1 (c)David Strom Inc. 19981 Internet Commerce: Enabling Web Storefronts presented by: David Strom...

(c)David Strom Inc. 1998 11

Internet Commerce: Enabling Web Storefrontspresented by:

David StromDavid Strom, Inc. [email protected]


Why This Tutorial

The Internet is moving from a collection of technologies to a set of commercial services

To use the Internet successfully: you need to know how it works; but, you must also understand why it works…

A fun topic, things changing quickly!


Course Topics

What Becomes Success? Choosing the Right eCommerce Path Installing and Operating Your Own

Storefront Examples of various products


Course Approach

Discuss technology Provide pointers Give examples Provide insight into various approaches

and technology choices


What This Course is Not About

Nuts and bolts of payment systems In-depth on security


Some Disclaimers

I’ve lived in the Internet for a long time Fundamental aspects of Internet

dynamics are unavoidable I have consulted to some of the vendors

mentioned


Today’s Topics

I: What Becomes Success II: Choosing the Right eCommerce Path III: Installing and Operating Your Own

Storefront


Topic I: What Becomes Success?

Overview of eCommerce market Review physical storefront success

factors Propose some definitions Define success for the web Draw up five eCommerce principles


Overview of eCommerce Market

Predictions Success factors Five principles

(c)David Strom Inc. 199810

eCommerce Revenue Predictions are Wide-Ranging

Source 1996 (B$US) 2000 est. (B$ US)

IDC $2.2 94

Forrester 1.4 117

Jupiter .7 15.6

Dataquest 6.4 56


And Not Very Believable

IDC says the web will become a mass market in the US by 12/98!

With 100 million users! Let’s not confuse web users with

eCommerce BUYERS!


Ticketmaster

US$5 million/month via the web in sales Started 11/96 Generating lots of new buyers, who

wouldn’t ordinarily use their service


Then there is Disney.com

Web site Daily Blast signing up 15k members/month

Sales via web are equal to 3x-5x of physical Disney store!


And of Course, There is the Porn Industry

“However, extensive interviews with adult site owners yield a picture of a highly charged market of approximately 10,000 sites generating about $1 billion in revenue per year, most through electronic credit card transactions.”

from Interactive Week


Sad State of Today’s eCommerce Marketplace

Poor quality tools Hard-to-find stores Limited payment methods Credit card snooping perceptions Older browser versions can’t view latest

sites


Case in Point: Buying a Bike Rack

Item not carried: outdated catalog Telesales not familiar with web No cross-sell or substitutions online Needed three phone calls to complete

purchase


Let’s Learn From the “Real World”

Compare what works for physical stores Try to extend to the web


Critical Success Factors for Physical Storefronts

Location Branding Good service Good product selection Proper pricing and margins Traffic


First Problem:

None of these translate on the ‘net!


Now Try to Agree on Definitions for Web Stores

What determines a good location? Position on a search page Nearness to popular destination Ad on a popular server

What determines branding? Memorable domain name Popular search category destination


An Example of bad location: Montana Meats

www.imt.net/~lingerie/buffalo/buffalo.html Can’t they afford their own domain name? www.company.com/~anything is BAD

NEWS!


Another Case: Buying Toner and Batteries

www.cartridgesusa.com, www.batterybarn.com Catalog shows pictures of parts Easy to find relevant item But payment acknowledgement

incomplete


Determining Traffic

Hard to do -- is it hits, page views, registered users?

[HITS = How Idiots Track Success] Hard to measure -- do you count gifs? Use

log files? No general agreement on any metrics!


Traditional Advertising Doesn’t Apply Anymore

Can’t measure anything Every site has its own banner sizes The Web is not TV


One Working Definition of Success:

SURVIVAL! If a site is still running after 12 months,

and getting more traffic, it is a success.


Does a site actually have to sell something?

Many actual eCommerce sites don’t do the complete transaction (Cisco)

Require faxes or telephone calls! Some merely have catalogs A good example: Singapore Power

Authority www.spower.com.sg/readmeter.cgi?cmd=form


Good eCommerce Examples

Easy to find merchandize Good service Individual customization is key Simple navigation Business-to-business focus


AMP Connect

Have customers in 100 countries Speak many languages Produce 400 catalogs covering 135,000

items Mailings cost US$7MM/yr Fax back cost US$800,000/yr But you can’t buy anything directly!


