3.2 E-Business & E-Commerce

Chapter 38 - e-Business & e-Commerce
Outline
38.1 38.2 Introduction e-BusinessModels 38.2.1 StorefrontModel 38.2.2 Shopping-CartTechnology 38.2.3 AuctionModel 38.2.4 PortalModel 38.2.5 Name-Your-PriceModel 38.2.6 Comparison-PricingModel 38.2.7 BarteringModel Buildingane-Business e-Marketing 38.4.1 Branding 38.4.2 MarketingResearch 38.4.3 e-MailMarketing
38.3 38.4
2004 Prentice Hall, Inc. All rights reserved.

38.4.4 Promotions 38.4.5 ConsumerTracking 38.4.6 ElectronicAdvertising 38.4.7 SearchEngines 38.4.8 AffiliatePrograms 38.4.9 PublicRelations 38.4.10 CustomerRelationshipManagement(CRM) OnlinePayments 38.5.1 Credit-CardPayment 38.5.2 DigitalCashande-Wallets 38.5.3 Micropayments 38.5.4 SmartCards
38.5

38.6 Security 38.6.1 Public-KeyCryptography 38.6.2 Cryptanalysis 38.6.3 KeyAgreementProtocols 38.6.4 KeyManagement 38.6.5 SecureSocketsLayer(SSL) 38.6.6 WTLS 38.6.7 IPSecandVirtualPrivateNetworks(VPN) 38.6.8 SecurityAttacks 38.6.9 NetworkSecurity LegalIssues 38.7.1 Privacy 38.7.2 Defamation 38.7.3 SexuallyExplicitSpeech 38.7.4 SPAM 38.7.5 CopyrightandPatents
38.7
e-Business & e-Commerce

38.8 38.9 38.10 38.11 38.12 38.13 38.14 38.15
XMLande-Commerce IntroductiontoWirelessTechnologyandm-Business m-Business IdentifyingUserLocation 38.11.1 E911Act 38.11.2 Location-IdentificationTechnologies WirelessMarketing,AdvertisingandPromotions WirelessPaymentOptions PrivacyandtheWirelessInternet WebResources
Objectives In this tutorial, you will learn:

To understand how the Internet and World Wide Web are revolutionizing business processes. To introduce various business models used on the Web. To explore the advantages and disadvantages of creating an online business. To examine marketing, payment, security and legal issues that affect e-businesses.
38.1Introduction Successful online businesses

Recognize need or demand Meet that need Must constantly readjust to shifting trends and technologies Personalization
Tradeoff between convenience and privacy concerns
E-commerce vs. e-business

E-commerce
Aspects of doing business online that relate to exchanges with customers, partners and vendors.
E-business
All aspects of e-commerce, plus internal operations of doing business
38.2e-BusinessModels e-business
Expansion of old technologies and techniques
Electronic Funds Transfers, for example
Requires new business models and categories Pioneered by early e-businesses

Amazon.com, eBay, Yahoo among others
38.2.1StorefrontModel Simulates the experience of shopping in a store

Very common Provides services similar to real brick and mortar store
Transaction processing Security Payment Information storage
Products organized into catalogs that users can browse and search
38.2.2Shopping-CartTechnology Shopping-cart metaphor

Holds items a user has selected to buy Merchant server contains database of available items User puts all desired items in the cart When finished, user checks out
Prices totaled Shipping, tax and other charges applied Shipping and payment details gathered Order confirmed
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32.2.3AuctionModel Online auctions

Buyers bid on items made available by various sellers
No fixed price
Very attractive to customers

Often able to get lower prices on goods than traditional stores
Site is searchable to allow easy location of desired items Site receives a commission on each sale Model also employed in business-to-business transactions www.eBay.com is the leading auction site
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38.2.3AuctionModel
Fig. 38.1 eBay home page. (These materials have been reproduced with the permission of eBay Inc. COPYRIGHT EBAY INC. ALL RIGHTS RESERVED.)
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38.2.3AuctionModel
Fig. 38.2 Placing a bid on eBay. (These materials have been reproduced with the permission of eBay Inc. COPYRIGHT EBAY INC. ALL RIGHTS RESERVED.)
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38.2.4PortalModel Portal sites

