LESSON 1 - 4 E COMMERCE PDF

Republic of the Philippines CAVITE STATE UNIVERSITY Imus Campus Cavite Civic Center, Palico IV, Imus City, Cavite Department of Management E – Commerce and Internet Marketing Compiled by: Kristine Anne S. Villanueva, MBA Module No.: 1...

Republic of the Philippines CAVITE STATE UNIVERSITY Imus Campus Cavite Civic Center, Palico IV, Imus City, Cavite Department of Management E – Commerce and Internet Marketing Compiled by: Kristine Anne S. Villanueva, MBA Module No.: 1 Module Title: E – Commerce and Internet Marketing I. Scope This course parallels the study of basic marketing and explores key marketing concepts in the context of today's digital/Internet environment. It fills the gap for those who have found Internet Marketing studies, which suffers from too much “E” and not enough marketing or are too narrowly or technically focused on e-commerce. This course will introduce the student to many marketing uses of the Internet. Featured are both discussions of E-Marketing strategy and practice with Web page authoring skills. Projects range from solving e-marketing problems to interviewing a professional and creating a Web site. The student will be exposed to the development or evaluation of a strategic marketing plan for a product or product mix offering on the Internet and development or evaluation of the company’s e-strategy and web site. Lesson 1 Introducing E Commerce Topic 1 How has internet changed marketing? Topic 2 E commerce vs Internet Marketing Topic 3 Types of E Commerce Lesson 2 Information and Communication Technology Topic 1 The Evolution of World Wide Web Topic 2 The Nature of Hardware and Software Lesson 3 The Nature of E-Payment System and relating in Electronic Commerce Topic 1 The concept of Electronic Payment System Topic 2 Advantages and Disadvantages of Various Payment Options Topic 3 The Point of Sales (POS) System Topic 4 The Credit Card System Topic 5 Digital Currency and Electronic Wallet Lesson 4 Electronic Security Measure Topic 1 Concept of Electronic Security Topic 2 eBusiness Security Concerns Topic 3 Password Provisions and Encryption Systems Topic 4 Hackers and the Hacking Process Topic 5 Spamming and Firewall Lesson 5 Mobile Commerce Topic 1 M - Commerce Topic 2 The Evolution of Telephone Technology Topic 3 Wireless versus Wired Systems Topic 4 The Concept of Mobile Commerce Topic 5 Pocket PCs versus Wired Systems Topic 6 Wireless Fidelity Topic 7 Legal Risks in Mobile Commerce Lesson 6 Electronic Business Options Topic 1 Contextualizing eBusiness Topic 2 Components of eBusiness Topic 3 Back end and Front end of Business Topic 4 Advantages and Disadvantages of eBusiness Topic 5 Types of eBusiness Models Topic 6 Products Suitable for eBusiness Options Lesson 7 Online Business Models Topic 1 Storefront Model Topic 2 Auction Model Topic 3 Portal Model Topic 4 Online Shopping Mall Lesson 8 Descriptive Statistics Lesson Number: 1 Lesson Title: Introducing the E - Commerce I. Objective At the end of the topic session, the students should be able to: Explain the evolution of internet and marketing; Distinguish E-Commerce and internet; and Determine the different types of E-Commerce available II. Discussions How has the internet transformed marketing? A. Websites Anyone can set up a website now, which has given businesses an easy way to reach their target audience and explain how their products and services can solve their problems. When someone recognizes a want or need, their search for the solution will often begin online. In 2014, research found that 81% of shoppers conduct online research before making a purchase. If your company hasn’t got a website, your target audience are unlikely to find out. As consumers we’re quite lazy and want businesses to provide us with all the information for us to peruse at our leisure, rather than us having to go through the yellow pages, or walk up and down the high street trying to find someone who sells what we’re looking for. In fact, we don’t even want to work that hard to find information when we’re searching for it on the internet from the comfort of our home. B. Reviews The research process often involves reading or watching reviews from professionals and fellow consumers to help us evaluate which product is best for us. A study in 2014 found that 61% of people read product reviews before making a purchase. There are multiple places we can find reviews for products we’re searching for, including: Websites that sell the product / service – both your actual website, and third-party sites you may sell through like Amazon or Etsy Impartial review sites like TripAdvisor, or Yell Social media Blogs YouTube Search Engines All of these things allow us to figure out which product will meet our need, and we will probably spend more time watching reviews than actually looking at the product on the seller’s website. On top of all of this, businesses now need to make sure that they have a responsive website to fit the demands of consumers. In the UK, the smartphone is the most popular device people use to access the internet. Those businesses who don’t keep up and have a responsive website could find themselves falling behind. C. E – Commerce  Without the internet you couldn’t: order presents online, buy a DVD cheaper than it’s sold for in physical stores, buy a book and begin reading it in seconds, or order takeaway food without