaction occurs everytime you buy or sell something.
Everytime you buy something online, data about the transaction is saved.
Personalised information is often stored in cookies. These are small text files that are created on your computer when you visit a website.
Transactional data includes personal information about the buyer and details about the purchase they made (like price and item information).

14. What is transactional data used for?
Transactional data is valuable to a company because it allows them to keep a record of your purchase and allows them to track your delivery.
The data can then be used to understand customers’ buying habits and see any trends.
This data can also allow websites to display products that it thinks you might be interested in based on what you have purchased before.
The data often allows for a more personalised online shopping experience.

15. Internet Advertising
Internet advertising is another way in which organisations operate online.
Internet advertising can be targeted at particular customers.
It allows for statistics be gathered (like how many people have clicked on the advert itself).
It reaches a wide range of customers.
It can reach customers faster than traditional forms of advertising.

16. Internet Advertising
Internet advertising can be done on search engines. This takes a users key words to display adverts that are appropriate for to their search.
Internet advertising can also be done on social networking websites.
These websites use the personal information they know about their users to display advertisements they think will be appropriate.
Facebook has over 800 million users worldwide and can select to advertise to particular locations, age groups and interest groups.

17. Viral Marketing
Viral marketing is when an organisation creates interesting and entertaining content that making people want to ‘pass it on’ to their friends using social networking, and texts.
This type of marketing is very cheap because the organisation does not need to pay for adverts.
Memorable content means that people remember the brand name.

18. Avoid Targeted Marketing
Targeted marketing is when online services use personal information about you to display adverts appropriate for your age, location or interests.
To avoid this type of marketing people can opt out of sharing personal information with other organisations when creating accounts online.
People can also delete cookies from their computers.
People should be careful with what information they are adding to online profiles.

19. Online Payments There are four ways of paying online:
Credit/debit cards
Online bank transfer
Third party payment processors
Online coupons/gift vouchers/eVouchers
Debit cards take payment directly from a customers’ account.
Credit cards are like borrowing money from the bank, customers need to pay the money back later, often with interest.

20. Credit Card Verification
The Credit Card Verification (CCV) code is the number on the back of the card.
This number is not included on the magnetic strip or chip itself.
Entering this code means that the person must have seen the credit card (so it enhances security).

21. Online Bank Transfer
Customers can make online payments directly from their account to other accounts as long as they know the bank account details of who they are paying.
Online banks keep customers safe from online fraud by checking accounts to make sure there is no unusual activity.
They also sometimes provide login protection schemes such as PINsentry – these are devices that look like calculators that generate codes to confirm the user’s authenticity.

22. Online Coupons/Vouchers
Many online shops now offer ‘online’ gift eVouchers or ‘money off’ coupons.
These can be sent to people electronically by , or printed out and sent by post.
To redeem the gift eVoucher or coupon the recipient creates and online account and enters the unique reference numbers given on the eVoucher or coupon.

23. Third Party Payment Processors
Third party payment processors are trusted organisations who stand between the customers and the retailers so payments are not made directly.
These services, like PayPal, mean that sellers do not need to offer a secure site (which can be expensive).
For the buyer, these services mean that users are not exposed to fraud.

24. Consumer Protection
Consumer protection is all about the laws that exist to protect the rights of people who are buying things.
When you buy something, the item must be of satisfactory quality, fit for purpose and as described – if not, the item has to be replaced, repaired or the customer’s money refunded.
If you buy from an online retailer in the UK, you have the same rights as if you bought the item in a ‘real’ shop.
There is also a cooling off period when buying online – this means orders can be cancelled up to seven working days after receiving an item.

25. Online Software
Locally installed software means that a program is installed on your computer. It is now common, however, to use hosted software – this is not installed on the users machine – instead, they use the Internet to access the program (like Google Documents, instead of Microsoft Word).
This is good because software doesn’t take up space on your computer and you can access the software on any computer.
Disadvantages, however, include the fact that an Internet connection is required to access the software and it is not as secure as local software.

26. Online Storage
Similarly, people now use online storage instead of saving documents locally (on their computer).
Skydrive (now called Onedrive) is an example of this.
Again, there are problems with an Internet connection being required and with security.
People do, however, save disk space on their computer when using online/cloud storage and they can access their documents no matter where they are!

27. Search Engines
A search engine is a computer program that searches for web content that contains or is tagged with key words.
Choosing key words when performing a search is important and people can narrow their search down by doing a more advanced search (by deciding what not to see or where to search).
People need to realise that no one checks or verifies that websites contain truthful information, so users should always double check information they get from a search engine.