Combine many services into one page
News Sports Weather Web searches
Horizontal portals
Search engines Aggregate information on broad range of topics
Vertical portals
Information on narrow range of topics
Convenient, centralized access to information
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38.2.5Name-Your-PriceModel User submits price they are willing to pay

Site then passes it along to partner sites, who evaluate the offer If accepted, user must pay that price If rejected, user may submit a new price Many such sites employ intelligent agents
Search, arrange, analyze large amounts of data
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38.2.6Comparison-PricingModel Poll merchants for lowest price on an item

Often generate revenue through partnerships with other sites Convenient way to search multiple merchants Not always the true best price
Non-partner merchants might have better offers, but be unlisted
Can employ search-engine technology to automatically seek out best prices or related products
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38.2.7BarteringModel Trade items rather than currency

Similar to auction sites Merchant and customer haggle to a fair price In practice, transaction is usually a combination of currency and items
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38.3Buildingane-Business Multiple approaches

Turnkey solutions
Ready-made e-Business sites
e-Business templates
Outline business structure Design details left open to owner
Outsource control entirely to a specialized firm

Expensive Little hassle, lets experts control it while you control your business
Build original, custom solution

Allows maximum control, makes your site unique Most expensive, involves reinventing the wheel
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38.4e-Marketing Marketing campaign

Marketing your site through multiple means Market research Advertising Promotions Branding Public Relations (PR) Search engines
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38.4.1Branding Brand
Name, logo or symbol that defines companys products or services
Unique Recognizable Easy to remember
Brand equity
Value of the brand Customer perception and loyalty
Companies with existing brand may more easily establish their brand on the Internet
New companies must work to establish trust in their brand
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38.4.2MarketingResearch Marketing research

Marketing mix
Product or service details Pricing Promotion Distribution
Focus groups Interviews Surveys and questionnaires Secondary research

Reviewing pre-existing data
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38.4.2MarketingResearch Marketing research, cont.

Demographics
Statistics on human population
Psychographics
Lifestyles, backgrounds, values
Online focus groups

Easier to conduct than in-person testing Get feedback from real customers
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38.4.3e-MailMarketing e-Mail marketing

Part of the reach of the campaign
Span of people who marketing should target
Direct mail vs. indirect mail

Direct mail is personalized to the individual recipient Direct is often more effective Offers right product at right time Tailor mailing to customers interests
Opt-in e-Mail lists

Customer chooses to subscribe Send newsletters with information on offers and promotions
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38.4.3e-MailMarketing e-Mail marketing, cont.

Dangers of e-Mail marketing
Do not flood customers with too much e-Mail in too short a time Do not send unsolicited e-Mail Spam Gives company a poor reputation, illegal in some areas
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38.4.4Promotions Promotions
Attract visitors Encourage purchasing Increase brand loyalty Should not be only reason people purchase from your company
Sign of weak product or brand
Be sure cost of promotion is not so great that no profit is ever seen
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38.4.5ConsumerTracking Consumer tracking

Keep user profiles Record visits Analyze results of advertising and promotion Helps define target market
Group toward whom it is most profitable to target marketing resources
Log files contain many useful details

IP address Time and frequency of visits
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38.4.5ConsumerTracking Consumer tracking, cont.

Cookies
Text file stored on customers computer Can contain record of users actions, preferences, buying habits
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38.4.6ElectronicAdvertising Advertising
Establish and strengthen branding Publish URL in all advertising
Internet advertising becoming important

Links and banners on sites viewed often by target market
Can be interactive or animated
Allow advertising on your site in return for payment Pop-up ads

Appear in a separate window when page loads Often extremely irritating to customers Actually decrease interest in advertised product due to negative association with pop-up ad
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38.4.6ElectronicAdvertising Search engine advertising

Pay for better placement of your site in search results Sites that receive more clicks on their advertisements move higher in rankings
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38.4.7SearchEngines Search engines

Scan websites for desired content Being highly ranked in search results important
People tend not to browse results too deeply
Some sites base your ranking on meta tags

Hidden XHTML tags that contain information about site Keywords, title, summary
Others simply spider the site

Program reads content and decides what is important
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38.4.7SearchEngines Search engines, cont.