having to speak to someone on the other end of the phone. The internet has allowed business owners to escape the risk and expensive costs of owning a physical shop. A website is cheaper in comparison, and allows businesses to reach more people. Physical stores are geographically restricted, but on the internet, you can reach and sell to people all over the globe. On top of that, you can sell or receive enquiries 24/7. For business owners, a website is an absolute no brainer. Why wouldn’t you want to be able to receive orders outside of business owners and not be restricted by your location? Business can reach more people, and customers can shop without leaving the house – everyone’s a winner D. Social Media Social media provides businesses with yet another way to reach, target, and communicate with their audience. As well as allowing businesses to communicate with their audience, it’s another way of encouraging your audience to visit your website. Businesses can also use social media as a customer service method, meaning they can quickly address and resolve issues without the customer having to send an email or make a phone call. As well as helping individual customers with their issue, it can also make the company look good if they handle it particularly well.  Social commerce even allows people to buy a product without even visiting the businesses website E. Email Marketing While email was certainly around long before the internet, email marketing as we know it today wouldn’t exist without the internet. Without it, how would businesses collect contact information? Email marketing has evolved to allow businesses to do a lot, such as: Letting customers know about special offers Introducing new products and services Making personalized recommendations based on previous purchases or searches Share tips to get more out of a product and service Encourage customers to leave reviews and refer others Invite people to events F. Analytics One of the best things about using the internet for marketing is that you can nearly always track your activities and ask yourself ‘so what?’ This means businesses can easily identify what activities are working well, which ones aren’t, which helps them to learn more about their audience and market to them better. G. Advertising The first advertising banner went live in 1994, and Google AdWords was born in 2000, allowing businesses to advertise and reach their target audience based on the keywords they searched for and the websites they visited. Online advertising isn’t limited to search engines and websites anymore, adverts are now found on:  Social networks In apps Music streaming services, like Spotify On devices – Amazon’s Kindle Fire shows adverts on the lock screen unless you pay to remove them What is the difference of E – Commerce and Internet Marketing? E – Commerce E-commerce, short for electronic commerce, is a business transaction that occurs over an electronic network such as the Internet. Anyone with access to a computer or mobile device, an Internet connection, and a means to pay for purchased goods or services can participate in e-commerce. Three types of e-commerce are business-to-consumer, consumer-to-consumer, and business-to-business. Business-to-consumer (B2C) e-commerce consists of the sale of goods and services to the general public. For example, Apple has a B2C Web site. Instead of visiting a retail store to purchase an iPod, for example, customers can order one directly from Apple’s Web site. E-retail, short for electronic retail, occurs when businesses use the Web to sell products. A customer (consumer) visits an online business through an electronic storefront, which contains product descriptions, images, and a shopping cart. The shopping cart allows the customer to collect purchases. When ready to complete the sale, the customer enters personal data and the method of payment, which should be through a secure Internet connection. Consumer-to-consumer (C2C) e-commerce occurs when one consumer sells directly to another, such as in an online auction. With an online auction, users bid on an item being sold by someone else. The highest bidder at the end of the bidding period purchases the item. eBay is one of the more popular online auction Web sites. As an alternative to entering credit card, bank account, or other financial information online, some shopping and auction Web sites allow consumers to use an online payment service such as PayPal or Google Checkout. To use an online payment service, you create an account that is linked to your credit card or funds at a financial institution. When you make a purchase, you use your online payment service account, which transfers money for you without revealing your financial information. Most e-commerce, though, actually takes place between businesses, which is called business-to-business (B2B) e-commerce. Many businesses provide goods and services to other businesses, such as online advertising, recruiting, credit, sales, market research, technical support, and training. Internet Marketing Internet Marketing is a type of marketing that can done electronically through websites or any other online tools or resources. A common and well known example of Internet Marketing is Google Adword by which you can promote your products or website. There are many methods for internet marketing, paid methods and free methods. While in