Nearly every business is concerned with collecting payment for the goods and services it sells. This software plug-in contains a consumer’s digital certificate, shipping and other account information. 997E018. Often the person using the browser can specify how the information will be presented. Given such radical innovations in technology, the boundaries between brick-and-mortar retailers and e-retailers are expected to blur even more. The successful management of extreme market and spiked-demand has, therefore, become the new focus area, optimizing the supply chain management process for these companies and playing a critical role in ensuring efficient and faster delivery models. Topologies for electronic cooperation. According to Gartner, 50% of consumers in mature markets will use smartphones or wearable-tech for making mobile payments by 2018. PDF has been adopted by a number of organizations, including the Internal Revenue Service for tax forms. Applegate, L. M., C. W. Holsapple, R. Kalakota, F. J. Rademacher, and A. E-commerce software 3. Electronic data interchange (EDI), e-mail, and hypertext text transfer protocol (HTTP) are examples of messaging software. Shopify. Exhibit 5.: Electronic commerce infrastructure. Computers can communicate with each other when they speak a common language or use a common communication protocol. According to Forrester’s mobile payments forecast 2016-2021, mobile payments in the EU-7 are expected to rise at a CAGR of 19% to reach $148 billion by 2021. PDF documents can be sent as e-mail attachments or accessed from a Web application. The reverse process, decryption, converts a seemingly senseless character string into the original message. HTML is a markup language , which means it marks a portion of text as referring to a particular type of information.6 HTML does not specify how this is to be interpreted; this is the function of the browser. Unarguably, Shopify is one of the most popular and highly preferred web technologies … This involves the transaction of goods and services, the transfer of funds and the exchange of data. For e-commerce businesses, AI technology is becoming increasingly important since it holds the potential for dynamic and adaptable targeting, which helps companies get the right pitch, at the right time, to the right customer, on the right platform. IP numbers are difficult to recall. It contains a person’s name, a serial number, expiration date, a copy of the certificate holder’s public key (used for encrypting and decrypting messages and verifying digital signatures), and the digital signature of the certificate-issuing authority so that a recipient can verify that the certificate is real. fast food, parking, public transport tickets). Adding a PIN number to a smart card can raise its security level. They have to abandon existing business practices to create new ways of interacting with stakeholders. All electronic money systems are potentially divisible. SET should reduce consumers’ fears of purchasing over the Web and increase use of credit cards for electronic shopping. Post-Modernism and the Web: Societal effects. Thus, the business services layer supports secure transmission of credit card numbers by providing encryption and electronic funds transfer. In the first chapter, we argued that organizations need to make a metamorphosis. This chapter will provide you with the wherewithal to understand the technology that enables an organization to make this transformation. A recent survey in the United States showed that almost 80 percent of the information flow between firms is on paper. In 2016, companies such as German online retailer Zalando had 90% of sales via its mobile app, while UK’s Shop Direct achieved 62% of total sales on the mobile platform. This facility provides an additional level of security for consumers, banks, and credit card issuers, because it significantly reduces the ability of unscrupulous merchants to establish a successful Web presence. Find out what Amazon does, what makes it different from other e-commerce Web sites and how its technology infrastructure supports its multi-pronged approach to online sales. This chapter will provide you with the wherewithal to understand the technology that enables an organization to make this transformation. TCP handles the transport of data, and IP performs routing and addressing. Similarly, Infinite Analytics delivers AI-powered personalization solutions by interacting with users through text and voice messages, while also being able to identify and find products based on pictures. These methods of restricting access and encoding are still appropriate. Researchers predict e-commerce will be 17 percent of U.S. retail sales by 2022, according to Digital Commerce 360. However, the Internet will enable these smaller companies to take advantage of EDI. Forrester also predicts that in-person mobile payments will become a fast-growing segment, while remote mobile payments will constitute over 65% of mobile payments by 2021. Security is an eternal concern for organizations as they face the dual problem of protecting stored data and transported messages. A public-key encryption system has two keys: one private and the other public. Reading, MA: Addison-Wesley. The creator of a Web site often wants to remember facts about you and your visit. According to 2015 estimates, warehouse-focused companies increased investments by 8%, crossing $1 billion in total investments. The various approaches to electronic money vary in their capability to solve these concerns (see Exhibit 19). Anticipatory shipping is the closest