BBA 7th Semester

Kasthmandap college of management

E-commerce
Unit-1 Introduction to E-commerce

1. Introduction It refers to the commercial transactions conducted

electronically on the Internet. E-commerce (electronic commerce)
is the activity of electronically buying or selling of products on
online services or over the Internet. Electronic commerce draws
on technologies such as mobile commerce, electronic funds
transfer, supply chain management, Internet marketing, online
transaction processing, electronic data interchange (EDI),
inventory management systems, and automated data collection
systems. E-commerce is in turn driven by the technological
advances of the semiconductor industry, and is the largest sector
of the electronics industry.
Modern electronic commerce typically uses the World Wide Web
for at least one part of the transaction's life cycle although it may
also use other technologies such as e-mail. Typical e-commerce
transactions include the purchase of online books (such as
Amazon) and music purchases (music download in the form of
digital distribution such as iTunes Store), and to a less extent,
customized/personalized online liquor store inventory services.
There are three areas of e-commerce: online retailing, electronic
markets, and online auctions. E-commerce is supported by
electronic business.
E-commerce businesses may also employ some or all of the
followings:
 Online shopping for retail sales direct to consumers via Web
sites and mobile apps, and conversational commerce via live
chat, chat bots, and voice assistants
 Providing or participating in online marketplaces, which
process third-party business-to-consumer (B2C) or consumer-
to-consumer (C2C) sales
 Business-to-business (B2B) buying and selling;
 Gathering and using demographic data through web contacts
and social media

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 Business-to-business (B2B) electronic data interchange

 Marketing to prospective and established customers by e-mail
or fax (for example, with newsletters)
 Engaging in pretail for launching new products and services
 Online financial exchanges for currency exchanges or trading
purposes.
Ecommerce, also known as electronic commerce or internet commerce,
refers to the buying and selling of goods or services using the internet,
and the transfer of money and data to execute these transactions.
Ecommerce is often used to refer to the sale of physical products online,
but it can also describe any kind of commercial transaction that is
facilitated through the internet.

The history of ecommerce begins with the first ever online sale: on the
August 11, 1994 a man sold a CD by the band Sting to his friend through
his website Net Market, an American retail platform. This is the first
example of a consumer purchasing a product from a business through
the World Wide Web—or “ecommerce” as we commonly know it today.
Some Example of e-commerce are
 Retail
 Whole sale
 Bropshipping
 Crowdfunding
 Subscription
 Physical products
 Digital products
 Service

Advantages of e-commerce:

1. Enhances convenience: Customers can make orders for goods

at their own convenience and from the comfort of their homes
without having to travel to the business premise. Orders are also
delivered to them at their most ideal locations. It’s the best
shopping option for people who are always busy.

2. Allows for product and price comparison: Again, when making

purchases, customers want to get the best deals. This business
model allows for product and price comparison by consumers so
that the best products are bought at the fairest prices. They can

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also enjoy extra benefits like discounts, coupons, items on sale

and also get the best deals.

3. Easy fund-raising for start-ups ventures: So many people have

the desire to venture into business but lack sufficient funds to set
up shop. Leasing a physical store can be quite expensive. E-
commerce makes it easier for start-ups to do business and grow.

4. Efficient: E-commerce has the advantage of being efficient.

Resources are used efficiently since most of the business services
are automated. Business owners sometimes spend a lot of
resources meeting business needs and this eats into profits. E-
commerce thrives on efficiency.

5. Customer reach: It’s easier to reach many customers on the

internet. Using social media links and good search engine
optimization strategies, an online business can increase brand
awareness and grow its customer base. It also has the advantage
of being able to connect buyers and sellers from all corners of the
globe.

6. Prompt payments: Payments are fast since online stores use

electronic or mobile transactions payment methods. The mobile
wallet system for merchant accounts drive up sales and increase
revenue generation.

7. Ability to sell different products: The flexibility of conducting

business over the internet makes it possible for entrepreneurs to
display and sell several products and also cater to a wider
demographic.

8. Low inventory: The online sellers do not have to maintain high

inventory. Once the get the orders, they can procure the goods
from the manufacturer or whole-seller to meet the demand. The

9. Minimizes the overall cost: Online business eliminates many

physical processes that are necessary for conducting traditional
businesses. Better resource planning, and the need for lower
number of sales personal, etc., helps in lowering the overall the
cost.

