ONLINE PAYMENT SYSTEMS
What you should know:
B2C vs. B2B
Payment Methods
- cash, cheque, debit card, credit card
Online Payments
- Bank EFT - electronic funds transfer
- Credit Card: >85% worldwide, >95% in the US, only 5% of all credit card transactions, accounts for 50% of all credit card fraud
- Scrip: Flooz, Beenz - cannot exchange for cash, but can use it to buy merchandise online
Consumer Concerns
- Privacy & Security
- Independence - having the ability to use whatever payment method i choose
- Portability - what to be able to access it everywhere, not just on my home computer
- Convenience -
- Phishing - bank or other trusted authority giving you money, you've got a third party trying to pretend or portray themselves as that trusted authority, log in to your account - the link they give you is never the exact link for your bank
Monday, March 31, 2008
Wednesday, March 26, 2008
Chapter 11: Key Concept
PAYMENT SYSTEMS FOR ECOMMERCE
Key Concept
This chapter focuses on the variety of forms of payment that are available online and the advantages and disadvantages of some different options. Electronic cash is used a lot online and there are advantages and disadvantages for it as well. Electronic wallets are also used in e-commerce, along with stored-value cards. This chapter explains how transactions work online and what is more beneficial.
Key Concept
This chapter focuses on the variety of forms of payment that are available online and the advantages and disadvantages of some different options. Electronic cash is used a lot online and there are advantages and disadvantages for it as well. Electronic wallets are also used in e-commerce, along with stored-value cards. This chapter explains how transactions work online and what is more beneficial.
Payment Cards
- credit cards, debit cards, charge cards
- credit card: VIsa, Mastercard - spending limit based on users credit history
- card not present transactions: online and telephone purchases
- debit card: removes $$ from cardholder's bank
- charge card: American Express, no spending limit
- single-use cards: valid for only one transaction
Advantages and Disadvantages
A:
- provide fraud protection
- worldwide acceptance
D:
- charge merchants per-transaction fees and monthly processing fees
Payment Acceptance and Processing
Opened and Closed Loop Systems
- closed: card issuer pays merchangts that accept the dard directly and does not use intermediary (bank)
- open loop: third party processes a transaction
- credit card associations: visa, m/c, operated by banks who are members in associations
- custoemr issuing banks: issue credit cards to individual consumers, responsible for establishing customer credit limits
Merchant Accounts
- merchant bank: bank that does business with sellers that want to accept payment cards
Processing Payment Cards Online
- payment processing service providers: software that handles payment card processing automatically
- automated clearing house: services connect to this and a credit card authorization company
Electronic Cash
- any value storage and exchange system created by private entity that doesn't use paper documents or coins, serve as a substitute for govn't issued physical currency
Micropayments and Small Payments
- internet payments for items costing from a few cents to approx a dollar
- small payments: less than $10
Advanatages:
- more efficient
- costs less than processing credit card transactions
- additional costs are nearly zero
Disadvantages
- no audit trail
- money laundering: convert money that they have obtained illegally into cash that they can spend without having it identified as proceeds of illegal activity
- susceptible to forgery
_ not a global commercial success
Providing Security for Electronic Cash
- anonymous electronic cash: cannot be traced back to the person who spent it
- cryptographic algorithms create tamperproof electronic cash that can be traved back to its origins
Electronic Cash Systems
- interoperable software: runs transparently on variety of hardware configurations and on diff software systems
CheckFree: largest online billing processor, provide online payment processing services to large corporations and individual internet users
Clickshare: aimed at magazine and newspaper publishers
Paypal: earns profit on the float: money deposited in paypal accounts and not used immediately
Electronic Wallets
- holds credit card numbers, electronic cash, owner identification, and owner contact info and provides that info at an electronic commerce site's checkout counter
- stores customers info on remote server belonging to particular merchant
- client-side electronic wallet: stores consumers info on his or her own computer - not portable
Microsoft . NET Passport
- server-side e-wallet operated by microsoft
Yahoo Wallet
- completing order forms automatically with identifying info and credit card payment info
Stored-Value Cards
- elaborate smart card with a microchip or plastic card with magnetic strip that records the currency balance - smart card can store larger amounts of info and includes processor ship on card
Magnetic Strip Cards
- hold value that can be recharged by inserting them into the appropriate machines, inserting cuurency into the machine, withdrawing the card, strip stores increased cash value
Smart Cards:
- stored-value card that is plastic with an embedded microchip that can store info, can store 100 x's the amount of info that a magnetic strip can store
- safer than conventional credit cards, info is encrypted
Sunday, March 23, 2008
Chapter 10: Key Concept
ELECTRONIC COMMERCE SECURITY
Online Security Issues:
Computer Security: protection of assets from unauthorized access, use, alteration, or destruction.
- physical security: tangible protection devices, alarms, guards, fireproof doors, security fences, safes or vaults, bombproof buildings
- logical security: protection of assets using nonphysical means
- threat: any act or object that poses danger to computer assets
Managing Risk
- Countermeasures: general name for procedure, physical or logical, that recognizes, reduces or eliminates threat Fig 10-1
- eavesdropper: person or device that can listen in on and copy internet transmissions
- crackers/hackers: people who write programs or manipulate technologies to obtain unauthorized access to computers and networks
Computer Security Classifications
- secrecy: protecing against unauthorized data disclosure and ensuring the authenticity of tha data source
- integrity: preventing unauthorized data modifidcation
- necessity: preventing data delays or denials
Security Policy and Integrated Security
- security policy: written statement describing which assets to protect and why they are being protected, who is responsible, which behvaiours are acceptable
Security for Client Computers
Cookies
- stateless connection: each transmission of info is independent
- small text files that web servers place on web client computers to identify returning visitors
- session cookies: exist until the web client ends the connection
- persistent cookies: remina on the client computerindefinitely
- cookie blockers: prevent cookie storage selectively
Web Bugs:
- tiny graphic that third-party web site places on another site's web page
Active Content:
- programs that are embedded transparently in web pages and cause action to occur
- zombie: trojon horse that tkaes over another computer for the purpose of launching attacks on other computers (MSN messages)
Java Script
- scripting language developed by netscape to enable web page designers to build active content
ActiveX Controls
- object that contains programs and properties that web designers place on web pages to perform particular tasks
Graphics and Plug-ins
- programs that enhance capabilities of browsers, handle content that crowser cannot handle
Viruses, Worms, and Antivirus software
- virus: software attaches itself to another program and causes damage when host program is activated
- worm: virus that replicates itself on the computers that it infects
- macro virus: coded as small program and embedded in a file
- antivirus software: detects viruses and worms and either deletes them or isolates them on client comp[ueter so they cannot run
Digital Certificates:
- attachment to an email msg or program embedded in web page that verifies that sender of web site is who or what it claims to be
- signed: DC is a signed message or code
- key: simple # that is used with the encryption algorithm to lock the characters of msg being protected so they are undecipherable without the key
Steganography:
- process of hiding info within another piece of info
Communication Channel Security
Secrecy Threats
- privacy: protection of inidivdual rights to nondisclosure
- sniffer programs: provide means to record info that passes through a compueter or router that is handling internet traffic
Integrity threats
- active wiretapping: when unauthorized party can alter msg stream of info
- masquerading/spoofing: pretending to be someone you are not, or representing a web site as original when it is fake
Necessity Threats:
- distrupt normal compueter processing, or deny processing entirely
Threats to wireless networks
- wardrivers: find an open network and may place a chalk mark on the building so that other attackers will know that an easily entered wirless network is nearby (warchalking)
Encryption Solution
- coding of info by using mathematically based program and a secret key to produce string of characters that is unintelligible (see class notes)
Online Security Issues:
Computer Security: protection of assets from unauthorized access, use, alteration, or destruction.
- physical security: tangible protection devices, alarms, guards, fireproof doors, security fences, safes or vaults, bombproof buildings
- logical security: protection of assets using nonphysical means
- threat: any act or object that poses danger to computer assets
Managing Risk
- Countermeasures: general name for procedure, physical or logical, that recognizes, reduces or eliminates threat Fig 10-1
- eavesdropper: person or device that can listen in on and copy internet transmissions
- crackers/hackers: people who write programs or manipulate technologies to obtain unauthorized access to computers and networks
Computer Security Classifications
- secrecy: protecing against unauthorized data disclosure and ensuring the authenticity of tha data source
- integrity: preventing unauthorized data modifidcation
- necessity: preventing data delays or denials
Security Policy and Integrated Security
- security policy: written statement describing which assets to protect and why they are being protected, who is responsible, which behvaiours are acceptable
Security for Client Computers
Cookies
- stateless connection: each transmission of info is independent
- small text files that web servers place on web client computers to identify returning visitors
- session cookies: exist until the web client ends the connection
- persistent cookies: remina on the client computerindefinitely
- cookie blockers: prevent cookie storage selectively
Web Bugs:
- tiny graphic that third-party web site places on another site's web page
Active Content:
- programs that are embedded transparently in web pages and cause action to occur
- zombie: trojon horse that tkaes over another computer for the purpose of launching attacks on other computers (MSN messages)
Java Script
- scripting language developed by netscape to enable web page designers to build active content
ActiveX Controls
- object that contains programs and properties that web designers place on web pages to perform particular tasks
Graphics and Plug-ins
- programs that enhance capabilities of browsers, handle content that crowser cannot handle
Viruses, Worms, and Antivirus software
- virus: software attaches itself to another program and causes damage when host program is activated
- worm: virus that replicates itself on the computers that it infects
- macro virus: coded as small program and embedded in a file
- antivirus software: detects viruses and worms and either deletes them or isolates them on client comp[ueter so they cannot run
Digital Certificates:
- attachment to an email msg or program embedded in web page that verifies that sender of web site is who or what it claims to be
- signed: DC is a signed message or code
- key: simple # that is used with the encryption algorithm to lock the characters of msg being protected so they are undecipherable without the key
Steganography:
- process of hiding info within another piece of info
Communication Channel Security
Secrecy Threats
- privacy: protection of inidivdual rights to nondisclosure
- sniffer programs: provide means to record info that passes through a compueter or router that is handling internet traffic
Integrity threats
- active wiretapping: when unauthorized party can alter msg stream of info
- masquerading/spoofing: pretending to be someone you are not, or representing a web site as original when it is fake
Necessity Threats:
- distrupt normal compueter processing, or deny processing entirely
Threats to wireless networks
- wardrivers: find an open network and may place a chalk mark on the building so that other attackers will know that an easily entered wirless network is nearby (warchalking)
Encryption Solution
- coding of info by using mathematically based program and a secret key to produce string of characters that is unintelligible (see class notes)
Monday, March 17, 2008
Chapter 10: Class Notes
E-Commerce Security
SECURITY ISSUES:
Types of Security:
- Physical Security: protecting your assets with physical systems (firewalls)
- Logical Security: intangible - the router you use to access the internet,
Minimum Level of Requirement: elements of security plan
- Privacy/secrecy: no unathorized disclosure of info...if hosting a site, you need plans around these areas ie: privacy policy
- Data integrity: no unathorized modification
- Availability/necessity: making sure your system is alwasy accessible - no data or message delays
- Key Management: secure encryption keys; how you manage all passwords and code numbers you need to access information
- Nonrepudiation: you know who is on the other end of the computer; end-to-end proof of identity
- Authenticity: digital signatures and certificates
Security Policy
- addresses:
- physical security
- network security
- access authorizations: administrator who can change things, user can only look at things
- virus protection:
- disaster recovery: if something goes wrong
- example: network security library
Risk Management
- figure 10-1
- countermeasures: how to eliminate a threat after it has happened
- eavesdroppers: sniffing programs; on the internet everywhere
- crackers/hackers: crackers hack in to systems for illegal purposes; hacker hacks into systems and are usually paid by a company...white hat: good black hat: bad
- firewalls: trusted network: behind a firewall untrusted network: outside of the firewall
CLIENT-SIDE SECURITY: you with web browsers surfing to ecomm site
Cookies: little files that webserver stores on your hard disk w/out you knowing; cannot do anything, it is just a text file
Types: session (temporary): cookie that is stored in the temporary folder of your browser; persistent (permanent): always stored on harddrive and allows someone to have your info handy, negative is that they are also used by ad agencies and trackers (ppl trying to collect info about what sites you visited); web bugs: type of cookie that are left behind on your system, instead of using a text file these guys use a little invisible graphic
Uses:
- online ordering systems
- site personalization
- website tracking
- user IDs
Active content:
- activex controls
- java applets
- javascript
- trojan horse
- viruses: destroy your computer system, worms, & zombies: launches off your system to destroy others
- graphics and plug-ins
SAFE WEB SURFING
anonymity: allow user to be anonymous
anti-virus
spam
spyware
spyware
miscellaneous
ENCRYPTION
Types
- symmetric: you use the same password to encrypt and decrypt
- asymmetric: public key: published out to the world, private key: key you use to decode something, digital signature:
- figure 10.10 Encryption
Email: Pretty Good Privacy (PGP)
Digital Certificates: use the idea of keys, when you see the https it means that they have a SSL license
Disks and Folders: consumer software products to protect files, photos, folders.... Truecrypt: allows you to create a hidden disk on your harddrive
Voice-over IP: when you talk into your computer microphone it encrypts it, is done right away
SECURITY ISSUES:
Types of Security:
- Physical Security: protecting your assets with physical systems (firewalls)
- Logical Security: intangible - the router you use to access the internet,
Minimum Level of Requirement: elements of security plan
- Privacy/secrecy: no unathorized disclosure of info...if hosting a site, you need plans around these areas ie: privacy policy
- Data integrity: no unathorized modification
- Availability/necessity: making sure your system is alwasy accessible - no data or message delays
- Key Management: secure encryption keys; how you manage all passwords and code numbers you need to access information
- Nonrepudiation: you know who is on the other end of the computer; end-to-end proof of identity
- Authenticity: digital signatures and certificates
Security Policy
- addresses:
- physical security
- network security
- access authorizations: administrator who can change things, user can only look at things
- virus protection:
- disaster recovery: if something goes wrong
- example: network security library
Risk Management
- figure 10-1
- countermeasures: how to eliminate a threat after it has happened
- eavesdroppers: sniffing programs; on the internet everywhere
- crackers/hackers: crackers hack in to systems for illegal purposes; hacker hacks into systems and are usually paid by a company...white hat: good black hat: bad
- firewalls: trusted network: behind a firewall untrusted network: outside of the firewall
CLIENT-SIDE SECURITY: you with web browsers surfing to ecomm site
Cookies: little files that webserver stores on your hard disk w/out you knowing; cannot do anything, it is just a text file
Types: session (temporary): cookie that is stored in the temporary folder of your browser; persistent (permanent): always stored on harddrive and allows someone to have your info handy, negative is that they are also used by ad agencies and trackers (ppl trying to collect info about what sites you visited); web bugs: type of cookie that are left behind on your system, instead of using a text file these guys use a little invisible graphic
Uses:
- online ordering systems
- site personalization
- website tracking
- user IDs
Active content:
- activex controls
- java applets
- javascript
- trojan horse
- viruses: destroy your computer system, worms, & zombies: launches off your system to destroy others
- graphics and plug-ins
SAFE WEB SURFING
anonymity: allow user to be anonymous
anti-virus
spam
spyware
spyware
miscellaneous
ENCRYPTION
Types
- symmetric: you use the same password to encrypt and decrypt
- asymmetric: public key: published out to the world, private key: key you use to decode something, digital signature:
- figure 10.10 Encryption
Email: Pretty Good Privacy (PGP)
Digital Certificates: use the idea of keys, when you see the https it means that they have a SSL license
Disks and Folders: consumer software products to protect files, photos, folders.... Truecrypt: allows you to create a hidden disk on your harddrive
Voice-over IP: when you talk into your computer microphone it encrypts it, is done right away
Wednesday, March 12, 2008
Chapter 9: Key Concept
ELECTRONIC COMMERCE SOFTWARE
Key Concept: This chapter focuses on the software for small, midsize, and larger businesses and the functions provided by each type. The software is chosen on the company's size, objectives, and budget.