Google a leading search engine
Uses complex formulas to rank pages Number of sites linked to you, and their ranking Number of clicks on your site Relevance to keyword user is searching for
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38.4.8AffiliatePrograms Affiliate programs

Company pays other sites to be affiliates
Advertise the companys products When their ad leads to purchases from the company, affiliate site receives a commission
Increases exposure and number of site visits Amazon.com has large, successful affiliate program
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38.4.9PublicRelations Public relations

Provide customers with latest information
Products and services Sales Promotions
Press releases Presentations and speeches e-Mail Crisis management

Issue statements regarding company problems Minimize damage to company, brand and reputation
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38.4.10CustomerRelationshipManagement Customer Relationship Management (CRM)

Provision and maintenance of quality service Communicate with customers Deliver responses to customers wants and needs Customer satisfaction key to successful business
Much easier, less expensive to retain customers than attract new customers
Challenging for online businesses

Transactions not conducted in person Requires innovative new techniques
eCRM, iCRM
Refer to CRM conduced via Internet, interchangeable terms
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38.4.10CustomerRelationshipManagement Aspects of CRM

Call handling
Management of calls between customers and service representatives
Sales tracking Transaction support

Support for people and technology involved in keeping transactions running smoothly
Personalization of customer experience
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38.5OnlinePayments Electronic Funds Transfer

Basis for online payments Multiple ways of conducting EFTs and presenting them to the customer Many companies offer EFT solutions
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38.5.1Credit-CardPayment Online credit-card payment

Popular and common
Many people have and are familiar with credit cards
Some customers have security and privacy concerns Require merchant account at bank
Special card-not-present (CNP) account for online transactions
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38.5.2DigitalCashande-Wallets Digital cash

Stored electronically Analogous to traditional bank account
Customers deposit money
Overcomes drawbacks of credit cards

Digital cash accounts often allow deposits in form of checks or bank transfers Allows merchants to accept customers without credit cards
e-Wallets
Store billing and shipping information Fill out forms at compatible sites in one click
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38.5.3Micropayments Micropayments
Merchants often charged fee for credit card transactions
For small items, fee can exceed cost of item
Micropayments allow merchants to avoid this problem

Add together all small transactions and pay percentage of that
Similar to concept of phone bill

Pay one large sum monthly rather than tiny sum per each use
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38.5.4SmartCards Smart cards

Memory cards
Only allow for storage of information
Microprocessor cards
Like tiny computers Can do processing in addition to storing data
Contact interface
Card inserted into reading device for use
Contactless interface
Data transmitted via wireless device inside card
Data and money protected by personal identification number (PIN)
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38.6Security Security is an increasingly important concern

Highly confidential data being transmitted all the time
Credit cards, social security numbers, business data
Attackers attempt to steal, corrupt or otherwise compromise this data Requirements for successful secure transaction:
Privacy Integrity Authentication Authorization Non-repudiation
Also concerned with availability of site
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38.6.1Public-KeyCryptography Cryptography
Transforms data using cipher or cryptostream Key acts as password that combined with cipher will decrypt encoded message into original message Early cryptography relied on symmetric cryptography
Same key used to encrypt and decrypt Problem of how to securely transmit key itself arose
Solution was public-key cryptography

Two related but different keys used Sender uses receivers public key to encode Receiver decodes with private key Keys long enough that guessing or cracking them takes so much time it is not worth the effort
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38.6.1Public-KeyCryptography
Fig. 38.3 Encrypting and decrypting a message using public-key cryptography.
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38.6.1Public-KeyCryptography Digital signatures

Same concept as physical written signatures
Authenticate signer Difficult to forge
Part of public-key cryptography Generated by running phrase through hash function

Returns hash value
Hash value for a phrase is over 99% guaranteed unique

ie., two different phrases very unlikely to generate same value
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38.6.1Public-KeyCryptography
Fig. 38.4 Authentication with a public-key algorithm.
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38.6.1Public-KeyCryptography Public Key Infrastructure

Digital certificates
Digital documents issued by certification authority Name of individual/group Public key Serial number Expiration date Signature of trusted authority
Certificate repositories
Hold database of public digital certificates
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38.6.1Public-KeyCryptography PKI implementations

More secure than standard point-of-sale (POS) transactions
Strong encryption can take decades to crack using current technology
RSA encryption popular choice for PKI