Electronic-Marketing, online marketing plays a major part. There is a variety of internet marketing including; direct email, blogs, banners, videos, images, search engines, social media, ads, Text/SMS messaging and other many ways can be used for internet marketing. Therefore, companies build their websites and promote their business or any product. Lesson Number: 2 Lesson Title: Information and Communication Technologies I. Objective At the end of the topic session, the students should be able to: Explain evolution of World Wide Web Determine the difference between Hardware and Software Explain the concepts of Computer Networks II. Discussions: The Evolution of World Wide Web There is a good deal of information available online about the significance that the World Wide Web holds for the functioning of society, economics, and technology. It is nearly impossible to imagine daily life without the World Wide Web, is it not? The web drives virtually everything from eCommerce and entertainment to education, and more. So how well-versed are you with the story of how the web came to grab center stage in modern society? Most of us think of the WWW and the internet to be synonymous in nature. Although closely linked to each other, there is a difference between the two. While the World Wide Web is a layer using different protocols on the internet, the internet facilitates global communication between devices. While Tim-Berners Lee founded the World Wide Web, several visionaries have contributed towards helping it reach critical mass and dominate the functioning of human societies, as it does today Global Penetration It started shortly after the curtains were drawn on the Second World War, in 1946. Back then, the idea of the World Wide Web was floated in the form of a short story by Murray Leinster. However, it took nearly three and a half decades before this idea was envisioned and executed by Tim Berners Lee. The first web browsers appeared in the early 1990s, with the earliest introduced at CERN in 1991. With the advent of the earliest website, the first online banner advertisements were released in 1994. The web became mainstream in the latter half of the 1990s, while the rise and fall of the dot-com bubble occurred in the early years of the new millennium. The race for the best social network began simultaneously, culminating in the web going mobile. See the infographics: https://866953.smushcdn.com/1927678/wp- content/uploads/2019/10/infographic4-01.jpg?lossy=1&strip=1&webp=1 The Nature of Hardware and Software Software is a general term used to describe a collection of computer programs, procedures, and documentation that perform some tasks on a computer system. Practical computer systems divide software systems into three major classes: system software, programming software, and application software, although the distinction is arbitrary and often blurred. Software is an ordered sequence of instructions for changing the state of the computer hardware in a particular sequence. Software is typically programmed with a user-friendly interface that allows humans to interact more efficiently with a computer system.  Hardware is best described as a device, such as a hard drive, that is physically connected to the computer or something that can be physically touched. A CD-ROM, computer display monitor, printer, and video card are all examples of computer hardware. Without any hardware, a computer would not function, and software would have nothing to run on. Hardware and software interact with one another: software tells hardware which tasks it needs to perform. Hardware Software Definition Devices that are required Collection of instructions to store and execute (or that enables a user to run) the software. interact with the computer. Software is a program that enables a computer to perform a specific task, as opposed to the physical components of the system (hardware). Types Input, storage, processing, System software, control, and output Programming software, devices. and Application software. Functions Hardware serves as the To perform the specific delivery system for task, you need to complete. software solutions. The Software is generally not hardware of a computer is needed to for the hardware infrequently changed, in to perform its basic level  comparison with software tasks such as turning on and data, which are “soft” and responding to input. in the sense that they are readily created, modified, or erased on the computer. Examples CD-ROM, monitor, printer, QuickBooks, Adobe video card, scanners, label Acrobat, Google Chrome, makers, routers and Microsoft Word, Microsoft modems. Excel, Apple Maps Interdependency Hardware starts To deliver its set of functioning once software instructions, Software is is loaded. installed on hardware. Failure Hardware failure is Software failure is random. Hardware does systematic. Software does have increasing failure at not have an increasing the last stage failure rate. Durability Hardware wears out over Software does not wear out time. over time. However, bugs are discovered in software as time passes. Nature Physical in nature Logical in nature. Lesson Number: 3 Lesson Title: The Nature of E Payment System and Relating in Electronic Commerce I. Objective At the end of the topic session, the students should be able to: Define concept of Electronic Payment System; Identify the Advantages and