Web Hosting Alternatives
- self-hosting: companies incorporate electronic cemmerce components and run servers in-house
- commerce service providers: a web host service that also provides commerce hosting services on its computer
- managed service providers: web site hosing service firm, synonymous with ASP and CSP
- shared hosting: web hosting arrangement in which the hosting company provides web space on a server computer that also hoses other web sites
- dedicated hosting: web hosting option in which the hosting company provides exlusive use of a specific server computer that is owned and administered by the hosting company
- co-location: internet service arrangement in which the service provider rents a physical space to the client to install its own server hardware
- scalable: system's ability to be adapted to meet changing requirements
Basic Functions of Electronic Commerce Software
ecommerce solution must as least provide:
- catalog display
- shopping cart capabilities
- transaction processing
additional software componenets can include:
- middleware that integrates ecommerce system with existing company info systems
- enterprise application integration
- web services
- integration with enterprise resource planning software
- supply chain management software
- customer relationship management software
- content management software
- knowledge management software
ECommerce Software For Small and Midsize Companies
Basic Commerce Service Providers
- CSPs offer free or low-cost electronic commerce software for ecommerce sites, then kept on CSPs server
Mall Style Commerce Service Providers
- internet connection, web site creation toosl, little or no banner adveritisng clutter
- charge monthly fee
Electronic Commerce Software for Midsize to Large Businesses
Web Site Development Tools
- Dreamweaver, Microsoft FrontPage, Intershop Enfinity MultiSite, WebSphere Commerce Professional Edition, Commerce Server 2002
ECommerce Software for Large Businesses
Enterprise-Class ECommerce Software
Customer Relationship Management Software
Supply Chain Management Software
Content Management Software
Knowledge Management Software
Key Concept: This chapter focuses on the software for small, midsize, and larger businesses and the functions provided by each type. The software is chosen on the company's size, objectives, and budget.
Web Hosting Alternatives
- self-hosting: companies incorporate electronic cemmerce components and run servers in-house
- commerce service providers: a web host service that also provides commerce hosting services on its computer
- managed service providers: web site hosing service firm, synonymous with ASP and CSP
- shared hosting: web hosting arrangement in which the hosting company provides web space on a server computer that also hoses other web sites
- dedicated hosting: web hosting option in which the hosting company provides exlusive use of a specific server computer that is owned and administered by the hosting company
- co-location: internet service arrangement in which the service provider rents a physical space to the client to install its own server hardware
- scalable: system's ability to be adapted to meet changing requirements
Basic Functions of Electronic Commerce Software
ecommerce solution must as least provide:
- catalog display
- shopping cart capabilities
- transaction processing
additional software componenets can include:
- middleware that integrates ecommerce system with existing company info systems
- enterprise application integration
- web services
- integration with enterprise resource planning software
- supply chain management software
- customer relationship management software
- content management software
- knowledge management software
ECommerce Software For Small and Midsize Companies
Basic Commerce Service Providers
- CSPs offer free or low-cost electronic commerce software for ecommerce sites, then kept on CSPs server
Mall Style Commerce Service Providers
- internet connection, web site creation toosl, little or no banner adveritisng clutter
- charge monthly fee
Electronic Commerce Software for Midsize to Large Businesses
Web Site Development Tools
- Dreamweaver, Microsoft FrontPage, Intershop Enfinity MultiSite, WebSphere Commerce Professional Edition, Commerce Server 2002
ECommerce Software for Large Businesses
Enterprise-Class ECommerce Software
Customer Relationship Management Software
Supply Chain Management Software
Content Management Software
Knowledge Management Software
Chapter 8: Key Concept
WEB SERVER HARDWARE AND SOFTWARE
Key Concept:
This chapter focuses on what happens when a client computer requests a web page. There are different operating systems and different servers that are involved in this process. Web server hardware is important aspect of an online business site.
Web Server Basics
Types of Web Sites:
- Development sites: evaluate different web designs with little initial investment
- Intranets: corporate networks
- Extranets: allow authorized parties outside the company to access certain parts of info stored
- Transaction-processing sites: B2B, available 24/7
- Content-delivery sites: news, histories, summaries, other digital information
Dynamic Content
- dynamic page: content is shaped by program in response to user requests
- static page: unchanging page retrieved from disk
- dynamic content: constructed in response to web clients request
- server-side scripting: programs running on web server create web pages before sending them back to requesting web clients
- dynamic page-generation technologies: active server pages (ASP), JavaServer Pages (JSP), Hypertext preprocessor (PHP)
Various meaning of server
- server: any computer used to provide files or make programs available to other computers connected to it through network
Two-Tier Client/Server Architecture
- messages are created and read only by the client and the server computers
- request message: message that web client sends to request file or files from web server
- request line: contains a comment, name of target resource, protocol name, version number
- request headers: info about types of files that client will accept
- entity body: sometimes used to pass bulk info to server
Three-tier and N-Tier Client/Server Architectures
- allow additional processing to occur before the web server responds to client's request
- third tier often includes databases and related software applications
Software for Web Servers
Operating Systems for Web Servers
- open-source software: developed by community of programmers who make the software available for download at no cost
Web Server Software:
- Apache, Microsoft Internet Information Server (IIS), Sun Java System Web Server
Electronic Mail (E-Mail)
E-mail Benefits: attachments frequently most important part of message
E-mail drawbacks: amount of emails in one day, viruses
Spam: spam is beginning to level off, antispam efforts and software projects help limit the annoyance and cost of spam
Solutions to the Spam Problems:
- individual user antispam tactics
- basic content filtering
- challenge-response content filtering
- advanced content filtering
- legal solutions
- technical solutions
Web Site and Internet Utility Programs
Finger and Ping Utilities:
- finger: program that runs on UNIX operating systems and allows user to obtain some info about other network users
- ping: packet internet groper: tests the connectivity between two computers connected to the internet computers, # of computers
Tracert and Other Route-Tracing Programs
- tracer: sends data packets to every computer on the path between one computer and another computer and clocks the packets round-trip times
Teinet and FTP Utilities:
- teinet: allows users to log on to a computer that is connected to the internet
- telnet protocal: set of rules
- file transfer protocol: part of TCP/IP that defines the formats used to transfer files between TCP/IP connected computers
Link-Checking Utilities: examines each page on site and reports on any URLs that are broken, seem broken, incorrect; orphan file: file on site that is not linked to any page
Remote Server Administration: web site administrator can control web site from any internet-connected computer
Web Server Hardware
Server Computers: have more memory, larger hard disk drives, faster processors, usually more expensive
Web Server Performance Evaluation:
- benchmarking: testing that is used to compare the performance of hardware and software
- throughput: number of HTTP requests that particular hardware and software combo can process in a unit of time
- response time: amount of time a server requires to process one request
Web Server Hardware Architectures
- server farms: large collection of servers
- centralized architecture: use few very large and fast computers
- distributed architecture: decentralized architecture
- load-balancing switch: piece of network hardware that monitors the workloads of servers attached to it and assigns incoming web traffic to the server that has the most available capacity at that instant in time
Key Concept:
This chapter focuses on what happens when a client computer requests a web page. There are different operating systems and different servers that are involved in this process. Web server hardware is important aspect of an online business site.
Web Server Basics
Types of Web Sites:
- Development sites: evaluate different web designs with little initial investment
- Intranets: corporate networks
- Extranets: allow authorized parties outside the company to access certain parts of info stored
- Transaction-processing sites: B2B, available 24/7
- Content-delivery sites: news, histories, summaries, other digital information
Dynamic Content
- dynamic page: content is shaped by program in response to user requests
- static page: unchanging page retrieved from disk
- dynamic content: constructed in response to web clients request
- server-side scripting: programs running on web server create web pages before sending them back to requesting web clients
- dynamic page-generation technologies: active server pages (ASP), JavaServer Pages (JSP), Hypertext preprocessor (PHP)
Various meaning of server
- server: any computer used to provide files or make programs available to other computers connected to it through network
Two-Tier Client/Server Architecture
- messages are created and read only by the client and the server computers
- request message: message that web client sends to request file or files from web server
- request line: contains a comment, name of target resource, protocol name, version number
- request headers: info about types of files that client will accept
- entity body: sometimes used to pass bulk info to server
Three-tier and N-Tier Client/Server Architectures
- allow additional processing to occur before the web server responds to client's request
- third tier often includes databases and related software applications
Software for Web Servers
Operating Systems for Web Servers
- open-source software: developed by community of programmers who make the software available for download at no cost
Web Server Software:
- Apache, Microsoft Internet Information Server (IIS), Sun Java System Web Server
Electronic Mail (E-Mail)
E-mail Benefits: attachments frequently most important part of message
E-mail drawbacks: amount of emails in one day, viruses
Spam: spam is beginning to level off, antispam efforts and software projects help limit the annoyance and cost of spam
Solutions to the Spam Problems:
- individual user antispam tactics
- basic content filtering
- challenge-response content filtering
- advanced content filtering
- legal solutions
- technical solutions
Web Site and Internet Utility Programs
Finger and Ping Utilities:
- finger: program that runs on UNIX operating systems and allows user to obtain some info about other network users
- ping: packet internet groper: tests the connectivity between two computers connected to the internet computers, # of computers
Tracert and Other Route-Tracing Programs
- tracer: sends data packets to every computer on the path between one computer and another computer and clocks the packets round-trip times
Teinet and FTP Utilities:
- teinet: allows users to log on to a computer that is connected to the internet
- telnet protocal: set of rules
- file transfer protocol: part of TCP/IP that defines the formats used to transfer files between TCP/IP connected computers
Link-Checking Utilities: examines each page on site and reports on any URLs that are broken, seem broken, incorrect; orphan file: file on site that is not linked to any page
Remote Server Administration: web site administrator can control web site from any internet-connected computer
Web Server Hardware
Server Computers: have more memory, larger hard disk drives, faster processors, usually more expensive
Web Server Performance Evaluation:
- benchmarking: testing that is used to compare the performance of hardware and software
- throughput: number of HTTP requests that particular hardware and software combo can process in a unit of time
- response time: amount of time a server requires to process one request
Web Server Hardware Architectures
- server farms: large collection of servers
- centralized architecture: use few very large and fast computers
- distributed architecture: decentralized architecture
- load-balancing switch: piece of network hardware that monitors the workloads of servers attached to it and assigns incoming web traffic to the server that has the most available capacity at that instant in time
Monday, March 10, 2008
Chapter 8 & 9: Class Notes
Web Server Tools: software programs to run a web server on home computer
- AMPP: MAMPP (macintosh), WAMPP (windows), XAMPP (distribution of apache server directly from aphace - truest form) ~ A= Apache (server to host from, runs on a system called unex/Lynex, 1/2 the price of Internet Information Server; ASP: microsoft server; M= My SQL Database, P= PHP, P = Pearl
- EasyPHP: used frequently
- HFS: http file server; allows users to share info: USB key
- Server2Go: full XAMP server, made to work off USB key
- Microsoft IIS (internet information server = created on windows computer)
My Local Web:
- http://localhost/
- http://127.0.0.1/ = localhost
- http:192.168.1.??? - home network
Web Design Tools
Free:
- Nvu
- KompoZer: best option
- Net Objects
- BlockNote.Net
- AMPP: MAMPP (macintosh), WAMPP (windows), XAMPP (distribution of apache server directly from aphace - truest form) ~ A= Apache (server to host from, runs on a system called unex/Lynex, 1/2 the price of Internet Information Server; ASP: microsoft server; M= My SQL Database, P= PHP, P = Pearl
- EasyPHP: used frequently
- HFS: http file server; allows users to share info: USB key
- Server2Go: full XAMP server, made to work off USB key
- Microsoft IIS (internet information server = created on windows computer)
My Local Web:
- http://localhost/
- http://127.0.0.1/ = localhost
- http:192.168.1.??? - home network
Web Design Tools
Free:
- Nvu
- KompoZer: best option
- Net Objects
- BlockNote.Net
Commercial:
- Adobe Dreamweaver
- Microsoft Expression Web
Content Management Systems (CMS): stores data in a database, the browser sends the request and the server is resonsible for building the page and sending it to the content user. if you create the pages you are actually storing all the info in one database forlder versus saving each page separate.
