E-commerce - AKHIB22011

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Transcript E-commerce - AKHIB22011

Electronic commerce (also referred to as EC, ecommerce or ecommerce) consists primarily of
the distributing, buying, selling, marketing, and
servicing of products or services over electronic
systems such as the Internet and other computer
Elements of E-commers
• Electronic Payment Systems
• E-tailing
• E-banking
• Online Publishing
• It can involve electronic funds transfer, supply chain
management, e-marketing, online marketing, online
transaction processing, electronic data interchange (EDI),
automated inventory management systems, and
automated data collection systems. It typically uses
electronic communications technology such as the
Internet, extranets, e-mail, e-books, databases,
catalogues and mobile phones.
• Teleshopping is shopping in a virtual mall with payment
using your credit card.
• Infomercials are long-format television commercials,
typically five minutes or longer. Infomercials are also
known as paid programming
• Stations in most countries around the world have
instituted similar media structures. According to
tapebeat.com, over $150 billion of consumer products in
the U.S. are sold through infomercials.
Online Marketing
• is the marketing of products or services over the internet.
• The Internet has brought media to a global audience. The
interactive nature of Internet marketing in terms of
providing instant responses and eliciting responses are
the unique qualities of the medium. Internet marketing is
sometimes considered to be broad in scope because it
not only refers to marketing on the Internet, but also
includes marketing done via e-mail and wireless media.
• Internet marketing also refers to the placement of media
along many different stages of the customer engagement
cycle through search engine marketing (SEM), search
engine optimization (SEO), banner ads on specific
websites, email marketing, and Web 2.0 strategies.
• Internet marketing is relatively inexpensive when
compared to the ratio of cost against the reach of the
target audience.
• Internet marketers also have the advantage of measuring
statistics easily and inexpensively.
• Because exposure, response, and overall efficiency of
Internet media are easier to track than traditional off-line
media—through the use of web analytics for instance—
Internet marketing can offer a greater sense of
accountability for advertisers.
• Improved customer interactions - With automated tools it is
possible to interact with a customer in richer ways at virtually
no cost. For example, the customer might get an email when
the order is confirmed, when the order is shipped and after the
order arrives. A happy customer is more likely to purchase
something else from the company.
• People can shop in different ways.For example ordering large
numbers of products from the web instead of going to the
normal shop.
• Lower transaction costs - if an e-commerce site is implemented
well, the web can significantly lower both order-taking costs up
front and customer service costs after the sale by automating
• Wider market diffusion
• From the buyer's perspective, the inability of shoppers to
touch, smell, taste or "try on" tangible goods before
making an online purchase can be limiting.
• The buyer can also be biased in case there is not
sufficiently reliable product information available online.
• Getting traffic to come to the company's Web site, it is not
easy to function with e-commerce without customers.
• Getting traffic to return to the company's Web site is
another thing , people must be attracted by the idea of eshopping.
• Getting people to buy something from the company's Web
site. Having people look at the site is one thing. Getting
them to actually type in their credit card numbers is
Data mining
• Data mining is the process of extracting patterns from
data. Data mining is becoming an increasingly important
tool to transform this data into information.
• It is commonly used in a wide range of profiling practices,
such as marketing, surveillance, fraud detection and
scientific discovery.
• A primary reason for using data mining is to assist in the
analysis of collections of observations of behaviour.
• Data mining commonly involves four classes of task:
• Classification - Arranges the data into predefined groups.
For example an email program might attempt to classify
an email as legitimate or spam. Common algorithms
include Decision Tree Learning, Nearest neighbor, naive
Bayesian classification and Neural network.
• Clustering - Is like classification but the groups are not
predefined, so the algorithm will try to group similar items
• Regression - Attempts to find a function which models the
data with the least error.
• Association rule learning - Searches for relationships
between variables. For example a supermarket might
gather data on customer purchasing habits. Using
association rule learning, the supermarket can determine
which products are frequently bought together and use
this information for marketing purposes. This is
sometimes referred to as market basket analysis.
Social and ethical issues
• Data mining requires data preparation which can uncover
information or patterns which may compromise
confidentiality and privacy obligations. The threat to an
individual's privacy comes into play when the data, once
compiled, cause the data miner, or anyone who has
access to the newly-compiled data set, to be able to
identify specific individuals, especially when originally the
data were anonymous.
