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e-Commerce Transaction

e-Commerce Transaction. Coky Fauzi Alfi. Definition. Commerce : “The activity of buying and selling, especially on a large scale” ( New Oxford Dictionary of English ) e-Commerce : “The trading of goods and services conducted using the Internet and other electronics media”.

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e-Commerce Transaction

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  1. e-Commerce Transaction Coky Fauzi Alfi

  2. Definition Commerce : “The activity of buying and selling, especially on a large scale” (New Oxford Dictionary of English) e-Commerce : “The trading of goods and services conducted using the Internet and other electronics media”

  3. e-Commerce versus Commerce

  4. Steps • Identify suppliers • Compare and select products or services • Make purchase commitments • Complete financial transactions • Obtain service

  5. Transparency Reliability Confidentiality and privacy Respect of the intellectual property rights Principles

  6. 1960, businesses were using primitive computer networks to conduct electronic transactions called Electronic Data Interchange (EDI) 1982, Transmission Control Protocol and Internet Protocol (TCP/IP) 1990, HTML 1992-1994, Mosaic and Netscape 1995, Amazon.com goes live. First Virtual and CyberCash go live too. History

  7. Electronic Data Interchange, EDI : The exchange, using electronic media, of standardized business documents such as purchase orders and invoices between buyers and sellers Electronic Funds Transfer, EFT : An aspect of the electronic payment mechanism involving transfer of funds from the bank of a buyer to a seller EDI and EFT

  8. Private Network EDI Diagram EDI standard documents Middleware Middleware Translator Translator Enterprise A Enterprise B

  9. Levels of e-Commerce Sophistication

  10. A Customer’s standpoint: Increase in demand for choice (product depth, global reach, price choices) Demand for information (detailed product information, inventory, order status) Demand for interactive, online support Avoidance of travel and parking difficulties for consumer e-commerce Elimination of time constraints (that is, opening hours or delays between placing an order and delivery) The Reasons for Implementing e-Commerce

  11. A business customer’s standpoint: Lower purchasing overhead – especially for small value and repeat orders Greater choice (greater product depth and global reach) Faster fulfillment cycle time (ordering, shipping, billing) Greater ability to supply information (inventory, order status, etc) Lower cost than EDI Exp. Dell Computers The Reasons for Implementing e-Commerce

  12. A supplier’s standpoint: A global reach, leading to more orders Reduced administration overhead Integration between back office and online ‘shopping’ activities Integration of online ‘shopping’ activities with database marketing Less need for distribution via channel Reduced working capital (inventory) The Reasons for Implementing e-Commerce

  13. Technophobia Security fears Technology not user friendly Poor performance leading to slow download Inertia of habitual conventional shopping and purchasing Internet access still limited Inhibitors to E-Commerce

  14. Business-to-Business (B2B). Exp. Wal-Mart, Warner-Lambert Business-to-Customer (B2C). Exp. Dell, Compaq, Cisco Consumer-to-Consumer (C2C). Exp. eBay. COM Consumer-to-business (C2B) Business-to-Employee (B2E) Nonbusiness e–Commerce. Exp. Social Security Online Types of E-Commerce

  15. Brokerage Model Brokers bring buyers and sellers together to make transactions happen They charge a fee or commission for the service (account or transaction-based) Exp. e-Tendering.com Advertising Model Acts as an extension of the traditional media broadcast model. Exp. Google e-Commerce Models

  16. Infomediary Model Assist buyers and/or sellers understand a market, its products and prices by gathering related data Exp. Nielsen/NetRatings Merchant Model Wholesalers and retailers of goods and services. Sales rely on price lists, and sometimes on auctions Exp. Mondo Online Store e-Commerce Models

  17. Be secure (achieving privacy, authentication, integrity and non-repudiability) Be easy for buyer and seller to use and understand Be straightforward for banks to administer Be scalable across different currencies and to different denominations Have low costs for implementing transactions Payment System Requirements

  18. Consumer Payment Systems Non-credit or pre-paid systems Digital, virtual or electronic cash (e-cash). Exp. CyberCash Microtransaction or Micropayment. Exp. ECoin Debit cards. Exp. Debit card from Bank Austria Smartcards. Exp. Visa Cash Post-paid or credit-based systems Digital/electronic cheques. Exp. Cheques from BankNet Credit card. Exp. Visa, Mastercard Types of Payment Systems

  19. Business Payment Systems Open Buying on the Internet (OBI) The Open Trading Protocol (OTP) Internet-based EDI Types of Payment Systems

  20. Security System Issues

  21. Authentication Privacy and confidentiality Integrity Non-repudiability Availability Security System Requirements

  22. Encryption Secret-key (symmetric) encryption Public-key (asymmetric) encryption Digital signature Secure Electronic Transaction (SET) Firewalls Methods of Security System

  23. Secret-key Encryption

  24. Public-key Encryption

  25. End

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