Local: serves static pages, when somebody goes to your website, they are pulling down a static page that isn't changing depending on the user, have to be on my computer to edit database
- CityDesk:FREE
- CMS Encore
- BlogJet (blogging): html editors
- ecto (bloggin)
- Windows Live Writer
Web-Based: make all changes on the website, database is stored on the web server; all work the same
- Drupal
- Joomia
Web Hosting
- Okanaganhosting.com
- BlueGenesis Canada
- Oak Park Solutions
- WebServe Canada
- TopHosts.com
Tuesday, March 4, 2008
Chapter 12: Planning for Electronic Commerce
Planning Electronic Commerce Initiatives
Identifying Objectives:
- increasing sales in existing markets, opening new markets, serving existing customers better, identifying new vendors, coordinating more efficiently with existing vendors, recruiting employees more effectively
Linking Objectives to Business Strategies:
- downstream of upstream strategies (reducing costs or generating value by working with suppliers)
- opportunities inspire businesses to undertake activities like: building brands, enhancing existing marketing programs, selling products and services, selling advertising, developing a better understanding of customer needs, improving after-sale service and support, purchasing products and services, managing supply chains, operating auctions, building vitural communities and web portals
Measuring Benefits:
- revenue, units, customer satisfaction surveys, time, number of visitors, number of return visits
Managing Costs
- Total Cost of ownership: costs of hardware, software, design work outsourced, salaries and benefits for employees
- Change management: process of helping employees cope with changes
- opportunity costs: cost of not undertaking initiative
- web site costs: anywhere from $100,000 to $15 million and up
Comparing Benefits to Costs
- capital projects/investments: equipment, personnel
- if benefits exceed costs of project by comfortable margin, company invests in the project
Return on Investment (ROI)
- measure the amount of income that will be provided by a specific current expenditure
- provide quantitative expression of comfortable benefit-to-cost margin for specific company
Strategies for Developing E-Commerce Web Sites
Internal Development vs Outsourcing
- internal team: people with enough knowledge about internet and technologies to know what kinds of things are possible, creative thinker who are interested in expanding the company
- early outsourcing: outsource initial site design and development - then company employees are trained in the new technology before taking over the operation of the site
- late outsourcing: company's info system professionals do initial design and development, implement the system and operate the system until it becomes stable part of the business operation
- partial outsourcing: company identifies specific portions of the project that can be completely designed, developed, implemented and operated by another firm that specializes in a particular function
Selecting a Hosting Service
- functionality, reliability, bandwidth and server scalability, security, backup and disaster recovery, cost
New Methods for Implementing Partial Outsourcing
- incubator: company that offers start-up companies physical location with offices, accounting and legal assistance, computers, internet connections at very low monthly cost
- fast venturing: existing company wants to launch an e-commerce initiative joins external equity partners and operational partners that can offer the experience and skills needed to develop and scale up the project
Managing E-Commerce Implementations
Project Management
- collection of formal techniques for planning and controlling the activities undertaken to achieve a specific goal
- project mgmt software: microsoft project, give managers array of built-in tools for managing resources and schedules
Project Portfolio Management
- each project is monitored as if it were an investment in financial portfolio
Staffing for e-commerce
- project manager: specific training or skills in tracking costs and accomplishment of specific objectives in a project
- account manager: keeps track of multiple web sites in use by project or keeps track of projects that will combine to create a larger web site
- applications specialists: maintain accounting, human resources, logistics software
- web programmers: design and write the underlying code for dynamic database-driven web pages
- web graphics designer: trained in art, layout, and composition and who also understands how web pages are constructed
- content creators: write original content and content managers purchase existing material and adapt if for use on the site
- call center: company that handles incoming customer telephone calls and emails for other companies
- systems administrator: responsible for system's reliable and secure operation
- network operations: staff functions include load estimation and load monitoring, resolving network problems as they arise, designing and implementing fault-resistant technologies, managing network operations that are outsourced to service providers
- database administration: support activities such as transaction processing, order entry inquiry
Identifying Objectives:
- increasing sales in existing markets, opening new markets, serving existing customers better, identifying new vendors, coordinating more efficiently with existing vendors, recruiting employees more effectively
Linking Objectives to Business Strategies:
- downstream of upstream strategies (reducing costs or generating value by working with suppliers)
- opportunities inspire businesses to undertake activities like: building brands, enhancing existing marketing programs, selling products and services, selling advertising, developing a better understanding of customer needs, improving after-sale service and support, purchasing products and services, managing supply chains, operating auctions, building vitural communities and web portals
Measuring Benefits:
- revenue, units, customer satisfaction surveys, time, number of visitors, number of return visits
Managing Costs
- Total Cost of ownership: costs of hardware, software, design work outsourced, salaries and benefits for employees
- Change management: process of helping employees cope with changes
- opportunity costs: cost of not undertaking initiative
- web site costs: anywhere from $100,000 to $15 million and up
Comparing Benefits to Costs
- capital projects/investments: equipment, personnel
- if benefits exceed costs of project by comfortable margin, company invests in the project
Return on Investment (ROI)
- measure the amount of income that will be provided by a specific current expenditure
- provide quantitative expression of comfortable benefit-to-cost margin for specific company
Strategies for Developing E-Commerce Web Sites
Internal Development vs Outsourcing
- internal team: people with enough knowledge about internet and technologies to know what kinds of things are possible, creative thinker who are interested in expanding the company
- early outsourcing: outsource initial site design and development - then company employees are trained in the new technology before taking over the operation of the site
- late outsourcing: company's info system professionals do initial design and development, implement the system and operate the system until it becomes stable part of the business operation
- partial outsourcing: company identifies specific portions of the project that can be completely designed, developed, implemented and operated by another firm that specializes in a particular function
Selecting a Hosting Service
- functionality, reliability, bandwidth and server scalability, security, backup and disaster recovery, cost
New Methods for Implementing Partial Outsourcing
- incubator: company that offers start-up companies physical location with offices, accounting and legal assistance, computers, internet connections at very low monthly cost
- fast venturing: existing company wants to launch an e-commerce initiative joins external equity partners and operational partners that can offer the experience and skills needed to develop and scale up the project
Managing E-Commerce Implementations
Project Management
- collection of formal techniques for planning and controlling the activities undertaken to achieve a specific goal
- project mgmt software: microsoft project, give managers array of built-in tools for managing resources and schedules
Project Portfolio Management
- each project is monitored as if it were an investment in financial portfolio
Staffing for e-commerce
- project manager: specific training or skills in tracking costs and accomplishment of specific objectives in a project
- account manager: keeps track of multiple web sites in use by project or keeps track of projects that will combine to create a larger web site
- applications specialists: maintain accounting, human resources, logistics software
- web programmers: design and write the underlying code for dynamic database-driven web pages
- web graphics designer: trained in art, layout, and composition and who also understands how web pages are constructed
- content creators: write original content and content managers purchase existing material and adapt if for use on the site
- call center: company that handles incoming customer telephone calls and emails for other companies
- systems administrator: responsible for system's reliable and secure operation
- network operations: staff functions include load estimation and load monitoring, resolving network problems as they arise, designing and implementing fault-resistant technologies, managing network operations that are outsourced to service providers
- database administration: support activities such as transaction processing, order entry inquiry
Monday, March 3, 2008
Chapter 12: Class Notes
SMART Objectives: (final exam question) for designing e-commerce website (transaction oriented)
- to sell products and services (into existing market or creating a new market)
- providing information / education to consumers
- reach widespread target market
- reduce costs - no brick and mortar, transactional costs (make the customers do the work), reduce intermediary costs (supply chain / just-in-time inventory), reducing aftersales support
- recruiting employees
- source new vendor relationships
- selling advertising
- sell memberships &/or subscriptions
- provide info to shareholders/stakeholders
- build brand identity/image
- create an outlet/ clearance area/ auction
- providing portals and web communities (stickiness)
How we measure whether we've met the objectives:
- specific, measureable, accurate/attainable, relavent to ore competency, timely (has some sort of milestone or date attached)
Ways to measure / indicators:
- units & revenue ($)
- using website statistics: hits (tells you every time you load a page - least info) / page views (if consumer comes to website, how many web pages did they view in your site ) / time spent on a page
- IP address (tells you the location of the computer of the viewer)
- saving and reducing costs: saving on investment, cost per transaction (#) (staffing of call centre, programmers time in developing the shopping cart), cost comparisons, wait time / customer satisfaction surveys
- number of qualified applications, # of inquiries
- # of qualified vendors / inquiries
- revenue / website statistics (traffic) so we can charge cost per thousand / click
- unit (# of subscriptions) / revenue
- # of inquiries about stock from shareholders / count downloads of information from site
- customer survey / inquiries
- # of auction items / $ value of items going out , registrants , active participants in auction
- # of registered users / # of posts
Managing Costs:
- Investing in a web business
- Small business ($10K to $50K)
- Entry-Level ($100K to $1M0
- Mid-Level ($2M to $5M)
- Large Site ($15M and up)
- maintenance costs between 50% and 200%
- Total cost of ownership - you are using or accounting for everything
- hardware & software
- programming & design: getting web designer (who know html and css) but also knows how to program the site to be interactive
- Maintenance & Support: having someone monitoring it / updating / security
- Training and documentation: who is updating, what do they need to know
- opportunity costs
- how much revenue is lost by not having website
- return on investment (ROI)
- requires quantification fo costs & benefits
- predicts benefits and returns (not hard numbers)
- emphasizes short-run versus long0run benefits
System Development Life Cycle (SDLC) - how do we get it done, manager with business-knowhow (business analyst) takes project through these stages - linear process
1. Plan
- critical success factors (CSFs)
- Project scope (SoW statement of work boundary)
- project plan (schedule/resources) -dictating whos doing what
2. Analysis
- business (user) requirements - paypal, etc
- functional specification document - output of this stage
3. Design
- hardware/software architecture - needed to do it
- technical specification document - output of this stage
4. Develop
- in-source (inhouse with own IT ppl); out-source (give it to another company); self-source (diff departments create different parts within their system)
- early sourcing; late sourcing (when do we actual get help?); partial-sourcing
5. Test
- componentl interface; system testing - is it working?
- user acceptance and usability testing - does it meet the functional specifications, does it work like my users need it to work?, if cusomters go to site, is it easy for them to put in credit card number.....etc etc
6. Implement
- selecting a hosting service (functionality; reliability; security, backup and disaster recovery, bandwidth and server scalability, operating and maintenance costs)
- training and cosumentation
- policies and procedures
7. Maintain
- establish help desk and FAQs
- user and technical support procedures
Project Management: being aware of system life cycle and assigning jobs to people
Software Tools
1. Identifying Dependencies - i cant start my phase until you finish yours
2. Create the Schedule:
3. Manage the Resources: making sure ppl do what they need to do
4. Evaluate the risks: what is the risk is somebody falls out of completing task on time
Tuesday, February 19, 2008
Chapter 7: Key Concept
Chapter 7: The Environment of Electronic Commerce: Legal, Ethical, and Tax Issues
The Legal Enviro of E-Commerce
Borders and Jurisdiction:
Power: form of control obrt physical space and ppl and objects that reside in that space
Effects: impact of laws of persons behaviour
Legitimacy: idea that those subject to laws should have some role if formulating them
Notice: constructive notice: when people receive notice that they have become subjected to new laws and cultural norms when they cross international border
Jurisdiction of the Internet
- more difficult in the internet
- contract: promise or set of promises between 2 or more ppl. provides for exchange of value
- breach of contract: either party to contract does not comply with terms
Subject-Matter Jurisdiction: court's authority to decide particular type of dispute
Personal Jurisdiction: determined by residence of the parties
Jurisdiction in International Commerce: judicial comity: voluntarily enforce other countries aws or judgements out of a sense of comity or friendly civility
Contracting and Contract Enforcement in ECommerce
- implied contract: 2 or more parties act as if contract exists (even if no contract was written and signed)
Warranties on the web: warranty disclaimer: statement declaring that the seller will not honor some or all implied warranties
Terms of Service Agreements: site visitor is held to terms of service even is that visitor has not read the text or clicked a button to indicate agreement with the terms
Use and Protection of Intellectual Property in Online Business
- intellectual property: includes all products of human mind
Web Site Content Issues
Copyright information: right granted by gov't to author of work - right to print, publish or sell work
Patent Infringment: patent: exclusive right granted by gov't to individual to make, use and sell invention; business process patent: protects specific set of procedures for conducting particular business activity
Trademark Infringement: trademark: distinctive mark, devide, motto, a company affixes to the goods it produces for identification purposes; service mark: used to identify services provided; trade name: name business uses to identify itself; common law: part of british and us law established by history of court; statutory law: arises when elected legislative bodies pass laws
Domain Names, Cybersquatting, and Name Stealing
- cybersquatting: practice of registering a domain name that is trademark of another person or company in hopes that the owner will pay huge amounts of money to acquire the URL
- name changing: someone registers purposely misspelled variations of well-known domain names
- name stealing: someone posing as a site's administrator changes the ownership of site's assigned domain name to another site and owner
Protecting Intellectual Property Online
- digital watermark: digital code embedded in digital image of audio file
- copy control: electronic mechanism for limiting the number of copies that one can make of digital work
Defamation:
- statement that is false and that injures the reputation of another person or company
- product disparagement: if statement injures the reputation of product or service instead of a person
Deceptive Trade Practices
- trademark dilution: reductiong of distinctive quality of a trademark by alternative uses
The Legal Enviro of E-Commerce
Borders and Jurisdiction:
Power: form of control obrt physical space and ppl and objects that reside in that space
Effects: impact of laws of persons behaviour
Legitimacy: idea that those subject to laws should have some role if formulating them
Notice: constructive notice: when people receive notice that they have become subjected to new laws and cultural norms when they cross international border
Jurisdiction of the Internet
- more difficult in the internet
- contract: promise or set of promises between 2 or more ppl. provides for exchange of value
- breach of contract: either party to contract does not comply with terms
Subject-Matter Jurisdiction: court's authority to decide particular type of dispute
Personal Jurisdiction: determined by residence of the parties
Jurisdiction in International Commerce: judicial comity: voluntarily enforce other countries aws or judgements out of a sense of comity or friendly civility
Contracting and Contract Enforcement in ECommerce
- implied contract: 2 or more parties act as if contract exists (even if no contract was written and signed)
Warranties on the web: warranty disclaimer: statement declaring that the seller will not honor some or all implied warranties
Terms of Service Agreements: site visitor is held to terms of service even is that visitor has not read the text or clicked a button to indicate agreement with the terms
Use and Protection of Intellectual Property in Online Business
- intellectual property: includes all products of human mind
Web Site Content Issues
Copyright information: right granted by gov't to author of work - right to print, publish or sell work
Patent Infringment: patent: exclusive right granted by gov't to individual to make, use and sell invention; business process patent: protects specific set of procedures for conducting particular business activity
Trademark Infringement: trademark: distinctive mark, devide, motto, a company affixes to the goods it produces for identification purposes; service mark: used to identify services provided; trade name: name business uses to identify itself; common law: part of british and us law established by history of court; statutory law: arises when elected legislative bodies pass laws
Domain Names, Cybersquatting, and Name Stealing
- cybersquatting: practice of registering a domain name that is trademark of another person or company in hopes that the owner will pay huge amounts of money to acquire the URL
- name changing: someone registers purposely misspelled variations of well-known domain names
- name stealing: someone posing as a site's administrator changes the ownership of site's assigned domain name to another site and owner
Protecting Intellectual Property Online
- digital watermark: digital code embedded in digital image of audio file
- copy control: electronic mechanism for limiting the number of copies that one can make of digital work
Defamation:
- statement that is false and that injures the reputation of another person or company
- product disparagement: if statement injures the reputation of product or service instead of a person
Deceptive Trade Practices
- trademark dilution: reductiong of distinctive quality of a trademark by alternative uses
Monday, February 11, 2008
Chapter 7: Class Notes
Ethical & Tax Issues in Electronic Commerce
Why is this Important:
1. E-Commerce = cross-border international business
2. E-commerce = fast & efficient communications
3. E-commerce = customer contact is interactive
4. E-commerce = promotes C2C interactions (social networking features / discussion boards to discuss products)
**all are affected by legal issues (defamation, slander)
Jurisdiction
Legal Issues:
Geographic-Legal Relationship :
- power: do they have the power to enforce the law? (regular business)
- effects: Impact - by doing business in a certain area
- legitimacy : if you are under the laws of the province, you should have some say in how those laws are forming (voting)
- notice : know what laws you are under in different areas
** don't work for e-commerce : who's jurisdiction takes over when two ppl from different countries go through with a contract
Contractual Jurisdiction
- subject-matter jurisdiction : is its a federal law, then fed's have jurisdiction
- personal jurisdiction : residence: jurisdiction determined by where the customer lives and where you live
- conflict of laws: whos jurisdition do you fall under?
Contratual Enforcement
- What is a contract? : legally binding arrangement, when somebody has provided an offer and someone on the other side has accepted it and consideration is paid (product or money)
- written contracts : some places have a minimum in which a written contract is not required: now we have the ability to digitally sign contracts
- warranties & disclaimers : warrant that the good is in operable condition and it works - the customer will be delivered as per what they ordered
- authority to bing and form contracts : because you cannot see anyone, how do you trust them to get into a contract with them
International Commerce
Culture and Customers :
Treaties (judical comity)
Income & Sales Tax Implications
State use tax
internet tax moratorium : no one can enforce any additional tax from e-commerce (only user tax)
Intellectual Property
Copyright : massive issue on the internet right now - legal right to ownership of creative works - anything original - all rights reserved
Fair Use : exemptions for using
Purpose of use : is your purpose to resell this thing?
Nature of Work : is this stuff that has already been published or is it original?
Amount Used : there is a maximum amount that can be used before copyright laws affect it
Market Impact : by using someone else's work, are you affecting them from gaining profit?
Creative Commons : (cc): your ability as the author of a work to specify who has the right to do something with that work - allowing you to find the middle ground - some rights are reserved
Patents (inventions & processes) : legally structured
Trademarks and service marks
Domain Names & Cybersquatting: registered a domain name just because someone else might want it
Anti-cybersquatting consumer protection act
iCANN UDRP Domain Name dispute proceedings
Defamation & Deceptive Practices
Digital Watermarking & Copy Control
Web Disclosures
Terms of Service
Acceptable Use policies :
Conditions of use
user agreements
** have same purpose
EXAMPLE: GOogle, Paypal
Privacy Policy
Personal Information
- what data is collected?
