Transcript E-Commerce Fundamentals

E-commerce and Information
Technology in Hospitality and Tourism
Chapter 4
E-Commerce Fundamentals
Copyright 2004 by Zongqing Zhou, PhD
Niagara University
4.1 The Internet and E-Commerce
E-Commerce allows businesses to be
more effective and efficient in responds
to customers’ needs and wants as well
as in conducting transactions with
suppliers and within the company itself.
 It has changed the way that business is
being conducted.
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4.2 E-Commerce Defined
The meaning of E-Commerce is not one
simple definition it can mean many
things to different people.
 One basic definition is a system of
conducting business activities using the
Internet and other information
technologies.
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4.2 E-Commerce Defined
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Common definitions include, but not
limited to the following:
 Buying and selling online
 Selling through the Internet
 Customer service using the Internet
 Marketing and advertising through the
Internet
4.2 E-Commerce Defined (cont.)
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Putting up a website for product and service
information, together with an email address for
customers to email in orders.
E-commerce is creating a website that can accept
credit card information to sell online directly to
consumers.
E-commerce involves 1) a website where
customers can find information, place an order, 2)
an order fulfillment center that tracks and ships the
orders, and 3) a customer service mechanism
where questions
4.3 Components of E-Commerce
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Our definition consists of three
components:
A. It requires a systematic approach
in conducting business. It
involves: research, planning,
operation and selling, marketing,
budgeting, customer service, and
human resource management.
4.3 Components of E-Commerce
B.
E-commerce is a special type of business,
but it is still a business. Just as there are all
kinds of businesses, there are all kinds of
ecommerce businesses. Some ecommerce
businesses sell tangible products such as
computers and clothes. Others offer
intangible products and services such as
providing information and reservation
services. Most of the hospitality and travel
ecommerce borders between these two, if
tickets can be considered as a tangible
product.
4.3 Components of E-Commerce
C.
Thirdly and lastly, e-commerce is
conducting business using
technologies. For a company to
be successful in ecommerce, it has
to understand these technologies
and make the best use of what is
available to the business.
4.3 Components of E-Commerce
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Types of E-Commerce
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B2B- between businesses
B2C- between business and consumer
C2C- between two or more individuals
C2B- consumer initiated interactions and
transactions.
4.4 Classification of E-Commerce
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Online-only businesses- Base the
entire operation online.
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Direct sellers- sell directly to the consumer
Intermediaries- the middleman
Fee-free-and-as-based- free to the
consumer and paid by advertisers, who
then advertise on the site.
Fee-based- Charged a fee to use their
service.
4.4 Classification of E-Commerce
(Cont.)
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Bricks-and clicks businesses- Operation both
online and in a physical space.
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Full-engaged models-product or service is
available online to sell directly to the consumer.
Partially-engaged models- Some of the product or
service is available online, but not all only the
products suitable to be sold on the internet are
available.
Same-line business- Can be full or partial but sell
the same line of products online.
Expanded models- See E-Commerce is a way to
expand their business.
By transaction parties
By operation Mode
Buyer
•Intermediaries
•Fee-free-andad-based
business
•Fee-based
business
•Full-engaged
models
•Partial-engaged
models
•Same-line models
•Expanded models
Business
•Direct Sellers
Bricks-and-clicks
business
Business
Consumer
B2B
B2C
Seller
Consumer
Online-only
business
C2B
C2C
Process of simple e-commerce
operation
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Establish a Web presence
Provide information (online catalog and
product information.)
Get the customers (marketing)
Fill the order (secure payment methods and
fast shipping service)
Provide customer support and service
(communications through both Web and
traditional means)
4.5 Establishing Web Presence
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To establish an e-commerce presence
on the Web:
Apply for a domain name or use a third
party domain name
 Find a server to host the domain
 Create Web pages and load them to the
server
 Set up a payment method to receive
payment of the internet.
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Applying for a domain name
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Website and homepage are interchangeable.