Solution: “Step Searching”

Saqqara.com software to enhance Oracle database

Provide user feedback as they type in the query

Show how many matches in the database Different mechanisms for searching:

by part number by alphabetical names by part family by picture even


AMP connect.ampincorporated.com


AMP Connect (con’t)

And can set to list parts that are available in specific countries!

Updated daily with over 200 item changes

Detailed drawings saves time for customers to pick the right item

Saved AMP over US$5MM in production costs


Save in Translation Costs

AMP catalog in several languages Translation cost was US$100,000 Versus US$1.5MM to produce separate

translations of print editions


Silicon Investor www.techstocks.com

Difficult to find anything Incomplete database of companies Companies are arranged poorly


First Principle of eCommerce:

It is easy to find what you are selling!


Amazon.com

Services frequent readers with a variety of programs Editorial comments If you liked this book, you’ll like... Notification of new books by author, topic Simplified “1 Click” ordering

Uses simple pages and email Associates program for commission kickbacks Gift certificates via email And ... lots of books to choose from


Amazon


Update your directories!

This one is almost a year old www.asiapage.com/alist.html#jewellery


Non-secure servers

Many SG sites collect credit cards on them

GoodWood Florist www.asiapage.com/goodwood


Second Principle of eCommerce:

Deliver solid service!


Dell

Most notable site for computer buyers Customize the features you want via a

web form Simplifies and personalizes the shopping

experience WYSIWYB (buy) >US$1MM/day in sales!


Dell


Canadiantire.com

eFlyer uses email notification along with web forms

Customize exactly what coupons and deals are sent to you


Third Principle of eCommerce:

Individual customization is key


BMW Motors

Example of what not to do Use gratuitous graphics Cheesy low-res videos Toys, not tools


BMW


Compare with Subaru

Find specific information about each car Can price options to your particular

needs


How NOT to Design a Payment Screen

www.netmar.com/~hamorder/cshorder.shtml


How NOT to take advantage of bandwidth

www.clickdiz.com Two different pages, one for SG ONE, one

for all others But SG ONE page has just heavy graphics

-- why?


A better example: fishing licenses

Simple, quick, and does the job with a minimum of clutter

www.permit.com


Fourth Principle of eCommerce:

Make navigation simple! Use small graphics, site maps, indexes Avoid clutter, frames


Int’l Commerce Exchange System

Matches overstocked sellers with buyers B2B exclusively Uses faxes to notify potential customers


ICES www.icesinc.com


Fifth Principle of eCommerce:

Business-to-business focus


Topic II: Choosing the Right eCommerce Path


Four Approaches:

Join an eMall Outsource to an ISP Buy suite of software DIY


Joining an eMall

Only if you don’t have any in-house programming staff

Don’t want or can’t trust consultants to do it for you

Want someone else to handle payment processing

Don’t care whether your store is tied into your own financial system


The Mall of eMalls

malls.com, of course!


Different Kinds of eMalls

Collection of independent links elsewhere Landlord/hosting provider Become a sales representative and Make

Money Fast!


Evaluating eMalls

Do they offer storefront design? Have in-house programmers? Hosting of your own web? How many payment systems do they

support? What kinds of accounting reports do they

offer? Who are the other tenants and do you like

them?


The Truth about Internet Malls

Read your contract Check your site for errors Evaluate your content Measure your results Promote your site (from www.netrageous.com/reports/thetruth.html)


Reasons Not to Join an eMall:

You know and like perl Don’t have to take payment via the web Want complete control over your site


The Results So Far Haven’t Been Encouraging

Many store owners haven’t sold anything from the mall!

Over 90% dissatisfied with mall operator Basic HTML errors and unresponsive staff

to fix problems


The Catch-22 of eCommerce:

To be successful, a software vendor has to promote his products via the Internet.

But this means eating one’s own dog food!