- how securely is it protected?
- how will my data be used/shared?
- can i restrict the use of my data?
- how do i update my data?
- what is i am a child?
- can i contact you?
Why is this Important:
1. E-Commerce = cross-border international business
2. E-commerce = fast & efficient communications
3. E-commerce = customer contact is interactive
4. E-commerce = promotes C2C interactions (social networking features / discussion boards to discuss products)
**all are affected by legal issues (defamation, slander)
Jurisdiction
Legal Issues:
Geographic-Legal Relationship :
- power: do they have the power to enforce the law? (regular business)
- effects: Impact - by doing business in a certain area
- legitimacy : if you are under the laws of the province, you should have some say in how those laws are forming (voting)
- notice : know what laws you are under in different areas
** don't work for e-commerce : who's jurisdiction takes over when two ppl from different countries go through with a contract
Contractual Jurisdiction
- subject-matter jurisdiction : is its a federal law, then fed's have jurisdiction
- personal jurisdiction : residence: jurisdiction determined by where the customer lives and where you live
- conflict of laws: whos jurisdition do you fall under?
Contratual Enforcement
- What is a contract? : legally binding arrangement, when somebody has provided an offer and someone on the other side has accepted it and consideration is paid (product or money)
- written contracts : some places have a minimum in which a written contract is not required: now we have the ability to digitally sign contracts
- warranties & disclaimers : warrant that the good is in operable condition and it works - the customer will be delivered as per what they ordered
- authority to bing and form contracts : because you cannot see anyone, how do you trust them to get into a contract with them
International Commerce
Culture and Customers :
Treaties (judical comity)
Income & Sales Tax Implications
State use tax
internet tax moratorium : no one can enforce any additional tax from e-commerce (only user tax)
Intellectual Property
Copyright : massive issue on the internet right now - legal right to ownership of creative works - anything original - all rights reserved
Fair Use : exemptions for using
Purpose of use : is your purpose to resell this thing?
Nature of Work : is this stuff that has already been published or is it original?
Amount Used : there is a maximum amount that can be used before copyright laws affect it
Market Impact : by using someone else's work, are you affecting them from gaining profit?
Creative Commons : (cc): your ability as the author of a work to specify who has the right to do something with that work - allowing you to find the middle ground - some rights are reserved
Patents (inventions & processes) : legally structured
Trademarks and service marks
Domain Names & Cybersquatting: registered a domain name just because someone else might want it
Anti-cybersquatting consumer protection act
iCANN UDRP Domain Name dispute proceedings
Defamation & Deceptive Practices
Digital Watermarking & Copy Control
Web Disclosures
Terms of Service
Acceptable Use policies :
Conditions of use
user agreements
** have same purpose
EXAMPLE: GOogle, Paypal
Privacy Policy
Personal Information
- what data is collected?
- how securely is it protected?
- how will my data be used/shared?
- can i restrict the use of my data?
- how do i update my data?
- what is i am a child?
- can i contact you?
Wednesday, February 6, 2008
Chapter 6: Key Concept
Chapter 6: Online Auctions, Virtual Communities, and Web Portals
Key Concept:
This chapter focuses on how companies use different technologies including auctions, virtual communities, serving as web portals. We learn about the main auction types and the characteristics of each.
Supporting Points:
Auction Overview
English Auctions
- bidders publicly announce their successive higher bids until no higher bid is forthcoming (ascending auction, open auction, open-outcry auction)
- minimum bid: price at which an auction begins (reserve bid)
- yankee auctions: offer multiple units for sale and allow bidders to specify quantity they want to buy
Dutch Auctions
- bidding starts at high price and drops until a bidder accepts the price (descending-price auctions)
First-Price Sealed-Bid Auctions
- bidders submit their bids independently and usually prohibited from sharing info with each other – highest bidder wins
Second-Price Sealed-Bid Auctions
- highest bidder awarded the item at the price bid by the second-highest bidder
Open-Outcry Double Auctions
- buy and sell offers shouted by traders standing in small area on exchange floor called a trading pit
Sealed-Bid Double Auctions
- buyers and sellers each submit combined price-quantity bids to an auctioneer
Reverse (seller-bid) auctions
- multiple sellers submit price bids to an auctioneer who represents a single buyer
Online Auctions and Related Businesses
General Consumer Auctions
- eBay – with third-party assurance provider
Specialty Consumer Auctions
- justbeads.com – cater to buyers and sellers who are geographically dispersed but share highly focused interests
Consumer Reverse Auctions and Group Purchasing Sites
- priceline.com – reverse bid: visitors state a price they are willing to pay
- group purchasing site: seller posts an item with a price, buyers enter bids on an item, the site negotiates better price
Business-to-Business Auctions
- liquidation brokers: firms that find buyers for items they get from smaller businesses
Auction-Related Services
- Auction escrow services
- Auction directory and information services
- Auction software
Virtual Communities and Web Portals
Mobile Communications Technology
- wireless application protocol: allows web pages formatted in html to be displayed on devices with small screens
Intelligent Software Agents
- programs that search the web and find items for sale that meet buyer’s specifications
Virtual Communities
- gathering place for people and businesses that does not have a physical existence
- virtual learning community: webCT
Web Communities in the Second Wave of Electronic Commerce
- web logs (BLOGS)
- social networking web sites: craigslist
Revenue Models for Web portals and virtual communities
- advertising-supported web portals and virtual communities
- mixed-revenue web portals and virtual communities
Key Concept:
This chapter focuses on how companies use different technologies including auctions, virtual communities, serving as web portals. We learn about the main auction types and the characteristics of each.
Supporting Points:
Auction Overview
English Auctions
- bidders publicly announce their successive higher bids until no higher bid is forthcoming (ascending auction, open auction, open-outcry auction)
- minimum bid: price at which an auction begins (reserve bid)
- yankee auctions: offer multiple units for sale and allow bidders to specify quantity they want to buy
Dutch Auctions
- bidding starts at high price and drops until a bidder accepts the price (descending-price auctions)
First-Price Sealed-Bid Auctions
- bidders submit their bids independently and usually prohibited from sharing info with each other – highest bidder wins
Second-Price Sealed-Bid Auctions
- highest bidder awarded the item at the price bid by the second-highest bidder
Open-Outcry Double Auctions
- buy and sell offers shouted by traders standing in small area on exchange floor called a trading pit
Sealed-Bid Double Auctions
- buyers and sellers each submit combined price-quantity bids to an auctioneer
Reverse (seller-bid) auctions
- multiple sellers submit price bids to an auctioneer who represents a single buyer
Online Auctions and Related Businesses
General Consumer Auctions
- eBay – with third-party assurance provider
Specialty Consumer Auctions
- justbeads.com – cater to buyers and sellers who are geographically dispersed but share highly focused interests
Consumer Reverse Auctions and Group Purchasing Sites
- priceline.com – reverse bid: visitors state a price they are willing to pay
- group purchasing site: seller posts an item with a price, buyers enter bids on an item, the site negotiates better price
Business-to-Business Auctions
- liquidation brokers: firms that find buyers for items they get from smaller businesses
Auction-Related Services
- Auction escrow services
- Auction directory and information services
- Auction software
Virtual Communities and Web Portals
Mobile Communications Technology
- wireless application protocol: allows web pages formatted in html to be displayed on devices with small screens
Intelligent Software Agents
- programs that search the web and find items for sale that meet buyer’s specifications
Virtual Communities
- gathering place for people and businesses that does not have a physical existence
- virtual learning community: webCT
Web Communities in the Second Wave of Electronic Commerce
- web logs (BLOGS)
- social networking web sites: craigslist
Revenue Models for Web portals and virtual communities
- advertising-supported web portals and virtual communities
- mixed-revenue web portals and virtual communities
Chapter 5: Key Concept
Chapter 5: Business-to-Business Strategies; From Electronic Data Interchange to Electronic Commerce
Key Concept:
This chapter focuses on companies that use the internet and different technologies to improve their logistics and purchasing activities.
Support Points:
Purchasing, Logistics, and Support Activities
Purchasing Activities
- identifying vendors, evaluating vendors, selecting specific products, placing orders, resolving issues (late deliveries, incorrect quantities, incorrect items, defective items)
- purchasing managers play role in maintaining and improving product quality and reducing costs
- e-sourcing: use of internet technologies in sourcing activities
Direct vs. Indirect Materials Purchasing
- direct: materials that become part of finished product in manufacturing process (cost is large part of cost of finished product
o replenishment purchasing (contract): company negotiates long-term contracts for materials; spot market: loosely organized market within specific industry
- indirect: other materials that are purchased (factory supplies, replacement parts); spot purchasing: direct materials purchasing that occurs within sport market; maintenance, repair, operating (MRO)
Logistic Activities
- managing inbound movements or materials and supplies, outbound movements of finished goods and services; receiving, warehousing, controlling inventory, scheduling and controlling vehicles, distributing finished
Support Activities
- finance and administration (making payments, processing payments, palnning capital expenditures, budgeting and planning); HR (hiring, training, evaluating employees, benefits; technology (network research scientists, posting research results, publishing research papers online, providing connections to outside sources
E-Government
- use of electronic commerce by gov’ts and governing agencies to perform activities (collect taxes and fees)
Electronic Data Interchange (EDI) - echange or transfer of information(not money) between two parties (purchase orders, receipts)How EDI WorksDirect vs. VANs- direct: no intermediary system - you are connecting your EDI comp to someone elses EDI directly - requires leased-line (connection that is always on)- VANs: value added network - intermediary is involved (your system connects to the VAN) - don't need leased-line connection - treating EDI like email (good for companies like Kal Tire, not fortune 500 companies)Internet EDI- VPN: vitural private network, issue of security - ppl don't trust having purchase orders floating across internet unprotectedFinancial EDI- exchange of money, Clearing House (ACH - automated clearing house) - they transfer money from bank to bank using clearing house as intermediary
Supply Chain Management Using Internet Technologies: managing integration of supply management and logistics
Value Creation in the Supply Chain
- tier one suppliers: develop long-term relationships with larger number of suppliers that provide components and raw materials
- tier two: manage relationships with next level of suppliers (tier three suppliers), provide them with components and raw materials
- supply alliance: long-term relationships created among participants in supply chain
Suppliers Can:
- share info about customer demand fluctuations
- receive rapid notification of product design changes and adjustments
- provide specifications and drawings more efficiently
- reduce cost of handling transactions
- reduce errors
Using Materials-tracking Technologies with EDI and electronic Commerce
- radio frequency identification devices: small chips that use radio transmissions to track inventory
Creating an Ultimate Consumer orientation in the supply chain
- ultimate consumer orientation: difficulty in maintaining customer focus
Building and maintaining Trust in the Supply Chain
- continual communication and information sharing key elements
Electronic Marketplaces and Portals:
Independent Industry marketplaces
- industry marketplaces: focus on single industry
- independent exchanges: not controlled by a company that was an established buyer or seller
- public marketplaces: open to new buyers and sellers just entering
- collectively known as independent industry marketplaces
Private Stores and Customer Portals
- private store: password-protected entrance and offers negotiated price reductions on limited selection of products
- customer portal sites: offer private stores along with services (product usage guidelines, safety info)
Private Company Marketplaces
- e-procurement software: allows company to manage its purchasing function through a web interface
- private company marketplace: provides auctions, request for quote postings
Industry Consortia-Sponsored Marketplaces
- formed by several large buyers in particular industry
Key Concept:
This chapter focuses on companies that use the internet and different technologies to improve their logistics and purchasing activities.
Support Points:
Purchasing, Logistics, and Support Activities
Purchasing Activities
- identifying vendors, evaluating vendors, selecting specific products, placing orders, resolving issues (late deliveries, incorrect quantities, incorrect items, defective items)
- purchasing managers play role in maintaining and improving product quality and reducing costs
- e-sourcing: use of internet technologies in sourcing activities
Direct vs. Indirect Materials Purchasing
- direct: materials that become part of finished product in manufacturing process (cost is large part of cost of finished product
o replenishment purchasing (contract): company negotiates long-term contracts for materials; spot market: loosely organized market within specific industry
- indirect: other materials that are purchased (factory supplies, replacement parts); spot purchasing: direct materials purchasing that occurs within sport market; maintenance, repair, operating (MRO)
Logistic Activities
- managing inbound movements or materials and supplies, outbound movements of finished goods and services; receiving, warehousing, controlling inventory, scheduling and controlling vehicles, distributing finished
Support Activities
- finance and administration (making payments, processing payments, palnning capital expenditures, budgeting and planning); HR (hiring, training, evaluating employees, benefits; technology (network research scientists, posting research results, publishing research papers online, providing connections to outside sources
E-Government
- use of electronic commerce by gov’ts and governing agencies to perform activities (collect taxes and fees)
Electronic Data Interchange (EDI) - echange or transfer of information(not money) between two parties (purchase orders, receipts)How EDI WorksDirect vs. VANs- direct: no intermediary system - you are connecting your EDI comp to someone elses EDI directly - requires leased-line (connection that is always on)- VANs: value added network - intermediary is involved (your system connects to the VAN) - don't need leased-line connection - treating EDI like email (good for companies like Kal Tire, not fortune 500 companies)Internet EDI- VPN: vitural private network, issue of security - ppl don't trust having purchase orders floating across internet unprotectedFinancial EDI- exchange of money, Clearing House (ACH - automated clearing house) - they transfer money from bank to bank using clearing house as intermediary
Supply Chain Management Using Internet Technologies: managing integration of supply management and logistics
Value Creation in the Supply Chain
- tier one suppliers: develop long-term relationships with larger number of suppliers that provide components and raw materials
- tier two: manage relationships with next level of suppliers (tier three suppliers), provide them with components and raw materials
- supply alliance: long-term relationships created among participants in supply chain
Suppliers Can:
- share info about customer demand fluctuations
- receive rapid notification of product design changes and adjustments
- provide specifications and drawings more efficiently
- reduce cost of handling transactions
- reduce errors
Using Materials-tracking Technologies with EDI and electronic Commerce
- radio frequency identification devices: small chips that use radio transmissions to track inventory
Creating an Ultimate Consumer orientation in the supply chain
- ultimate consumer orientation: difficulty in maintaining customer focus
Building and maintaining Trust in the Supply Chain
- continual communication and information sharing key elements
Electronic Marketplaces and Portals:
Independent Industry marketplaces
- industry marketplaces: focus on single industry
- independent exchanges: not controlled by a company that was an established buyer or seller
- public marketplaces: open to new buyers and sellers just entering
- collectively known as independent industry marketplaces
Private Stores and Customer Portals
- private store: password-protected entrance and offers negotiated price reductions on limited selection of products
- customer portal sites: offer private stores along with services (product usage guidelines, safety info)
Private Company Marketplaces
- e-procurement software: allows company to manage its purchasing function through a web interface
- private company marketplace: provides auctions, request for quote postings
Industry Consortia-Sponsored Marketplaces
- formed by several large buyers in particular industry
Monday, February 4, 2008
Chapter 6: Class Notes
Auctions, Communities & Portals
Types of Auctions
English (ascending Price)
Dutch (descending Price)
Sealed-Bid auctions
Open-Outcry Double
Sealed-Bid Double
Reverse (seller-bid): priceline
Online Auctions
CSC: Amazon auctions, ebay.ca, (TRUSTe, Escrow.com, eDeposit.com - ways to protect yourself)
CSB: Priceline.com - demand aggregation, customers come together to buy something cheaper than they would pay by themselves
BSB: liquidators - solution vendors
BSC: eBay stores, yahoo merchant
Building Long-Term Customer Relationships: social networking sites
Blogs
Wikis
Forums
Facebook
Friendster
Linkedin
MySpace
Web Portals: ability to search site for info, provide content (updated news stories), and directories on how to find other parts of the site (categorizing the info)
A company setting up ecommerce website builds in social networking, and earns revenue by creating portal-like front ends.
