E-commerce

Overview of E-commerce
Definition: Electronic Commerce (EC) describes the process of buying, selling, transferring, or exchanging products, services, and information using computer network and the Internet. It also include servicing customers, collaborating with business partners, conducting e-learning, intra business activities, and conducting electronic transactions within an organization.

E-commerce forms
EC can take several forms depending on the degree of digitization of : 1-product 2-process 3-Deleivary agent. All of them can be physically or digitally. examples: buying SW is pure digitally, buying a shirt is partially digital and partially physically. Any transaction that is partially digital is an E-commerce transaction.

 EC organization are pure physically organizations, but companies engaged only in EC are virtual organizations. EC can done over the: 1-Internet 2-Value-Added networks ( VAN) that add communication services to existing common carriers such as LAN. * For example: buying food from vending machine, buying with smart cards or cell phone are all EC activities.

Types of EC transactions
1-Business to business (B2B): seller and buyer are organizations. 2- collaborative commerce (c-commerce): sharing business activities electronically. 3-Business to consumer (B2C): seller is an organization, buyers are individuals. 4-consumer to business (C2B): consumer names a service, the organization try to fulfill it. (it looks for a supplier to the service).

5-consumer-to-consumer (C2C): individual sells product to other individual. 6-intra business (intraorganization) commerce: internally improve org. functions. 7-government to citizens (G2C) or others: government provides services to citizens using EC technologies. It can do business to other governments. 8- mobile commerce (MC): EC is done in a wireless environment, using cell phones to access the Internet.

EC models
Some of the major EC models are: 1-Online direct marketing sell directly to customers. 2-Name-your-price (use priceline.com) 3-Find the best price: specify your need, compare prices, choose the best price. 4-virtual marketing: spread your brand on the NET. 5-membership model: for members only.

EC benefits
To organization: 1- Expands a companys market place to national and international markets. 2- decreases cost of creating, processing, distributing, storing, and retrieving information by digitized process. 3-enables companies to get material and services from other companies faster and cheaper. 4-enables small business to compete with large ones.

EC benefits
To customers 1-provide less expensive products and services provided by online services. 2- gives customers more choices to select from. 3-makes it possible for people to work and study at home. 4-allows consumers to communicate and exchange ideas. 5-enables customers to shop 24 hours daily. 6-delivers detailed information in seconds.

EC benefits
To society 1- enable individual to work at home, and do less traveling. 2- allows some good to be sold at low prices which increase the living standards. 3-enables people in developing countries to enjoy products and services that are not available in these countries.

Limitations and failures of EC

There are technical and not technical limitations which slowed the growth of EC, some of which are: A- Technical limitations: 1-lack of universally accepted standards. 2-insufficient telecommunications bandwidth 3-still-evolving SW development tools. 4-difficulties of integrating the Internet and EC applications and SW with some existing applications and DBs (especially legacy). 5-need for special WEB servers. 6-expensive and inconvenient Internet accessibility.

 B- Non Technical limitations: 1-unresolved legal issues (for quality, security, and reliability). 2-lack of national and international government regulations and industry standards. 3-lack of mature methods for measuring EC benefits. 4-many sellers and buyers wait for EC to stabilize before they take part. 5-customers resistance to change from real to virtual store. 6-thinking that EC is expensive and unsecured.

EC mechanisms
The most common are: A-Electronic auctions B-Portals - Electronic Auctions: A mechanisms where sellers place offers and buyers make sequential bids. It uses competitive nature for reaching a final price. The Internet provide an efficient infrastructure, a less expensive and with many participants of sellers and buyers.

Auction types
1- Forward: used as a selling channel for one seller to many buyers. - products are placed in a site like eBay.com. Sellers and buyers can individuals. They bid continuously and the heights bidder wins the items. 2- Reverse auctions: there is one buyer, (an organization) that wants to buy a product or services. Then suppliers are invited to submit bids. Online bidding is fast and attracts many bidders. The lowest bid wins.

Auction Benefits
Benefits to sellers: - Increase revenues in a short period of time. - More buyers means more optimized selling prices. - Saves auction fees, administrative expenses. - Enables more liquidation

 Benefits to buyers - increased chances to find unique products. - Chance to bargain instead of buying a fixed price. - Entertainment buyers enjoy e-buying. - Anonymity buyers remain anonymous.

