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9 - 1Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Electronic Commerce
Systems
Chapter
9
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9 - 2Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
1. Identify the major categories and trendsof e-commerce applications.
2. Identify the essential processes of an e-commerce system, and give examples of
how they are implemented in e-
commerce applications.
Learning Objectives
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9 - 3Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Learning Objectives
3. Identify and give examples of several keyfactors and Web store requirements needed to
succeed in e-commerce.
4. Identify and explain the business value of
several types of e-commerce marketplaces.
5. Discuss the benefits and trade-offs of severale-commerce clicks and bricks alternatives.
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9 - 4Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
What is Electronic Commerce?
Electronic commerce encompasses theentire online process ofdeveloping,
marketing, selling, delivering, servicing,
and paying for products and servicestransacted on internetworked, global
marketplaces of customers, with the
support of a worldwide network of
business partners.
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9 - 5Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Scope of e-Commerce
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9 - 6Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Categories of e-Commerce
Business-to-Consumer (B2C) businessesdevelop attractive electronic marketplaces to
sell products and services to consumers
Business-to-Business (B2B) involves both
electronic business marketplaces anddirect
market links between businesses
Consumer-to-Consumer (C2C) includes
auction websites and electronic personal
advertising
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9 - 7Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Essential e-Commerce Processes
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9 - 8Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Access Control and Security
Definition:
E-commerce processes must establish
mutual trust and secure access between
the parties in an e-commerce transactionby authenticating users, authorizing
access, and enforcing security features
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9 - 9Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Profiling and Personalizing
Definition:
Processes that gatherdata on you and
your website behavior and choices, and
build electronic profiles of yourcharacteristics and preferences. These
profiles are then used to recognize you as
an ind
ivid
ual user and
provid
e you with apersonalized view of the contents of the
site, as well as product recommendations
and personalized Web advertising
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9 - 10Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Search Management
Definition:
Efficient and effective search processes
provide a top e-commerce website
capability that helps customers find thespecific product or service they want to
evaluate or buy
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9 - 11Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Content and Catalog Management
Content Management software thathelps e-commerce companies develop,
generate, deliver, update, and archive text
data and multimedia information at e-commerce websites
Catalog Management software thathelps generate and manage catalog
content
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9 - 12Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Workflow Management
Definition:
Software that helps employees
electronically collaborate to accomplish
structured work tasks within knowledge-based business processes
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9 - 13Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Event Notification
Definition:
Software that notifies customers,
suppliers, employees, and other
stakeholders of their status in atransaction based on events initiated by
one of the parties
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9 - 14Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Collaboration and Trading
Definition:
Processes that support the vital
collaboration arrangements and trading
services needed by customers, suppliers,and other stakeholders
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9 - 15Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Electronic Payment Processes
Web Payment credit card payment processes
Electronic Funds Transfer (EFT) use IT tocapture and process money and credit transfers
between banks and
businesses and
theircustomers
Secure Electronic Payments securitymeasures including encrypting data passing
between customer and merchant, encryptingdata passing between customer and companyauthorizing the credit card transaction, andtaking sensitive information off-line
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9 - 16Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
e-Commerce Trends
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9 - 17Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Business-to-Consumer e-Commerce
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9 - 18Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
e-Commerce Success Factors
Selection and Value attractive productselections, competitive prices, satisfaction
guarantees, and customer support after
the sale
Performance and Service fast, easy
navigation, shopping, and purchasing, andprompt shipping anddelivery
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9 - 19Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
e-Commerce Success Factors
Look and Feel attractive web storefront,website shipping areas, multimedia
product catalog pages, and shopping
features
Advertising andIncentives targeted web
page advertising and e-mail promotions,discounts and special offers, including
advertising at affiliate sites
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9 - 20Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
e-Commerce Success Factors
Personal Attention personal web pages,personalized product recommendations,
Web advertising and e-mail notices, and
interactive support for all customers
Community Relationships virtual
communities of customers, suppliers,company representatives, and others via
newsgroups, chat rooms, and links to
related sites
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9 - 21Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
e-Commerce Success Factors
Security and Reliability security ofcustomer information and website
transactions, trustworthy product
information, and reliable order fulfillment
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9 - 22Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Web Store Requirements
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9 - 23Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Developing a Web Store
Build website using simple website designtools
Market website to attract visitors andtransform them into loyal Web customers
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9 - 24Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Serving Customers
Serve customers by creating user profiles,customer files, personal Web pages andpromotions that help develop a one-to-onerelationship
Transact with customers by providingdynamically changing catalog, fast catalogsearch engine, and convenient shopping cartsystem integrated with promotions, payment,
shipping, and
account information
Support customers with help menus, tutorials,FAQs and e-mail correspondence with customerservice representatives
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9 - 25Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Managing a Web Store
Manage both the business and thewebsite
Operate twenty-four hours a day, sevendays a week
Protect Web store transactions andcustomer records, and repel hacker
attacks and other security threats
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9 - 26Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Business-to-Business e-Commerce
B2B e-commerce is the wholesale andsupply side of the commercial process,
where businesses buy, sell, or trade with
other businesses.