Disadvantages of Various Payment Options; Explain how Credit Cards system works Assess and explain the difference between the digital currencies available Il. Discussion The Concept of Electronic Payment System In a contract of sale, the merchants sell the goods to customers and customers pay the price. In offline in the world, the payments are made with cash or through cheque. In online sales, accepting payment is a crucial aspect of the transaction, E-payment system is becoming central to e-commerce as companies look for ways to serve customers faster and at a lower cost. Emerging innovation in the payment for goods and services in electronic commerce promises to offer a wide range of new business opportunities. The growth in electronic banking and commerce is fueled by: - 1. An increasing number of internet users. 2. Reduce operational and processing cost due to improvement in technology 3. The affordability of high-performance technology  The term ‘electronic payment’ is a collective phrase for many different kinds of electronic-payment methods available and the processing of the transaction and their application within online merchants and eCommerce websites. All online business needs to be able to accept and process electronic payments in a fast and secure way. Electronic payment systems can also increase your cash flow, reduce administrative costs and labor and provide yet another way for your customers to pay. Care must be taken when choosing an electronic payment solution as it will need to fit within the constraint of your particular online business and integrate seamlessly within your website. Special features required in the payment system for eCommerce: If the one doing E-commerce, then it is obvious that there will be the use of an electronic payment system. To complete the transaction of eCommerce efficiency, electronic payment should possess the following special features. Anonymity– The payment system should be anonymous E-payment system should be designed in such a way that it could not be able to provide the information that can be used I trace the personal information of the customer. Security– The payment system should be secure. There should be no harm n threat to the user’s credit card numbers, smart card numbers, or other personal details. Overhead– The overhead cost should be optimum or minimum for the customer so that they can buy easily online without bothering the overhead costs. Transferability– This feature states that whether the payment can be carried out without the involvement of a third party. Divisibility– This means that a payment can be divided into arbitrary small payments whose sum is equal to the original payment.  Acceptability– The last but not least feature that an electronic payment system should possess is that the payment should be supported globally. Advantages and Disadvantages of Various Payment Options Advantages 1. Cash Instant money in hand, except taxes of course. There are no transaction fees with cash like there are with credit cards. Minimizes bookkeeping, which means less stress & less hassle. 2. Check Some customers prefer to pay with a check instead of carrying cash or using a credit card. Checks are also better to send in the mail for payments and invoices. Checks can now be processed electronically at the point of purchase much like a credit card but cost less to process in most cases. A check is usually better than a customer walking out the door because they don’t have cash or plastic. 3. Credit Cards Accepting credit cards boost sales. Accepting credit cards increase the cash flow. Accepting credit cards creates legitimacy. Disadvantages: 1. Cash Money in the drawer can be tempting for some employees to steal. A safe needs to be on-site or frequent trips to the bank for deposits must be made, which takes time and money.  Money at your location increases your risk for theft not just from employees but criminals as well. 2. Check Just because you have a check-in hand, that doesn’t guarantee payment. bounced checks can even cost you money. Depending on your bank, they may assess fees for these bounced checks. Checking accounts can be frozen, empty or even nonexistent. Customers can put stop payments on checks, close their account, and even post- date checks if the cashier is not paying attention. All of this delay payment. If your bank does not offer remote capture, you again will be spending time and money away from your business driving to the bank regularly. 3. Credit cards Credit Cards can add another level of difficulty to bookkeeping and accepting credit cards can be an added monthly expense in most cases. Credit cards do come with risks such as chargebacks and fraud. Refunds on credit cards are not immediate. 4. Mobile Payments You must have NFC equipment. No NFC hardware = no mobile wallet payments There are many mobile wallets out there, and they don’t all work the same, you will have to figure out which one is right for you. The rewards for the customer to use a mobile wallet are not 100% clear yet. The Credit Card System Cardholder A cardholder begins a credit card transaction by presenting his or her card to a merchant as payment for goods or services.  