E-Commerce

HFE 651 PresentationBrenee Burns

Ping GaiMay 23, 2000

Contents• E-Commerce Strategies• Business Models• Do Business Online• E-Commerce Technologies • Security, Encryption, & Web Ethics• E-Commerce Trend• Questions

E-Commerce Strategies• Offer a Great Customer Experience to

increase customer loyalty

– 40% of online job applicants can’t figure out how to apply online

– 62% of online shoppers had given up at least once while looking for products

– 42% of users had turned to traditional channels to make their purchase

E-Commerce Strategies

• Customer Experience Gap

– when the web does not offer the experience the customer wants

– focus on the difference between what the customer wants and what the customer gets

E-Commerce Strategies

• Valuing the Customer

– great customer experience makes it quicker for the customer to buy from the website

– customer relationship is valuable– customer can achieve their goal from the

website then it is more likely for the customer to revisit the site in the future

E-Commerce Strategies• In today’s fast economy satisfying customers is no

longer enough- must produce long term customer loyalty to have continued success

• Build relationships with customers and treating each one as an individual-loyalty strategies are essential

• E-markets of buyers and sellers can cost effectively drive the right customers to your business

Business Models• Business-to-customer Model (B2C)

– sell books, CDs, news, information, airline tickets, computers, stocks,

– Amazon, eBuy, eTrade, CDnow, Dell, ... • Business-to-business Model (B2B)

– a channel for business to sell and pay for goods and services among themselves

– networking hardwares, automobile parts, computer servers, …

– Cisco, Ford, ...

Business Models• Bokerage• Advertising• Informediary• Merchant• Manufacture• Community• Subscription

Business Models

• Brokerage Model– Market-makers: Bring buyers and sellers

together and facilitate transactions. – Makes money by charging a fee for each

transaction it enables.

Business Models

• Advertising Model– An extension of traditional media broadcasting

model.– The banner ads may be the major or sole source

of revenue for a website

Business Models

• Infomediary – collecting and selling data about consumers and

their buying habits– offer users free staffs in exchange for detailed

information about their surfing and purchasing habits.

– Registration

Business Models

• Manufacture Model– Allow manufactures to reach buyers directly

and thereby compress the distribution channel.– Efficiency, improved user service, better

understanding of user preference.

Business Models

• Community Model– based on user loyalty. Users have a high

investment in both time and emotion in the sites.

– Having users who visit continually offers adverting, infomediary, or specialized portal opportunities.

Business Models

• Subscription Model– Users pay for access to the sites.– High value-added contents is essential– Wall St. Journal

Do Business Online

• A business plan– Customer

– Merchandising– Sales service– Promotions– Transaction processing– Fulfillment– Post-sales service– Marketing data and analysis– Brand

Build An Online Shop

• Domain• Server• Software• Webpages• Maintenance and update

Build An Online Shop

• Make the page unique.• Keep the design simple.• Create an easy-to-navigate Web site.• Keep the content fresh.• Promote your business -- online and

offline.• Connect with your customers.

Worst Examples of E-Commerce

• Reflect.com: Required new-user survey puts site design ahead of the customer experience

• BMG.com: Intimidating, unexplained warning message could scare away customers

• Marthastewart.com: Allows out-of-stock items to be placed in shopping carts

• Century21.com: Wastes home page real estate on unrelated promotions

• REI.com: Ineffective "shop by brand" feature

• Bloomingale's: Unnecessarily wordy checkout page

• Gloss.com: Magazine-style layout doesn't serve the shopping experience

• Ninewest.com: Extra step to sale price impedes impulse buying

• Goodhome.com: Unintuitive horizontal scrolling

• RedEnvelope.com: Extra steps in the buying process

Worst Examples of E-Commerce

• Boo.com Overdesigned site impedes shoppingNote: In May 2000, Boo.com announced it was going out of business

• OfficeMax.com Registration feature could turn away first-time shoppers

• Levi's Flagship product hidden by graphics and promosNote: Levi's is no longer selling products from its Web site

• Women.com Shopping feature frustrates with empty categories

•

Do Business Online

• Transactions– Taxes– Shipping– Pay– Security

E-Commerce Technologies• To take advantage of the opportunities in

E-commerce it is important to have these skills:

– HTML– DHTML– XML– JAVA– ASP– JAVA Script

Security, Encryption, & Web Ethics

• Who is affected?– In past it use to be only large companies with

proprietary issues– Today, stock exchange and even sports on the web– Bank accounts, medical records, credit history are a

few arenas that must be concerned with secruity• Encryption is the process that transforms

information into some secret form to prevent unauthorized individuals from using the data should they acquire it.

Security, Encryption, & Web Ethics

• Why is there a concern?– Increase in secruity because PC are used more

often ie. Recreation, home, email, newsgroups, online shopping, ecommerce, and mobile phones

– People will become more reliant on computer based resources

– If confidential information is tampered with from companies, the company will lose its credibility and thus loose its customers

Security, Encryption, & Web Ethics

• Object of IT Secruity

– Confidentiality– Integrity

Security, Encryption, & Web Ethics

• Confidentiality

– strict controls implemented to ensure only certain person who need access to database will have access

– protecting and using passwords– limiting resources an employee has access to

Security, Encryption, & Web Ethics

• Integrity– loss of integrity can result from human error,

intentional tampering, or even catastrophic events– Efforts must be taken to ensure the accuracy and

soundness of data at all time– Internet Fraud

• online credit cards• customer trusting the company they do business with• online auctions, sweepstakes & price offers• travel offers, scholarship scams etc.

Security, Encryption, & Web Ethics

• Secruity Methods that are used whenever the Internet & Corporate Networks intersect:– Routers– Firewalls– Intrusion Detection Systems (IDSs)

Security, Encryption, & Web Ethics

• Routers– are network traffic-managing devices that routes

traffic intended for the servers or networks they are attached

• Firewalls– insulates a private network from a public

network using carefully established controls on the types of request they will route through to the private network for processing and fulfillment

Security, Encryption, & Web Ethics

• Intrusion Detection System (IDSs)– Attempts to detect an intruder breaking into

your system or legitimate user misusing system resources. Operates constantly, working in the background and only notifies you when it detects suspicious or illegal activity

Trend of E-commerce• Expanded ECM Deployment• Customer-Centric Corporate Restructuring• Free Extends into B-to-B Space• Wireless Applications Become More Common• ASP's Capabilities Expand• Dynamic Pricing Reaches Most Industries• Privacy Concerns Increase• Merger &Acquisition Activity Escalates• B-to-B Growth Continues its Dramatic Pace

References• Peter S.Cohen, Net Prpfit, Jossey-Bass Publishers,19998• http://www.webmonkey.com• http://www.zdnet.com/Ecommerce• http://www.zonaresearch.com• http://ecommerce.internet.• http://www.fraud.com• Six Tips for Building a Successful Homepage, By Andrew Beebe,, Working Solo, Inc.

• http://www.cnet.com

• http://www.msn.com

• http://ecommerce.about.com/smallbusiness/ecommerce/

• http://www.bigstep.com

• http://www.Ecomm.com

Questions?