1.

0 Foundations of E-Commerce
Definitions and Content of the Field

E-commerce, short for electronic commerce, refers to the buying and selling of goods and services over the internet.

It encompasses a wide range of activities, including online retail (e-tail), electronic payments, online auctions, internet
banking, online ticketing, and more.

The field also includes related activities such as online marketing, supply chain management, and electronic data
interchange (EDI).

 Benefits

• Increased reach and accessibility: E-commerce allows businesses to reach customers globally, breaking
geographical barriers.

• Cost-effectiveness: Online businesses often have lower overhead costs compared to traditional brick-and-mortar
stores.

• Convenience: Customers can shop from anywhere at any time, leading to enhanced customer satisfaction.

• Personalization: E-commerce platforms can leverage data analytics to offer personalized recommendations and
tailored shopping experiences.

 Limitations

• Security concerns: E-commerce transactions are susceptible to cyber threats such as hacking, data breaches, and
identity theft.

• Lack of tangibility: Customers cannot physically inspect products before purchase, leading to potential
dissatisfaction with product quality or appearance.

• Technical issues: Glitches, website crashes, and slow loading times can frustrate users and lead to lost sales.

• Dependency on internet access: E-commerce relies heavily on internet connectivity, which may be limited in
some regions or for certain demographics.

 The Driving Forces of E-Commerce

• Technological advancements: Innovations in internet infrastructure, mobile technology, and secure online
payment systems have fueled the growth of e-commerce.

• Changing consumer behavior: Increasingly tech-savvy consumers prefer the convenience and accessibility of
online shopping.

• Globalization: E-commerce facilitates international trade by enabling businesses to reach customers across
borders.

• Regulatory environment: Government policies and regulations impact the growth and operation of e-commerce,
influencing aspects such as taxation, consumer protection, and data privacy.
  Impact of E-Commerce:

• Economic impact: E-commerce has disrupted traditional retail models and created new opportunities for
businesses, contributing to economic growth and job creation.

• Social impact: E-commerce has transformed the way people shop, interact, and conduct business, shaping social
norms and behaviors.

• Environmental impact: While e-commerce offers potential environmental benefits such as reduced carbon
emissions from transportation, it also contributes to packaging waste and energy consumption from data
centers.

• Cultural impact: E-commerce has facilitated cultural exchange and cross-border trade, influencing global
consumer trends and preferences.

2.0 Retailing in E-Commerce

Overview of E-Commerce Marketing:

• E-commerce marketing refers to the strategies and tactics used by businesses to promote and sell products or
services online.

• It encompasses various online channels such as websites, social media, email marketing, search engine
optimization (SEO), pay-per-click (PPC) advertising, and more.

• E-commerce marketing aims to attract potential customers, drive traffic to online stores, and ultimately generate
sales.

 Structure:

• E-commerce typically involves a digital storefront where products or services are displayed and transactions take
place.

• The structure of e-commerce can vary widely, from small independent online stores to large multinational
corporations operating comprehensive online platforms.

• Key components of e-commerce structure include website design, user interface, payment gateways, inventory
management systems, and shipping logistics.

 Forecast of the B2C Electronic Markets:

• B2C (business-to-consumer) electronic markets refer to online platforms where businesses sell products or
services directly to consumers.

• Forecasts for B2C electronic markets indicate continuous growth driven by factors such as increasing internet
penetration, smartphone adoption, and consumer preference for online shopping.

 Business Models of Electronic Marketing:

• Various business models are employed in e-commerce, including direct sales, subscription-based models,
marketplace platforms, dropshipping, and affiliate marketing.
 • Each business model has its own advantages and challenges, catering to different types of products, services,
and target markets.

 Direct Marketing:

• Direct marketing in e-commerce involves reaching out to potential customers directly through channels such as
email marketing, social media advertising, and targeted online campaigns.

• It aims to personalize marketing messages and offers, increasing the likelihood of conversion and customer
retention.

 Procedure of Internet Shopping:

• Internet shopping involves several steps, including browsing products or services online, adding items to the
shopping cart, proceeding to checkout, entering payment and shipping details, and completing the transaction.

• Customers may also engage in comparison shopping, reading reviews, and seeking recommendations before
making a purchase decision.

 The Impact of E-Commerce on Traditional Retailing Systems:

• E-commerce has disrupted traditional retailing systems by offering consumers greater convenience, wider
product selection, and often lower prices.

