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E-Commerce
Electronic commerce
(ecommerce) is the idea of doing business electronically over the
Internet. No longer bound by time or geography, ecommerce provides
store owners with ubiquitous access to their customers. This
significantly expands a store owner's opportunity to satisfy demand
for products, services, and information of each customer.
Online purchasing is
becoming as common and convenient as ordering by telephone or fax.
How does a typical
transaction at a retail store work? You select the items you wish to
purchase and put them in your shopping cart. When you're ready to
checkout, you take them to a sales clerk at the cash register where
you are given the option to pay by cash, check or credit card. The
cash register used to process your payment is actually referred to as
a Point-of-Sale (POS terminal). The cash register (POS
terminal) is connected to the retail store's bank processing network
where the credit card and/or check is verified as valid either with
available credit and/or a valid banking institution. You are then
given a receipt and the transaction is complete.
Ecommerce services are very similar and operate just as stated above,
only without a sales clerk. Just think of your computer as your sales
staff.
E-mail receipts are sent
after a transaction is processed giving your customer an instantaneous
online verification that the transaction was completed.
- Easy-to-use
- Appealing
- Good customer service
- Unsaturated market
- Know who your competitors are:
How many other companies are selling similar products online?
Do their web sites work? Are their web sites fast?
Do they provide secure ordering?
What are their prices?
How responsive are they to their customers?
What is their reputation on the
Internet newsgroups?
- Increase revenue
-
Low-cost/high-payback alternative to
traditional physical store or mail-order catalog.
- Avoid losing sales to competitors
who are online
- Immediate international sales
presence
- Shop 24 hrs/day, 365 days/year
- Expand customer base
- Set up shop anywhere, no need to
re-locate
- Low-cost way to turn your Web site
into a profit center
- Reduce phone cost due to customer
support via email
- Create customized mailing list
Digital authentication
services provided like
Version, Inc.
or
Thawte
to ensure that orders are secure. A Digital ID binds a company's
identity to a digital key which can be used to conduct secure
transactions.
The Secure Hypertext
Transport Protocol (S-HTTP) is an extension of the Web protocol (HTTP)
and adds security features to it. The Secure Sockets Layer (SSL)
protocol, originally introduced in Netscape 2.0, is a data encryption
technique that allows for secure transactions across the Internet.
This software will
encrypt a customer's credit card and purchase information as it is
sent over the Internet from the customer's Web browser to the Web
server hosting the online store. The customer will know their
connection is secure because the lock icon in the bottom left corner
of their Web browser will be closed (locked) instead of open and the
URL at the top of the browser will have https instead of
http at the beginning.
Shipping and taxes can be defined
according to each store owner's requirements and are calculated and
added into the purchase amount for display to the consumer.
Advantages
When transactions are
authorized in real-time, the need for manual tracking of invalid
credit card numbers is eliminated so less sales staff is needed.
Sale proceeds from
credit card transactions are automatically deposited electronically to
the store owner's bank account.
Disadvantages
Many fees.
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