Merchant The merchant uses their credit card machine, software or gateway to transmit the cardholder’s information and the details of the transaction to their acquiring bank, or the bank’s processor. Acquirer / Processor The acquiring bank (or its processor) captures the transaction information and routes it through the appropriate card network to the cardholder’s issuing bank for approval. Visa / MasterCard Network MasterCard transaction information is routed between issuing and acquiring banks through MasterCard’s Banknet network. Visa transactions are routed through Visa’s VisaNet network. Issuer The credit card issuer receives the transaction information from the acquiring bank (or its processor) through Banknet or VisaNet and responds by approving or declining the transaction after checking to ensure, among other things, that the transaction information is valid, the cardholder has sufficient balance to make the purchase and that the account is in good standing. Visa / MasterCard Network The card issuer sends a response code back through the appropriate network to the acquiring bank (or its processor). Merchant The response code reaches the merchant’s terminal, software or gateway and is stored in a batch file awaiting settlement. The Digital Currency and Electronic Wallet  A digital wallet (or e-wallet) is a software-based system that securely stores users' payment information and passwords for numerous payment methods and websites. By using a digital wallet, users can complete purchases easily and quickly with near-field communications technology. They can also create stronger passwords without worrying about whether they will be able to remember them later. Digital wallets can be used in conjunction with mobile payment systems, which allow customers to pay for purchases with their smartphones. A digital wallet can also be used to store loyalty card information and digital coupons. Digital wallets largely eliminate the need to carry a physical wallet by storing all of a consumer's payment information securely and compactly. Also, digital wallets are a potential boon to companies that collect consumer data. The more companies know about their customers' purchasing habits, the more effectively they can market to them. The downside for consumers can be a loss of privacy. Digital wallets allow many in developing nations to participate more fully in the global financial system. Digital wallets allow participants to accept payments for services rendered, as well as receive funds or remittances from friends and family in other nations. Digital wallets do not require a bank account with a physical firm or branch, often allowing those in unbanked and underbanked communities, such as Black and Latinx neighborhoods and low-income or rural areas, to be served as well and therefore enables a wider financial inclusion. Example of Using a Digital Wallet While a handful of top digital wallet1 companies in 2020 included Due, Apple Pay, Google Wallet, Samsung Pay, PayPal, Venmo, Alipay, Walmart Pay, Dwolla, Vodafone-M-Pesa, – among others – the top 3 leading E-Wallets are those of Google, Amazon and Apple. As one example, Google's Wallet service allows its users to “store” cash on their phones. Customers can spend this cash both in-store, as well as online at businesses that accept Google payments. As noted above, this is supported by near field communication technology (the ability to enable two smart devices to communicate if they are in close range). If a business doesn’t currently accept Google's payment system, Google also recently developed a physical Wallet Card – essentially, a debit card connected with the Bank of Google. Recently, Google combined its two essential payment streams (Android Pay and Google Wallet) into a single service called Google Pay. Apple on the other hand entered into a strategic partnership with Goldman Sachs to issue Apple credit cards and expand its Apple Pay services.. Lesson Number: 4 Lesson Title: Electronic Security Measure I. Objective At the end of the topic session, the students should be able to: Explain the concept of E-Security Discuss the eBusiness Security Concerns Recognize and avoid the hackers in the business Apply the spamming and firewall concepts in the e-Business Il. Discussions Concept of Electronic Security Cyber security is the practice of defending computers, servers, mobile devices, electronic systems, networks, and data from malicious attacks. It's also known as information technology security or electronic information security. The term applies in a variety of contexts, from business to mobile computing, and can be divided into a few common categories. o Network security is the practice of securing a computer network from intruders, whether targeted attackers or opportunistic malware. o Application security focuses on keeping software and devices free of threats. A compromised application could provide access to the data its designed to protect. Successful security begins in the design stage, well before a program or device is deployed. o Information security protects the integrity and privacy of data, both in storage and in transit.  