• Traditional retailers have responded by integrating online channels into their operations, adopting omnichannel
strategies, and enhancing the in-store shopping experience to remain competitive.

3.0 Internet Consumer and Market Research

1. Building Customer Relationship

Definition: Building customer relationships in the context of the internet involves establishing and maintaining a positive
connection with consumers through various online channels.

Strategies:

 Personalized communication: Tailor messages and offers based on customer preferences and behaviors.
 Engagement on social media: Respond to comments, messages, and reviews to show a commitment to
customer satisfaction.
 Loyalty programs: Offer incentives for repeat purchases or engagement.
 Email marketing: Send targeted, relevant content to keep customers engaged.

Importance:

 Building strong customer relationships can lead to repeat business, positive word-of-mouth, and increased
customer loyalty.

The Consumer Behavior Model

 Need recognition: The consumer identifies a need or problem.

 Information search: The consumer seeks information about potential solutions.
 Evaluation of alternatives: The consumer compares different options based on various criteria.
 Purchase decision: The consumer selects a product or service.
 Post-purchase evaluation: The consumer assesses their satisfaction with the purchase.
 3. Personal Characteristics and the Demographics of Internet Surfers

• Personal Characteristics: Age, gender, occupation, income, education level, lifestyle, values, attitudes, personality
traits, and interests.

• Demographics of Internet Surfers:

• Age: Younger demographics tend to be more tech-savvy and spend more time online.

• Gender: Internet usage patterns can vary between men and women.

• Income: Higher income individuals may have different online purchasing behaviors.

• Education: Higher education levels can influence how individuals interact with the internet.

Significance:

Understanding these characteristics helps businesses tailor their online marketing strategies to reach their target
audience more effectively.

Delivering Customer Service in Cyberspace

Challenges:

• Lack of face-to-face interaction: It can be challenging to convey empathy and build rapport online.

• Security concerns: Customers may be hesitant to share personal information online.

• Technology limitations: Technical issues can disrupt the customer service experience.

Strategies

• Use chatbots and AI to provide instant responses to customer queries.

• Offer multiple communication channels (e.g., live chat, email, social media) for customer support.

• Provide clear, concise information on your website to address common customer questions.

Market Research on E-Commerce (EC)

• Definition: Market research on e-commerce involves gathering and analyzing data related to online consumer
behavior, preferences, and trends.

• Methods:

• Surveys: Gather feedback from online shoppers about their preferences and buying habits.

• Data analysis: Use website analytics tools to track user behavior on your site.

• Competitor analysis: Study your competitors' strategies and performance in the e-commerce market.

• Purpose: Market research helps businesses understand their target market better and make informed decisions
about their e-commerce strategies.
Advertisement in E-Commerce MODULE: 4

Web Advertisement

Definition: Web advertisement refers to the promotion of products or services using the internet.

 Types:

 Display Ads: Banner or image ads placed on websites.

 Search Engine Marketing (SEM): Ads that appear on search engine results pages.
 Social Media Ads: Promotional content on social media platforms.
 Native Advertising: Ads that match the form and function of the platform they appear on.

 Benefits: Wide reach, targeted advertising, measurable results.

Advertisement Methods

 Pay-Per-Click (PPC): Advertisers pay a fee each time their ad is clicked.

 Cost-Per-Impression (CPM): Advertisers pay for every thousand times their ad is displayed.
 Affiliate Marketing: Partnering with other websites to promote products or services in exchange for a
commission on sales.

Push Technology

 Definition: Push technology delivers information to users without the users having to request it.
 Example: Push notifications on mobile devices or web browsers.
 Benefits: Allows for real-time communication with users, increases engagement.

Online Catalogs

 Definition: Online catalogs are digital versions of print catalogs that showcase products or services.
 Features: Product images, descriptions, pricing, and sometimes reviews or ratings.
 Benefits: Easily accessible, can be updated in real-time, cost-effective compared to print catalogs.
E-Commerce for Service Industries Module: 5

Broker-Based Services

 Definition: Broker-based services involve intermediaries who facilitate transactions between buyers and
sellers.
 Examples: Real estate brokers, insurance brokers, stockbrokers.
 E-commerce Impact: Online platforms allow brokers to reach a wider audience and streamline the
transaction process.