Neilsen NetRatings
Advertising-Supported
Mixed-Revenue (subscription based and advertising)
Intranet Portals: knowledge management model:
Types of Auctions
English (ascending Price)
Dutch (descending Price)
Sealed-Bid auctions
Open-Outcry Double
Sealed-Bid Double
Reverse (seller-bid): priceline
Online Auctions
CSC: Amazon auctions, ebay.ca, (TRUSTe, Escrow.com, eDeposit.com - ways to protect yourself)
CSB: Priceline.com - demand aggregation, customers come together to buy something cheaper than they would pay by themselves
BSB: liquidators - solution vendors
BSC: eBay stores, yahoo merchant
Building Long-Term Customer Relationships: social networking sites
Blogs
Wikis
Forums
Friendster
MySpace
Web Portals: ability to search site for info, provide content (updated news stories), and directories on how to find other parts of the site (categorizing the info)
A company setting up ecommerce website builds in social networking, and earns revenue by creating portal-like front ends.
Neilsen NetRatings
Advertising-Supported
Mixed-Revenue (subscription based and advertising)
Intranet Portals: knowledge management model:
Chapter 5: Class Notes
BSB Strategies:
Purchasing & Logistics
e-Procurement: function within most large companies - many purchasing funtions are now done through online systems like Ariba as well as outsourced companies
- identify vendors
- evaluate venors
- place orders
- track receipt
- process payment
Direct vs indirect materials
- direct: anything that goes into manufacturing process
- indirect: MRO (maintenance, repair, operations)
Logistics management
- usually need understanding of the accounting function
Support Services & KM
- supply chain is a component of the entire value class - should be an activity that adds to te final product
- knowledge mgmt: able to capture all info from supply chain or elsewhere
Electronic Data Interchange (EDI) - echange or transfer of information(not money) between two parties (purchase orders, receipts)
How EDI Works
- P
ANSI ASC X12
UN EDIFACT
**** IMPORTANT!!!******Direct vs. VANs
- direct: no intermediary system - you are connecting your EDI comp to someone elses EDI directly - requires leased-line (connection that is always on)
- VANs: value added network - intermediary is involved (your system connects to the VAN) - don't need leased-line connection - treating EDI like email (good for companies like Kal Tire, not fortune 500 companies)
Internet EDI
- VPN: vitural private network, issue of security - ppl don't trust having purchase orders floating across internet unprotected
Financial EDI
- exchange of money, Clearing House (ACH - automated clearing house) - they transfer money from bank to bank using clearing house as intermediary
Supply Chain Management (SCM)
Upstream vs Downstream
- Upstream: raw materials - inbound logistics - warehouse and storage - production (everything that went in to creating a product)
- Downstream: getting production to the customer
Advantages:
- share customer demand info
- notify of design modifications
- exchange design schematics
- increase processing speed
- reduce handling costs
- reduce human (re-key) error
- reduce and inform of defects
Challenges:
- Trust:
- costs
B2B Models & e-Marketplaces (fig 5-14)
Private stores: build website to specific customer
Customer Portals: accessed to ecommerce site, provide directory and search assistance
Industry Marketplaces: demand aggregation
Consortium Marketplaces: vendors get together to get lower prices
Private Company Marketplaces
Purchasing & Logistics
e-Procurement: function within most large companies - many purchasing funtions are now done through online systems like Ariba as well as outsourced companies
- identify vendors
- evaluate venors
- place orders
- track receipt
- process payment
Direct vs indirect materials
- direct: anything that goes into manufacturing process
- indirect: MRO (maintenance, repair, operations)
Logistics management
- usually need understanding of the accounting function
Support Services & KM
- supply chain is a component of the entire value class - should be an activity that adds to te final product
- knowledge mgmt: able to capture all info from supply chain or elsewhere
Electronic Data Interchange (EDI) - echange or transfer of information(not money) between two parties (purchase orders, receipts)
How EDI Works
- P
ANSI ASC X12
UN EDIFACT
**** IMPORTANT!!!******Direct vs. VANs
- direct: no intermediary system - you are connecting your EDI comp to someone elses EDI directly - requires leased-line (connection that is always on)
- VANs: value added network - intermediary is involved (your system connects to the VAN) - don't need leased-line connection - treating EDI like email (good for companies like Kal Tire, not fortune 500 companies)
Internet EDI
- VPN: vitural private network, issue of security - ppl don't trust having purchase orders floating across internet unprotected
Financial EDI
- exchange of money, Clearing House (ACH - automated clearing house) - they transfer money from bank to bank using clearing house as intermediary
Supply Chain Management (SCM)
Upstream vs Downstream
- Upstream: raw materials - inbound logistics - warehouse and storage - production (everything that went in to creating a product)
- Downstream: getting production to the customer
Advantages:
- share customer demand info
- notify of design modifications
- exchange design schematics
- increase processing speed
- reduce handling costs
- reduce human (re-key) error
- reduce and inform of defects
Challenges:
- Trust:
- costs
B2B Models & e-Marketplaces (fig 5-14)
Private stores: build website to specific customer
Customer Portals: accessed to ecommerce site, provide directory and search assistance
Industry Marketplaces: demand aggregation
Consortium Marketplaces: vendors get together to get lower prices
Private Company Marketplaces
Thursday, January 31, 2008
Chapter 4: Key Concept
Chapter 4: Marketing on the Web
Key Concept:
This chapter focuses on companies can market their goods and services online. These companies can use either a product-based strategy or a customer-based strategy or even both.
Supporting Points
Web Marketing Strategies
Product-Based Marketing Strategies
- organize website from internal viewpoint (way that they arrange product design and manufacturing processes (Staples, Sears) – Product categories
Customer-Based Marketing Strategies
- site is flexible to meet needs of many different users – identify groups of customers who chare common characteristics (Dell)
Communicating with Different Market Segments
Trust and Media Choice
- mass media (lowest level of trust); personal selling (highest level); blogs allow companies can use the web to communicate like the high-trust personal contact
Market Segmentation
- dividing pool of potential customers into segments (demographic and geographic)
- micromarketing: targeting very small market segements
Market Segmentation on the Web
- web can present different environments online; retailers can provide separate virtual spaces for different market segments
Offering Customers a Choice on the Web
- Dell – one-to-one marketing; internet gives marketers best opportunity for highly customized interactions with customers
Beyond Market Segmentation: Customer Behavior and Relationship Intensity
Segmentation Using Customer Behaviour
- browsers: surfing, trigger words prompt visitor to stay and investigate the products offered
- buyers: ready to make purchase right away; easy transaction
- shoppers: motivated to buy, but look for more info before they make a purchase decision
o simplifiers: like convenience
o surfers: use web to find info, explore new ideas, shop
o bargainers: in search of good deal
o connectors: use web to stay in touch with other people
o routiners: return to same sites over and over again
o sportsters: spend more time on sports and entertainment sites rather then news and financial info
Customer Relationship Intensity and Life-Cycle Segmentation
- awareness: recognize name, but no interaction yet; advertise brand
- exploration: potential customers learn more, might visit site, communication via telephone or email
- familiarity: customers have completed several transactions and are aware of company’s policies, likely to shop and buy from competitors too
- commitment: many successful encounters, customers develop fierce loyalty with brand (commitment stage)
- separation: disappointment, intensity of relationship fades
Acquisition, Conversion, and Retention of Customers
- acquisition cost: total amount of money that a site spends to draw one visitor to the site
- conversion: convert first-time visitor into a customer, visitor usually registers
- retention: costs of inducing customers to return and buy again
Advertising on the Web
Banner Ads
- displays stationary or moving graphic, hyperlink
o banner exchange network: coordinates ad sharing so other sites run one company’s ad while that company’s site runs other members ads
o find site that appeals to market segment and pay those sites to carry the ads
o use network: acts as broker between advertisers and sites that carry ads
- CPM: cost per thousand
- Visit: visitor requests page from web site (trial visit, repeat visit, page view, ad view)
- Impression: each time banner ad lads
- Click-through: visitor clisk banner ad
Other Web Ad Formats
- pop-up ad: appears in its own window when user opens or closes a page
- pop-behind: pop-up that is followed quickly be command that returns the focus to original browser window
- ad-blocking software: prevents banner ads and popup ads from loading
- interstitial ad: user slicks link to load a page, interstitial ad opens in own browser window
- rich media ads: generate graphical actibity that floats ovefr the page itself instead of opening in separate window
Site Sponsorships
- give advertisers chance to promote in more subtle way
Effectiveness of Online Advertising
- difficult to measure; problem is lack of single industry standard measuring service, ways in which site visitors change their web surfing behaviour and habits
E-Mail Marketing
Permission Marketing
- sending email to ppl who request info on particular topic (opt-in email)
Combining Content and Advertising
- get ppl to accept emails more easily
Technology-Enabled Customer Relationship Management
- firm obtains detailed info about customers behavior, preferences, needs, buying patterns and uses that info to set prices, negotiate terms, tailor promotions, add product features, customize entire relationship with that customer
Creating and Maintaining Brands on the Web
Elements of Branding
- differentiation: distinguish product form all others in the market: branding is then difficult for commodity products
- relevance: degree to which product offers utility to potential customer
- perceived value: is the product good?
Emotional Branding vs. Rational Branding
- emotional appeals difficult to convey on the web
- rational brand: offer to help web users in some way in exchange for their viewing an ad (hotmail)
Brand Leverage Strategies
- extend dominant positions to other products and services (yahoo)
Brand Consolidation Strategies
- have everything accessible from one location on the web
Costs of Branding
- transferring existing brands onto the web is easier and less expensive than creating new brand
Affiliate Marketing Strategies
- one firms site (affiliate firm) includes descriptions, reiews, ratings, about a product linked to another firm’s site that offers it for sale
- save expense of inventory, advertising and promoting product, processing transaction
- pay per click / par-per conversion model
Viral Marketing Strategies
- relies on existing customers to tell other people about product
Search Engine Positioning and Domain Names
Search Engine and Web Directories
- spider, robot, crawler: automatically searches the web to find web pages and then info is stored in database
- search utility: takes terms and finds entries for web pages in index that match
- search engine positioning: have particular URL listed near the top os search engine results
Paid Search Engine Inclusion and Placement
- google adwords
- contextual advertising: ads are placed in proximity to related content
- localized advertising: places ads related to location on search results page
Web Site Naming Issues
- buying, selling, and leasing domain names: some companies purchase desirable domain names, lease rights to domain names (sometimes through URL brokers)
Application
Dell uses a customer-based strategy by having different sections on their website specified for customers differing needs. Customers can customize products to their needs online. These customers may be surfers or even commitment customers. If customers have dealt with Dell before and enjoy the experience of customizing their own product, they create a relationship with the company and return when they need a new computer.
Key Concept:
This chapter focuses on companies can market their goods and services online. These companies can use either a product-based strategy or a customer-based strategy or even both.
Supporting Points
Web Marketing Strategies
Product-Based Marketing Strategies
- organize website from internal viewpoint (way that they arrange product design and manufacturing processes (Staples, Sears) – Product categories
Customer-Based Marketing Strategies
- site is flexible to meet needs of many different users – identify groups of customers who chare common characteristics (Dell)
Communicating with Different Market Segments
Trust and Media Choice
- mass media (lowest level of trust); personal selling (highest level); blogs allow companies can use the web to communicate like the high-trust personal contact
Market Segmentation
- dividing pool of potential customers into segments (demographic and geographic)
- micromarketing: targeting very small market segements
Market Segmentation on the Web
- web can present different environments online; retailers can provide separate virtual spaces for different market segments
Offering Customers a Choice on the Web
- Dell – one-to-one marketing; internet gives marketers best opportunity for highly customized interactions with customers
Beyond Market Segmentation: Customer Behavior and Relationship Intensity
Segmentation Using Customer Behaviour
- browsers: surfing, trigger words prompt visitor to stay and investigate the products offered
- buyers: ready to make purchase right away; easy transaction
- shoppers: motivated to buy, but look for more info before they make a purchase decision
o simplifiers: like convenience
o surfers: use web to find info, explore new ideas, shop
o bargainers: in search of good deal
o connectors: use web to stay in touch with other people
o routiners: return to same sites over and over again
o sportsters: spend more time on sports and entertainment sites rather then news and financial info
Customer Relationship Intensity and Life-Cycle Segmentation
- awareness: recognize name, but no interaction yet; advertise brand
- exploration: potential customers learn more, might visit site, communication via telephone or email
- familiarity: customers have completed several transactions and are aware of company’s policies, likely to shop and buy from competitors too
- commitment: many successful encounters, customers develop fierce loyalty with brand (commitment stage)
- separation: disappointment, intensity of relationship fades
Acquisition, Conversion, and Retention of Customers
- acquisition cost: total amount of money that a site spends to draw one visitor to the site
- conversion: convert first-time visitor into a customer, visitor usually registers
- retention: costs of inducing customers to return and buy again
Advertising on the Web
Banner Ads
- displays stationary or moving graphic, hyperlink
o banner exchange network: coordinates ad sharing so other sites run one company’s ad while that company’s site runs other members ads
o find site that appeals to market segment and pay those sites to carry the ads
o use network: acts as broker between advertisers and sites that carry ads
- CPM: cost per thousand
- Visit: visitor requests page from web site (trial visit, repeat visit, page view, ad view)
- Impression: each time banner ad lads
- Click-through: visitor clisk banner ad
Other Web Ad Formats
- pop-up ad: appears in its own window when user opens or closes a page
- pop-behind: pop-up that is followed quickly be command that returns the focus to original browser window
- ad-blocking software: prevents banner ads and popup ads from loading
- interstitial ad: user slicks link to load a page, interstitial ad opens in own browser window
- rich media ads: generate graphical actibity that floats ovefr the page itself instead of opening in separate window
Site Sponsorships
- give advertisers chance to promote in more subtle way
Effectiveness of Online Advertising
- difficult to measure; problem is lack of single industry standard measuring service, ways in which site visitors change their web surfing behaviour and habits
E-Mail Marketing
Permission Marketing
- sending email to ppl who request info on particular topic (opt-in email)
Combining Content and Advertising
- get ppl to accept emails more easily
Technology-Enabled Customer Relationship Management
- firm obtains detailed info about customers behavior, preferences, needs, buying patterns and uses that info to set prices, negotiate terms, tailor promotions, add product features, customize entire relationship with that customer
Creating and Maintaining Brands on the Web
Elements of Branding
- differentiation: distinguish product form all others in the market: branding is then difficult for commodity products
- relevance: degree to which product offers utility to potential customer
- perceived value: is the product good?
Emotional Branding vs. Rational Branding
- emotional appeals difficult to convey on the web
- rational brand: offer to help web users in some way in exchange for their viewing an ad (hotmail)
Brand Leverage Strategies
- extend dominant positions to other products and services (yahoo)
Brand Consolidation Strategies
- have everything accessible from one location on the web
Costs of Branding
- transferring existing brands onto the web is easier and less expensive than creating new brand
Affiliate Marketing Strategies
- one firms site (affiliate firm) includes descriptions, reiews, ratings, about a product linked to another firm’s site that offers it for sale
- save expense of inventory, advertising and promoting product, processing transaction
- pay per click / par-per conversion model
Viral Marketing Strategies
- relies on existing customers to tell other people about product
Search Engine Positioning and Domain Names
Search Engine and Web Directories
- spider, robot, crawler: automatically searches the web to find web pages and then info is stored in database
- search utility: takes terms and finds entries for web pages in index that match
- search engine positioning: have particular URL listed near the top os search engine results
Paid Search Engine Inclusion and Placement
- google adwords
- contextual advertising: ads are placed in proximity to related content
- localized advertising: places ads related to location on search results page
Web Site Naming Issues
- buying, selling, and leasing domain names: some companies purchase desirable domain names, lease rights to domain names (sometimes through URL brokers)
Application
Dell uses a customer-based strategy by having different sections on their website specified for customers differing needs. Customers can customize products to their needs online. These customers may be surfers or even commitment customers. If customers have dealt with Dell before and enjoy the experience of customizing their own product, they create a relationship with the company and return when they need a new computer.
