Chapter 11 Electronic Commerce.

Chapter 11 Electronic Commerce

Presentation Overview
An Overview of Electronic Commerce Online Shopping Online Services Peer-to-Peer Online Transactions Transaction Payment Methods Establishing an E-tailer Web Site Business-to-Business Electronic Commerce The Supply Chain: A B2B Model Major Types of B2B Technologies B2B in the U.S. Economy

An Overview of Electronic Commerce
What is electronic commerce?

What is electronic commerce? Electronic commerce – buying and selling of products and services over the Internet

What is electronic commerce? Electronic commerce – buying and selling of products and services over the Internet Business-to-consumer electronic commerce – companies use Internet to sell products and services to customers and receive payment

What is electronic commerce? Electronic commerce – buying and selling of products and services over the Internet Business-to-consumer electronic commerce – companies use Internet to sell products and services to customers and receive payment Business-to-business electronic commerce – companies use Internet to conduct a wide range of business activities with other companies

Popular Business-to- Consumer Shopping Sites

Online Shopping What are the advantages of online shopping?

Online Shopping What are the advantages of online shopping?
Convenience – consumers purchase what they want when they want from their own homes

Convenience – consumers purchase what they want when they want from their own homes Greater selection – online stores offer consumers almost unlimited products

Convenience – consumers purchase what they want when they want from their own homes Greater selection – online stores offer consumers almost unlimited products Product information – consumers find detailed information on a wide variety of products

Convenience – consumers purchase what they want when they want from their own homes Greater selection – online stores offer consumers almost unlimited products Product information – consumers find detailed information on a wide variety of products Ease of comparison shopping – consumers quickly find comparable items at similar stores

Online Shopping Online Store

Online Shopping Online Store
seller’s Web site where customers can view and purchase products and services

seller’s Web site where customers can view and purchase products and services seller groups products or services in categories that link to a list of merchandise in each category

seller’s Web site where customers can view and purchase products and services seller groups products or services in categories that link to a list of merchandise in each category user clicks desired category to view pictures, descriptions, and prices

Online Shopping Online superstores
offer an extensive array of products products are grouped into departments provides search features to find specific products

Online Shopping Online superstores Online shopping malls
offer an extensive array of products products are grouped into departments provides search features to find specific products Online shopping malls connects its stores by hyperlinks on the mall’s home page

Online Shopping Shopping agent continually
scans data- bases for products and prices that are displayed when a user requests a price comparison.

Online Shopping The online shopping process

Online Shopping Tip checklist for shopping online

Online Shopping Milestones in federal privacy legislation

Online Shopping Data is coded when sent over Internet and decoded by recipient.

Online Shopping Online shopping sites should provide

Online Shopping Online shopping sites should provide
easy to find, read, and understand terms of sale

easy to find, read, and understand terms of sale satisfactory degree of information about the product being offered

easy to find, read, and understand terms of sale satisfactory degree of information about the product being offered simple to follow directions for purchasing

easy to find, read, and understand terms of sale satisfactory degree of information about the product being offered simple to follow directions for purchasing high level of customer service

Online Services Online Banking and Investing

Online Services Online Banking and Investing
Online banking involves using a computer, modem, and Internet to conduct routine banking.

Online banking involves using a computer, modem, and Internet to conduct routine banking. Users pay bills, transfer funds among accounts, and transact other financial business online.

Online banking involves using a computer, modem, and Internet to conduct routine banking. Users pay bills, transfer funds among accounts, and transact other financial business online. Brokerage firms maintain Web sites so consumers can purchase and sell stocks and other securities.

Online Services Online Travel

Online Services Online Travel
allows users to research destinations, transportation, and prices

Online Services Online Travel
allows users to research destinations, transportation, and prices users can surf price and schedule combinations to sort options by airline, arrival and departure times, price, and duration of flight

Peer-to-Peer Online Transactions
Peer-to-peer online transaction venue is a Web site forum where anyone may sell, buy, trade, or share goods with other individuals.