Leading USA eMalls

Vendor, location Number of stores

ViaWebwww.viaweb.com

$100/month, all done witha browser

Internet Mallwww.internetmall.com

$150 + $15/mo, % of eachtransaction

Blue Moneywww.bluemoney.com

Outsourced payments andcatalogs


Leading Singapore eMalls

shop.bnn.com.sg www.shoppingvillage.com.sg


Find an ISP

More ISPs are offering eCommerce solutions

Have to use their software standards and payment schemes

Could be pricey Just catching on in USA


Some Examples

www.psi.net/web/ecommerce.shtml www.Best.com/bizcomm.html www.Brainlink.com/html/saleslink.htm www.Earthlink.net/company/webservices.html IBM: mypage.ihost.com www.Netcom.com business.Mindspring.com/prod-svc/smbiz/


Price Comparison for ISP hosting

Provider Setup fee (US$) Monthly fee(US$)

Plan name,paymentoptions

IBM 260 55 Bronze, creditcards

Earthlink 624 194 Premium Plus

Netcom 450 300 Commerce Site,credit cards

Mindspring 175 324 CommercialAdvantage,credit cards,Cybercash


Price Comparison assumptions

10 Mb disk storage Single email account InterNIC $100 fee included for domain

name


New Approaches: GeoShop, Tripod

Builds on GeoCities “communities” but for merchants

$25/month for just commercial listings $100/month for actual transactions

working with Internet Commerce Services Corp.

Tripod will offer something similar this summer


One Way to Support Lots of Payment Systems

Wired-2-Shop www.wired-2-shop.com/TestDrive/Admin/PaymentList.asp


The Suite Approach

Leading contenders What is part of the suite and what isn’t Prices and platforms


Popular eCommerce Suites

Vendor, Product Version Price Platform

ICatElec Comm Suite

3.0 $9000 NT, 95

IBMNet.Commerce

2.0 $5000 NT, AIX

MicrosoftCommerce

2.0 $5000 NT


Popular eCommerce Suites (con’t)

Vendor, Product Version Price Platform

OM TransactOpen Market

2.3 $250,000 Unix

Intershop OnlineIntershop

2.0 $5000$8000

NTUnix

WebSite ProO'Reilly

2.0 $800 NT, 95


Four Typical Elements

Catalog Storefront designer Ordering/inventory system Shopping trolley/check out system


The Cold Hard Reality of Suites

Suites are nothing more than collection of products

Lack integration among various elements Difficult to setup, customize, and use Require you to live “inside” their

structure Limited payment options Sounds like early MS Office


Payment Systems Included in Each Suite

Microsoft: Verifone, Buy Now IBM: Verifone, SET, eTill iCat: None (but many third parties) OpenMarket: Verifone WebSite Pro: InternetSecure, CyberCash Intershop: CyberCash, ICVerify, others


Sample Stores Included in Each Suite

Microsoft: 4 stores IBM: 5 stores that are part of an eMall iCat: 1 hardware store OpenMarket: none WebSite Pro: 1 bookstore Intershop:3 stores


Databases Supported in Each Suite

Microsoft: SQL Server IBM: DB2 iCat: 4D, Sybase SQL Anywhere WebSite: Access Intershop: Sybase SQL 11


Dealing With ODBC

Have to understand how to set up data sources

Intimate knowledge of your data structure

Re-install ODBC drivers at least once! Best to start with built-in database


Store Wizards Included in Each Suite

WebSite Pro (but doesn’t do much) net.Commerce v3 (11/97) MS Commerce

create appearance navigation registration, check out flows payment methods


Tips

Don’t install anything before making sure you have everything!

Downloads for free, but they expire Can you export existing files to these

systems?

Don’t install anything before making sure you have everything!

Downloads for free, but they expire Can you export existing files to these

systems?


