Chapter 6: Electronic Commerce: Applications and Issues

 

 

6.1 : E- Business and E- commerce:

·       Definitions and concepts:

o   E- Commerce: is specified in buying, selling, transferring, services exchanging products and information through the internet.

o   E- Business: is larger than E- Business, it includes E- Commerce adding other activities such as collaborating with business partners, performing electronic transactions and providing services to customers.

·       Types of E- Commerce:

o   B2B (Business to Business): the seller and the buyer are both organizations.

o   B2C (Business to customers): the seller is an organization and the buyer is an individual.

o   B2E (Business to Employees): organization provides services and information to its employees.

o   C2C (Customer to Customer): the seller and the buyer are both individuals.

o   G2C (Government to citizens) (E- Government): government uses E- Commerce to deliver information and public services to citizens.

·       E- Commerce and search:

o   E- Commerce is developing and improving which allow the users to access to more specific and relevant search results.

·       Major E- Commerce Mechanisms:

o   Auction: is a competitive process in which either a seller solicits consecutive bids from buyers or a buyer solicits consecutive bids from sellers.

§  Forward Auction: 1 seller to many potential buyers. (The highest bidder wins the item).

    

§  Reverse Auction: 1 buyer ( usually an organization) to many sellers. (The lowest- price wins the auction).

 

·       Benefits and limitations of E- Commerce:

Benefits:	Limitation:
ü Making the organization a national and international market. ü Reduce the cost of processing. ü Reduce distribution cost.	ü Lack of security standards. ü Expensive accessibility. ü Inefficient telecommunication bandwidth.

 

6.2: Business- to –Consumer (B2C), electronic commerce:

·       Electronic Storefronts And Malls (E- Tailing): Direct sale of products and services via electronic storefronts or electronic malls:

o   Electronic Storefronts: website for a single store.

o   Electronic Malls (E-mail): group of individual shops under a single internet address.

·       Online Service Industries:

o   Cyber banking.

o    Online Securities Trading.

o   The Online Job Market.

o   Travel Service.

·       Issues in E- Tailing:

ü Channel Conflict: a situation when companies face problems with their regular distributors, when they sell directly to the customers online.

ü Order Fulfillment: when companies sell directly to customers, they must perform some of the following activities such as quickly find the product to be shipped, packaging and collect the money from the customers.

·       Online Advertising:

o   Advertising is an attempt to disseminate information in order to influence a buyer-seller transaction.

o   Advertising Methods:

ü Banners are electronic billboards.

ü Pop-up ad appears in front of the current browser window.

ü Pop-under ad appears underneath the active window.

ü Permission marketing asks consumers to give their permission to accept online advertising and e-mail.

ü Viral marketing is online “word-of-mouth” marketing.

 

6.3: Business- to – Business (B2B) Electronic Commerce:

·       Sell- side Marketplace: B2B Model in which organizations sell to other organizations

·       Buy- Side Marketplace: B2B Model in which organizations buy needed products and services from other organization.

·       Electronic Exchange:

o   Vertical Exchange: connect seller and buyer in an industry.

o   Horizontal Exchange: connect the seller and buyer across many industries.

o   Functional Exchange: needed services such as temporary help or extra office space are traded on an “as-needed” basis.

6.4: Electronic Payments:

·       Electronic Checks.

 

·       Electronic Credit Card.

·       Purchasing Cards.

·       Electronic Cash.

 

6.5: Ethical and Legal Issues in E- Business:

 

·       Ethical Issues:

o   Privacy: ecommerce provides opportunities for businesses and employers to track individual activities on the WWW using cookies or special spyware.

o   Disintermediation: middlemen or intermediaries  (1) provide information, and (2) perform value-added services such as consulting.

·       Legal Issues Specific to E- Commerce:

o   Fraud on the Internet

o   Domain Names

o   Domain Tasting

o   Cyber squatting

o   Taxes and other Fees

o   Copyright