Developed at MIT in 1977
Pretty Good Privacy (PGP)

Implementation of PKI Very popular way to encrypt e-mail Operates using web of trust
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38.6.2Cryptanalysis Searching for weaknesses in encryption

Try to find ways to decrypt ciphertext without having key Not just done by malicious attackers
Researchers want to find and fix flaws before attackers find and exploit them
Cryptanalytic attacks
Common attack searches for relationship between ciphertext and key Easier when all or part of decoded message known in advance
Goal not to determine original message, but to discover key Allows attacker to forge messages from that sender
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38.6.2Cryptanalysis Preventative measures

Key expiration dates
If attacker breaks or steals key, only useful for limited time
Exchange secret keys securely with public-key cryptography
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38.6.3Key-AgreementProtocols Public-key encryption not perfect solution

Requires significant computing power Best used to exchange secret keys once, then use those keys for rest of transaction
Key-agreement protocol
Protocol is set of rules for communication Digital envelope most common
Encrypt message using secret key Encrypt secret key with public-key encryption Both encrypted portions sent to receiver Receiver decrypts secret key using private key Receiver then uses decrypted secret key to decrypt message
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38.6.3Key-AgreementProtocols
Fig. 38.5 Creating a digital envelope.
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38.6.4KeyManagement Protecting private keys vital to security

Key generates possible source of vulnerability
Susceptible to brute-force cracking If keys always chosen from small subset of all possible keys, much easier to crack Algorithm must generate random keys from large set of possible keys
Key should be very long Common standard is 128 bits

2 to the 128 power
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38.6.5SecureSocketsLayer(SSL) SSL facilitates secure online communications

Developed by Netscape Built into most browsers and servers
Standard Internet communication process

Data sent and received through sockets
Software mechanism that sends, receives and interprets network data
Transmission Control Protocol/Internet Protocol (TCP/IP)

Standard protocol for Internet communication Controls how data is transferred and interpreted over networks
Messages broken down into packets

Add ordering, routing and error-correction information
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38.6.5SecureSocketsLayer(SSL) Standard Internet communication process, cont.

Packets destination is an IP address
Unique number that identifies computer on network
TCP puts received packets in order and checks for errors

Can request retransmission if errors discovered
Only basic error checking exists

Attackers can forge data with relative ease More secure methods necessary to increase integrity
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38.6.5SecureSocketsLayer(SSL) SSL
Layer on top of TCP/IP Implements public-key encryption using RSA algorithm Generates secret key referred to as session key
Rest of transaction encrypted using this key
Messages still sent through TCP/IP after encryption step Generally used for point-to-point connections
One computer communicating with another directly
Transport Layer Security (TLS) another similar technology
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38.6.5SecureSocketsLayer(SSL) SSL, cont.

SSL does not protect data stored on server
Only data that is currently traveling across network
Stored data should be encrypted by another means Always take standard precautions against cracker attacks
Making SSL more efficient

Encryption taxing on server resources Dedicated SSL encoding/decoding hardware exists
Peripheral component interface (PCI) cards Offload these tasks from CPU
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38.6.6WTLS Wireless Transport Layer Security

Security layer for Wireless Application Protocol (WAP)
WAP used for wireless communication on cell phones and other devices
Provides authentication, integrity, privacy and denial-of-service protection Encrypts data sent between WAP device and WAP gateway
Where wireless network connects to wired network
Data translated from WTLS to SSL at gateway

For an instant, data is unencrypted WAP gap No successful WAP gap attack ever reported
38.6.7IPSecandVirtualPrivateNetworks (VPN) Types of networks

Local Area Network (LAN)
Connects physically close computers
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Wide Area Network (WAN)

Connect computers in multiple locations Employ private phone lines, radio waves or other techniques
Virtual Private Network (VPN)

Leverage Internet to simulate LAN for multiple remote networks and wireless users Secure tunnel over Internet Data protected by encryption
38.6.7IPSecandVirtualPrivateNetworks (VPN) Internet Protocol Security (IPSec)

Developed by Internet Engineering Task Force (IETF) Uses public-key and symmetric-key cryptography Protects against data manipulation and IP-spoofing Conceptually similar to SSL
Secures entire network rather than point-to-point transaction
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Often employs RSA or Diffie-Hellman encryption for key exchange DES or 3DES used for secret key
IPSec packets
Three components
38.6.7IPSecandVirtualPrivateNetworks (VPN) IPSec packets, cont.