WebSite Professional website.ora.com

Version 2, shipping since 9/97 US$799! NT (or 95) Supports Cybercash OR Internet Secure

(Visa, MC) One sample store (bookstore)


Sample storefront

http://merchant.inline.net/admin/


WebSite Configuration Sheet


Store Properties

Only can operate a single payment system

Run on a series of Access databases Built-in tax table, but for N.Americans! Well documented data structures in

typical O’Reilly fashion


Recommendations

Lowest priced suite by far! iHTML is robust, but will take some

learning Nice store setup and organization of

catalog Good low-end solution


Intershop

demo at presentation.intershop.com (admin/admin for store)

Includes Sybase SQL 11 US$5000 for NT, higher for Unix, includes

3 mos. support


Six Different Managers

Catalog Products Store Purchases Inventory Customers


Characteristics

Everything managed via browser, which can get tedious

But you already have a database behind it


Payment Options galore


Recommendations

Most flexible payment options of any suite

Better at processing orders than site creation

Not good for large catalogs


Microsoft Commerce (nee Merchant)

Still evolving More of a development platform than a

suite Closely tied to IIS, SQL Server et al.


The many Microsoft servers


Shopping with MS Commerce


MS Commerce


Microsoft Upsells


Recommendations

If you are going to use any other MS apps If you believe developers will follow If you must stay on the cutting edge of

MS products


Commerce Server Specifics

NT, fast Pentium with 128 M RAM essential

US$5000 www.microsoft.com/commerce


iCat Electronic Commerce Suite


iCat Process

Use four-step process Make changes to staging db Use designer and built-in catalog Then post changes to production db


Create Your Database

Can use bundled Sybase SQL Anywhere Enter upsells, promotions, and discounts


Design Your Templates

Look and feel of storefront Design views of catalog


Setup Your Hard Disk

Locate your files Setup your web server


Set Misc. Options

Matching sales tax rates to zip codes Use registration and indexing tools


iCat Demo Catalogs www.icat.com/catalogs/democats.htm

Demonstrate variety of options Several different stores to view


Recommendations

No wizards, all browser-based forms Tedious but straightforward Lots of third-party add-on tools Best for people new to db or the ‘net Best if you don’t have computer-based

accounting system yet


iCat Specifics

NT, fast Pentium with 128 M of RAM US$9000 for professional version www.icat.com


IBM Net.Commerce


Included

IBM’s Web Server DB2 database Shopping trolley system Credit card verifier


Setup Four Basic Web Forms

System Configuration, web server directories

Access Control, user identities Server Control, start/stop servers Database Management, setup


Recommendations

Great if you already use DB2 for inventories

Most security-conscious suite More depth than iCat


Net.Commerce Specifics

NT, fast Pentium with 64 M of RAM AIX too! US$5000 www.internet.ibm.com/net.commerce


Coming in version 3

“Intelligent Catalog” Recognizes shopping preferences New SET payment server Integration with Domino Merchant


OpenMarket

High end solution Worldnet offers hosting of OM servers Still needs customization!


Recommendations

If you can afford it .... Really the price covers lots of consulting

time High transactions and throughput needs


OpenMarket Specifics

Various Unix US$250,000 and up! www.openmarket.com


Do it Yourself Path

Traditional merchant banking approach More risk, especially when your payment

system is on the ‘net


Steps Involved for DIY’ers

Get a web server Get merchant software Integrate with your back end systems

catalogs inventory customer accounts

Be prepared to do lots of coding


The 90s Help Wanted

Wanted: Webmaster Required skills: High proficiency in

various web based programming, development tools, CGI, cookies, DNS, eCommerce, FTP, HTML 2.0 through 3.02, IIS Server admin, Javascript, Java, MS SQL, Netscape server admin, NT Server admin, perl, Unix admin, web security


But First: Consider the Customer


How Customers Buy Stuff

Sometimes have partial orders Sometimes cancel orders Sometimes inventory systems lie Sometimes shipments are returned


Purchasing Stages

One product has a 14-stage process! Need to gather so many items:

Shipping info Item inventory, pricing Order pricing “Last chance” (upsells, cancel out)

All this means: get thee to a database!


What is Needed

A way to track orders Provide shipping status Provide payment status


Our Recommendation: email!

Capture that email address Use it for status reports Outcalls and future upsells Reminders But how do you valid the address these

days?


Payment System Considerations

Do customers need accounts and profiles? yes: reduces the amount a visitor has to type no: less of a privacy concern

Should shopping be persistent across the session? yes: use accounts or cookies

Should all communications be via SSL? yes: then you’ll need the appropriate browsers

and servers Do I want to have multiple stores on a single

server?