Travel and Tourism Services

 Definition: E-commerce has transformed the way travel and tourism services are booked and managed.
 Online Booking: Customers can book flights, hotels, and activities online, often at discounted prices.
 Reviews and Recommendations: Online platforms provide reviews and recommendations from other
travelers, influencing booking decisions.

Trading Stocks Online

 Definition: Online stock trading platforms allow investors to buy and sell stocks electronically.
 Advantages: Real-time trading, lower transaction costs, access to a wide range of financial instruments.
 Risks: Volatility of stock markets, potential for loss of investment.

Cyberbanking and Personal Finance

 Cyberbanking: Online banking services allow customers to manage their finances, transfer funds, pay bills, and
more.

 Personal Finance Tools: Online platforms offer tools for budgeting, investing, and managing personal finances.

 Security: Emphasize the importance of secure practices such as using strong passwords and avoiding phishing
scams.

Auctions

 Online Auctions: Platforms like eBay allow users to bid on and purchase items through an auction format.
 Benefits: Access to a wide variety of products, competitive pricing, and the thrill of bidding.
 Seller Considerations: Discuss strategies for sellers to maximize their auction results, such as setting a
competitive starting price and providing detailed product descriptions.
 Intranet and Extranet Module 7
 Architecture of the Internet, Intranet, and Extranet:

• Internet: The global system of interconnected computer networks that use the Internet protocol suite (TCP/IP) to
link devices worldwide. It is a public network.

• Intranet: A private network that uses Internet protocols to securely share any part of an organization's
information or operational systems within that organization. It is accessible only to an organization's staff.

• Example: A company uses an intranet to share internal documents, company announcements, and collaborate on
projects among employees.

• Extranet: An extension of an intranet that allows controlled access to outsiders such as suppliers, vendors,
partners, or selected customers. It is part of a company's network that is made available to customers, partners,
suppliers, or others outside the company.

• Example: A company sets up an extranet portal for its suppliers to access inventory information, submit orders,
and track deliveries.

 Intranet Software:

• Intranet software includes various tools and applications that facilitate internal communication, collaboration,
and information sharing within an organization.

• Example: SharePoint is a popular intranet software that offers document management, collaboration features,
and workflow automation tools.

 Applications of Intranets:

• Communication: Internal communication tools like email, chat, forums, and announcements.

• Example: An employee uses the intranet chat feature to quickly ask a colleague a question without
sending an email.

• Document Management: Storing, sharing, and collaborating on documents.

• Example: Teams collaborate on a project by sharing and editing documents stored on the intranet.

• Knowledge Sharing: Wikis, blogs, and discussion boards for sharing expertise and best practices.

• Example: An employee creates a wiki page to document a process for others to reference.

• Workflow Automation: Streamlining processes like approvals, requests, and document review.

• Example: An employee submits a vacation request through an intranet form, which automatically routes
it to their manager for approval.

• Training and Development: Online training modules and resources for employee development.

• Example: New employees complete onboarding training modules accessible through the intranet.

 The Extranet:
 • An extranet is a controlled private network that allows access to partners, vendors, suppliers, or an authorized
set of customers.

• It extends an organization's intranet, making certain services available to authorized parties from outside the
company.

 Business Models of Extranet Applications:

• Supplier Collaboration: Extranets facilitate closer collaboration with suppliers, enabling just-in-time inventory
management, product design collaboration, and streamlined procurement processes.

• Customer Portals: Extranets can offer customers access to order tracking, product information, and customer
support, enhancing the customer experience and fostering loyalty.

• Partner Integration: Extranets enable seamless integration with partners, allowing for joint product
development, marketing campaigns, and shared services.

• Remote Access: Extranets provide remote employees or contractors with secure access to company resources,
improving efficiency and flexibility.

Electronic Payment System MODULE 8

E-Payment and Protocols:

• E-Payment: The electronic transfer of money from one account to another, typically through the internet or a
digital network.

• Protocols: Standards that define the rules and procedures for secure communication between systems in e-
payment transactions.

• Example: Secure Sockets Layer (SSL) and Transport Layer Security (TLS) are protocols commonly used to secure e-
payment transactions over the internet.

 Security Schemes in E-Payment Systems:

• Encryption: Encoding data to prevent unauthorized access, ensuring that only the intended recipient can
decipher it.

• Tokenization: Replacing sensitive card information with a unique identifier (token) that cannot be used outside
the specific transaction context.

• Fraud Detection: Using algorithms and machine learning to detect patterns indicative of fraudulent activity in e-
payment transactions.