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Disadvantages of e-commerce
1. Poor quality products: You don’t physically see and inspect
whatever you are paying for before it’s delivered. Customers,
therefore, run the risk of falling victim to false marketing and
buying poor quality products from the virtual shop.

2. Impulsive purchases: Online stores display a large number of

products and due to the convenience of shopping, customers can
find themselves making bad financial decisions through impulsive
purchases.

3. Internet scammers: The internet is a good thing but some

people have decided to use it for all the wrong reasons. Scammers
have made this type of business model unattractive for some
consumers.

4. Lack of after sales support: As a result of lack of physical

premises, customers find it hard to access after sales support. It
can take up to several days before any help is accorded to a
customer in need.

5. Fast changing business environment: Technology evolves so

fast. Some entrepreneurs find it hard to keep up and lose a lot of
business in the process. This may make business growth
unattainable.

6. Loss of personal touch: Business is all about relationships. This

business model erodes the personal touch between a customer
and the business owner. Cultivating loyalty can thus be problems
since there are many such businesses that provide different
options.

7. Delivery of goods can get delayed: It takes time before the

goods ordered for are delivered. Sometimes the delivery delays
and this inconveniences the customer. This is different from
physical business premises where customers walk out with the
products bought.

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2. Elements of e-commerce
1. User Friendly
If your store is easy to navigate, you will have a greater chance of
making a sale from the start. The homepage should be inviting and
encourage visitors to click on products or categories of items they
are looking to purchase. Categories should be self-explanatory and
should be broken down into subcategories so visitors can quickly
find what they are looking for.

The search bar should be easy to find and quickly list all applicable
items that are currently available for sale once the user types in
their query.

2. Shopping Cart and Checkout Process

Adding items to the shopping cart should be simple. Color choices
or style preferences should be easy to view and select. Customers
like to view what they have in their cart while continuing to shop,
so make sure you have a design and functionality that makes it
easy.

Don't confuse users during checkout. Keep things basic and value
your customer's time. The shopper should feel confident shopping
on your website.

3. Mobile Compatibility
80% of all online adults own a Smartphone. Mobile visits, in many
cases now, outrank desktop use. Your e-commerce site needs to
be designed and built for all devices, not just a personal computer
or laptops.

4. Calls to Action (CTA)

Make sure to lead your customers through your site with calls to
action that are specific to what you want them to do. For example,
if you have a sale, your CTA button could be "Click Here to Save
20%!" It may be obvious to you and even to most people, but
there are still a lot of people out there that have lives, raised kids
or are raising kids, own or run businesses that don't spend much
time on the web. Adding that extra help builds confidence in your
business, shows that you care about your customers and helps to
make things less frustrating. Always avoid making your customer

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feel stupid because they not. If they are going to your website
they must be smart enough to buy from the best company out
there.

5. Images and Descriptions

When people are searching for a product to buy, they want to
know all the details about it before making their purchase.

Shopping online can have it's drawbacks because one cannot

physically see or touch the items they are looking at. Because of
this, it's important to have professional quality images of your
products and when applicable images from multiple angles, views,
and even context.

It is also important to thoroughly describe the items in detail.

Cover all aspects, including size, texture, uses, benefits, colors
available, etc. You want your potential customer to feel confident
that they know enough about your product to purchase it, instead
of going elsewhere.

6. Customer Support
Some sort of customer support needs to be available in case of
any problems or questions. There are several different types of
customer support, such as 800 numbers, email support, and
online chat. Decide which is the best choice for your budget and
type of business. Keep in mind to always be friendly and respond
in a timely manner to resolve any issues to keep your customers
happy.

7. Security and Privacy

Last but not least is security. Make sure you have an SSL certificate
installed to encrypt data coming and going to the browser. Today
every website, e-commerce or not, should have one. Also, have a
transparent privacy policy that tells your customers how their
information is used on your site and by your company.

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3. Traditional Commerce v/s E-Commerce

Sr. Traditional Commerce E-Commerce
No.

1 Heavy dependency on information Information sharing is made easy via electronic

exchange from person to person. communication channels making little dependency on
person to person information exchange.

