E commerce
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The document provides a comprehensive overview of e-commerce, covering its history, applications, infrastructures, and various types such as B2B, B2C, and C2C. It highlights the advantages and disadvantages of e-commerce, as well as critical components and technologies required for successful implementation. Additionally, it discusses the trends, security measures, and payment systems essential for operating in the digital commerce landscape.
E commerce
- 1. E – Commerce •By: Prof. Ganesh Ingle
- 2. 2 Course Outline Overview of e-commerce The Internet and the WWW E-commerce software building blocks and tools Scalability, high-performance servers, web caching Basic cryptography Security, watermarking, firewalls Payment systems Current and future directions
- 3. 3 Electronic Commerce (E-Commerce) Commerce refers to all the activities the purchase and sales of goods or services. Marketing, sales, payment, fulfillment, customer service Electronic commerce is doing commerce with the use of computers, networks and commerce-enabled software (more than just online shopping)
- 4. 4 Brief History 1970s: Electronic Funds Transfer (EFT) Used by the banking industry to exchange account information over secured networks Late 1970s and early 1980s: Electronic Data Interchange (EDI) for e-commerce within companies Used by businesses to transmit data from one business to another 1990s: the World Wide Web on the Internet provides easy-to-use technology for information publishing and dissemination Cheaper to do business (economies of scale) Enable diverse business activities (economies of scope)
- 5. 5 E-commerce applications Supply chain management Video on demand Remote banking Procurement and purchasing Online marketing and advertisement Home shopping Auctions
- 7. Ecommerce infrastructure 7 Information superhighway infrastructure Internet, LAN, WAN, routers, etc. telecom, cable TV, wireless, etc. Messaging and information distribution infrastructure HTML, XML, e-mail, HTTP, etc. Common business infrastructure Security, authentication, electronic payment, directories, catalogs, etc.
- 8. The Main Elements of E-commerce 8 Consumer shopping on the Web, called B2C (business to consumer) Transactions conducted between businesses on the Web, call B2B (business to business) Transactions and business processes that support selling and purchasing activities on the Web Supplier, inventory, distribution, payment management Financial management, purchasing products and information
- 9. Advantages of Electronic Commerce 9 Increased sales Reach narrow market segments in geographically dispersed locations Create virtual communities Decreased costs Handling of sales inquiries Providing price quotes Determining product availability Being in the space
- 10. 10 Disadvantages of Electronic Commerce Loss of ability to inspect products from remote locations Rapid developing pace of underlying technologies Difficult to calculate return on investment Cultural and legal impediments
- 11. The process of e-commerce 11 1. Attract customers Advertising, marketing 2. Interact with customers Catalog, negotiation 3. Handle and manage orders Order capture Payment Transaction Fulfillment (physical good, service good, digital good) 4. React to customer inquiries Customer service Order tracking
- 12. Web-based E-commerce Architecture 12 •Client •Tier 1 •Web Server •Tier 3•Tier 2 •Tier N •Application Server •Database Server DMS
- 13. 13 E-commerce Technologies Internet Mobile technologies Web architecture Component programming Data exchange Multimedia Search engines Data mining Intelligent agents Access security Cryptographic security Watermarking Payment systems
- 14. Infrastructure for E-commerce 14 The Internet system of interconnected networks that spans the globe routers, TCP/IP, firewalls, network infrastructure, network protocols The World Wide Web (WWW) part of the Internet and allows users to share information with an easy-to-use interface Web browsers, web servers, HTTP, HTML, XML Web architecture Client/server model N-tier architecture; e.g., web servers, application servers, database servers, scalability
- 16. Types of e-commerce 16 B2B: E-commerce that is conducted between businesses is referred to as Business-to- business (1) open to the entire public or (2) limited to a group of businesses who have been part of the specific group Transaction cost reduced through reduction in search costs costs of processing transactions (e.g. invoices, purchase orders and payment schemes) cost in trading processes eliminating intermediaries and distributors increase in price transparency creates supply-side cost-based economies of scale
- 17. Types of e-commerce..contd… B2C Commerce commerce between companies and consumers involves customers gathering information; purchasing physical goods or information goods online retailing companies such as Amazon.com, Drugstore.com, Beyond.com, Flipkart.com, Lenskart.com reduces transactions costs increasing consumer access to information reduces market entry barriers 17
- 18. ..Contd… B2G e-commerce commerce between companies and the public sector use of the Internet for public procurement licensing procedures 18
- 19. ..Contd… C2C e-commerce commerce between private individuals or consumers online auctions auctions facilitated at a portal, such as eBay, which allows online real-time bidding on items being sold in the Web; peer-to-peer systems, such as the Napster model (a protocol for sharing files between users used by chat forums similar to IRC) and other file exchange and later money exchange models; and classified ads at portal sites such as Excite Classifieds and eWanted (an inter- active, online marketplace where buyers and sellers can negotiate and which features “Buyer Leads & Want Ads”). Consumer-to-business (C2B) transactions involve reverse auctions, which empower the consumer to drive transactions. A concrete example of this when competing airlines gives a traveler best travel and ticket offers in response to the traveler’s post that she wants to fly from New York to San Francisco. There is little information on the relative size of global C2C e-commerce. However, C2C figures of popular C2C sites such as eBay and Napster indicate that this market is quite large. These sites produce millions of dollars in sales every day 19