 Electronic Credit Card System on the Internet:

  Online Payment Gateways: Services that facilitate e-commerce transactions by authorizing credit card payments
over the internet.

Example: PayPal, Stripe, and Square are popular online payment gateways that enable businesses to accept credit card
payments online.

 Electronic Check System:

• E-Check: A digital version of a paper check used for online payments, enabling funds to be transferred
electronically from a payer's bank account to a payee's account.

• Example: A customer uses their bank's online banking platform to send an e-check to pay for a purchase on a
website.

 Unified Payment Systems:

• Unified Payment Interface (UPI): An instant real-time payment system developed by the National Payments
Corporation of India (NPCI) to facilitate inter-bank transactions in India.

Example: UPI allows users to link multiple bank accounts to a single mobile application, providing a unified platform for
making payments.

11. PUBLIC POLICY FROM LEGAL ISSUE TO PRIVACY

Commerce-related legal incident

There are various legal issues associated with eCommerce businesses as well. And if these issues are not taken care of in
time, they can lead to serious problems for your business.

The common legal issues an E-Commerce business faces.

Incorporation Problem

If the company has operated merely via a website, not being incorporated is a crucial problem. Any purchase and selling
activity related to the products will be considered illegal and you can’t claim your right in case of any fraud and
corruption. Without incorporation, the business has no shelter.

• The common legal issues an E-Commerce business faces

Trademark Security Problem

Not getting trademark protected is one of the main legal issues in the field of E-Commerce. Since trademark is the
company’s logo and symbol, the representation of business all over the web, it must be protected. If it is not secure , it
won’t take long before you realize your trademark is being infringed upon. This is very common legal issue and can
become a deadly threat to e-business.
With the hackers on loose and cybercrime so common, trademark infringement of the business or by your business can
be a serious legal matter and may hinder the business’s progress.

• The common legal issues an E-Commerce business faces

Copyright Protection Issue

While publishing content for E-Commerce website, using content of any other company can be a severe legal problem.
This might mark an end to your e-business. There are many sites online which are royalty free and allow you to access
their content and images. You may use those sites for creating web content for your business site. Even if you
unintentionally used copyrighted content, the other party can easily sue your business.

• The common legal issues an E-Commerce business faces

Transaction Issues

If we do not abide by the rules, business can get into serious law violation problems. If the business fails to provide clear
and complete description of the product, cost and purchase details, information about delivery i.e. when the customer
will receive products and other information related to exchange and refunds, Consumer Law can impose penalties on
the business.

• The common legal issues an E-Commerce business faces

Privacy Issues

When it comes to online businesses, privacy is the major issue that can create problems both for the business and
customers. Consumers share information with businesses online and they expect the sellers to keep their information
confidential. By just one minor mistake and leakage of valuable information of a customer, we will not only lose our
potential customer but the image and reputation will become a question mark.

• Ethical Issue faced by E-Commerce

Web tracking

Every time someone visit the web, the website system retains some trails of the users that can be refer later, this trails
are normal call logs. These logs contains all the records pertains to what the users perform in the site. Logs as records
mean, they can be retrieve or save for later use.

Analysis of log file means turning log data into application service or installing software that can pluck relevant
information from files in-house. Companies track individual’s movement through tracking software and cookie analysis.
Programs such as cookies raise a batch of privacy concerns. The tracking history is stored on your PC’s hard disk, and any
time you revisit a website, the computer knows it.

• Ethical Issue faced by E-Commerce

Online Privacy

Most Electronic Payment Systems knows the identity of the buyer. So it is necessary to protect the identity of a buyer
who uses Electronic Payment System. A privacy issue related to the employees of company is tracking. Monitoring
systems are installed in many companies to monitor e-mail and other web activities in order to identify employees who
extensively use business hours for non-business activities.

• Ethical Issue faced by E-Commerce

Web Spoofing
Web spoofing is an electronic deception relates to the Internet. It occurs when the attacker sets up a fake website which
almost totally same with the original website in order to lure consumers to give their credit card number or other
personal information.

Email Spamming & phishing:

E-mail spamming involved unsolicited commercial e-mail (UCE) sent or broadcast unwanted advertisement or
correspondence over the Internet. The use of e-mail spammers meant to lure consumers to enter their personal
information on fake website using e-mail, forged to look like it is from authorized organization such as bank. The content
of e-mail often directs the consumers to the fake website in order to lure them to fill their personal information such as
credit card or bank account’s details. This technique is called phishing. And these illegal process easily compromised the
user's right and expose to danger.