Merchant Back-end Integration

Financial interactions Clerical interactions


Credit Card Issues

Separate authorization from settlement authorize when order received, but ship within 24 hrs of settlemen, and beware of stale backorder data

Consumers can chargeback either need a physical signature or evidence of verified shipping address

Opening a merchant account (see www.shopsite.com/help/payment.merchant.html)


Electronic Bill Presentment

Saves on paper but requires lots of coordinated systems

Can show bills with nice fonts, interactive applications

Is separate process from the actual payment system


Electronic Bill Presentment Issues

Does the processor use EBP with merchant bank?

Can users browsers support these new applications Java applets Active X controls etc.

Reconciliation requires access to both dispute and payout information


Microsoft’s MSFDC

A means to standardize on presentment Have both web-based access and special

consumer-based software Former “Marble” server, read white

paper at: www.microsoft.com/finserv/marblewp.htm

Requires NT, SQL Server, IIS, etc.


Other EBP efforts

Open Financial Exchange (www.ofx.net) www.Integrion.Net CheckFree’s E-Bill

(getbills.checkfree.com)


eBill

Most popular and in widest practice Schwab and Intuit/Quicken are

supporters Most threatened by MSFDC


OFX

Started with Intuit Trying to standarize on too much at once:

data transfers account inquiries financial applications and transactions

Verisign Financial Server (US$1200) digitalid.verisign.com/ofxIntro.htm


Integrion

Banking-intensive plus IBM No other software supporter, BUT… Combining forces with CheckFree Trying to establish their “Gold Standard”

vs. OFX


What about OBI?

Open Buying on the Internet A bunch of standards: SSL, X12 EDI,

X.509 PKI Exchange of purchase order info Unresolved issues:

who owns the catalog? how much infrastructure is really needed? knitting together a solid solution is more than

enumerating standards!


What about SET?

IBM, Verifone having second thoughts Specs still at 1.0 (barely) Just handles the buyer authentication

piece Trial with Citibank/SG www.visa.com


Topic III: Installing and Operating Your Own Storefront

What you need to know What you need to buy


You Need to be a Superhero:

Part web designer Internet technologist SQL database admin Payment system maven


Things You’ll Need to Discover

Are your sales and marketing staff web-savvy?

Is your accounting system adaptable to web purchases?

How do you reconcile these accounts? Does your business owner understand

Internet culture? Can anyone find you


Dealing with search engines

Some use <META>, some use <TITLE> Keep descriptions at top of your home

page short and sweet Web Review article:

webreview.com/97/10/17/webmaster


The Most Under-rated Skill:

PATIENCE!


Components Needed to Operate a Web Storefront

Database of items to sell and current inventories

Secure web server Searchable catalog server Connections to backend payments and

financial servers Shopping trolley system Checkout/payment system


Which Database Server?

Pick before anything else Core of your store revolves around the

database: inventory system accounting system catalog system


Database Server Recommendations

Use existing client/server db if possible SQL Server: best with MS tools Oracle: if you know pSQL already Informix: all other situations


Database/web Tools

Develop your own forms Query your database Develop your own catalog


Why is a Catalog Important?

Your customers view of your store Current with your own inventory and

offerings Don’t want to sell what you don’t have


Catalog Software

Cadis.com, US$1500 Centor.com, US$50,000 Dataware.com, US$1800 Elekom.com, US$25,000 Isadra.com, US$10,000


Other catalogs

Product Price

ICat US$9000

Intershop 5000

CatSmart 10,000

WebCatalog(www.pacific-coast.com)

2500

Cat@log 5000

Impulse(www.inetrep.com)

<$1000


Another choice: outsourced catalog!

ShopSite IBM Home Page Creator mypage-

products.ihost.com (N. America only) Mindspring with Mercantec


ShopSite demo

www.reliablehost.com/cgi-bin/bo/start.cgi username: test8 password: test


Tool Recommendations

Cold Fusion, www.allaire.com Sapphire/Web, www.bluestone.com


Which Web Server?

Hundreds to choose from Must support SSL and/or SHTTP Platform isn’t important, really


Get Your Certificates in Order

Bring up form inside web server Send to Verisign on letterhead with credit

card (!) Receive cert from Verisign Install on your web server


What can a Shopping trolley do?