Peer-to-peer online transaction venue is a Web site forum where anyone may sell, buy, trade, or share goods with other individuals. Online auction is a site to place an item for sale or bid on items being offered for auction.

Peer-to-peer online transaction venue is a Web site forum where anyone may sell, buy, trade, or share goods with other individuals. Online auction is a site to place an item for sale or bid on items being offered for auction. Digital music distribution is the free distribution of music over the Internet.

Transaction Payment Methods
Electronic Funds Transfer (EFT) any transfer of money over the Internet

Electronic Funds Transfer (EFT) any transfer of money over the Internet Check or Credit Card by Phone Electronic check (e-check) initiates an electronic transfer of funds from customer’s checking account to merchant.

Credit Account represents a customer’s promise to pay for online purchases upon receipt of a periodic statement

Credit Account represents a customer’s promise to pay for online purchases upon receipt of a periodic statement Credit Cards and Debit Cards Credit card – small plastic card with information that enables user to make purchases on credit Debit card – withdraws funds directly from purchaser’s current checking or savings account

Smart Card user swipes card through reader attached to computer and information is transmitted to e-tailer which completes payment transaction

Smart Card user swipes card through reader attached to computer and information is transmitted to e-tailer which completes payment transaction Digital Cash allows customer to pay for online purchases by transmitting a number from one computer to another; the number represents a specified amount of money

Electronic Wallet encryption software stores user’s personal, credit card, and shipping information

Electronic Wallet encryption software stores user’s personal, credit card, and shipping information Micro Payments enables buyers to purchase low-cost items on Internet

Electronic Wallet encryption software stores user’s personal, credit card, and shipping information Micro Payments enables buyers to purchase low-cost items on Internet Person-to-Person Payment Systems allows consumers to transfer money through a credit card or bank account

Establishing an E-tailer Web Site
Registering the Domain Name Internet Corporation for Assigned Names and Numbers (ICANN) provides information about site registration, allows lookup to see if domain name is available, and provides information about how to register site’s address with registrar.

Choosing Hardware and Software

Choosing Hardware and Software Next step is to determine the type of hardware and software needed to create a storefront.

Choosing Hardware and Software Next step is to determine the type of hardware and software needed to create a storefront. A Web hosting service allows individuals or businesses to use its Web servers to store Web pages.

Processing Payments To process payments, you will need

Processing Payments To process payments, you will need to obtain a merchant account

Processing Payments To process payments, you will need to obtain a merchant account to provide secure order forms at the site

Processing Payments To process payments, you will need to obtain a merchant account to provide secure order forms at the site to use payment-processing software

Processing Payments To process payments, you will need to obtain a merchant account to provide secure order forms at the site to use payment-processing software an electronic order form

Processing Payments To process payments, you will need to obtain a merchant account to provide secure order forms at the site to use payment-processing software an electronic order form to use a commercial payment-processing service

Checklist for designing an effective site

Managing the Site Customers expect e-tailer sites to

Managing the Site Customers expect e-tailer sites to reflect current product descriptions and prices

Managing the Site Customers expect e-tailer sites to reflect current product descriptions and prices show specials, new products or services, updated information, or new images that encourage browsing the site frequently

Advertising and Promoting the Site Electronic methods to let shoppers know about your site include

Advertising and Promoting the Site Electronic methods to let shoppers know about your site include co-advertise and co-promote with other sites

Advertising and Promoting the Site Electronic methods to let shoppers know about your site include co-advertise and co-promote with other sites links to other sites like yours, and vice versa

Advertising and Promoting the Site Electronic methods to let shoppers know about your site include co-advertise and co-promote with other sites links to other sites like yours, and vice versa submit site to search engines

Analyzing the Effectiveness of the Site

Analyzing the Effectiveness of the Site Site analysis is ongoing evaluation of an e-commerce Web site and its activity.

Analyzing the Effectiveness of the Site Site analysis is ongoing evaluation of an e-commerce Web site and its activity. One form involves timing a Web site’s ordering or processing activities.