• What is meant by intellectual property?

Intellectual property (IP) refers to creations of the mind, such as inventions; literary and artistic works; designs; and
symbols, names and images used in commerce.

Intellectual property is considered to be intangible property created by individuals or corporations. Information

technology has made it difficult to protect intellectual property, because computerized information can be so easily
copied or distributed on networks.

• Types of Intellectual Property Protection

COPYRIGHTS

In this digital era, copyrights play a significant role in safeguarding the creative content and information available on the
websites. With rapid digitalization, the copyright owners seek Copyright Protection to prevent any unauthorized copying
or distribution of their works presented online. Moreover, many technological prevention methods like Encryption and
Watermarking can be effectively used to safeguard the IP rights of online businesses.

• Types of Intellectual Property Protection

TRADEMARKS

In the online world and E-Commerce, Trademarks have considerable importance to build a brand image by growing or
selling the businesses. A Registered Trademark also makes it easier to take legal action and proceedings against brands
that infringe on your business assets online.

• Types of Intellectual Property Protection

PATENTS

Patents offer a considerable amount of incentives to the researchers and innovators in the arena of E-Commerce and
online businesses. Patents help in licensing, contracting to outsource, and building strategic relationships involved in E-
Commerce. Patents not only help in recording and developing new ideas for an E-Commerce business, but also boost up
the sales of your products by giving them exclusive features unavailable to the other competitors in the online business.

• Role of Intellectual Property in E-Commerce

• The Intellectual Property Law safeguards the business interests and entities of a company or an individual against
unfair competition. Coming to the digital economy and E-commerce, in the absence of IP laws and practices,
everything ranging from music, software, design, and so forth could be stolen, duplicated, or distributed over the
globe without paying the proprietors for their one of a kind creation and work.
 • Additionally, IP is also involved in the working of E-Commerce as components like software, chips, networks,
designs, routers, to name a few, are all forms of IP which must be protected to allow the functioning of the
Internet.

• Role of Intellectual Property in E-Commerce

• All E-Commerce and online businesses are based on product or patent licensing. As a variety of technologies are
needed to create a product, most online businesses either outsource the development of some components or
share technologies using licensing agreements.

• E-Commerce based businesses consider IP as their most valuable asset and often own Patent portfolios and
trademarks to enhance the value of their online businesses.

• Encryption policy

Encryption is a technique for hiding data. The encrypted data can be read only by those users for whom it is intended.

The purpose of data encryption is to protect digital data confidentiality as it is stored on computer systems and
transmitted using the internet or other computer networks.

In a Public Key encryption system each user has two keys-public key and private key. The encryption and decryption
algorithms are designed in a way so that only the private key can decrypt data that is encrypted by the public key. And
the public key can decrypt data, encrypted by the private key. Therefore, one can broadcast the public key to all users.

• Encryption

• What is Ecommerce Sales Tax?

• Sales tax is a small percentage of a sale tacked on to that sale by an online retailer.

• Sales tax is a “consumption tax,” meaning that consumers only pay sales tax on taxable items they buy at retail.

• If you are a Sole Trader, you will need to pay income tax on your revenues. Companies must pay corporation tax
on their profits.

• E-Commerce law in Nepal

• E-Commerce customer protection law in Nepal

1. Order to be deemed as contract

• Section 7, sub-section 1: If the seller accepts the order placed by the customer, it shall be deemed as contract
and the duties as of contract shall be created.

2. Right to cancellation

• Section 7, sub-section 3: The customer can cancel the order until the product is dispatched or the service is
provided.

3. No charge in case of cancellation

• Section 7, sub-section 4: An order cancelled as per section 7, sub-section 3 shall not be charged and if the
amount for the product or service is pre-paid, all the amount shall be refunded to the customer.

• E-Commerce customer protection law in Nepal

3. No charge in case of cancellation

• Section 7, sub-section 4: An order cancelled as per section 7, sub-section 3 shall not be charged and if the
amount for the product or service is pre-paid, all the amount shall be refunded to the customer.
4. Diverse payment methods

• Section 8, sub-section 2: The customer can pay by using any mode of payment; it may be cash, debit/credit card,
internet/mobile banking or through cheque.