Simplify ordering process Track multiple purchases for a single

visitor Display items purchased Calculate total prices, tax, shipping

charges Track item attributes (colors, styles,

sizes)


Different Shopping Trolley Methods

Account-based Cookie-based; see www.cookiecentral.com Encoded URLs


Shopping Trolley Programs

S-Mart: www.rcinet.com/~brobison/scripts Minishop: www.egrafx.com/minishop mvend: www.iac.net/~mikeh/mvend.html PerlShop: www.arpanet.com/perlshop


Commercial Programs

Internet Shopping Cart Server: www.webisland.com/cart

Rent-A-Cart: www.rent-a-cart.com CyberCart: www.lobo.net/~rtweb AutoCart: www.autocart.com/Autocart WebCart: www.staff.net/webcart.html SoftCart: www.mercantec.com WWWOrder: www.virtualcenter.com/scripts2/WWWOrder.html


Shopping Trolley Example www.asizip.com (SoftCart)

Shopping basket Cookies to track purchases Simple navigation


Payment Systems for SSL

ICVerify, www.icverify.com Worldpay/PSI www.psi.net/worldpay


ICVerify Process

Customer submits 16+4 through SSL browser connection

Merchant swre records to a file ICVerify submits to bank ICVerify receives response from bank,

creates answer file Merchant swre retrieves answer, sends

response to customer No per transaction fee!


Supported Merchant Servers for ICVerify

MS Merchant, Commerce Oracle Payment Mercantec SoftCart Internet Factory Merchant InterShop Online


ICVerify Demo Download

www.icverify.com/library/downloads/icvdemo20.html


WorldPay and PSI

Multicurrency payments >100 for product prices 16 different ones for settlement

Have to host your web at PSI Includes SoftCart and iCat software as well US$1000 + US$1400/yr


WorldPay Demo

www.worldpay.com/demo/store.html


Prices of Typical Products

Product Type PriceInex Accounting US$6000SoftCart Shopping Cart 900MallManager Catalog 2000WebCatalog Catalog 1600Saqqara Search tool 700VPOS Payment server 2500WebMate Development tool 750


Inex Demo

Financial backend strength Store front and some aspects of suite www.inex-corp.com


Don’t Forget About Security

Make sure you protect your web site! See “Ten ways” article from Winn

Schwartau Limit access, isolate servers, lock down

scripts, so forth See www.nwfusion.com/netresources/0202hack1.html


What About Web Server Load Balancing?

Resonate, HydraWeb, Cisco IBM Interactive Network Dispatcher,

www.ics.raleigh.ibm.com/netdispatch Packeteer PacketShaper,

www.packeteer.com Others at

www.techweb.com/se/directlink.cgi?NWC19970801S0026


Putting Together Your Own Solution

Mercantec shopping trolley SQL Server database ICVerify payment system WebCatalog IIS web server Total price: <US$10,000


Don’t Forget the Process and People

Put together policies and procedures book that describe what you did

Gather forms for your business partners to sign up for ISPs if needed

Document how to make changes to your product catalog via the web

Approach your trading partners with solutions, not problems!


Conclusions

eCommerce crosses many different skill sets

Software is still too dicey in many areas Standards aren’t much use right now Suites don’t offer much in the way of

integration DIY may be the best solution


Some eCommerce Resources

Windows Sources reviews of 3 eCommerce suites: web1.zdnet.com/wsources/content/0697/ntadmin.html

My Infoworld reviews www.strom.com/pubwork/iworld.html

www.webcompare.com, all the web servers you could ask for

PC Magazine review of various products www5.zdnet.com/products/content/pcmg/1620/pcmg0024.html


Copy of This Presentation

www.strom.com/pubwork/spore98w1.ppt links at www.strom.com/pubwork/spore.html


Conclusion

Review

Q&A David Strom +1 516 944 3407 [email protected]

Date post:	01-Jan-2016
Category:	Documents
Upload:	lily-randall
View:	221 times
Download:	1 times

1 (c)David Strom Inc. 19981 Internet Commerce: Enabling Web Storefronts presented by: David Strom...

Documents