- 20. M-Commerce 20 buying and selling of goods and services through wireless technology handheld devices such as cellular telephones and personal digital assistants (PDAs) are used m-commerce will become the choice for digital commerce transactions bill payment and account reviews can all be conducted from the handheld devices consumers are given the ability to place and pay for orders on-the-fly delivery of entertainment, financial news, sports figures and traffic updates to a single mobile different server than that accessed by the regular online users allow users to book and cancel rail, flight, movie tickets through their mobile devices
- 21. M-Commerce..contd.. critical considerations for this strategy is the software solution that the organization uses ‘all in one’ device strategy vs individual device based technology banks can use cost effective virtual distribution channel Financial inclusion Greater reach across the population convenience without compromising security benefits are in terms of usage, reach, cost of installation, efforts and money for maintenance, upgradeability and sustainability 21
- 22. M commerce..contd.. address the needs of all the players (including regulatory requirements) solution is adopted that can be deployed fast, and can be scalable care of disparate systems, customized solutions and maintenance cost a platform that easily integrates new services and allows banks to be flexible allowing the bank to reap benefits from the full potential of the mobile commerce M commerce strategy requires a clear vision and objectives and not ‘one size fits all’ approach 22
- 23. Factors affecting e-commerce Major forces fuelling e-commerce economic forces, marketing and customer interaction forces, and Technology communications costs, low-cost technological infrastructure, speedier and more economic electronic transactions with suppliers, lower global information sharing and advertising costs, and cheaper customer service cost networking of corporations, suppliers, customers/clients, and independent contractors into one community Networking of the various departments within a corporation, and of business operations and processes 23
- 24. Factors affecting e-commerce..contd.. critical business information to be stored in a digital form retrieved instantly transmitted electronically connecting businesses (small, medium or large) to trading partners sourcing out supplies, buying and selling goods and services online in real time center for management of content and the processing of business transactions support services such as financial clearance and information services regional, vertical and industry-specific interoperable B2B e-markets across the globe 24
- 25. Factors affecting e-commerce..contd.. provide their target consumers with more detailed product and service information using e-commerce logistical and technological infrastructure to other retailers expertise in credit analysis tracking orders product comparison systems digitizing content, compression and the promotion of open systems technology convergence of telephone services, television broadcast, cable television, and Internet access 25
- 26. E-commerce components A corporate Web site with e-commerce capabilities A corporate intranet so that orders are processed in an efficient manner IT-literate employees to manage the information flows and maintain the e-commerce system Banking institutions that offer transaction clearing services National and international logistics cost-efficient transport of small and big packages critical mass of the population with access to the Internet and disposable income Firms/Businesses with order fulfilling capability 26
- 27. E-commerce components..contd.. A legal framework governing e-commerce transactions Legal institutions that would enforce the legal framework A robust and reliable Internet infrastructure; A pricing structure that doesn’t penalize consumers for spending time on and buying goods over the Internet global collection of networks connected to share information common set of protocols 27
- 28. E-commerce components 28 Important component of e-commerce based firm is the website website should have technology that will make it easier for its customers to navigate site should offer every single feature necessary fully-functional and sustainable ecommerce web site stable server for hosting provide customer specific services technology partners who constantly upgrade the features as well as technology help business partners such as logistics partners and suppliers to share and exchange business data Alternatively SaaS can be used for running these services (reduce cost)
- 29. Business transformation through e-commerce Linking stakeholders through e-commerce Supply chain management integration The product flow The information flow The finances flow Shared data in diverse database systems, data warehouse Sharing data “upstream” (with a company’s suppliers) and “downstream” (with a company’s clients) shared digital business infrastructure including integrated value chains e-business management model business policies consistent with e-commerce laws, teleworking/virtual work, distance learning, incentive schemes 29
- 30. E-COMMERCE APPLICATIONS: ISSUES AND PROSPECTS e-banking, e-tailing and online publishing/online retailing telephone banking, credit cards, ATMs E-commerce in developing countries Cash-on-delivery Bank payments electronic payment system Security issues in e-payment Factors the growth of e-banking in developing countries access to the Internet Inclination for banking over the internet access to high-quality products Security over internet 30
- 31. E-Commerce Software 31 Content Transport pull, push, web-caching, MIME Server Components CGI, server-side scripting Programming Clients Sessions and Cookies Object Technology CORBA, COM, Java Beans/RMI Visual Studio .NET 2005 (ORCAS, ASP.NET, … etc) Technology of Fulfillment of Digital Goods Secure and fail-safe delivery, rights management
- 32. System Design Issues 32 Good architectural properties Functional separation Performance (load balancing, web caching) Secure Reliable Available Scalable
- 33. 33 Cryptography Keeping secrets Privacy: interceptor cannot use information Authentication: sender’s identity cannot be forged Integrity: data cannot be altered Non-repudiation: sender cannot deny sending How to evaluate cryptography Secret key (symmetric) cryptography; e.g., DES Public key (asymmetric) cryptosystems; e.g, RSA Digital signatures, digital certificates Key management; e.g., PKI
- 34. 34 Public-Key Cryptography Encrypting and decrypting a message using public-key cryptography.