5. Fixed place and time for delivery

• Section 9: The seller shall deliver the goods in a particular place and time which is mentioned while placing an
order.

• E-Commerce customer protection law in Nepal

6. Prohibition on alteration

• Section 11(a): The goods and services mentioned on the website shall be delivered to the customers.

7. Provision of replacement and refund

• Section 11(b): If the goods delivered is found to be defective, the seller shall replace the goods or shall refund
the amount.

8. Non-compliant sellers to be booked

• Section 18, sub-section 2: If the seller commits any thing against the act, they shall be labile for fine ranging up
to Rs 200,000.

• E-Commerce customer protection law in Nepal

9. Complaint response mechanism

• Section 20: In case of inability to deliver the goods within the stated time, the customer can file the complaint in
concerned District Administration Office.

• Section 23: The seller should designate an employee to hear complaints from the customers. The name, phone
number and address of the employee shall be placed on the website

MODULE 11
INFRASTRUCTURE OF E-COMMERCE
Internet Protocol

Internet Protocol (IP) – a set of rules that dictate how data should be delivered over the public network (Internet). Often
works in conjunction with the transmission control protocol (TCP), which divides traffic into packets for efficient
transport through the Internet; together they are referred to as TCP/IP.

Example

For example, when an email (using the simple mail transfer protocol – SMTP) is sent from an email server, the TCP layer
in that server will divide the message up into multiple packets, number them and then forward them to the IP layer for
transport. At the IP layer, each packet will be transported to the destination email server. While each packet is going to
the same place, the route they take to get there may be different. When it arrives, the IP layer hands it back to the TCP
layer, which reassembles the packets into the message and hands it to the email application, where it shows up in the
Inbox.

IP packets
While IP defines the protocol by which data moves around the internet, the unit that does the actual moving is the IP
packet.

An IP packet is like a physical parcel or a letter with an envelope indicating address information and the data contained
within.

What is an IP address?

IP provides mechanisms that enable different systems to connect to each other to transfer data. Identifying each
machine in an IP network is enabled with an IP address.

Similar to the way a street address identifies the location of a home or business, an IP address provides an address that
identifies a specific system so data can be sent to it or received from it.

What is an IP address?

WHAT IS TCP?

The Transmission Control Protocol (TCP) is an Internet protocol that connects a server and a client. Together, TCP and
Internet Protocol (IP) are the set of networking protocols that enable computers to connect over the Internet.

Data travels over the Internet in packets. For transit they are disassembled into packets, which are then reassembled at
their destination. TCP manages the reliability of the rails on which they travel to ensure that no packets are lost, they are
properly ordered, and that there are no delays in the journey that would affect data reassembly or quality.

CLIENT & SERVER

Client: When we talk the word Client, it mean to talk of a person or an organization using a particular service. Similarly in
the digital world a Client is a computer (Host) i.e. capable of receiving information or using a particular service from the
service providers (Servers).

Servers: Similarly, when we talk the word Servers, It mean a person or medium that serves something. Similarly in this
digital world a Server is a remote computer which provides information (data) or access to particular services.

A client-server network is a central computer that provides a means for end-users, or clients, to obtain services and
resources from another entity, such as when a library member downloads a book from the local library.

CLIENT & SERVER

Web Server

Web Server

Internet security

Internet security is a term that describes security for activities and transactions made over the internet. It’s a particular
component of the larger ideas of cybersecurity and computer security, involving topics including browser security, online
behavior and network security.

Types of internet security threats

Malware: Short for "malicious software," malware comes in several forms, including computer viruses, worms, Trojans,
and dishonest spyware.

Computer worm: A computer worm is a software program that copies itself from one computer to the next. It does not
require human interaction to create these copies and can spread rapidly and in great volume.
Spam: Spam refers to unwanted messages in your email inbox. In some cases, spam can simply include junk mail that
advertises goods or services you aren't interested in. These are usually considered harmless, but some can include links
that will install malicious software on your computer if they're clicked on.

Types of internet security threats

Phishing: Phishing scams are created by cybercriminals attempting to solicit private or sensitive information. They can
pose as your bank or web service and lure you into clicking links to verify details like account information or passwords.

Botnet: A botnet is a network of private computers that have been compromised. Infected with malicious software,
these computers are controlled by a single user and are often prompted to engage in nefarious activities, such as sending
spam messages or denial-of-service (DoS) attacks.

Advantages of Cyber Security

1) Protects system against viruses, worms, spyware and other unwanted programs.

