E-commerce(Electronic Commerce)

Systems that support electronically executed business transactions.

Development DescriptionGoogle Search engine used by more than 30 percent of the Internet

population

Broadband High-speed access used by more than 50 percent of Internet users, making it much more convenient to shop

Ebay Web site that introduced the masses to the power and benefits of e-commerce

Amazon Pioneer of e-commerce that sets the standard for online transactions

Google AdWords Today’s biggest online advertising vehicle that generated over $21 billion for Google in 2008

Wi-Fi WIreless technology that helped move e-commerce from desktops to mobile devices

User-generated content Contributions to the online community by anyone and everyone via Web sites like Facebook and YouTube

iTunes Application that legitimized music distribution over the Internet

BlackBerry Smart phone that helped to create a new mobile business culture

iPhone Created a market for online mobile applications and services

Major e-commerce developments

Electronic Data Interchange (EDI)

Uses private communications networks (Value-added networks-VANs)

To transmit standardized transaction databetween business partners and

suppliers.

TransactionAn exchange involving

goods or services, such as buying medical supplies for

a hospital or purchasing and downloading music on

the Internet

A transaction processing system (TPS)An information system used to support and

record transactions such as paying for products or paying an employee.

The Transaction Processing Cycle

Data Collection

Original Data

Data Editing

Data Manipulation

Data Storage

Data Production

Data Correction

TPS Reports

“Good” data“Bad” data

Capture transaction-related data such as item number, quantity, and payment methodCheck validity of the data entered, such as whether item number and credit card number are valid

Request correction if data editing reveals invalid data.

Process the transaction data, calculate totals, tax, shipping, and so on.

Store transaction-related data in the transaction database

Data Output:Output receipts, picking lists for the warehouse, or other documents

Types of E-Commerce

Business to consumer

Connects individual consumers directly with sellers to purchase products.

Types of E-CommerceBusiness to Business

Transactions between businessesExamples:

• Purchasing raw materials for production of products• Purchasing tools, parts, and machinery for the production line• Purchasing office furnishings, equipment, and products• Purchasing transportation and shipping services

Types of E-Commerce

Consumer to Consumer

Uses the Web to connect individuals who wish to sell their personal belongings with people

shopping for used items

Types of E-Commerce

M-Commerce (Mobile commerce)

Takes place over wireless mobile devices

such as handheld computers and cell

phones.Examples:

Purchasing and downloading songs directly to your phoneBuying and selling stocks from you Blackberry

“If You Build It, They Will Come”

Simply creating a website for the purposes of e-commerce will not guarantee any business

????

The 3C’s approach is used to build traffic to their website

3C’s ApproachFor capturing the interest of the online community:

ContentCommunityCommerce

3C’s ApproachFor capturing the interest of the online community:

Example: Content: A Web site sponsored by a health food company might offer valuable suggestions for good health. It might

also offer a calculator to keep track of calories to its visitors.

Community: As customers make regular return visits to the site because of the content, a community is built. Perhaps, a free membership can be offered to encourage return visits.

Commerce: Once a community is established, visitors may begin making health food and equipment purchases from the

site.

Security Issues

Digital CertificateA type of electronic business card

that is attached to Internet transaction data to verify the

sender of the data.

Digital certificates are provided by certification authorities such as VeriSign

Security Issues

A digital certificate contains the owner’s name, a serial number, an expiration date, and a public key.

EncryptionUses high-level mathematical functions and computer algorithms to encode data so that it is unintelligible to all but the intended recipient.