COMP 6125 An Introduction to Electronic Commerce Session 4: B2B, B2C, C2C and B2G E- Commerce.
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Transcript of COMP 6125 An Introduction to Electronic Commerce Session 4: B2B, B2C, C2C and B2G E- Commerce.
COMP 6125 An Introduction to Electronic
Commerce
Session 4: B2B, B2C, C2C and B2G E-
Commerce
B2B E-Commerce• Typically takes the form of automated processes
between businesses
• Also encompasses marketing activities between businesses; not just final transactions that result from marketing
• Approximately makes up 80% of e-commerce
• Has two primary components– E-frastructure– E-markets
E-frastructure
• Logistics– Transportation, warehousing, distribution
• Application Service Providers– Deployment, hosting and management of packaged
software from central facility
• Outsourcing of functions in the process of e-commerce– Web-hosting, security and customer care solutions
E-frastructure
• Auctions solution software for efficient real-time auctioning on the Internet
• Content management software– Facilitates Web site content management and
delivery
• Web-based commerce enablers
E-markets
• Web sites where buyers and sellers interact with each other and conduct transactions
B2C E-Commerce
• Business conducted online between customers and companies
• Involves the following:– Customers obtaining information about an
organisation– Customers purchasing physical or information
goods from the company– Receiving the products over an electronic
network (if applicable)
Benefits of B2C E-Commerce
• Reduces transaction costs
• Increases consumer access to information
• Allows consumers to find most competitive price for a product or service
• Reduces market entry barriers as cost of putting up and maintaining a Web site is much cheaper than installing brick-and-mortar structure
Benefits of B2C E-Commerce
• Removes additional cost of a physical distribution network for information goods
• Increases feasibility of delivering information goods by those countries with a growing and robust Internet population
C2C E-Commerce
• Commerce between private individuals or consumers [Wikipedia.org]
• Characterized by growth of e-marketplaces and online auctions
Forms of C2C E-Commerce
• Online auctions facilitated at a portal– For example: eBay, Bajanbid.com
• Peer-to-peer systems– For example: Napster, Morpheus, bitTorrent
• Online classified ads at portals– For example: eWanted, Excite Classifieds
Of Note – C2B
• Involves reverse auctions where consumer drives the transaction
• For example: A traveler posts the intention of flying from Miami to Boston. Competing airlines offers the traveler best travel and ticket pricing in response to her post
B2G E-Commerce
• Commerce between companies and the public sector
• Refers to the use of the Internet for public procurement (or e-procurement), licensing procedures, filing of tax forms, and other government-related operations
• Sometimes referred to as e-government
B2G E-Commerce
• The use of e-commerce by governments to improve the efficiency with which they undertake their support services and serve their stakeholder is on the rise
• Governments and government agencies are developing websites to better meet the needs of their stakeholders and to facilitate the dissemination of information
Features of B2G E-Commerce
• The public sector assumes a piloting or leading role in establishing e-commerce
• It is assumed that the public sector has the greatest need for making its procurement system more effective
Home Assignment
• Read Chapter 6, pg 263 - 300
Payment Options For E-Commerce
• Payment options should be safe, convenient and widely accepted
• Must integrate well with existing systems and practices
• Should not require customers to learn a new way of doing something that they were already comfortable doing
Current Payment Options
• Cash
• Checks
• Credit cards
• Debit cards
• Electronic transfer (includes automated payments)
“Newer” Payment Technologies
• Digital cash – Scrip: minted by a company and not a
government; must be exchanged for goods or services by the issuing company; now used mainly by not-for-profit organisations
• Case Study: Flooz and Beenz, pg 496
Payment Technologies
• Payment cards
• Electronic cash
• Electronic wallets
• Stored-value cards
Payment Cards• Credit card – Visa, Mastercard; have limit to spenditure
based on credit history of user
• Debit card – direct removal from account of funds at time of purchase
• Charge card – no spending limit; entire amount charged is due at end of billing period; no interest charges
• Single-use cards – developed to address concern of security in providing payment card numbers online; unique card number valid for one transaction only
Advantages Of Payment Cards
• Fraud protection – authentication authorization using payment card processing network
• Built-in security for merchants of assurance that they will be paid by the issuing card company
• Limited liability is fraud does occur (mostly in US)
• Worldwide acceptance
• No special hardware or software required for use
Disadvantages Of Payment Cards
• Card companies charge per-transaction and monthly processing fees to businesses – cost of an online transaction can be 50% higher than offline transaction; price of goods are slightly higher as a result
• Consumers have to pay an annual fee (credit and charge cards mainly)
• Stores typically require minimum purchase value amounts
• Small payments not profitable
Electronic Cash
• Supposedly looking promising for the future
• Any value storage and exchange system created by a private, non-governmental organisation that does not use paper documents or cash
• Can serve as a substitute for physical currency issued by the government
• Can be readily exchanged for physical cash on demand
Advantages of E-Cash
• Small payments are more feasible (and more profitable for merchants), especially for sales $10 or less
• Most of the world’s population do not have credit cards; hence, makes online purchasing more available to them
• Authorization by one party in the transaction is not required
Disadvantages Of E-Cash• No audit trail
• Money laundering
• Susceptible to forgery – less difficult than using a fraudulently obtained credit card number, however
• Not yet a global commercial success
• Multiple e-cash standards exist
Electronic Wallets• Holds credit card numbers, e-cash, owner identification,
owner contact information, shipping and billing information (multiple versions possible)
• Information provided at an e-commerce checkout counter
• Information is entered once, as opposed to re-entering for each e-commerce site
• Two types:– Server-side e-wallet– Client-side e-wallet
Server-side E-Wallets• Wallet information stored on a remote server
belonging to a specific merchant or wallet provider
• Issue: security breach exposes thousands of users’ information to unauthorized parties
• Typically use strong security measure that minimize possibility of this occurrence
• Must be enabled on the merchant site before a user can use the wallet
Client-side E-Wallets
• Stores information on user’s computer – removes risk associated with storing on remote server
• Wallet software required to be downloaded to user’s computer
• Not very portable – not available for use if you switch computers
Examples Of E-Wallets
• Microsoft .NET Passport
• Yahoo! Wallet
Stored-value Cards
• Elaborate smart card containing a microchip or magnetic strip that records currency balances
• Can store larger amounts of information
• Examples:– Magnetic strip cards (rechargeable)– Smart cards (better suited for Internet
payments due to processing capability
Links
• Reference– Electronic Commerce, Seventh Annual Edition by Gary
Schneider– Whatis.com, http://www.whatis.com– Webopedia.com, http://www.webopedia.com– Wikipedia, http://www.wikipedia.org
• Of Interest– Onvia, http://www.onvia.com– Dept. of Homeland Security, http://www.dhs.gov/– Payment Online, http://www.paymentonline.com