Analyzing the Effectiveness of the Site Site analysis is ongoing evaluation of an e-commerce Web site and its activity. One form involves timing a Web site’s ordering or processing activities. Another form provides users with a simple online questionnaire that allows feedback.

Developing a Customer Focus Customer relationship management (CRM) software electronically manages the business/customer relationship. It focuses on establishing and maintaining good relationships with online customers, suppliers, and other businesses.

Business-to-Business Electronic Commerce
How does the Internet support the supply chain in B2B e-commerce?

How does the Internet support the supply chain in B2B e-commerce? B2B e-commerce networks companies, suppliers, agents, customers, and others in a supply chain.

How does the Internet support the supply chain in B2B e-commerce? B2B e-commerce networks companies, suppliers, agents, customers, and others in a supply chain. Procurement is finding products and services at the best possible prices.

How does the Internet support the supply chain in B2B e-commerce? B2B e-commerce networks companies, suppliers, agents, customers, and others in a supply chain. Procurement is finding products and services at the best possible prices. Communicating with others in the supply chain can be done through Web sites, intranets, internets, extranets, and virtual private networks.

The Supply Chain: A B2B Model
Electronic commerce technologies allow businesses to conduct activities quickly and efficiently on a worldwide scale.

Types of information shared in the B2B model

An intranet allows departments within a business to share information quickly and easily.

Major Types of B2B Technologies
The electronic data interchange (EDI) process

Payment and Transaction Systems

Payment and Transaction Systems Financial electronic data interchange (FEDI) provides for electronic transmission of payment and remittance information among a payer, payee, and banks.

Payment and Transaction Systems Financial electronic data interchange (FEDI) provides for electronic transmission of payment and remittance information among a payer, payee, and banks. Automated clearinghouse (ACH) is established to transfer funds electronically from one account to another.

Security Technologies

Security Technologies Authentication identifies and individual and confirms authorization to access a system.

Security Technologies Authentication identifies and individual and confirms authorization to access a system. Electronic signature is a digital code attached to a message to uniquely identify the sender.

Security Technologies Authentication identifies and individual and confirms authorization to access a system. Electronic signature is a digital code attached to a message to uniquely identify the sender. Trusted operating system isolates OS functions into separate compartments and restricts access of unauthorized users to key areas of systems.

B2B in the U.S. Economy General Electric Corporation

B2B in the U.S. Economy General Electric Corporation
Customers can view high-resolution photos of engine parts they have sent in for repair.

B2B in the U.S. Economy General Electric Corporation
Customers can view high-resolution photos of engine parts they have sent in for repair. Site describes the defect and recommends whether and how to fix it.

B2B in the U.S. Economy Wal-Mart’s Customer Inventory System

B2B in the U.S. Economy Wal-Mart’s Customer Inventory System
Computers electronically transmit purchase orders, shipping lists, invoices, and payments; eliminates delays in shipping, obtains accurate pricing, and better serves customers.

B2B in the U.S. Economy Wal-Mart’s Customer Inventory System
Computers electronically transmit purchase orders, shipping lists, invoices, and payments; eliminates delays in shipping, obtains accurate pricing, and better serves customers. Electronic funds transfers allows payments to be electronically credited to suppliers’ bank accounts.

B2B in the U.S. Economy United Parcel Service (USP)

B2B in the U.S. Economy United Parcel Service (USP)
Employees use personal computers to enter information from customers who request package pick up or trace.

Employees use personal computers to enter information from customers who request package pick up or trace. Drivers use handheld devices to scan bar codes for product and destination information.

Employees use personal computers to enter information from customers who request package pick up or trace. Drivers use handheld devices to scan bar codes for product and destination information. Shipping label information can track packages and inform customers of package status.

On the Horizon Based on the information presented in this chapter and your own experience, what do you think is on the horizon? Suggested final slide for each chapter. CLH SLIDE Please have this slide be the final slide for each chapter.

Chapter 11 Electronic Commerce.

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