e-commerce can come towards clairvoyance. iQCVAwUBMeRVVUblZxMqZR69AQFJNQQAwHMSrZhWyiGTieGukbhPGUNF3aB qm7E8g5ySsY6QqUcg2zwUr40w8Q0Lfcc4nmr0NUujiXkqzTNb 3RL41w5x fTCfMp1Fi5Hawo829UQAlmN8L5hzl7XfeON5WxfYcxLGXZcbUWkGio6/d4r 9Ez6s79DDf9EuDlZ4qfQcy1iA==G6jB. Delivery (using drones to deliver shipments). What’s more, tech features are giving entrepreneurs the ability to … Digital certificates uniquely identify the parties to a transaction. Exhibit 6. In today’s hyper-commoditized market, where differentiating a business from the likes of giants like Amazon, Alibaba, and Flipkart, is becoming increasing difficult; e-commerce vendors are focusing on providing a superior customer experience. Because it is a general transport system for electronic information, the Internet can carry a wide range of confidential information (financial reports, sales figures, marketing strategies, technology reports, and so on). Commerce constitutes the exchange of products and services between businesses, groups and individuals and can be seen as one of the essential activities of any business. Firms following the same standard can electronically share data.  As technology continues to evolve, expect the e-commerce industry to reach unmatched levels of growth by 2020. A smart card combines many functions into one card. The Internet is a packet switching network. Ecash can be used for everyday Internet transactions, such as buying software, receiving money from parents, or paying for a pizza to be delivered. While an intranet may not directly facilitate cooperation with external stakeholders, its ultimate goal is to improve an organization’s ability to serve these stakeholders. A signed message has additional encrypted text containing the sender’s signature (see Exhibit 18). Bad checks are no longer a problem because the seller’s account balance is verified at the moment of the transaction. Harvard Business School, 9-198-006. Secure Sockets Layer (SSL) was created by Netscape for managing the security of message transmissions in a network. Consider the case of a book seller with an on-line catalog (see Exhibit 6). There is still a need to consider addressability (i.e., a URL) and have a common language across the network (i.e., HTTP and HTML). In contrast to the free form of e-mail messages, EDI supports the exchange of repetitive, routine business transactions. The major shortcoming of credit cards is that they do not support person-to-person transfers and do not have the privacy of cash. The transaction is then electronically transmitted to an intermediary (usually the banking system), which transfers the funds from the buyer’s account to the seller’s account. An organization that simply wants to publicize its products and services may operate a simple firewall with limited screening rules. E-commerce is a popular term for electronic commerce or even internet commerce. A sender’s private key is used to create a signed message . Also, how do you know that the key’s receiver will protect its secrecy? Oracle Commerce holds 0.36% of the ecommerce market share. Digital supply chain. A cookie is a small file (not more than 4k) stored on your hard disk by a Web application. Backed by major credit card companies, MasterCard and Visa, SET is designed to offer a high level of security for Web-based financial transactions. Without a secure means of transmitting payment information, customers and merchants will be very reluctant to place and receive orders, respectively. A digital signature is used to guarantee a message sender’s identity. To counteract this possibility, encryption can be used to obscure the meaning of data. A popular form of encryption, readily available to Internet users, goes by the name of Pretty Good Privacy (PGP) and is distributed on the Web. Want to keep track of emerging technology changes in a different industry? The receiver then applies the sender’s public key to verify the signature (see Exhibit 17). Engagement with Content. So, why worry about sending your credit card number over the Internet? Other servers can be enabled by using Netscape’s SSLRef program library, which can be downloaded for noncommercial use or licensed for commercial use. If senders and receivers cannot be sure that their communication is strictly private, they will not use the Internet. PDF is a page description language that captures electronically the layout of the original document. Digital cash is an electronic parallel of notes and coins. Artificial intelligence. 1996. Thus, the Internet is well-suited to communicating with a wide variety of stakeholders. Traditional encryption, which uses the same key to encode and decode a message, has a very significant problem. Any money system, real or electronic, must have a reasonable level of security and a high level of authentication, otherwise people will not use it. Any computer connected to the Internet can communicate with any server in the system (see Exhibit 5). Here are the five emerging technologies that will impact e-commerce the most. C) On-demand service firms are fueling the growth of local e-commerce. When the purported sender’s public key is applied to this message, the identity of the sender can be verified (it was not the President). Electronic commerce: building blocks for new business opportunity. And with the rolling out of 4G connectivity in mobile networks, users the world over are beginning to experience a faster and more reliable mobile internet experience – which in turn is giving rise to mobile commerce. TCP/IP has two parts. Warehouse management (robot technology for collaborative automated order