12-ecommerce

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Copyright 2004 ProsoftTraining, All Rights Reserved.

Lesson 12:

E-Commerce Practices

2007 Prosoft Learning Corporation

All rights reserved

ITD 110 Web Page Design


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Objectives

Compare e-commerce to traditional commerce

Define e-commerce terms and concepts

Relate the concept of supply chain to e-commerce

Identify payment models used in e-commerce

Identify ways to protect private transactions

Identify issues related to working in a global

environment

Identify ways to build e-commerce relationshipsusing Web-based technology


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Traditional Commerce

vs. E-Commerce

Similarities

Both aim to deliver a valued product or service

Both want to serve a large audience

Both strive to quickly deliver products and services

Differences E-commerce customers expect shorter fulfillment time

E-commerce customers must understand Web-based

technologies

E-commerce provides a global audience

E-commerce orders are processed without humaninteraction or travel to a store location

E-commerce relies upon encryption for security


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E-Commerce Models

Business to consumer (B2C) Targets consumers or end users, and sells

products and/or services

Amazon.com, small business sites

Business to business (B2B)

Helps organizations to manage relationshipsand transactions with other businesses

B2BExchange

Consumer to consumer

Not a traditional B2C model

eBay


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Business and Internet

Technologies

Traditional businesses also use e-commerce

Not an either/or proposition

Web technologies make traditional

business more efficient E-commerce concepts:

Supply chain management

Enterprise resource planning (ERP)

B2B information sharing

Internet marketing


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Supply Chain Management

The ability to manage the process that

generates a product and distributes it to

customers

You must manage the process that begins

with raw materials and ends with a product

delivered to a consumer

Customer can be:

An end user

Another business that resells your

product after adding value to it, known

as a Value Added Reseller (VAR)


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Supply Chain Management (contd) Traditional supply chain management model

Professionals running e-commerce sitesincreasingly need to understand this model


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Enterprise Resource Planning (ERP)

Use of software to create an automated plan forcompany operations

ERP goal -- enhance communication among all

company departments and divisions through

software automation

Accomplished through automation of tasks and

reporting

All company/organization departments involved

Common terms: Bolt-on system

Application programming interface (API)

Library


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Internet Marketing

More than technical knowledge is needed

Relationship to the business, including the

marketing department

Marketing terms


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E-Commerce Information-Formatting

Technologies

When businesses need to exchange

information, they must agree upon universal

information-formatting methods

The two most common ways to formatinformation are:

Electronic Data Interchange (EDI)

Open Buying on the Internet (OBI)


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Electronic Data Interchange (EDI)

A universal method for formatting information so itcan be transferred among organizations

In place for over 20 years

Useful for exchanging:

Invoices Bills

Purchase orders

Inventory lists

Supply chain information

EDI implementation and drawbacks

EDI and XML


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Open Buying on the Internet (OBI)

Designed as an alternative to EDI Developed to target high-volume, low-cost

transactions

These account for almost 80 percent of

most companies' purchasing activities OBI components

OBI transactions

OBI and EDI

OBI and XML


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E-Commerce

Payment Technologies

Payment technologies include:

Electronic Funds Transfer (EFT)

Payment gateways

Secure Electronic Transactions (SET)

Open Trading Protocol (OTP)

Secure Sockets Layer (SSL) / Transport

Layer Security (TLS)


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Payment Gateway

Mediates between a merchant and a merchantbank

Once the merchant receives payment from acustomer, the merchant uses the paymentgateway to transmit credit card information to the

bank Responsibilities:

Forwarding information

Authenticating participants

Ensuring confidentiality Ensuring data integrity

Payment gateway companies


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Secure Electronic

Transactions (SET)

Uses digital certificates to secure financial

transactions

Public and private keys ensure encryption,

data confidentiality and non-repudiation

Designed to allow both simple and complex

transactions

History of SET

SET example SET vs. conventional transactions


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Open Trading Protocol (OTP)

Alternative to SET An open standard (RFC 2802)

Used for both B2C and B2B

Often used with XML

OTP features:

Provides trading protocol options to control the

way that the trade occurs

Provides a record of a particular trade

Supports real and virtual delivery of goods and

services (payment tracking)


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SSL/TLS and

Public Key Infrastructure (PKI)

You need a certificate to enable host

authentication before you can begin an SSL

session

Public Key Infrastructure (PKI) A collection of individuals, networks and

machines that comprise the ability to

authoritatively confirm the identity of a

person, host or organization


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PKI Elements

PKI elements include:

Digital certificate

Certificate authority (CA)

Registration authority (RA)

Certificate server

Certification chain


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Digital Certificates and X.509

Digital certificates used in PKI conform to the ITU

X.509 standard

X.509 describes how to format digital certificates


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PKCS Standards

Public-Key Cryptography Standards (PKCS) Used to store and transport certificates

PKCS #7

Used to secure e-mail certificates

PKCS #10 Used to generate a certificate request to a

certificate authority (CA)


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Certificate Life Cycle

Certificates usually have a limited life (e.g., 1

month, 2 years, 6 years) Life cycle helps reduce the likelihood of fraud

Terms include:

Certificate policy

Certificate Practice Statement (CPS)

Certificate expiration

Certificate revocation

Certificate suspension

Certificate renewal

Certificate revocation list (CRL)

Online Certificate Status Protocol (OCSP)


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Additional SSL/TLS Concepts

The SSL/TLS handshake

Common applications

Beginning an SSL/TLS session

Encryption begins after authentication

Issues:

Different host name

Certificate expired

Certificate date not yet valid

Invalid certificate format

Certificate presented by the server notsigned by a recognized CA

Incompatible encryption settings


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Working in a Global Environment

By placing your business on the Web, you

expand your audience to include anyone in theworld with a browser and Internet access

Consider the level to which you will

accommodate potential customers from

countries outside yours Issues to consider include:

Currency exchange rates

International shipping

Language concerns

Relationship management


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Currency and Trade

Each country (e.g., China) and economic block

(e.g., European Union) uses its own currency

Businesses and organizations must be able

to:

Automatically calculate exchange rates for

the day of the transaction

Calculate taxes and tariffs on goods

Taxes, tariffs and trade


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International Shipping

Consider the following issues: Customs searches

Costs incurred by customs

Delays caused by customs

All tariffs Legal and regulatory issues


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Language Concerns

As you develop an e-commerce site, considerthe following issues:

The language(s) used by the target

audience

The characters necessary (e.g.,alphanumeric, mathematical or currency

symbols)

Character sets and languages

Computers can use different character sets Unicode


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Relationship Management

Building trust Quality customer service

Frequent contact

Customer self-service

Automatic order tracking

Unattended choice

Order customization


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Lesson 12 Summary

Lesson 12 Ecommerce Practices

See Skills Review

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12-ecommerce