- 35. Basic terminology 1. Plaintext: original message to be encrypted 2. Ciphertext: the encrypted message 3. Enciphering or encryption: the process of converting plaintext into ciphertext 4. Encryption algorithm: performs encryption 5. Two inputs: a plaintext and a secret key
- 37. Deciphering or decryption: recovering plaintext from ciphertext Decryption algorithm: performs decryption Two inputs: ciphertext and secret key Secret key: same key used for encryption and decryption. Also referred to as a symmetric key Symmetric Cipher Model
- 38. Cipher or cryptographic system : A scheme for encryption and decryption Cryptography: Science of studying ciphers Cryptanalysis: Science of studying attacks against cryptographic systems Cryptology: cryptography + cryptanalysis Symmetric Cipher Model
- 39. Ciphers Symmetric cipher: same key used for encryption and decryption Block cipher: encrypts a block of plaintext at a time (typically 64 or 128 bits) Stream cipher: encrypts data one bit or one byte at a time Asymmetric cipher: different keys used for encryption and decryption
- 40. Security 40 Concerns about security Client security issues Server security issues Security policy, risk assessment Authentication methods Something you know: passwords Something you have: smart card Something you are: biometrics Firewalls, proxy servers, intrusion detection Denial of service (DOS) attacks, viruses, worms
- 41. 41 Payment Systems Role of payment Cash properties: wide accept, convenient, anonymity, un- traceability, no buyer transaction cost Online credit card payment, Smart Cards Secure protocols: SSL, SET Internet payment systems Electronic cash, digital wallets Micro-payments Wireless devices
- 42. Transactions Processing 42 Transactions and e-commerce Overview of transaction processing Transaction processing in e-commerce Keeping business records, audit, backup High-availability systems Replication and scaling Implementation
- 43. 43 Other System Components Taxes Shipping and handling Search engines Data mining Intelligent agents Inventory management, enterprise resource planning (ERP) Customer relation management (CRM)
- 44. 44 • SSL was first developed by Netscape in 1994 and became an internet standard in 1996 ( RFC 2246 – TLS V1.0) • SSL is a cryptographic protocol to secure network across a connection-oriented layer • Any program using TCP can be modified to use SSL connection Encryption and its types SSL Facts
- 45. 45 • SSL connection uses a dedicated TCP/IP socket(e.g. port 443 for https) • SSL is flexible in choice of which symmetric encryption, message digest, and authentication can be used • SSL provides built in data compression SSL Facts
- 46. 46 • Authenticate the server to the client • Allow the client and server to select cryptographic algorithms, or ciphers, that they both support • Optionally authenticate the client to the server • Use public key encryption techniques to generate shared secret • Establish an encrypted SSL connection SSL Usage
- 47. 47 SSL is a secure protocol which runs above TCP/IP and allows users to encrypt data and authenticate servers/vendors identity securely Application layer Transport layerTCP/IP layer SMTPSFTPSHTTPS SECURE SOCKET LAYER SSL
- 48. 48 SSL
- 49. 49 SSL Record Protocol Operation
- 52. 52 Cyber Cash
- 53. 53 Digital Cash
- 54. 54 Digital Cash
- 55. 55 SSL vs SET
- 56. 56 Hashing Hashing is an algorithm that calculates a fixed-size bit string value from a file. A file basically contains blocks of data. Hashing transforms this data into a far shorter fixed-length value or key which represents the original string. The hash value can be considered the distilled summary of everything within that file. A good hashing algorithm would exhibit a property called the avalanche effect, where the resulting hash output would change significantly or entirely even when a single bit or byte of data within a file is changed. A hash function that does not do this is considered to have poor randomization, which would be easy to break by hackers.
- 57. 57 Hashing A hash is usually a hexadecimal string of several characters. Hashing is also a unidirectional process so you can never work backwards to get back the original data. A good hash algorithm should be complex enough such that it does not produce the same hash value from two different inputs. If it does, this is known as a hash collision. A hash algorithm can only be considered good and acceptable if it can offer a very low chance of collision. Types of Hashing There are many different types of hash algorithms such as RipeMD, Tiger, xxhash and more, but the most common type of hashing used for file integrity checks are MD5, SHA-2 and CRC32.