picking), Infrastructure (deploying drones to inspect bridges), and. Stored-value cards are likely to be in widespread use in the United States within five years. There is always some chance that people will circumvent authentication controls and gain unauthorized access. and then you make the pay… Communication is confined to the computers linking the two organizations. "We used to be a pizza company that sells online and we needed to become an e-commerce company that sells pizza," Dennis Maloney, Domino's chief … 1996. Emerging economies, on the other hand, are still based in cash, however, they too are rapidly moving towards digitization. This layer consists of software for sending and receiving messages. The E Commerce Notes Pdf – ECommerce Pdf Notes book starts with the topics covering Electronic Commerce-Frame work, Consumer Oriented Electronic commerce, Electronic payment systems, Inter Organizational Commerce, lntra Organizational Commerce, … Transmission Control Protocol/Internet Protocol (TCP/IP) is the communication network protocol used on the Internet. And as mobile penetration increases, along with better quality services, this trend is assured to grow. Routing is the process of determining the path a message will take from the sending to the receiving computer. As more people embrace digital technologies, companies are betting on innovative technologies to capture more customers and create differentiated experiences online. The principal purpose of this layer is to support common business processes. In the case of fraud in the U.S., banks already protect consumers, who are typically liable for only the first USD 50. The main advantages of EDI are: Despite these advantages, for most companies EDI is still the exception, not the rule. Kalakota, R., and A. An IP address is a unique 32-bit number consisting of four groups of decimal numbers in the range 0 to 255 (e.g., They realized that in order to promote electronic commerce, consumers and merchants would need a secure, reliable payment system. This is further expected to give a boost to cashless payment modes and, in turn, lead to inflating e-commerce sales. A smart card can serve as personal identification, credit card, ATM card, telephone credit card, critical medical information record and as cash for small transactions. The idea of an extranet derives from the notion that each business has a value chain and the end-point of one firm’s chain links to the beginning of another’s. How do you securely distribute the key? For instance, if you want to e-mail a confidential message, you can simply obtain the sender’s public key and encrypt your entire message prior to transmission. In the first chapter, we argued that organizations need to make a metamorphosis. The following set of steps illustrates SET in action. Shopping cart software 2. Amazon patented a “method and system for anticipatory shipping” in 2013. AI-powered technologies have great potential in optimizing search through … A cookie is the mechanism for remembering details of a single visit or store facts between visits. Ensuring on-time delivery is a key differentiating factor for companies in the e-commerce space. A means to accomplish this has been to use technology that drives a high degree of personalization, such that each customer is treated as an individual target segment, rather than a part of a generalized mass. Cookies are a useful way of collecting data to provide visitors with better service. As smart cards are likely to have a unique serial number, consumers can limit their loss by reporting a stolen or misplaced smart card to invalidate its use. The U.S. will spend about $460 billion online in … Convenience is an essential value proposition associated with e-commerce. Promotion: Integrated Web communications, 5. Because routing is dynamic, packets of the same message may take different paths and not necessarily arrive in the sequence in which they were sent. Certain e-commerce platforms such as BigCommerce and Shopify utilize innovative technologies to provide sellers greater transparency over various operations like marketing and logistics. Electronic commerce requires participants to have a secure means of transmitting the confidential data necessary to perform a transaction. In an earlier time, messages were sealed with the sender’s personal signet ring–a simple, but easily forged, method of authentication. Faster, efficient and secure payment options have played a big role in driving the unprecedented growth of the e-commerce market in recent years. These various technologies created a layered, integrated infrastructure that permits the development and deployment of electronic commerce applications (see Exhibit 9). The main standard used in the U.S. and Canada is known as ANSI X.12, and the major international standard is EDIFACT. Contact us at Frontiers of electronic commerce . Two forms of protecting electronic transactions are SSL and SET. The combination of SSL and fraud-detection software has so far provided low-cost, adequate protection for electronic commerce. A structured, standardized data format is used to exchange common business documents (e.g., invoices and shipping orders) between trading partners. Parts of the telephone system still operate as a circuit-switched network. The Automatic Teller Machine (ATM), credit cards, telephone backing etc are all technologies used within E-Commerce. In order to succeed, SET must displace the current standard for electronic transactions, SSL, which is simpler than SET but less secure. A proposed revision, due in 1999, will extend SET to support