Portals
E-commerce portals: As the Internet and Intranets are widely used, more and more information are gathered which (overload) . Information is scattered across documents, e-mail messages, and database in different locations and systems. This makes finding accurate and relevant information takes time and requires access to multiple systems.

 To solve this problem PORTALS are used. Portal is an information gateway. It attempts to address information overload through an intranet-based environment to search and access relevant information from disparate IT system and Internet using advanced indexing and search techniques.

 Information portal: A single point of access through a Web browser to critical business information located inside and outside an organization and it can be personalized.

Types of Portals
Portals vary according to audiences and contents. We consider five types: 1- commercial (public): offer routine contents for different audiences, most popular on the Internet, intended for broad audiences. Examples : yahoo.com, lycos.com 2-publishing portals: intended for specific groups of specific interests. They provide extensive on line search. examples: techweb.com and zdnet.com

3-personal portals: contain specific filtered information for individuals. Offer narrow contents for one audience. Example any personal web page. 4-mobile portals: accessible from mobile devices. 5-voice portals: web sites with audio interface, they can be accessed by a standard phone or cell phone.

Functionality of Portals
Functionality vary from simple information portals that stores data and enables users to navigate and query them to more sophisticated one that allows collaboration. Collaborative commerce refers to non-buying and selling EC transactions. It refers to joint product design, joint forecasted demand and other decision making activities among organizations. Example, collaboration between a company and a vender who is designing a product or part of it.

Legal and Ethical issues in E-Commerce

When buyers and sellers do not know each other and can not even see each other (they may be in different countries), there is a chance that dishonest people will commit fraud and other crimes over the Internet. Internet fraud has grown very fast even faster than the Internet itself.

E-commerce
Process of buying, selling, transferring, exchanging products, services, or information over computer networks Pure versus partial
Based on degree of digitization
Product Process Intermediary

Pure requires all three components to be fully digitized

Internet versus non-Internet

Most are Internet based May be value-added networks or local area networks

E-commerce Transactions
Business-to-business (B2B) Business-to-consumer (B2C) Consumer-to-consumer (C2C) Consumer-to-business (C2B) Government-to-citizens (G2C) Collaborative commerce between partners Business to employees Intrabusiness/Intraorganizational commerce Mobile commerce (M-commerce)

Scope of E-commerce
Applications supported by infrastructure
Hardware Software
Messaging, multimedia, interfaces, business services

Networks
communications

Support areas
People Legal and public policy and regulations Marketing and advertisements Support services ranging from payments to order delivery Business partnerships like joint ventures, e-marketplaces, affiliations

Advantages
Advantages: Expands marketplace globally Expands availability of resources Shortens marketing-distribution channels Decreases expenses Reduces inventory Aids small businesses in competing Enables specialized niches Quicker delivery of information Enables individuals to work from home Facilitates delivery of public services Allows for purchase of goods at lowered prices Enables customization, personalization Decreases costs to customers, while increasing their choices Allows for 24 hour shopping Makes electronic auctions possible Enables people to interact in electronic communities

Limitations
Limitations: Lack of universal standards Insufficient bandwidth Software-development tools are still evolving Integration difficulties Need for special Web servers in addition to network servers Accessibility expensive Unresolved legal issues Lack of national and international governmental regulations Lack of mature methodologies to measure benefits and justify Customer resistance Security questions Insufficient number of buyers and sellers for profitable e-commerce operations

E-commerce Mechanisms
Electronic auctions
Competitive market mechanisms
Forward auctions
Sellers place offers and buyers make sequential bids

Reverse auctions
Sellers are invited to submit bids on product or service buyer wants

Bartering
Exchange of goods or services without money transactions

Portals
Information gateways
Single point of access through Web browser

Portals
Commercial
Offer content to broad audiences
Routine Little personalization

Publishing
Based on specific interests
Extensive search capabilities

Personal
Target specific filtered information
Narrow content Personalized

Mobile
Accessible through mobile devices

Portals
Voice
Audio interfaces Accessible through phones

Corporate
Access to business information located both within and outside of organization
Rich content Limited communities Organized focal point
Suppliers Customers Employees Supervisors

Legal and Ethical Issues

Fraud
Sellers and buyers

Buyer protection Seller protection

Unwarranted repudiation Intellectual property rights Domain names

Privacy issues
Cookies Web tracking Sales of lists Monitoring e-mails and site visits

Taxation Disintermediation Intellectual Property issues