2 Communication/ transaction are done in Communication or transaction can be done in

synchronous way. Manual intervention is asynchronous way. Electronics system automatically
required for each communication or handles when to pass communication to required
transaction. person or do the transactions.

3 It is difficult to establish and maintain A uniform strategy can be easily established and
standard practices in traditional maintain in e-commerce.
commerce.

4 Communications of business depends In e-Commerce or Electronic Market, there is no

upon individual skills. human intervention.

5 Unavailability of a uniform platform as E-Commerce website provides user a platform where

traditional commerce depends heavily on al l information is available at one place.
personal communication.

6 No uniform platform for information sharing E-Commerce provides a universal platform to support
as it depends heavily on personal commercial / business activities across the globe.
communication.

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Unit-2 Business Model for Ecommerce

The first thing that comes to our mind when we talk about ecommerce is
that it is an online commercial or sales transaction that takes place
between the supplier and the customer. While the idea of the concept is
right, there are more specific factors involved that categorize
ecommerce into six major types. Each of these types has different
features and attributes.

Typically, ecommerce business models can be divided into six major

types, such as:

 Business-to-Business (B2B)
 Business-to-Consumer (B2C)
 Consumer-to-Consumer (C2C)
 Consumer-to-Business (C2B)
 Business-to-Administration (B2A)
 Consumer-to-Administration (C2A)
 Business-to-government (B2G)
 Government-to-business(G2B)

Business-to-Business (B2B): This kind of ecommerce consists of all the

electronic transactions and dealings related to the goods and services.
These basically are conducted between companies and include
conventional wholesalers and producers dealing with retailers.

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Business-to-Consumer (B2C): The Business-to-Consumer ecommerce is

related to the transactions and relationship between businesses and the
end customers. This is mainly to do with the retail ecommerce trade that
takes place online. With the inception of the internet, B2C ecommerce
has evolved to a great extent. Today, we find scores of electronic
shopping sites and virtual stores on the web, that sell myriad products,
ranging from computers, fashion items to even necessities.

In this case, the customer has more info about the products in the form
of informative content and there is also a chance to buy products at
cheaper rates. Most times, quick delivery of the order is also maintained.

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Consumer-to-Consumer (C2C): This consists of electronic transactions of

products and services between two customers. These are mainly
conducted through a third party that provides an online platform for
these transactions. Sites, where old items are bought and sold, are
examples of C2C ecommerce.

Consumer-to-Business (C2B): In this, a complete reversal of the selling

and buying process takes place. This is very relevant for crowd sourcing
projects. In this case, individuals make their items or services and sell
them to companies. Some examples are proposals for company site or
logo, royalty free photographs, design elements and so on.

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Business-to-Administration (B2A): In this kind of ecommerce

transaction, there are dealings between companies and public
administration. It encompasses different services, such as social security,
fiscal measures, legal documents, employment and so on.

Consumer-to-Administration (C2A): In this ecommerce model,

electronic transactions are carried between individuals and public
administration. Some examples are distance learning, information
sharing, electronic tax filing, and so on.
Business - to - Government
B2G model is a variant of B2B model. Such websites are used by
governments to trade and exchange information with various business
organizations. Such websites are accredited by the government and
provide a medium to businesses to submit application forms to the
government.

Government - to - Business
Governments use B2G model websites to approach business
organizations. Such websites support auctions, tenders, and application
submission functionalities.

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Unit-3 Electronic Data Interchange (EDI)

Meaning of Electronic data interchange

Electronic data interchange ('EDI) is the concept of businesses
electronically communicating information that was traditionally
communicated on paper, such as purchase orders and invoices.
Technical standards for EDI exist to facilitate parties transacting such
instruments without having to make special arrangements.