business-to-business transactions, such as inventory payments. EFT is flexible; it can handle high volumes of consumer and commercial transactions, both locally and internationally. The receiver’s private key, the only one that can decrypt the message, must be kept secret to permit secure message exchange. Each link of a predetermined bandwidth is dedicated to a predetermined number of users for a period of time. The provider is then assured that it is servicing paying customers. Most EDI traffic has been handled by value-added networks (VANs) or private networks. For more information, check out our Privacy Policy. The major advantage of packet switching is that it permits sharing of resources (e.g., a communication link) and makes better use of available bandwidth. There is a need, however, to adapt some systems so that transactions can be automated. Naturally, any messages between the service and the client should be encrypted to ensure that others do not gain from the information. While not all markets may be as technologically advanced in the retailing areas as China and South Korea, many retail and manufacturing businesses around the world can benefit from a more proactive e-commerce strategy, as technology enabled solutions become even more sought after and preferred. Anticipatory shipping definitely has the power to save the customer a lot of valuable time and effort as they are set free from mundane tasks such as shopping for household essentials and having to travel to markets. Here are some Oracle Commerce facts: Most companies that use Oracle Commerce are in the retail, computer software, and information technology niche. A banking system has one or more common clearinghouses that facilitate the flow of funds between accounts in different banks. Exhibit 8. A smart card, containing memory and a microprocessor, can store as much as 100 times more data than a magnetic-stripe card. Although encryption is primarily used for protecting the integrity of messages, it can also be used to complement data access controls. A payment gateway application translates SET messages for the existing payment system to complete the electronic transaction. The provider might want to verify that any e-mail requests it receives are from subscribers. Then, the amount of the transaction is transferred to the reader, and the value of the card is reduced by the transaction amount. However, these are built upon the previous layer, in the case of a URL, or at a higher level, in the case of HTML. Once multimedia capability is added to the information exchange equation, then a new class of applications can be developed (e.g., educating the other partner about a firm’s purchasing procedures). It is not as secure as the other alternatives, but most people are likely to carry only small amounts of digital cash and thus security is not so critical. You must find another secure medium for transmitting the key. Electronic commerce topologies. Electronic funds transfer (EFT), introduced in the late 1960s, uses the existing banking structure to support a wide variety of payments. It permits organizations to publish a full range of text and multimedia. Not only does the mobile strategy give e-tailers a direct sales channel between the e-tailer and the customer, but it also acts as a branding tool that is perennially close to the customer. A PDF document can include links to a HTML document, and vice versa. Redefining the Consumer Shopping Experience: E-commerce industry has … When the customer places an order, the Web browser should automatically encrypt the order prior to transmission–this is not the customer’s task. Technologies are no doubt creating an impact on e-commerce businesses giving sellers various opportunities and advantages. Alternatively, a firm that wants to share sensitive data with selected customers may install a more complex firewall to offer a high degree of protection. While desktop still beats mobile devices as the primary method consumers use to make eCommerce purchases, that won’t last long. The payment gateway is the bridge between SET and the existing payment network. Paper handling costs are substantially reduced. Exhibit 13.: Encryption with a public-key system. You may unsubscribe from our communications at any time. Think of a digital certificate as an electronic credit card. Encryption is the process of transforming messages or data to protect their meaning. Imagine you pay USD 1,000 per year for an investment information service. The stored-value card, the most common application of smart card technology, can be used to purchase a wide variety of items (e.g,. Also, a number of leading software companies are working on extensions to HTML that will give the creator greater control of the rendering of HTML (e.g., specifying the font to be used). Electronic currency must be spendable in small amounts (e.g., less than one-tenth of a cent) so that high-volume, small-value Internet transactions are feasible (e.g., paying 0.1 cent to read an article in an encyclopedia). Encryption scrambles a message so that it is meaningful only to the person knowing the method of encryption and the key for deciphering it. The multimedia capability of the Internet creates an opportunity for new applications that spawn a qualitatively different type of information exchange within a partnership. Either B2B or B2C, the role of technology is the base and the existential factor when it comes to E-commerce industry. Secure Electronic Transaction (SET) is a financial industry innovation designed to increase consumer and merchant confidence in electronic commerce.