Authentication header (AH)
Verifies identity of sender and integrity of data
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Encapsulating security payload (ESP)

Encrypts packet to prevent reading while in transit
Internet Key Exchange (IKE)

Authenticates encryption keys
VPN shortcomings
Time consuming and complicated to initially set up Must be careful who is given access
VPN users essentially the same as LAN users Potentially have access to sensitive data
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38.6.8SecurityAttacks Security of greater concern than ever before

Great variety of attacks to defend against Denial of Service (DoS) and Distributed DOS (DDoS)
Flood server or network with data packets Prevents any legitimate traffic from passing through DDoS occurs when attacker gains control of multiple machines Uses them all to coordinate massive attack
Viruses
Malicious programs Attach to or overwrite legitimate programs Vary in severity from minor irritations to complete destruction of hard drive data
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38.6.8SecurityAttacks Security of greater concern than ever before, cont.

Worms
Similar to viruses Able to reproduce and spread over networks Generate extreme amount of traffic, slowing networks CodeRed and ILOVEYOU two infamous worms
Attackers commonly called hackers or crackers

Traditionally, terms not interchangeable
Hacker is a skilled programmer and computer user Cracker maliciously attacks computers for personal gain In practice, hacker has become blanket term for computer criminals
62
38.6.8SecurityAttacks Protecting against attacks

Software exists to mitigate effects of these attacks Anti-Virus software
Detects and deletes viruses and worms before they execute
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38.6.9NetworkSecurity Network security

Allow authorized users access they need Prevent unauthorized users from accessing and damaging network Firewall a vital tool for network security
Protects LANs from unauthorized traffic Placed between external Internet connection and computers on local network Blocks or allows traffic based on rules set by administrator Administrator must balance users needs for functionality against need for network security
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38.6.9NetworkSecurity Network security, cont.

Intrusion detection systems (IDS)
Detect that an attacker has penetrated the firewall Monitor network traffic and log files If intrusion detected, immediately closes that connection and alerts administrator through various means
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38.7LegalIssues Internet poses new challenges to lawmakers

File-sharing could redefine copyright laws Marketing techniques clash with users desire for privacy Cyberspace requires rethinking many traditional legal ideas
66
38.7.1Privacy U.S. Constitution has no explicit right to privacy

Regardless, privacy is vital concern to many people Many sites track activity and personal information
Provides personalization and sometimes better service Balanced against desire for marketers to not follow ones every move or steal valuable information
Affects company employees as well as customers

Companies install key loggers or keystroke cops Monitor what employees do on their system Right of company to ensure employees doing their jobs versus employee desire for privacy and free-speech
Idea of right to privacy still being created in courts
67
38.7.2Defamation Defamation
Consists of slander and libel
Slander is spoken Libel is written or spoken in a broader context than slander
Proving defamation
Plaintiff must:
Show that statement was written, spoken or broadcast Reasonably identify individual responsible Show that the statement is indeed defamatory Show that the statement was intended to cause harm and known to be false Show evidence of injury or actual loss
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38.7.3SexuallyExplicitSpeech Pornography is protected by First Amendment

Obscenity is not Miller test has been deciding factor between the two
Obscenity appeals to the prurient interest Lacks serious literary, artistic, political or scientific value
In cyberspace, community standards are different

Communities not defined by physical location Issues of jurisdiction are unclear
Problem of what standard to hold Internet to

Broadcast laws restrict content rather than audience Print laws use non-content-related means Restrict audience rather than content Either is possible on the Internet
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38.7.4Spam E-mail marketing

Can be useful or harmful Unsolicited mass-mailings, or Spam, strongly frowned on
Many Internet users received hundreds per day Content often at best irrelevant and at worst highly offensive Possible for children to receive pornography, for example
Legislation being created to deal with Spam epidemic Software to combat spam also exists Spammers constantly evolve to circumvent new measures One of the toughest usability and privacy issues with Internet today
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38.7.5CopyrightsandPatents Copyright
Protection given to author of original piece
Protects an expression of idea, not idea itself
Incentive to create by guaranteeing credit for work