Monday, January 28, 2008
Chapter 4: Class Notes
Chapter 4: Marketing on the Web
7 Pages Every Website Should Have
- Contact Us
- Testimonials
- Privacy Policy
- FAQ
- A "gimme" page: section where users can be persuaded to five up some of their personal information in exchange for something else
- About Us
- Confirmation
Web Marketing
- Product-Based Strategies: i'm going to design my website around various product categories (Staples.ca)
- Customer-Based Strategies: focusing on customers needs and why are they coming to our site in the first place (BMO.com)
- Trust and Media Selection: look at web as mass media vehicle OR look at it as personal contact (talking to every customer & customizing website to fit that customer)
- Market Segmentation: helps direct the personal interaction or focus - customer-based strategies to direct to different customers and customize what we offer (Dell.ca)
- The Long Tail: popular products is where most of profit comes from however, companies ignore long tail of many different types of products that aren't as popular, but if you add up the long tail, the profit exceeds the profit you earn on the short side.
Consumer Behaviour
Segmentation
* Browsers: just surf the site, if they are interested, they stop: if not, they continue on; have to get them to stick to the site, offer free things, cool graphics - somehow trigger them to stay longer
* Shoppers: ppl that know that they are in the market for something (digital camera), but don't know what they want to buy but know the features they want (cendirect.com)
* Buyers: ready to make purchase: strategy as marketer - has to make it easy to buy (amazon.ca) - facilitate ecommerce transaction
Relationship Marketing
* Awareness: make customers at least want to look at site
* Exploration: get them to the site and look up info
* Familiarity: they actual buy something and are comfortable with it
* Commitment: experience and relationship with companies (takes a lot of work to get customers to this point)
* Separation: something happens and messes up relationship (easy to lose customers)
Consumer Strategies
- Acquisition: cost of getting someone to your site (awareness and exploration)
- Conversion : how much is it going to take to convert that browser to a buyer (familiarity and satisfied)
- Retention: trying to get customer commitment
Advertising Strategies
Banner Ads: easy to create in-house
Pop-Up Ads: there are standards created; pop-under ads: close browser and something else is there
Active Ads: people walking across the screen, car driving along the bottom of site
Interstitial Ads: iceberg radio - comes in between getting to the actual product
Site Sponsorships: sponsor a website and you get advertising - custom options
Problems - Measuring Effectiveness: Page visit, page views, ad view (the page that contains the ad), impression (the ad itself), click-through, purchase
CPM ads: cost per thousand views impressions, banner ads online and regular ads in print, TV
CPC ads: cost per click, think google ads
CPT ads" cost per transaction, you pay only if the customer brought to you from a media site becomes a paying customer
E-Mail & CRM Strategies
Permission Marketing: have someone sign up on website, giving company permission to send you stuff and you have accepted
Content & Advertising: similar to permission, but not just sending info about product, sending other info in newsletter format and other advertising built in
Outsourcing Processing: companies to process email, reports, analytic processing
eCRM Solutions: figure 4-10
Branding Strategies
Leveraging & Consolidation: (google buying other sites that get the brand trust and image of google)
Affiliate Marketing: sell advertising to other businesses that want to access a certain market (blogs) - commission sales person.....using amazon's brand: posting reviews for books, customer hits link to go to amazon.com and if they buy the book, blogger gets a commission
Viral Marketing: word of mouth done through technology
Search Engine Strategies
Search Engines:
- spider, crawler, robot: goes into internet and indexes all the pages, stored; could submit website to google and have them index it immediately
- index or database
- search front-end:
Web Directories: you don't have a crawler get info, you have people to gather info
SEO for Keywords: search engine optimization
- Long tail keywords: terms or keywords that aren't popular, but when combined, you target and segment market further; short terms are very expensive to purchase
- SEO digger
- SEOBook Keyword tools
- Google's Dos & Don'ts
Paid inclusion: pay to get your site to show up on first page on google (adwords)
Blogs, Social Media Sites, Forums:
Website Domain Names
7 Pages Every Website Should Have
- Contact Us
- Testimonials
- Privacy Policy
- FAQ
- A "gimme" page: section where users can be persuaded to five up some of their personal information in exchange for something else
- About Us
- Confirmation
Web Marketing
- Product-Based Strategies: i'm going to design my website around various product categories (Staples.ca)
- Customer-Based Strategies: focusing on customers needs and why are they coming to our site in the first place (BMO.com)
- Trust and Media Selection: look at web as mass media vehicle OR look at it as personal contact (talking to every customer & customizing website to fit that customer)
- Market Segmentation: helps direct the personal interaction or focus - customer-based strategies to direct to different customers and customize what we offer (Dell.ca)
- The Long Tail: popular products is where most of profit comes from however, companies ignore long tail of many different types of products that aren't as popular, but if you add up the long tail, the profit exceeds the profit you earn on the short side.
Consumer Behaviour
Segmentation
* Browsers: just surf the site, if they are interested, they stop: if not, they continue on; have to get them to stick to the site, offer free things, cool graphics - somehow trigger them to stay longer
* Shoppers: ppl that know that they are in the market for something (digital camera), but don't know what they want to buy but know the features they want (cendirect.com)
* Buyers: ready to make purchase: strategy as marketer - has to make it easy to buy (amazon.ca) - facilitate ecommerce transaction
Relationship Marketing
* Awareness: make customers at least want to look at site
* Exploration: get them to the site and look up info
* Familiarity: they actual buy something and are comfortable with it
* Commitment: experience and relationship with companies (takes a lot of work to get customers to this point)
* Separation: something happens and messes up relationship (easy to lose customers)
Consumer Strategies
- Acquisition: cost of getting someone to your site (awareness and exploration)
- Conversion : how much is it going to take to convert that browser to a buyer (familiarity and satisfied)
- Retention: trying to get customer commitment
Advertising Strategies
Banner Ads: easy to create in-house
Pop-Up Ads: there are standards created; pop-under ads: close browser and something else is there
Active Ads: people walking across the screen, car driving along the bottom of site
Interstitial Ads: iceberg radio - comes in between getting to the actual product
Site Sponsorships: sponsor a website and you get advertising - custom options
Problems - Measuring Effectiveness: Page visit, page views, ad view (the page that contains the ad), impression (the ad itself), click-through, purchase
CPM ads: cost per thousand views impressions, banner ads online and regular ads in print, TV
CPC ads: cost per click, think google ads
CPT ads" cost per transaction, you pay only if the customer brought to you from a media site becomes a paying customer
E-Mail & CRM Strategies
Permission Marketing: have someone sign up on website, giving company permission to send you stuff and you have accepted
Content & Advertising: similar to permission, but not just sending info about product, sending other info in newsletter format and other advertising built in
Outsourcing Processing: companies to process email, reports, analytic processing
eCRM Solutions: figure 4-10
Branding Strategies
Leveraging & Consolidation: (google buying other sites that get the brand trust and image of google)
Affiliate Marketing: sell advertising to other businesses that want to access a certain market (blogs) - commission sales person.....using amazon's brand: posting reviews for books, customer hits link to go to amazon.com and if they buy the book, blogger gets a commission
Viral Marketing: word of mouth done through technology
Search Engine Strategies
Search Engines:
- spider, crawler, robot: goes into internet and indexes all the pages, stored; could submit website to google and have them index it immediately
- index or database
- search front-end:
Web Directories: you don't have a crawler get info, you have people to gather info
SEO for Keywords: search engine optimization
- Long tail keywords: terms or keywords that aren't popular, but when combined, you target and segment market further; short terms are very expensive to purchase
- SEO digger
- SEOBook Keyword tools
- Google's Dos & Don'ts
Paid inclusion: pay to get your site to show up on first page on google (adwords)
Blogs, Social Media Sites, Forums:
Website Domain Names
Thursday, January 24, 2008
Chapter 3: Key Concept
Chapter 3: Selling on the Web: Revenue Models and Building A Web Presence
Key Concept:
This chapter focuses on 6 main ways in which a company can generate revenue online. We learn how these models work and what companies use each. This chapter also focuses on what is involved in order to make a successful web site based on the customers.
Supporting Points:
Revenue Models
Web Catalog Revenue Models: print catalogues expanded online (old mail order model was the start of this)
- Computers and Consumer Electronics: Apple, Dell, Gateway (offer customers access to product info and customization); Best Buy, Circuit City (sell products same way they sell in their stores)
- Books, Music, and Videos: Amazon,com (evolved to become retailer selling books, music, videos, electronics, tools, etc); amazon inspired others to sell online such as Barnes & Noble;
- Luxury Goods: people are usually reluctant to buy through the internet; Versace was developed online to provide info to those who would shop in-store
- Clothing Retailers: Gap; display photos of casual and business clothing with prices, sizes, colors, tailoring details; customers examine clothing and place an order; personal shopper: intelligent agent programs that learns the customers preferences and makes suggestions; virtual model: graphic image built from customer measurements; some companies have overstock websites to sell off inventory; colour settings on monitors cause problems
- Flowers and Gifts: 1-800-Flowers created online extension to its telephone order business; mrs. Fields cookies
- General Discounters: Buy.com, Walmart.com
Digital Content Revenue Models: Lexis.com (provides full-text search of court cases, laws, patent, tax regulations); ProQuest (sells digital copies of published documents)
Advertising-Supported Revenue Models: sites provide info about stuff through advertisements from other companies and charge advertisers rates for placing ads on their page; stickiness: ability to keep visitors as the site and attract repeat visitors; 2 problems: (1) no consensus on how to measure and charge for site visitor views, (2) few web sites have sufficient numbers of visitors to interest large advertisers
- Web Portals: Yahoo!; web directories: listing of hyperlinks to web pages; web portal: site that ppl use as launching point to enter the web (includes directory and search engine, other features that help ppl find what they are looking for)
- Newspaper Publishers: some worry if it helps or hurts sales of newspapers
- Targeted Classified Advertising Sites: niche markets are more successful; monster.com, autotrader.com; classified advertising is very profitable
Advertising-Subscription Mixed Revenue Models: subscribers pay a fee and accept some level of advertisingl The New York Times (mostly advertising supported, charges fees for access to certain areas of the site though)
Fee-for-Transaction Revenue Model: businesses offer services for which they charge a fee that is based on the number or size of transactions they process
- Travel Agents: earn commissions on each booking; value-added is info consolidation and filtering; Travelocity, expedia; these sites also generate revenue from ads placed on travel info pages
- Automobile Sales: carsdirect.com – allows people to select a car at a price it determines
- Stockbrokers: charge customers commission for each trade executed
- Insurance Brokers: Progressive insurance – provides quotes for them and their competitors
- Event Tickets: ticketmaster – sell tickets from one virtual location
- Real Estate and Mortgage Loan Brokers: eRealty: industry observers agree that new online brokers do much better job selling on the Web than traditional real estate brokers
- Online Banking and Financial Services: online banks hold tiny portion of worlds financial transactions; account aggregation: ability to obtain bank, investment, loan and other financial account info from multiple web sites and display in one location at banks web site
- Online Music: ?
Fee-for-Service Revenue Models: based on value of the service provided
- Online games: MSN Games by Zone.com
- Concerts and films:
- Professional Services: WebMD offers general health info
Revenue Models in Transition
Subscription to Advertising-Supported Model:
Advertising-Supported to Advertising-Subscription Model
Advertising-Supported to Fee-for-Services Model
Advertising-Supported to Subscription Model
Multiple Transitions
** Many companies undergo transitions in their revenue models as they leanr how to do business successfully on the web
Revenue Strategy Issues
Channel Conflict and Cannibalization
- channel conflict: occur when sales activities on company’s site interfere with existing sales outlets (also called cannibalization – sites sales consume sales that would be made in the company’s other sales channels
Strategic Alliances and Channel Distribution Management
- when two or more companies join forces to undertake activity over long period of time
- channel distribution managers: companies that take over responsibility for a particular product line within a retail store
Mobile Commerce
- few companies have made money in mobile commerce but some believe that a company with the right service can be successful
Creating an Effective Web Presence
- presence: the public image it conveys to stakeholders
- stakeholders: include customers, suppliers, employees, stockholders, neighbours, general public
Identifying Web Presence Goals
- Making Web presence consistent with brand image:
Achieving Web Presence Goals
- objectives:
o attracting visitors to site
o making the site interesting enough that visitors stay and explore
o convincing visitors to follow sites links to obtain info
o creating impression consistent with org’s desired image
o building trusting relationship with visitors
o reinforcing positive images that the visitor might already have about the org
o encouraging visitors to return to the site
- Profit-driven Organizations
o Companies can enhance their images by providing info
- Not-for-profit organizations
o Key goal is info dissemination
Web Site Usability
How the Web is Different
Meeting the Needs of Web Site Visitors
- Many motivations of web site visitors
- Making web sites accessible
o Offer easily accessible facts about the org
o Allow visitors to experience the site in different ways at different levels
o Provide visitors with meaningful communication link with the org
o Sustain visitor attention and encourage return visits
o Offer info about products and how to use them
Trust and Loyalty
- seller can create value in relationship with customer by nurturing customers’ trust and developing it into loyalty
Customer-Centric Web Site Design: there are many things to think of when designing your site and there are some guidelines that involve usability, avoiding business jargon, text visibility, etc.
Application
Valhalla Pure Outfitters has an online store that has only been up and running for a few months thus far. There is channel conflict between the online store and the retail stores across BC and Alberta. The site is set up so that the products are sold online but come from the closest retail store. Some of the stores are frustrated and do not like the idea that the online store is taking 50% of the margin on sales made online, as they are losing their margin if they were to sell it in store.
Key Concept:
This chapter focuses on 6 main ways in which a company can generate revenue online. We learn how these models work and what companies use each. This chapter also focuses on what is involved in order to make a successful web site based on the customers.
