E-Commerce Short Notes

1. What is e-commerce? Electronic commerce or e-commerce refers to the buying and selling of products or services over electronic systems such as the Internet and other computer networks 2. Is e-commerce the same as e-business? While some use e-commerce and e-business interchangeably, they are distinct concepts. In e-commerce, information and communications technology (ICT) is used in inter-business or inter-organizational transactions (transactions between and among firms/organizations) and in business-to-consumer transactions (transactions between firms/organizations and individuals). In e-business, on the other hand, ICT is used to enhance one’s business. It includes any process that a business organization (either a for-profit, governmental or non-profit entity) conducts over a computer-mediated network. A more comprehensive definition of e-business is: “The transformation of an organization’s processes to deliver additional customer value through the application of technologies, philosophies and computing paradigm of the new economy.” 3. Three primary processes are enhanced in e-business 1. Production processes 2. Customer-focused processes, 3. Internal management processes 4. Advantages of E-Commerce:  It is fast  Reasonably reliable  Inexpensive  Global Marketplace  24 Hour Access 5. Disadvantages of E-Commerce:  Unable to Examine Products Personally  Online Purchasing Security  Hardware and Software Problems  Training and Maintenance  Security 6. Four main areas in which companies conduct business online today:  Direct marketing  Selling and service  Online banking and billing  Secure distribution of information 7. What is B2B e-commerce? B2B e-commerce is simply defined as e-commerce between companies. This is the type of e-commerce that deals with relationships between and among businesses. About 80% of e-commerce is of this type, and most experts predict that B2B ecommerce will continue to grow faster than the B2C segment. 8. What is B2C e-commerce? Business-to-consumer e-commerce, or commerce between companies and consumers, involves customers gathering information; purchasing physical goods (i.e., tangibles such as books or consumer products) or information goods (or goods of electronic material or digitized content, such as software, or e-books); and, for information goods, receiving products over an electronic network. 9. What is B2G e-commerce? Business-to-government e-commerce or B2G is generally defined as commerce between companies and the public sector. It refers to the use of the Internet for public procurement, licensing procedures, and other government-related operations. This kind of e-commerce has two features: first, the public sector assumes a pilot/leading role in establishing e-commerce; and second, it is assumed that the public sector has the greatest need for making its procurement system more effective 10. What is C2C e-commerce? Consumer-to-consumer e-commerce or C2C is simply commerce between private individuals or consumers.

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11. What is m-commerce? M-commerce (mobile commerce) is the buying and selling of goods and services through wireless technology-i.e., handheld devices such as cellular telephones and personal digital assistants (PDAs). Japan is seen as a global leader in m-commerce. 12. What forces are fuelling e-commerce?  Economic forces  Market forces  Technology forces 13. How is the Internet relevant to e-commerce? The Internet allows people from all over the world to get connected inexpensively and reliably. As a technical infrastructure, it is a global collection of networks, connected to share information using a common set of protocols. Also, as a vast network of people and information, the Internet is an enabler for e-commerce as it allows businesses to showcase and sell their products and services online and gives potential customers, prospects, and business partners access to information about these businesses and their products and services that would lead to purchase. 14. How important is an intranet for a business engaging in e-commerce? An intranet aids in the management of internal corporate information that may be interconnected with a company’s ecommerce transactions (or transactions conducted outside the intranet). Inasmuch as the intranet allows for the instantaneous flow of internal information, vital information is simultaneously processed and matched with data flowing from external e-commerce transactions, allowing for the efficient and effective integration of the corporation’s organizational processes. In this context, corporate functions, decisions and processes involving e-commerce activities are more coherent and organized. 15. Supply chain management (SCM) SCM is defined as the supervision of materials, information, and finances as they move from supplier to manufacturer to wholesaler to retailer to consumer. It involves the coordination and integration of these flows both within and among companies. The goal of any effective supply chain management system is timely provision of goods or services to the next link in the chain (and ultimately, the reduction of inventory within each link)  The product flow  The information flow  The finances flow 16. What are the existing practices in developing countries with respect to buying and paying online? In most developing countries, the payment schemes available for online transactions are the following: A. Traditional Payment Methods  Cash-on-delivery.  Bank payments. B. Electronic Payment Methods  Innovations affecting consumers  Innovations enabling online commerce  Innovations affecting companies 17. What is an electronic payment system? Why is it important? An electronic payment system (EPS) is a system of financial exchange between buyers and sellers in the online environment that is facilitated by a digital financial instrument (such as encrypted credit card numbers, electronic checks, or digital cash) backed by a bank, an intermediary, or by legal tender. EPS plays an important role in ecommerce because it closes the e-commerce loop. In developing countries, the underdeveloped electronic payments system is a serious impediment to the growth of e-commerce. In these countries, entrepreneurs are not able to accept credit card payments over the Internet due to legal and business concerns. The primary issue is transaction security. 18. In general, the main issues of concern that acts as barriers to the increased uptake of Information technology and e-commerce are the following:  Lack of awareness and understanding of the value of e-commerce.  Lack of ICT knowledge and skills. 19. How can government use e-commerce? Government can use e-commerce in the following ways:  E-procurement  Customs clearance.  Tax administration. T.Kartheeswaran (2007/ICT/61)

20. Is e-commerce helpful to the women sector? How has it helped in empowering women? In general, the Internet and e-commerce have empowered sectors previously discriminated against. The Guyanan experience can attest to this. Women have gained a foothold in many e-commerce areas. In B2C e-commerce, most success stories of women-empowered enterprises have to do with marketing unique products to consumers with disposable income. The consumers are found largely in developed countries, implying that there is a need for sufficient infrastructure for the delivery of products for the business to prosper and establish credibility. For example, if an enterprise can venture into producing digital goods such as music or software that can be transmitted electronically or if such goods can be distributed and/or delivered locally, then this is the option that is more feasible and practicable. 21. E-Commerce Site Design Tips:     

Carefully Research Your Own Favourite E-Commerce Sites. Your Web Site is a Front Door of Your Business. Make it Easy for Customers to Navigate Your Site. Keep Things Simple. Keep downloads times short.