 Domain name is a convenient way to
recognize the homepage and to locate
information on the internet.
 What’s Needed:
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IP address
DNA domain name system- distributed base.
TCP/IP Transmission Control Protocol/Internet
Protocol- map between hostname and IP address
Domain name continued…
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Registering a domain name
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Go to an ICANN-accredited registrar.
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ICANN- Internet Corporation for Assigned Names and
Numbers
Can rent a cyber home on other people’s domains
Benefits
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Credibility on the Web
More power in marketing
Better control
Professionalism and security
Branding opportunity
Domain Name
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.com
.edu
.gov
.mil
.net
.org
.int
.biz
.info
.name
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Meaning
Commercial Organization
Educational Institutions
Government Institutions
Military groups
Major network support
centers
Organizations other than
those listed here
International organizations
Business
Unrestricted use
For registration by individuals
Domain Name
Purpose
.aero
Air transport industry
.biz
Business
.coop
.info
.museum
.name
Cooperatives
Unrestricted use
Status in 2 0 0 2
Operational
Operational and accepting
live registration
Operational
Operational and accepting
live registration
Operational
Operational and accepting
live registration
Under negotiation
Museums
For registration
by individuals
.pro
For accountants,
lawyers, physicians,
and other professionals
Source: InterNIC (www.internic.net), January, 2003.
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123 Registration, Inc. (US)
Capital Networks Pty Ltd. (Australia)
Domaninfo AB (Sweden)
DomainRegistry.com, Inc. (US)
Go Daddy Software, Inc. (US)
Internet Domain Registrars, d/b/a (Canada & US)
Key-Systems GmbH, d/b/a (Germany)
Melbourne IT Limited, d/b/a Internet News Worldwide (Australia)
Mr. DomReg.com, Inc. (Canada)
Namebay (Monaco)
Network Solutions, Inc. Registrar (US)
NORDNET (France)
Register.com, Inc. (US)
Xin Net Corp. (China)
Source: UCANN (www.icann.org). For complete list, see ICANN’s Website.
Finding an ISP or Web Host
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Website is a series of WebPages (HTML
files) that reside on a server
 Two ways to host a Web site:
 Purchase your own server, set it up,
and manage your own site.
 Find an ISP or Web hosting
company without having to invest in
the server hardware and software.
Creating Web Pages and loading
them to the Server
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Depending on the ISP you may need to create
your own Web files and then load them up to
the server.
 Web host companies will create the Web files
for you based on the information you provide.
 Software needed:
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FTP- file transfer protocol- allows one computer to
transfer files from another computer over the
internet.
Allocated Server Storage Space
 Shared hosting or dedicated server
 E-mail accounts
 Service and technical support
 Online Security
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Purpose of your Web site
 Determine who your customers are
 Avoid excessive use of graphics and
animations
 Put yourself in the visitor’s shoes when
designing a Web site
 How to make visitors repeat visitors
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Setting up Payment Methods
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Concerns:
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Secure transmission
Safety of information
Who has access to the information
Solutions:
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SSL (Secure Sockets Layer)- encrypts data transfer
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Encryptions:
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Asymmetric or public-key
Symmetric
Digital signature
Certificate Authority
Issues
 Security
 Privacy and
Identity
Solutions
 SSL, SHTTP
 SET, digital
signature, digital
certificate
Figure 4.1 Typical Offline Payment Process
Figure 4.2 Typical Online Payment Process
Payment continued…
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Means of online payment:
Traditional Credit Cards
 E-money
 eCash
 PayPal
 Billpoint
 Smart Card
 PowerWallet
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Major criteria
For dominant payment systems
 Security
 Reliability
 Privacy
 Convenience
 User
friendly
 Universality
 Cost free
Security Issues
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SSL (Secure Sockets Layer)
asymmetric encryption, also called
public-key encryption
digital signature
digital ertificate
Certificate Authority (CA)