Life of author plus 70 years
Digital technology has made copyright gray area

Fair use vs. piracy Copies can be perfect, not cheap imitations
Movies and MP3-encoded music files hottest area of debate

File-sharing programs lets users download copyrighted works freely Costs distributors and artists money Users want to sample music, enjoy lower prices
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38.7.5CopyrightsandPatents Patents
Grant creator sole rights to a discovery Designed to foster invention and innovation
Guarantees new idea cannot be stolen from inventor
Possible to patent method of doing business

Must be non-obvious to person skilled in relevant field
Also contentious area

Some feel patents stifle rather than foster innovation 20-year duration may be too long in fast-paced software world Some companies file patents solely to profit from infringement lawsuits later on
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38.8XMLande-Commerce Extensible Markup Language (XML)

One parent of XHTML Allows users to create customized tags to mark up data
Share data in standard, easily-used format worldwide Portable between multiple applications and platforms
Some industries have standard XML formats already

MathML CML XMI OSD
Facilitates Electronic Data Interchange (EDI)
38.9IntroductiontoWirelessTechnology andm-Business Wireless technology

One of technologys fastest growing sectors Brings communications and Internet everywhere Wireless devices support increasing number of features Convergence beginning to occur
Features of several distinct products combined into one PDAs merging with cell phones
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38.10m-Business Mobile business

E-business enabled by wireless technology Relatively new, but rapidly growing Access critical business information anytime, anywhere
Employees can conduct their duties more easily Customers can interact with online businesses in new ways and locations
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38.11IdentifyingUserLocation Location-identification technologies

Determine users physical location to within yards Useful in wireless marketing
Send promotion data when user is near relevant location
Great benefits to emergency services

Quickly and accurately locate victims
Made possible by relationships between wireless providers, networks and users Multipath errors can cause problems
Signals reflecting off nearby objects
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38.11.1E911Act Enhanced 911 Act

Standardize 911 service across mobile devices Improve response time to calls made from cell phones First phase requires cellular providers to disclose phone number of caller as well as location of nearest cell site Second phase requires disclosure of location of caller to within 125 meters Several benefits
Callers often do not know their exact location If call breaks up, emergency responders can still send help
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38.11.2Location-IdentificationTechnologies Methods of locating the user

Triangulation
Analyze angle of signals from at least two fixed points
Information presented as geocode

Latitude and longitude
Different methods have varying degrees of accuracy
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38.11.2Location-IdentificationTechnologies
Technology Cell of Origin (COO) Degree of Accuracy Least accurate. User could be anywhere in towers range. Meets only Phase I of E911 Act. Angle of Arrival (AOA) Fairly accurate. User is within the overlap of two towers cell sites. Used primarily in rural areas where there are fewer towers. Complies with Phase II of E911. Time Difference of Arrival Accurate. Users location is determined by triangulating (TDOA) from three locations. Complies with Phase II of E911. Most effective when towers are close together. Enhanced Observed Time Accurate. Users location is determined by triangulating Difference (E-OTD) from three locations. Complies with Phase II of E911. Location Pattern Matching Accurate. Users location is determined by analyzing multipath interference in a given area, making the method more effective for locating a device in an urban area. Global Positioning Systems Highly accurate. Satellites determine a users location (GPS) anywhere on earth. However, GPS is not as effective when the user is indoors. Fig. 38.6Location-identification technologies.
38.12WirelessMarketing,Advertisingand Promotions Wireless Marketing

Wireless technology provides unique opportunities Augments, rather than replaces, traditional marketing
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Push and pull strategies

Pull
Users request data to be sent in real-time
Push
Company delivers messages at time it deems appropriate
Using either one, advertising should be opt-in

User must have explicitly requested the service Otherwise it is essentially spam, creates ill-will toward the company
38.12WirelessMarketing,Advertisingand Promotions Effective wireless marketing

Must deliver right content at right time Perfect match for location-identification technology Advertisers much more likely to place and pay more for ads that are well-targeted and likely to generate response Several challenges and obstacles
Security Ensuring ads display properly on diverse devices Additional middle-men Selecting suitable publisher and transmission technology
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38.12WirelessMarketing,Advertisingand Promotions Short Message Service