22. Common Mistakes in Web Site Design:  Lack of a development plan  Overly ambitious in functionality, e.g. multiple languages & currencies  Too much “cool” and not customer-oriented  Too demanding/restrictive on user’s resource o High-speed connection o Complicated navigation  Too many pop-ups  Crowded interface hidden or small links 23. Intellectual Property (IP) Intellectual Property (IP) refers to the creations of the human mind that are protected by province and federal law. There are three main types of IP, which are:  Copyrights  Trade Secrets  Trademarks 24. Top Ten Strategies for Internet Marketing:  Start with a web promotion plan and an effective web design and development strategy.  Get ranked at the top in major search engines, and practice good Search Optimization Techniques.  Learn to use Email Marketing Effectively.  Dominate your marketing place with affiliate, reseller, and associate programs.  Request an analysis from an Internet marketing coach or Internet marketing consultant.  Build a responsive opt-in email list.  Publish articles or get listed in news stories.  Write and publish online press releases.  Facilitate and run contests and giveaways via your web site.  Use email auto responders and handle your e-mail efficiently and effectively. 25. There are many factors involve in Search Engine Optimization, some of these are:  Pick a Good Domain Name  Pick a Good Web Hosting Company  Figure Out Your Key Word Phrases  Set up your Meta Tags  Set up your Tag  Set up your Meta Keyword Tag  Set up your Meta Description Tag  Put Key Words in Headings  Use Key Words in Your Text  Put Key Words in Alt Tags  Put Key Words in Anchor Tags  Register by Hand with the Search Engines and Directories

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27. List down eight (8) ways which can attract visitors to the website.  Keep the content up-to-date and real-time  Offer free information about products and services to everyone  Offer discounts and incentives for customers who come for the second time  Personalization for returning customers  Privacy notice on the website and keep the customer information confidential  Online and offline reading, and possibility to download and print information  Cross-marketing and cross-selling – inform customer about few other books other people have bought after buying a certain book  Navigational aids in all the web pages – every piece of information on the website can be reached with three clicks  Event marketing – online chats and interviews with popular people 28. List down five (5) technologies which can be used to track customers who visit the website. Basic authentication – login procedure  Cookies  Domain name of customer  IP address of customer  Personalized URLs used by a customer  Digital certificates 29. The company wishes to integrate a shopping cart facility to their website. What are the basic functions of a shopping cart?  Add items  Delete items  Display total cost of the items purchased and balance after each transaction  Finish shopping by checking out 30. List down three (3) such search strategies used by a search engine.  Number of appearances of a certain keyword on a given web page  Keywords appear in the domain name or in the URL  Keywords appear in the title of the web page  Keywords appear in meta-data  Number of links pointing to a given webpage 31. Cyber-terrorists use different strategies for attacking computing infrastructure of an institution. List down four (4) such strategies.  Virus attacks  Alternation of information  Cutting off communication  Killing from a distance (e.g. by altering the drug dosage of a patient)  Spreading misinformation 32. What is/are the information/components which can be found on a typical credit card? Give six (6) of them. Issuing bank logo EMV chip, Cardholder’s name, Hologram, Magnetic stripe, Card number, Signature strip, Card security code, Card brand logo, Expiry date 33. List down four (4) ways in which Information and Communication Technology (ICT) would be used to improve the efficiency of a business process.  No need to enter data manually into computer systems  High accuracy  Easy access from anywhere in the world  Faster data communication  Facilitate to take immediate decisions 34. Going into online business has many concerns for people. List down six (6) of them. Channel conflict, Competition, Copyright, Customer acceptance, Legal issues, Loyalty, Pricing Security, Service, Viability 35. How does one make sure that sending his credit card number to someone over the web is secure and confidential?  The URL starts with https instead of http T.Kartheeswaran (2007/ICT/61)

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Closed padlock appears at the bottom part of the browser Warning message is given saying that it is going to make a connection with a secure site.

36. List down six (6) different types of cyber crimes Interception, Modification, Theft Interference, Sabotage, Hacking, Virus distribution Aiding and abetting cyber criminals, Computer fraud, Computer forgery 37. List six main advantages of online electronic transactions  Faster transactions  Lower transaction costs  Store transaction information in database  Increased accountability  Reduced errors  Minimized equipment costs  Availability round the 24 hour clock  No need of travelling 38. List five items which will decide the cost to setup an e-Commerce website  Domain name  Hosting cost  Development cost  Shopping chart  Merchant account  Payment gateway  Software tools 39. List down six security technologies and protocols you would use to ensure the safety of your e-Commerce site and customer data.  Firewalls  Antivirus software  SSL  SET  Kerberos  Digital certificates and signatures  PCI  .NET Passport

40. List down three advantages which smart cards offer to its holders  Greater protection for personal information  Making online payments  Verifying authentication for online payments  Can store multiple application data 41. Discuss how information and communication technology can be used by the Sri Lanka Police to enhance law enforcement efficiency.  Computer-aided dispatch and directions,  Real-time inquiry into local, regional, state and national databases to run checks on criminal records, registrations and drivers’ licenses,  Records management, ticketing, accident reporting and data collection.

T.Kartheeswaran (2007/ICT/61)