Supporting Points:
Revenue Models
Web Catalog Revenue Models: print catalogues expanded online (old mail order model was the start of this)
- Computers and Consumer Electronics: Apple, Dell, Gateway (offer customers access to product info and customization); Best Buy, Circuit City (sell products same way they sell in their stores)
- Books, Music, and Videos: Amazon,com (evolved to become retailer selling books, music, videos, electronics, tools, etc); amazon inspired others to sell online such as Barnes & Noble;
- Luxury Goods: people are usually reluctant to buy through the internet; Versace was developed online to provide info to those who would shop in-store
- Clothing Retailers: Gap; display photos of casual and business clothing with prices, sizes, colors, tailoring details; customers examine clothing and place an order; personal shopper: intelligent agent programs that learns the customers preferences and makes suggestions; virtual model: graphic image built from customer measurements; some companies have overstock websites to sell off inventory; colour settings on monitors cause problems
- Flowers and Gifts: 1-800-Flowers created online extension to its telephone order business; mrs. Fields cookies
- General Discounters: Buy.com, Walmart.com
Digital Content Revenue Models: Lexis.com (provides full-text search of court cases, laws, patent, tax regulations); ProQuest (sells digital copies of published documents)
Advertising-Supported Revenue Models: sites provide info about stuff through advertisements from other companies and charge advertisers rates for placing ads on their page; stickiness: ability to keep visitors as the site and attract repeat visitors; 2 problems: (1) no consensus on how to measure and charge for site visitor views, (2) few web sites have sufficient numbers of visitors to interest large advertisers
- Web Portals: Yahoo!; web directories: listing of hyperlinks to web pages; web portal: site that ppl use as launching point to enter the web (includes directory and search engine, other features that help ppl find what they are looking for)
- Newspaper Publishers: some worry if it helps or hurts sales of newspapers
- Targeted Classified Advertising Sites: niche markets are more successful; monster.com, autotrader.com; classified advertising is very profitable
Advertising-Subscription Mixed Revenue Models: subscribers pay a fee and accept some level of advertisingl The New York Times (mostly advertising supported, charges fees for access to certain areas of the site though)
Fee-for-Transaction Revenue Model: businesses offer services for which they charge a fee that is based on the number or size of transactions they process
- Travel Agents: earn commissions on each booking; value-added is info consolidation and filtering; Travelocity, expedia; these sites also generate revenue from ads placed on travel info pages
- Automobile Sales: carsdirect.com – allows people to select a car at a price it determines
- Stockbrokers: charge customers commission for each trade executed
- Insurance Brokers: Progressive insurance – provides quotes for them and their competitors
- Event Tickets: ticketmaster – sell tickets from one virtual location
- Real Estate and Mortgage Loan Brokers: eRealty: industry observers agree that new online brokers do much better job selling on the Web than traditional real estate brokers
- Online Banking and Financial Services: online banks hold tiny portion of worlds financial transactions; account aggregation: ability to obtain bank, investment, loan and other financial account info from multiple web sites and display in one location at banks web site
- Online Music: ?
Fee-for-Service Revenue Models: based on value of the service provided
- Online games: MSN Games by Zone.com
- Concerts and films:
- Professional Services: WebMD offers general health info
Revenue Models in Transition
Subscription to Advertising-Supported Model:
Advertising-Supported to Advertising-Subscription Model
Advertising-Supported to Fee-for-Services Model
Advertising-Supported to Subscription Model
Multiple Transitions
** Many companies undergo transitions in their revenue models as they leanr how to do business successfully on the web
Revenue Strategy Issues
Channel Conflict and Cannibalization
- channel conflict: occur when sales activities on company’s site interfere with existing sales outlets (also called cannibalization – sites sales consume sales that would be made in the company’s other sales channels
Strategic Alliances and Channel Distribution Management
- when two or more companies join forces to undertake activity over long period of time
- channel distribution managers: companies that take over responsibility for a particular product line within a retail store
Mobile Commerce
- few companies have made money in mobile commerce but some believe that a company with the right service can be successful
Creating an Effective Web Presence
- presence: the public image it conveys to stakeholders
- stakeholders: include customers, suppliers, employees, stockholders, neighbours, general public
Identifying Web Presence Goals
- Making Web presence consistent with brand image:
Achieving Web Presence Goals
- objectives:
o attracting visitors to site
o making the site interesting enough that visitors stay and explore
o convincing visitors to follow sites links to obtain info
o creating impression consistent with org’s desired image
o building trusting relationship with visitors
o reinforcing positive images that the visitor might already have about the org
o encouraging visitors to return to the site
- Profit-driven Organizations
o Companies can enhance their images by providing info
- Not-for-profit organizations
o Key goal is info dissemination
Web Site Usability
How the Web is Different
Meeting the Needs of Web Site Visitors
- Many motivations of web site visitors
- Making web sites accessible
o Offer easily accessible facts about the org
o Allow visitors to experience the site in different ways at different levels
o Provide visitors with meaningful communication link with the org
o Sustain visitor attention and encourage return visits
o Offer info about products and how to use them
Trust and Loyalty
- seller can create value in relationship with customer by nurturing customers’ trust and developing it into loyalty
Customer-Centric Web Site Design: there are many things to think of when designing your site and there are some guidelines that involve usability, avoiding business jargon, text visibility, etc.
Application
Valhalla Pure Outfitters has an online store that has only been up and running for a few months thus far. There is channel conflict between the online store and the retail stores across BC and Alberta. The site is set up so that the products are sold online but come from the closest retail store. Some of the stores are frustrated and do not like the idea that the online store is taking 50% of the margin on sales made online, as they are losing their margin if they were to sell it in store.
Monday, January 21, 2008
Chapter 3: Selling on the web
Revenue Models
Web Catalog
- Books & CDs
- Clothing & Apparel
- Computers & Electronics
Digital Content (IP): stuff you own the copyright too or licensed the copyright to - you have the right to distribute
- Journal Articles
- Research Studies
- Industry Reports
Advertising-Supported:
- Web Directories/Portals: (search engine, shopping directories, white/yellow pages)
Mixed Model Advertising-Subscription Supported: advertising fees as well as subscription fees for content products
Fee-for-transaction: every single sale, piece of that sale (in terms of profit) goes to the website - getting paid on each transaction and number of transactions
- travel agents
- auto sales
- event tickets
- stock brokers
- online banking
- online music
fee-for-service: paying for the value of service online
(Example question for exam)
1. Web Catalog:
- Listing of products with info and pricing
- Sell directly to customers online
- Need checkout and shipping process
- Returns and other policies (sales contract policies)
- Make money through standard markup and margin
Examples:
- NFLshop.com, Amazon, dell, Victoria secret, walmart, buy.com
2. Digital Content
- All the firms own the rights
- Databases
- Make money off selling the rights for the info they have
- View abstracts: to sell entire thing, you have to pay
- More academic and research focused
- Largely controlled by education institutions
Example:
- International trade commissioner, Harvard business journal, CBC learning online, ACM digital library
3. Advertising-Supported:
- Solely supported by advertising
- Counting systems for hits on ad’s : reach, CPM – how many impressions, CPC (clicks per thousand) – how many times someone actual clicks on it
- No subscription of service fees
- High traffic / highly targeting
-
Examples: newschoolers.com, monster.ca, yahoo.ca, google, msn,
4. Mixed model Advertising-Subscription Supported
- Has membership requirements
- Costs money to become a member
- Yearly fee for subscription
- May have to pay for product or info on the site
- Uses advertising to generate revenue
Examples: hotmail.com,
** to move someone from free-loader to subscriber: additional features, tell them they will get less advertisements
5. Fee for transaction
- Own the product after transaction
- Paying for a specific interaction with the firm (one time)
- Make money based on buying with volume discounts as a low cost
- Fee is for the transaction
- Log in
- Info/price
- Paypal/payment options – check out
- Remove the middle man – this is where the fees come in
- CIS: get the customer to do the work for you
Example: ticketselleronline.com,
6. Fee for service
- Don’t own product at the end of the service
- Access to the service for a certain time period
- Log in
- Privacy regulations
Example: www.macorr.com, www.adgcanada.ca
Strategic Issues (the back end)
- channel conflict/cannibalization
- alliances/distribution management:
- mobile commerce:
Web Presence
- attractive and easy to use
- ranks high on stickiness (not only attracting, but having them stay there and browse)
- provides quick links / content
- provides help and support
- portrays consistent image
- reinforces positive image
- builds trusting relationship
- engages for return ability: new content, social presence sites (forum)
Web Catalog
- Books & CDs
- Clothing & Apparel
- Computers & Electronics
Digital Content (IP): stuff you own the copyright too or licensed the copyright to - you have the right to distribute
- Journal Articles
- Research Studies
- Industry Reports
Advertising-Supported:
- Web Directories/Portals: (search engine, shopping directories, white/yellow pages)
Mixed Model Advertising-Subscription Supported: advertising fees as well as subscription fees for content products
Fee-for-transaction: every single sale, piece of that sale (in terms of profit) goes to the website - getting paid on each transaction and number of transactions
- travel agents
- auto sales
- event tickets
- stock brokers
- online banking
- online music
fee-for-service: paying for the value of service online
(Example question for exam)
1. Web Catalog:
- Listing of products with info and pricing
- Sell directly to customers online
- Need checkout and shipping process
- Returns and other policies (sales contract policies)
- Make money through standard markup and margin
Examples:
- NFLshop.com, Amazon, dell, Victoria secret, walmart, buy.com
2. Digital Content
- All the firms own the rights
- Databases
- Make money off selling the rights for the info they have
- View abstracts: to sell entire thing, you have to pay
- More academic and research focused
- Largely controlled by education institutions
Example:
- International trade commissioner, Harvard business journal, CBC learning online, ACM digital library
3. Advertising-Supported:
- Solely supported by advertising
- Counting systems for hits on ad’s : reach, CPM – how many impressions, CPC (clicks per thousand) – how many times someone actual clicks on it
- No subscription of service fees
- High traffic / highly targeting
-
Examples: newschoolers.com, monster.ca, yahoo.ca, google, msn,
4. Mixed model Advertising-Subscription Supported
- Has membership requirements
- Costs money to become a member
- Yearly fee for subscription
- May have to pay for product or info on the site
- Uses advertising to generate revenue
Examples: hotmail.com,
** to move someone from free-loader to subscriber: additional features, tell them they will get less advertisements
5. Fee for transaction
- Own the product after transaction
- Paying for a specific interaction with the firm (one time)
- Make money based on buying with volume discounts as a low cost
- Fee is for the transaction
- Log in
- Info/price
- Paypal/payment options – check out
- Remove the middle man – this is where the fees come in
- CIS: get the customer to do the work for you
Example: ticketselleronline.com,
6. Fee for service
- Don’t own product at the end of the service
- Access to the service for a certain time period
- Log in
- Privacy regulations
Example: www.macorr.com, www.adgcanada.ca
Strategic Issues (the back end)
- channel conflict/cannibalization
- alliances/distribution management:
- mobile commerce:
Web Presence
- attractive and easy to use
- ranks high on stickiness (not only attracting, but having them stay there and browse)
- provides quick links / content
- provides help and support
- portrays consistent image
- reinforces positive image
- builds trusting relationship
- engages for return ability: new content, social presence sites (forum)
Tuesday, January 15, 2008
Chapter 2: Key Concept
Chapter 2: Technology Infrastructure: The Internet and The World Wide Web
Key Concept:
This chapter focuses on how the internet has changed over the past few years, including networks, protocols, and other important elements that have improved the speed, quality and depth of what is involved today. This chapter focuses on the history of the internet and the web, along with languages, software, technologies and connectivity that is involved or used when accesses the web and the internet.
Supporting Points:
History of the Internet:
- 1960’s: US Department of Defense: networks were built that could operate independently
- 1969: ARPA used network to connect 4 computers: ARPANET
- 1972: email was born: Ray Tomlinson
- 1979: Usenet: user’s news network: newsgroups
- 1989: NSF: commercial network traffic
- 1990: more than 300,000 computers connected to networks
- 1995: internet was privatized and no longer operated by the US gov’t
History of the Web:
- 1945: Memex: memory extension device
- 1960’s: hypertext: one page links to another; 1987: Xanadu: global system for online hypertext publishing and commerce
- 1989: WWW, system of hyperlinked HTML documents
- 1993: Mosaic: first program that could read HTML and use the hyperlinks to navigate
- 1994: Netscape was designed: web browser: became fastest-growing software company
Network Technologies:
- local area network: LAN or wide area networks: WANs
- packet-switched networks: files and email broken down into packets, labeled electronically with origin, sequences, destinations address: travel from computer to destination
- routing computers, router computers, routers, gateway computes, border routers: decide best way to get packet to destination
- hubs, switches and bridges move packets from network to network
- internet backbone: handle packet traffic along internets main connecting points
Internet Protocols:
- collection of rules for formatting, ordering, error-checking data sent across networks
- TCP/IP: rules that govern how data moves through the internet and how network connections are established and terminated
- TCP: breaks down info into packets: and reassembles at the other end
- IP: specifies addressing details for each packet, labeling packets with destination addresses
- Domain names: sets of words assigned to specific IP addresses
o Top-level: .edu, .com, .org
- Web client software: sends requests for web page files to other computers (web servers)
- Web server: receives and responds by sending files back to those web client computers: purpose of web server is to respond to requests for web pages from web clients
- URL (uniform resource locator): combo of protocol name and domain name: lets user locate a resource on another computer
Markup Languages
- SGML: standard generalized markup language: was used to create documents that needed to be printed in various formats and revised frequently
- XML: extensible markup language: used to mark up info that companies share
- XHTML: extensible hypertext markup language:
- HTML: tags that define format, style of text
- XML: templates that can be used with the same info input by HTML
Intranets and Extranets:
- intranet: interconnected network, uses TCP/IP, does not extend beyond the organization that created it: easiest low-cost way to distribute internal corporate info
- extranet: intranet that has been extended to include outside boundaries of the org (customers, suppliers)
- public network: any computer network available to the public (the internet)
- private network: leased-line connection between 2 companies that physically connects their intranets to one another
- virtual private network: extranet that uses public networks and protocols to send sensitive data to partners, customers, suppliers, employees using system IP tunneling
- Bandwidth: amount of data that can travel through a communication line per unit of time
- DSL, ISDN: through local telephone service provider
- Broadband services: DSL, high speed
- Wireless: blue tooth, ultra wideband, Wi-Fi
Internet2
- make the web quicker and more efficient
- no more waiting to download videos or music
Semantic Web
- all words on a website will be links
Application:
It is pretty hard to apply this chapter to a specific company, but one can say that most all companies use the internet in some way or another. Valhalla Pure Outfitters uses the internet and has created an online store that links all 16 privately-owned stores to the one site. If a customer orders a product online, they can see what store has that product and where it is going to be shipped from. That store then gets an email as to what product is needed and where it has to be sent. Most products in every store are linked to the online store and available for sale. The company uses many networks to connected the head office to one another, along with linking all the stores to the online store.
Key Concept:
This chapter focuses on how the internet has changed over the past few years, including networks, protocols, and other important elements that have improved the speed, quality and depth of what is involved today. This chapter focuses on the history of the internet and the web, along with languages, software, technologies and connectivity that is involved or used when accesses the web and the internet.
