Introduction to Electronic Commerce: Types and Methods

1. 2 CHAPTER The Internet and the Web Irfan A. Ilyas

2. Points to cover • Introducing Electronic Commerce • Ecommerce main areas • Types of ecommerce sites • Web Storefronts • Web Auctions • Methods of Ecommerce Payments • Checks • Credit cards • E-cash • Browser Utilities • Helper Applications • Plugins • Java applets • Web Portals • Types of internet

3. Introducing Electronic Commerce • Electronic Commerce is “doing business over the Internet”. • Ecommerce mainly includes any type of business activity over the Internet • Publicizing the business information • Selling and buying goods, information and services

4. Ecommerce Areas • Three basic types of Ecommerce • Business to consumer (B2C) • Involves sale of a product or service to the general public • Lets the business company directly interact with the consumers without a middleman • Business to business (B2B) • Involves sale of a product or service from one business to another • Typically promotes a manufacturer-supplier relationship • Consumer to consumer (C2C) • Involves individuals selling to individuals • Goods are described and interested buyers contact sellers to negotiate prices • Buyers & sellers may not meet face to face. • Similar to a classified ad or auction.

5. Types of Ecommerce Sites • Web Storefronts • Storefronts on web are offering customers to visit virtual (may not exist physically) retail stores • Promotes B2C Commerce • Special software packages available to create a web storefront, called Commerce Servers • Consumer activities on a web store front • Registration: • Consumers need to provide their details (name, shipping address, credit card number etc.) once • Next purchase doesn’t need them to enter it again • Product Browsing • Look for different product details • Can be done without registration also. • Placing products into virtual shopping carts • A cart is a virtual space to put different items.

6. … Web Storefronts • Behind the scene activities • Calculate taxes and shipping costs • Handle a variety of payment options • Update and replenish inventory • Ensure reliable and safe communications • Collect the data about visitors and generate reports to evaluate the site’s profitability

7. … Types of Ecommerce Sites • Web Auctions • Promotes C2C Commerce • Let sellers put the product details and buyers submit bids electronically • Like traditional auctions • Two basic types of Web Auction Sites • Auction house sites • Site owner normally asks bids for some company’s surplus stock • These sites are normally safer site for electronic auctions • Person-person auction sites • Operates more like flea (free) markets • The site owner allows buyers and sellers meet electronically • Site owner is not involved in the purchase (get some %age of it or just a facilitator) • The credibility of such sites may be shaky (sellers & buyers need to be cautions)

8. …Web Auctions

9. Methods of Electronic Payments • Checks • Buyers send a check through ordinary mail • When received by the seller, the check is checked for validity • After verifying the validity, the goods are sent • Needs longest time • Most secure • Credit Cards • Buyers provide their credit card number to the seller • Sellers contact the relevant bank to ensure the credit card validity • After verifying, the seller is being paid by the bank • there should be some way for the buyer to let the bank know about seller’s ability to draw a fix amount • Fastest but most dangerous • Not feasible for very low value transactions [due to the processing charges bank takes for this service]

10. …Methods of Electronic Payments • Electronic Money • Also called E-cash or cyber cash or digital cash • Denotes digitally encoded currency balances (Numbers saved on a smart card, also called e-wallet) • A third party (banks) is involved • Any one can pay the third party to increase the count on its card • After a purchase done, the seller can transfer the count on a customer’s smart card to its own card • A device called “Card Reader/ writer” is used • Seller’s card reader should have an access to customer’s card reader for an e-cash transfer • The method is still in infancy: • The third parties offering e-money services are not many • Card reader devices are not widely available with customer computers

11. Browser Utilities • Helper Applications • Some files which are attached to the hyperlinks of a page can not be shown by the browser • Example: • Video clips, Sound clips, Microsoft Power point slides • A separate program is needed to show different types of files • Examples: • Microsoft Media Player for video and sound clips • Microsoft power point • A Web Browser can be configured to open the needed programs (called Helper Applications) directly • To properly use a helper application • It must already be installed on the user computer • Browser must be configured properly to invoke the application when needed

12. …Browser Utilities • Plugins • Helper application programs run in separate windows • A plug-in program lets the browser to deal with non-html files within their windows • A plug-in • Adds new functionality to the browser (sometimes adding new menu options) • Doesn’t let the user to configure the browser or to install any separate program • Users need to obtain and install the plug-in program • Examples: • Acrobat reader plug in lets the user read pdf documents within the browser window (available differently for different browsers) • Cosmos plug-in for showing 3D animations • Media Player from Microsoft to play audio files • Quicktime from Apple, RealPlayer for Real Networks, Shockwave from Macromedia

13. …Browser Utilities • The best place to find plug-ins for a specific browser is “the browser’s home page” • For Example: • Netscape’s home page is having a list for Netscape plug-ins

14. …Browser Utilities • Java Applets • Plugins data cannot be shown by a browser if the plugin program is not installed before • Java applets are similar to plugins (added new functionality to your browser) but they are downloaded and run within the web page • A java-enabled browser is capable to run a Java applet code inside its window • Java applets are widely used to: • Display graphics • Present animation • Provide interactive games • And much more….

15. More Web Concepts • Web Portal • Portals are sites which offer a bunch of services (instead of just displaying some information) • The services may include: • Email space for the visitors • On registering the service, the user will get an email address and a limited space to the site’s email server • Updated News • Links to other web sites for • Weather • Sports • Financial • Web Service • Users can allocate a web space to launch their pages on the Internet

16. … More Web Concepts • Two main types of portals are: • Horizontal portals • Designed to appeal the mass audience (general public) • Offer general interest services and links • Vertical portals • Present focused content to appeal to special interest groups • Examples: • Sports portal discuss only links/ services relevant to sports

17. Helper Applications • Most popular helper application categories: • Offline browsers • Information Pushers • Filters • Information pushers • User selects channels • Program retrieves relevant information • Stores it for later viewing • PointCast Network and BackWeb

18. Helper Applications • Off-line search utilities • Standard method requires connection while searching • Off-line search utilities • accept instructions from the user • conducts the search • compiles a non-duplicating index • WebFind, WebCompass, EchoSearch

19. Helper Utility from InContext

20. Web Publisher: Backweb

21. Helper Applications • Filter • On Web, some content is inappropriate for youngsters • Filters • limit access • Set time limits for access time • Report usage statistics • Cyber Patrol, Cybersitter, Net Nanny

22. Types of internets • Intranets • Private networks within an organization • Like the Web outside, browsers, web pages and web sites are used • Prime objective • information availability and flow

23. …Types of internets • Extranets • Private networks connecting two or more organizations • Increases efficiency and reduces costs

24. Special Internet Host • Firewalls • Information security is critical • Firewalls are designed to control access inside • Key component is the proxy server • Proxy is gatekeeper

25. Internet2 • A private Internet • Limited access • More costly • High speed • Primary beneficiaries are Federal Government and major corporations • Advanced nanomanipulators