Deliver simple text-only messages Interactivity is limited Nearly no load time Work well for quick, simple alerts
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38.13WirelessPaymentOptions Wireless payments (m-payments)

Must be secure and reliable, like standard online payments Mobile Virtual Network Operators (MVNOs)
Purchase bandwidth and re-brand with added services Option for banks to make micropayments profitable
M-wallets
Users store billing and shipping information Recall with one click Promote convenience
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38.14PrivacyandtheWirelessInternet Privacy problems magnified on wireless devices

Transmissions can be intercepted Users located accurately Accepted standard is opt-in policy
Users request to be sent information Consumer should always expect the information they receive No unauthorized information sharing with partners
Sometimes double opt-in

User requests information, then has to confirm decision
Opt-out frowned upon

Send users information unless they say to stop
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38.14PrivacyandtheWirelessInternet CITA
Cellular Telecommunications and Internet Association Group that has created guidelines for consumer privacy Outlined four guidelines
Alert consumers when location being identified Always use opt-in marketing Consumers able to access their own information Same protections offered by all devices and carriers

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Chapter 38 - e-Business & e-Commerce

2004 Prentice Hall, Inc. All rights reserved.

Chapter 38 - e-Business & e-Commerce

2004 Prentice Hall, Inc. All rights reserved.

Chapter 38 - e-Business & e-Commerce

2004 Prentice Hall, Inc. All rights reserved.

e-Business & e-Commerce

2004 Prentice Hall, Inc. All rights reserved.

Objectives In this tutorial, you will learn:

2004 Prentice Hall, Inc. All rights reserved.

38.1Introduction Successful online businesses

E-commerce vs. e-business

Requires new business models and categories Pioneered by early e-businesses

2004 Prentice Hall, Inc. All rights reserved.

38.2.1StorefrontModel Simulates the experience of shopping in a store

2004 Prentice Hall, Inc. All rights reserved.

38.2.2Shopping-CartTechnology Shopping-cart metaphor

2004 Prentice Hall, Inc. All rights reserved.

32.2.3AuctionModel Online auctions

Very attractive to customers

2004 Prentice Hall, Inc. All rights reserved.

2004 Prentice Hall, Inc. All rights reserved.

2004 Prentice Hall, Inc. All rights reserved.

38.2.4PortalModel Portal sites

Convenient, centralized access to information

2004 Prentice Hall, Inc. All rights reserved.

38.2.5Name-Your-PriceModel User submits price they are willing to pay

2004 Prentice Hall, Inc. All rights reserved.

38.2.6Comparison-PricingModel Poll merchants for lowest price on an item

2004 Prentice Hall, Inc. All rights reserved.

38.2.7BarteringModel Trade items rather than currency

2004 Prentice Hall, Inc. All rights reserved.

38.3Buildingane-Business Multiple approaches

Outsource control entirely to a specialized firm

Build original, custom solution

38.4e-Marketing Marketing campaign

2004 Prentice Hall, Inc. All rights reserved.

2004 Prentice Hall, Inc. All rights reserved.

38.4.2MarketingResearch Marketing research

Focus groups Interviews Surveys and questionnaires Secondary research

2004 Prentice Hall, Inc. All rights reserved.

38.4.2MarketingResearch Marketing research, cont.

Online focus groups

2004 Prentice Hall, Inc. All rights reserved.

38.4.3e-MailMarketing e-Mail marketing

Direct mail vs. indirect mail

Opt-in e-Mail lists

2004 Prentice Hall, Inc. All rights reserved.

38.4.3e-MailMarketing e-Mail marketing, cont.

2004 Prentice Hall, Inc. All rights reserved.

Be sure cost of promotion is not so great that no profit is ever seen

2004 Prentice Hall, Inc. All rights reserved.

38.4.5ConsumerTracking Consumer tracking

Log files contain many useful details

2004 Prentice Hall, Inc. All rights reserved.

38.4.5ConsumerTracking Consumer tracking, cont.

2004 Prentice Hall, Inc. All rights reserved.

Internet advertising becoming important

Allow advertising on your site in return for payment Pop-up ads

3.2 E-Business & E-Commerce

3.2 E-Business & E-Commerce

3.2 E-Business & E-Commerce