Supporting Points:
History of the Internet:
- 1960’s: US Department of Defense: networks were built that could operate independently
- 1969: ARPA used network to connect 4 computers: ARPANET
- 1972: email was born: Ray Tomlinson
- 1979: Usenet: user’s news network: newsgroups
- 1989: NSF: commercial network traffic
- 1990: more than 300,000 computers connected to networks
- 1995: internet was privatized and no longer operated by the US gov’t
History of the Web:
- 1945: Memex: memory extension device
- 1960’s: hypertext: one page links to another; 1987: Xanadu: global system for online hypertext publishing and commerce
- 1989: WWW, system of hyperlinked HTML documents
- 1993: Mosaic: first program that could read HTML and use the hyperlinks to navigate
- 1994: Netscape was designed: web browser: became fastest-growing software company
Network Technologies:
- local area network: LAN or wide area networks: WANs
- packet-switched networks: files and email broken down into packets, labeled electronically with origin, sequences, destinations address: travel from computer to destination
- routing computers, router computers, routers, gateway computes, border routers: decide best way to get packet to destination
- hubs, switches and bridges move packets from network to network
- internet backbone: handle packet traffic along internets main connecting points
Internet Protocols:
- collection of rules for formatting, ordering, error-checking data sent across networks
- TCP/IP: rules that govern how data moves through the internet and how network connections are established and terminated
- TCP: breaks down info into packets: and reassembles at the other end
- IP: specifies addressing details for each packet, labeling packets with destination addresses
- Domain names: sets of words assigned to specific IP addresses
o Top-level: .edu, .com, .org
- Web client software: sends requests for web page files to other computers (web servers)
- Web server: receives and responds by sending files back to those web client computers: purpose of web server is to respond to requests for web pages from web clients
- URL (uniform resource locator): combo of protocol name and domain name: lets user locate a resource on another computer
Markup Languages
- SGML: standard generalized markup language: was used to create documents that needed to be printed in various formats and revised frequently
- XML: extensible markup language: used to mark up info that companies share
- XHTML: extensible hypertext markup language:
- HTML: tags that define format, style of text
- XML: templates that can be used with the same info input by HTML
Intranets and Extranets:
- intranet: interconnected network, uses TCP/IP, does not extend beyond the organization that created it: easiest low-cost way to distribute internal corporate info
- extranet: intranet that has been extended to include outside boundaries of the org (customers, suppliers)
- public network: any computer network available to the public (the internet)
- private network: leased-line connection between 2 companies that physically connects their intranets to one another
- virtual private network: extranet that uses public networks and protocols to send sensitive data to partners, customers, suppliers, employees using system IP tunneling
- Bandwidth: amount of data that can travel through a communication line per unit of time
- DSL, ISDN: through local telephone service provider
- Broadband services: DSL, high speed
- Wireless: blue tooth, ultra wideband, Wi-Fi
Internet2
- make the web quicker and more efficient
- no more waiting to download videos or music
Semantic Web
- all words on a website will be links
Application:
It is pretty hard to apply this chapter to a specific company, but one can say that most all companies use the internet in some way or another. Valhalla Pure Outfitters uses the internet and has created an online store that links all 16 privately-owned stores to the one site. If a customer orders a product online, they can see what store has that product and where it is going to be shipped from. That store then gets an email as to what product is needed and where it has to be sent. Most products in every store are linked to the online store and available for sale. The company uses many networks to connected the head office to one another, along with linking all the stores to the online store.
Monday, January 14, 2008
Chapter 2: Class Notes
Technology Infrastructure:
History of the Internet: (the network communications) - not the web!
- 1960's: Dept of Defense
- 1969: ARPANet - redundancy model for network communications
- 1972: E-mail -
- 1974: TCP/IP - Vint Cerf: developed protocols; technology, rules, guidlines for how we transfer data across the internet
- 1979: Usenet - email for groups (newsgroups)
- 1980's: NSF - National Science Foundation - US based org given billions of $$ by the US gov't, with the mandate to educate and give students and faculty and researchers access to all the resources of the gov't (where the money came in)
- 1993: CBC Peter Mansbridge - YouTube announcement
- 1995: Privatized - more internet hosts - no longer only funded by NSF
History of the Web (how we use this network to publish and share info)
- 1945: Vannevar Bush - Memex - store all of memory items
- 1960's: Ted Nelson - "hypertext"
- 1987: Ted Nelson - Xanadu - memex on steroids
- 1989: Tim Berners-Lee - WWW - father of the world wide web: created a hypertext system
- 1993: Marc Andreesen - Mosaic - developed first web browser
- 1994: Andreesen & Clark - Netscape
- 2004: Web 2.0 - facebook is a web 2.0 application (web 1.0 application is where info is stored on web and you can access it, but you only passively consume content; web 2.0 consume and produce content). Before we would just email back and forth and only be able to read email; now we can talk instantaneously with one another over instant messaging.
Web Languages
- SGML:
*HTML: Hypertext markup language; shows us what is bold, italic
* DHTML
*XML : extensible markup language; tells us what the content is inside the document (title, author, publisher, isbn) - Used for almost eveything in Web 2.0
*XHMTL : extensible hypertext markup language; next level (not only is it a heading 1, but also the title of the book) tags...
* CSS: cascading style sheets; like templates in word - apply diff sheet to change the look
- Scripting and Programming: (creating web applications)
* Javascript: most popular (AJAX, Client-side, Server-side); PHP: used for databases
- Tutorials
Web Software
- Web Servers: any single computer connected to internet can be a web server; need ability to run one of the following programs
* Apache:
* IIS: internet information server; works with microsoft products
* HSF: server that will run off of USB stick
* Server2Go: could run business off of and fits on usb stick
* EasyPHP:
* XAMPP:
- Web Clients:
* Internet Explorer: most of the market share
* Firefox: better techonology but only 25% of market
* Opera: one of the first browsers to come up with tabs
* Flock: new browser directed toward social browsing
Future of the Internet
- internet2 (5 years or so): increase in bandwidth; instantaneous downloads and capacity to hold everything and anything and anyone can get to it immediately
- semantic web: googlefied: search, retrieve, link from anything on the page (not only hyperlinks)
Network Technologies:
- Hardware:
* Routers: connects two networks: plans the map of where the info goes: has intelligence within
* Hubs: extra connection points (routers only have 4 ports): only good for shorter distances
* Switches: for larger companies that need to switch off to longer distances
* Gateway: router or switch: connects gateway between one gateway and another
* Access Point: usually built into routers
* Modems: POTS (plain old telephone service), Cable, DSL
- Protocols: rules and guildelines for how to tranfers info over the internet
* Internet: TCP (transmission control protocol) & IP (internet protocol- made up of 4 numbers 0-255; 127.0.0.1 (local computer); 192.168.1.x (local area network)port 80 opens up web server to allow other people to get to it; sheilds up: tells you your problems), TelNet, VOIP,
a) Domain names: all have associated domain names instead of knowing what the numbers are;
* Mail: SMTP & POP3 (old technology, standard email accounts; outlook express), IMAP (newer, stores the messages on the server, the okanagan email), WebMail (google, hotmail, yahoo)
* Newsgroups: NNTP (newsgroup transfer protocol)
* Files: FTP (file tranfer protocol): retreiving files on the internet, SFTP (secure)
* Web: HTTP (hypertext transfer protocol), HTTPS (secure)
Network Connectivity
- Bandwidth:
* Telephone: POTS, ISDN - old service
* Broadband: Cable, DSL
* Leased-line: T1/T3, ATM/OC3: always on connection, pay $1,000 a month
* Wireless: iRDA, Bluetooth, Wi-Fi ethernet (most important for this class), Cell network, satellite
History of the Internet: (the network communications) - not the web!
- 1960's: Dept of Defense
- 1969: ARPANet - redundancy model for network communications
- 1972: E-mail -
- 1974: TCP/IP - Vint Cerf: developed protocols; technology, rules, guidlines for how we transfer data across the internet
- 1979: Usenet - email for groups (newsgroups)
- 1980's: NSF - National Science Foundation - US based org given billions of $$ by the US gov't, with the mandate to educate and give students and faculty and researchers access to all the resources of the gov't (where the money came in)
- 1993: CBC Peter Mansbridge - YouTube announcement
- 1995: Privatized - more internet hosts - no longer only funded by NSF
History of the Web (how we use this network to publish and share info)
- 1945: Vannevar Bush - Memex - store all of memory items
- 1960's: Ted Nelson - "hypertext"
- 1987: Ted Nelson - Xanadu - memex on steroids
- 1989: Tim Berners-Lee - WWW - father of the world wide web: created a hypertext system
- 1993: Marc Andreesen - Mosaic - developed first web browser
- 1994: Andreesen & Clark - Netscape
- 2004: Web 2.0 - facebook is a web 2.0 application (web 1.0 application is where info is stored on web and you can access it, but you only passively consume content; web 2.0 consume and produce content). Before we would just email back and forth and only be able to read email; now we can talk instantaneously with one another over instant messaging.
Web Languages
- SGML:
*HTML: Hypertext markup language; shows us what is bold, italic
* DHTML
*XML : extensible markup language; tells us what the content is inside the document (title, author, publisher, isbn) - Used for almost eveything in Web 2.0
*XHMTL : extensible hypertext markup language; next level (not only is it a heading 1, but also the title of the book) tags...
* CSS: cascading style sheets; like templates in word - apply diff sheet to change the look
- Scripting and Programming: (creating web applications)
* Javascript: most popular (AJAX, Client-side, Server-side); PHP: used for databases
- Tutorials
Web Software
- Web Servers: any single computer connected to internet can be a web server; need ability to run one of the following programs
* Apache:
* IIS: internet information server; works with microsoft products
* HSF: server that will run off of USB stick
* Server2Go: could run business off of and fits on usb stick
* EasyPHP:
* XAMPP:
- Web Clients:
* Internet Explorer: most of the market share
* Firefox: better techonology but only 25% of market
* Opera: one of the first browsers to come up with tabs
* Flock: new browser directed toward social browsing
Future of the Internet
- internet2 (5 years or so): increase in bandwidth; instantaneous downloads and capacity to hold everything and anything and anyone can get to it immediately
- semantic web: googlefied: search, retrieve, link from anything on the page (not only hyperlinks)
Network Technologies:
- Hardware:
* Routers: connects two networks: plans the map of where the info goes: has intelligence within
* Hubs: extra connection points (routers only have 4 ports): only good for shorter distances
* Switches: for larger companies that need to switch off to longer distances
* Gateway: router or switch: connects gateway between one gateway and another
* Access Point: usually built into routers
* Modems: POTS (plain old telephone service), Cable, DSL
- Protocols: rules and guildelines for how to tranfers info over the internet
* Internet: TCP (transmission control protocol) & IP (internet protocol- made up of 4 numbers 0-255; 127.0.0.1 (local computer); 192.168.1.x (local area network)port 80 opens up web server to allow other people to get to it; sheilds up: tells you your problems), TelNet, VOIP,
a) Domain names: all have associated domain names instead of knowing what the numbers are;
* Mail: SMTP & POP3 (old technology, standard email accounts; outlook express), IMAP (newer, stores the messages on the server, the okanagan email), WebMail (google, hotmail, yahoo)
* Newsgroups: NNTP (newsgroup transfer protocol)
* Files: FTP (file tranfer protocol): retreiving files on the internet, SFTP (secure)
* Web: HTTP (hypertext transfer protocol), HTTPS (secure)
Network Connectivity
- Bandwidth:
* Telephone: POTS, ISDN - old service
* Broadband: Cable, DSL
* Leased-line: T1/T3, ATM/OC3: always on connection, pay $1,000 a month
* Wireless: iRDA, Bluetooth, Wi-Fi ethernet (most important for this class), Cell network, satellite
Wednesday, January 9, 2008
Chapter 1: Class Notes
Intro to E-Commerce
- Revenue model: focuses on sales; how do i bring money into the company (create one channel to bring in revenue); indentify customers, market to them
- Business model: focuses on strategic elements of you busines and what it does; bottom-line driven
Sounds Bites:
- fortunes have been made and lost
- still riding the learning curve on what works and what doesn't
- being first to market isn't that important anymore
- EDI and EFT have been around since the 60's
- 60% of internet content is in English: >50% users do not read English; >75% users live outside of the US (still have to be aware of global size of the market, and English is not everything)
E-Commerce Defined
- is the exchange of info across electronic networks at any stage in the supply chain whether within an org, between businesses, between business & consumers, or between public and private sectors whether paid or unpaid
- is commerce, but enhanced and accelerated by IT (internet)
- most important thing in supply chain: exchange of info
E-Business:
- transformation of key business processes through the use of internet technologies
- encompasses e-commerce & includes front and back office applications that form engine for modern business; redefining old business models with aid of technology to maximize customer value
E-Commerce vs E-business
- e-commerce is equivalent or a subset of electronic business
E-Commerce Categories:
- B2B: supply chain, value chain (Dell)
- C2B: demand aggregation (consumer groups)
- B2C: commerce over the Net (amazon)
- C2C: community groups (eBay)
- B2G: business to government
- B2B: Disintermediation: removing the middleman
First Wave
defining characteristics:
- dominant influence of US businesses
- extensive use of english
- many companies started with ouside investor money
- piracy, hacking problems
Second Wave of E-Commerce
Defining characteristics:
- global enterprise: multi-cultural and multi-lingual
- established companies fund electronic commerce initiatives with own capital
- integration with key business processes
- many customers are now linked to broadband connections
Product/Process Suitability
- Commodity item: hard to distinguish from competitors products or services
- shipping profile: how easily can a product be packaged and delivered?
- high value-to-weight ratio: what is the ratio of shipping cost to selling price?
- digital products:
Advantages of E-Commerce
- increase sales through enhanced customers services
- decrease costs of handling inquiries and transactions
- reach potential customers in every country
- increase purchasing opportunities/options
- make negotiating price and delivery terms easier
- ability to do commerce transactions faster and easier with a audit trail
Disadvantages of E-Commerce
- perishable products harder to sell online
- companies believe that their business is centered around e-business model (draw ppl in because its new, but are they really making money at it)
- cultural and legal obstacles
Global Nature of E-Commerce
- Trust issues: use brand recognition and image to connect with customers
- Language issues: focus on localization, which considers multiple elements of the local environment (unlike translation, which is just language)
- Cultural issues: expectations of parties and how each will react (values and customers)
- Infrastructure issues
- Revenue model: focuses on sales; how do i bring money into the company (create one channel to bring in revenue); indentify customers, market to them
- Business model: focuses on strategic elements of you busines and what it does; bottom-line driven
Sounds Bites:
- fortunes have been made and lost
- still riding the learning curve on what works and what doesn't
- being first to market isn't that important anymore
- EDI and EFT have been around since the 60's
- 60% of internet content is in English: >50% users do not read English; >75% users live outside of the US (still have to be aware of global size of the market, and English is not everything)
E-Commerce Defined
- is the exchange of info across electronic networks at any stage in the supply chain whether within an org, between businesses, between business & consumers, or between public and private sectors whether paid or unpaid
- is commerce, but enhanced and accelerated by IT (internet)
- most important thing in supply chain: exchange of info
E-Business:
- transformation of key business processes through the use of internet technologies
- encompasses e-commerce & includes front and back office applications that form engine for modern business; redefining old business models with aid of technology to maximize customer value
E-Commerce vs E-business
- e-commerce is equivalent or a subset of electronic business
E-Commerce Categories:
- B2B: supply chain, value chain (Dell)
- C2B: demand aggregation (consumer groups)
- B2C: commerce over the Net (amazon)
- C2C: community groups (eBay)
- B2G: business to government
- B2B: Disintermediation: removing the middleman
First Wave
defining characteristics:
- dominant influence of US businesses
- extensive use of english
- many companies started with ouside investor money
- piracy, hacking problems
Second Wave of E-Commerce
Defining characteristics:
- global enterprise: multi-cultural and multi-lingual
- established companies fund electronic commerce initiatives with own capital
- integration with key business processes
- many customers are now linked to broadband connections
Product/Process Suitability
- Commodity item: hard to distinguish from competitors products or services
- shipping profile: how easily can a product be packaged and delivered?
- high value-to-weight ratio: what is the ratio of shipping cost to selling price?
- digital products:
Advantages of E-Commerce
- increase sales through enhanced customers services
- decrease costs of handling inquiries and transactions
- reach potential customers in every country
- increase purchasing opportunities/options
- make negotiating price and delivery terms easier
- ability to do commerce transactions faster and easier with a audit trail
Disadvantages of E-Commerce
- perishable products harder to sell online
- companies believe that their business is centered around e-business model (draw ppl in because its new, but are they really making money at it)
- cultural and legal obstacles
Global Nature of E-Commerce
- Trust issues: use brand recognition and image to connect with customers
- Language issues: focus on localization, which considers multiple elements of the local environment (unlike translation, which is just language)
- Cultural issues: expectations of parties and how each will react (values and customers)
- Infrastructure issues
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