o Operational security includes the processes and decisions for handling and protecting data assets. The permissions users have when accessing a network and the procedures that determine how and where data may be stored or shared all fall under this umbrella. o Disaster recovery and business continuity define how an organization responds to a cyber-security incident or any other event that causes the loss of operations or data. Disaster recovery policies dictate how the organization restores its operations and information to return to the same operating capacity as before the event. Business continuity is the plan the organization falls back on while trying to operate without certain resources. o End-user education addresses the most unpredictable cyber-security factor: people. Anyone can accidentally introduce a virus to an otherwise secure system by failing to follow good security practices. Teaching users to delete suspicious email attachments, not plug in unidentified USB drives, and various other important lessons is vital for the security of any organization. Types of Cyber Threats 1. Cybercrime includes single actors or groups targeting systems for financial gain or to cause disruption. 2. Cyber-attack often involves politically motivated information gathering. 3. Cyberterrorism is intended to undermine electronic systems to cause panic or fear. Malware Malware means malicious software. One of the most common cyber threats, malware is software that a cybercriminal or hacker has created to disrupt or damage a legitimate user’s computer. Often spread via an unsolicited email attachment or legitimate- looking download, malware may be used by cybercriminals to make money or in politically motivated cyber-attacks. o Virus: A self-replicating program that attaches itself to clean file and spreads throughout a computer system, infecting files with malicious code. o Trojans: A type of malware that is disguised as legitimate software. Cybercriminals trick users into uploading Trojans onto their computer where they cause damage or collect data. o Spyware: A program that secretly records what a user does, so that cybercriminals can make use of this information. For example, spyware could capture credit card details. o Ransomware: Malware which locks down a user’s files and data, with the threat of erasing it unless a ransom is paid. o Adware: Advertising software which can be used to spread malware. o Botnets: Networks of malware infected computers which cybercriminals use to perform tasks online without the user’s permission. Safety Tips 1. Update your software and operating system: This means you benefit from the latest security patches. 2. Use anti-virus software: Security solutions like Kaspersky Total Security will detect and removes threats. Keep your software updated for the best level of protection. 3. Use strong passwords: Ensure your passwords are not easily guessable. 4. Do not open email attachments from unknown senders: These could be infected with malware. 5. Do not click on links in emails from unknown senders or unfamiliar websites: This is a common way that malware is spread. 6. Avoid using unsecure WIFI networks in public places: Unsecure networks leave you vulnerable to man-in-the-middle attacks. Hackers and Hacking Process 1. Reconnaissance Reconnaissance also called as the preparatory phase is the process in which the attacker obtains information about a target. NMAP, Maltego, Google Dorks, Hping, etc. are the tools that are commonly used in this process. Two Types: o Active reconnaissance: To interact with the target to collect information about the target. For example, using the Nmap tool to scan the target o Passive reconnaissance: gathering data about the target without accessing the target directly. This includes collecting social media data, public websites, etc. 2. Scanning The attacker starts actively testing a target computer or network in this process for vulnerabilities that can be exploited. Nessus, NMAP the tools used in this process. Types: o Port Scanning: It includes scanning the target for data such as open ports, services running on the host, live networks, etc. o Vulnerability Scanning: To check the target for exploitable bugs or vulnerabilities. It involves use automated software. o Network mapping: Find the network topology, firewall servers, routers, and host information and draw a network diagram with the information available. 3. Gaining Access The vulnerability is found in this step and hacker tries to exploit it to get into the system. Metasploit is the main tool used in this process. In order to track the devices connected  to the system, the hacker gains access to the network, device, and software and expands their user privileges. 4. Maintaining Access This is the process in which the hacker has already obtained access to a computer. The hacker activates some backdoors after obtaining access to penetrate the device when he wants access in the future in this proprietary system. The preferred method in this phase is Metasploit. 5. Clearing Tracks This phase is an unethical operation. No robber wants to be caught. An excellent hacker always removes all traces so that no one will find any evidence leading to him in the later stage of time. This includes corrupting, modifying, or deleting log values, Removing the cookies and cache, uninstalling all of the applications that he used, closing all the open ports, modifying the registry values, modifying the log files and deleting all of the folders that he made 6. Reporting The last step in completing the ethical hacking process is reporting. In this process, Ethical Hacker gathers a report with his results and the work that has been performed, such as the instruments used the rate of performance, vulnerabilities identified, and the processes of exploitation