It is recommended that an individual is made aware of the
following before data are collected:
• the purpose of the data collection and any data mining
• how the data will be used,
• who will be able to mine the data and use them,
• the security surrounding access to the data, and in
• how collected data can be updated
• Spyware is computer software that collects personal
information about a user of a computer without their
informed consent.
• Sometimes it uses the techniques of saving the
keystrokes , sometimes it saves the web history of the
user to later send it to the hackers and spammers. Many
of the purposes for spyware are that they collect the
personal information and send it to the advertising
agencies so they are kind of linked to the whole idea of ecommerce.
• We can divide spyware into few categories. The term
adware frequently refers to any software which displays
advertisements, whether or not it does so with the user's
consent. Those are usually used to promote the
companies or simply display the unwanted content to the
• Spyware usually gets onto your machine because of
something you do, like clicking a button on a pop-up
window, installing a software package or agreeing to add
functionality to your Web browser. These applications
often use trickery to get you to install them, from fake
system alert messages to buttons that say "cancel" when
they really do the opposite.
• Another use of spyware is to steal the credits from the
company. Major shopping sites like Amazon.com and
Ebay.com offers money to a Web site that successfully
directs traffic to their item pages.
• Certain spyware applications capture your requests to
view sites like Amazon and EBay and then take the credit
for sending you there.
• This whole idea could be linked to the e-commerce as
spyware is sort of trying to improve the standings of the
websites on the internet and promote them.
Social and ethical issues
• The data on the website could be unreliable if it is designed
• Spyware and adware is unreliable as it sends your information
to the hacker without your knowledge.
• Poorly designed, bug-infested e-commerce web sites that
frustrate online shoppers and drive them away. Also causes the
original to change. Ex.Ebay's or PayPal's original template
websites could be altered and infested with adware and
• Some spyware programs has to do with the replacement of
banner ads on viewed web sites. Spyware that acts as a web
proxy or a Browser Helper Object can replace references to a
site's own advertisements
• Many people will not use the e-commerce over the
Internet because they are afraid of card theft and internet
• Need to forfeit financial records because they could be
stolen during the e-transactions
Privacy and anonymity
• Financial details could be revealed
• Anonymous shopping or bank transitions could be done if
the privacy would be broken
Equality of access
• The problem of access to web commerce, particularly for
poor households and for developing countries.
• Low penetration rates of Internet access in some sectors
greatly reduces the potential for e-commerce.
• High Internet access costs, including connection service
fees, communication fees, and hosting charges for
websites with sufficient bandwidth would discourage
some of the customers to use the e-commerce.
• In some of the countries underdeveloped transportation
infrastructure results in slow and uncertain delivery of
goods and services
• Becoming the victim of organized crime. Many syndicates
have caught on to the potential of the Internet as a new
revenue stream. Two main methods are as follows: (1)
Using identity theft techniques like phishing to order
expensive goods and bill them to some innocent person,
then liquidating the goods for quick cash; (2) Extortion by
using a network of compromised "zombie" computers to
engage in distributed denial of service attacks against the
target Web site until it starts paying protection money.
People and Machines
• Some people enjoy talking to the staff in the retail stores
or enjoy the shopping with the social aspect invloved. The
online shopping does not provide that aspect when using
• Over-estimation of resource competence. Can staff,
hardware, software, and processes handle the proposed
strategy? Have e-tailers failed to develop employee and
management skills?
Globalization and cultural diversity
• Cross-border issues, such as the recognition of
transactions under laws of other ASEAN membercountries, certification services, improvement of delivery
methods and customs facilitation
• Introduction of global markets
• Wider choice of products in foreign countries
• The way that people shop could be altered and changed
by the e-commerce
Policies and Standards
• Inconsistent return policies among e-tailers or difficulties
in exchange/return.
• Content restriction on national security and other public
policy grounds, which greatly affects e-commerce in the
field of information services, such as the media and
entertainment sectors.
• Many users complain about irritating or offensive
advertisements as well. Pop-up ads for pornography often
display offensive material, including when children use the
computer(possibly in violation of anti-pornography laws).
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