2) Protection against data from theft.

3) Protects the computer from being hacked.

4) Minimizes computer freezing and crashes.

5) Gives privacy to users

Selling on the Internet

 Electronic safeguards in your website

The first step to take is to build electronic safeguards in your website. For example, your website creator can design order
forms so that the computer will reject fake addresses, incorrect credit card numbers or other information which does not
appear to be correct. This will make it more difficult for people to place fake orders with your business.

 Exit, print or download the order form

Another step to take is to allow a customer to exit the order form screen at any time while they are filling it out. This way,
if a customer changes their mind about an order, they can easily cancel the order before it is sent to your company.

In addition, once the order is submitted, the customer should be permitted to print or download a copy for their records.

Selling on the Internet

 Credit card security

Businesses that want to accept credit card payments through their website should address their customers’ concerns
about using credit cards over the Internet. You can do this by providing information on your website stating what you
have done to protect credit card transactions. For example, many software programs now scramble Internet messages.
This is called encryption. If encrypted information is copied as it is sent from one website to another, it will not be
understood.

Selling on the Internet

 Clear contracts

Another thing you can do to protect your business in e-commerce is to make the terms of your order form or contract
very clear. The customer should know what they are buying when they agree to your terms. By being very clear and
precise, you will minimize the number of orders that are returned, and you will be able to prove that you had a contract.
This will help you protect your legal rights in a contract dispute.
  Know the law

Business owners who market goods and services on the Internet must also be aware of the many laws which may affect
how they can do business. These include laws regarding business registrations, consumer protection, language and
labelling regulations and many others.

Selling on the Internet

Terms of Service

A Terms of Service (also called a Terms & Conditions) is a legal document provided by a business to their customers. It
describes the business’ products, services, sales process, and specific rules regarding cancellations, refunds, and returns.
The Terms of Service is usually posted on a dedicated page on the business website. Also, it will often explain how
customers should interact with the website, and how the business protects its property and content.

Advantages of online retail

Easy access to market - in many ways the access to market for entrepreneurs has never been easier. Online marketplaces
such as eBay and Amazon allow anyone to set up a simple online shop and sell products within minutes. See selling
through online marketplaces.

Reduced overheads - selling online can remove the need for expensive retail premises and customer-facing staff, allowing
you to invest in better marketing and customer experience on your e-commerce site.

Potential for rapid growth - selling on the internet means traditional constraints to retail growth - eg finding and paying
for larger - are not major factors. With a good digital marketing strategy and a plan a scale up order fulfilment systems,
you can respond and boost growing sales. See planning for e-commerce.

Advantages of online retail

Widen your market / export - one major advantage over premises-based retailers is the ability expand your market
beyond local customers very quickly. You may discover a strong demand for your products in other countries which you
can respond to by targeted marketing, offering your website in a different language, or perhaps partnering with an
overseas company. See basics of exporting.

Customer intelligence - ability to use online marketing tools to target new customers and website analysis tools to gain
insight into your customers' needs. For advice on improving your customer's on-site experience, read how to measure
your online marketing.

Disadvantages of online retail

Website costs - planning, designing, creating, hosting, securing and maintaining a professional e-commerce website isn't
cheap, especially if you expect large and growing sales volumes. See common e-commerce pitfalls.

Infrastructure costs - even if you aren't paying the cost of customer-facing premises, you'll need to think about the costs
of physical space for order fulfilment, warehousing goods, dealing with returns and staffing for these tasks. See fulfilling
online orders.

Security and fraud - the growth of online retail market has attracted the attention of sophisticated criminal elements. The
reputation of your business could be fatally damaged if you don't invest in the latest security systems to protect your
website and transaction processes. See e-commerce pitfalls - security weaknesses.

Disadvantages of online retail

Legal issues - getting to grips with e-commerce and the law can be a challenge and you'll need to be aware of, and plan
to cope with, the additional customer rights which are attached to online sales. See the law and selling online.
Advertising costs - while online marketing can be a very efficient way of getting the right customers to your products, it
demands a generous budget. This is especially true if you are competing in a crowded sector or for popular keywords.
See pay-per-click and paid search advertising.

Customer trust - it can be difficult to establish a trusted brand name, especially without a physical business with a track
record and face-to-face interaction between customers and sales staff. You need to consider the costs or setting up a
good customer service system as part of your online offering. See manage your customer service.