All factors for building a successful retail
website also apply to wholesale websitesfor B2B e-commerce.
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9 - 27Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
e-Commerce Marketplaces
One to Many sell-side marketplaces host onemajor supplier who dictates product catalog
offerings and prices
Many to One buy-side marketplaces attract
many suppliers that flock to these exchanges to
bid on the business of a major buyer
Some to Many distribution marketplaces unite
major suppliers who combine their product
catalogs to attract a larger audience of buyers
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9 - 28Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
e-Commerce Marketplaces
Many to Some procurementmarketplaces unite major buyers who
combine their purchasing catalogs to
attract more suppliers and thus morecompetition and lower prices
Many to Many auction marketplacesused by many buyers and sellers that can
create a variety of buyers or sellers
auctions to dynamically optimize prices
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9 - 29Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
e-Commerce Portals
Definition:
Websites developed and hosted by third-
party market-maker companies who serve
as infomediaries that bring buyers andsellers together in catalog, exchange, and
auction markets.
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9 - 30Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Infomediaries
Definition:
Companies that serve as intermediaries in
e-business and e-commerce transactions
Provide e-commerce marketplace
software products and services to power
business Web portals for e-commercetransactions
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9 - 31Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Clicks and Bricks in e-Commerce
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9 - 32Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
E-Commerce Channel
Definition:
The marketing or sales channel created
by a company to conduct and manage its
chosen e-commerce activities
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9 - 33Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Checklist for Channel Development
What audiences are we attempting to reach?
What action do we want those audiences to
take?
Who owns the e-commerce channel within the
organization?
Is the e-commerce channel planned alongside
other channels?
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9 - 34Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Checklist for Channel Development
Do we have a process for generating,approving, releasing, and withdrawing
content?
Will our brands translate to the new
channel or will they require modification?
How will we market the channel itself?
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9 - 35Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Summary
Electronic commerce encompasses theentire online process ofdeveloping,
marketing, selling, delivering, servicing,
and
paying for prod
ucts and
services.
The basic categories of e-commerce
includ
e B2
C, B2
B and
C2
C.
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9 - 36Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Summary
Many e-business enterprises are movingtoward offering full service B2C and B2Be-commerce portals supported byintegrated customer-focused processes
and internetworked supply chains.
Companies must evaluate a variety of e-
commerce integration or separationalternatives and benefit trade-offs whenchoosing a clicks and bricks strategy ande-commerce channel.
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9 - 37Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Summary
Businesses typically sell products andservices to consumers at e-commerce
websites that provide attractive Web
pages, multimed
ia catalogs, interactiveorder processing, secure electronic
payment systems, and online customer
support.
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9 - 38Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
Summary
Business-to-business applications of e-commerce involve electronic catalog,
exchange, and auction marketplaces that
useInternet, intranet, an
dextranetwebsites and portals to unite buyers and
sellers.
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9 - 39Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.
End of Chapter
Chapter
9