EDI has existed at least since the early 70s, and there are many EDI
standards (including X12, EDIFACT, ODETTE, etc.), some of which address
the needs of specific industries or regions. It also refers specifically to a
family of standards. In 1996, the National Institute of Standards and
Technology defined electronic data interchange as "the computer-to-
computer interchange of strictly formatted messages that represent
documents other than monetary instruments. EDI implies a sequence of
messages between two parties, either of whom may serve as originator
or recipient. The formatted data representing the documents may be
transmitted from originator to recipient via telecommunications or
physically transported on electronic storage media." It distinguished
mere electronic communication or data exchange, specifying that "in
EDI, the usual processing of received messages is by computer only.
Human intervention in the processing of a received message is typically
intended only for error conditions, for quality review, and for special
situations. For example, the transmission of binary or textual data is not
EDI as defined here unless the data are treated as one or more data
elements of an EDI message and are not normally intended for human
interpretation as part of online data processing."In short, EDI can be
defined as the transfer of structured data, by agreed message standards,
from one computer system to another without human intervention.
EDI can be transmitted using any methodology agreed to by the sender
and recipient, but as more trading partners began using the Internet for
transmission, standardized protocols have emerged.
This includes a variety of technologies, including:
 mModem (asynchronous and synchronous)
 FTP, SFTP and FTPS
 Email
 HTTP
 AS1

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 AS2
 AS4
 OFTP (and OFTP2)
 Mobile EDI
 And more technologies
Electronic data interchange (EDI) is the electronic transmission of
structured data by agreed message standards from one computer
system to another without human intervention. It is a system for
exchanging business documents with external entities.EDI refers to a
family of standards and does not specify transmission methods, which
are freely agreed upon by the trading partners. The wide adoption of EDI
in the business world facilitates efficiency and cost reduction. EDI is used
in such diverse business-to-business relationships as:
- Interchanges between health care providers and insurers
- Travel and hotel bookings
- Education
- Supply chain management
- Administration
- Tax reporting

Basic Components of EDI

1. Standard Language
Interchanging electronic information requires a standardized language
shared by sender and receiver to structure the messages. There are
different standards, such as X12, EDIFACT, XML.

2. EDI software:
Sender and receiver must have an EDI solution to construct and manage
the messages according to the standard in which the interchanges are to
take place.

3. Communications Network:
EDI interchanges call for secure communications systems adapted to the
peculiarities of this type of transaction. There are different options
available, although the most widespread are VANs or Value Added
Networks. These are private communications networks with high levels
of security, control and monitoring that guarantee the correct sending
and reception of the different messages.
It involves

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a. Modem: hardware device that transmit data from the one

computer to another.
b. VAN: network that connect computer system of one organization
to another.
c. Point to point link: A direct communication link between two
computers.
4. People
Some common functions of EDI are Business/EDI Analyst, EDI
Coordinator/Specialist, EDI Map and Integration Developer, and
Project Management. Maintaining EDI also includes trading
partner support, on boarding, change events, and internal
support. EDI service providers allow businesses to outsource some
or all of these functions.
5. Translator and Mapper
A translator is used to convert the raw into meaningful
information according to specification provided by a mapper. It
used to create conversion specification. It gives instruction to
translator on how to convert the data.

Comparison between EDI and e-mail

EDI E-mail
(i) EDI is an acronym of Electronic Data (i) E-mail is an acronym of electronic mail
interchange
(ii) EDI is the inter-organisational (ii) E-mail system is basically used for
exchange of business documentation in sending message electronically to
structured, machine process able form. individuals or group of individuals in an
inter and intra office environment. It
requires network to connect them.
(iii) EDI provides communication
between trading partners that agree to (iii) No such need.
exchange EDI transactions.
(iv) EDI eliminates the paper documents (iv) One of the advantages of E-mail is
associated with common business that if gives users ability to review,
transactions. respond message quickly.
(v) EDI message can be immediately (v) No processing of the message
processed by receiving computer without received.
any human intervention or interpretation
or re-keying
(vi) One other advantage of EDI is that it (vi) No such facility
generates the functional
acknowledgment whenever an EDI
message is received, and is electronically
transmitted to the sender.

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Benefits of EDI
1. Better Speed:
EDI decreases the time it takes for an employee to make invoices and
handle purchase orders manually. Timing is crucial when it comes to
processing of an order. With EDI, businesses can speed up their cycles by
61% creating an allowance for more automation process that
significantly reduces, if not eliminated, time delays related to manual
processes that entail you to compare, enter, and file data. Records
management is reorganized and made more effective with simultaneous
data updates. Transferring documents electronically improves
transaction speed and perceptibility while reducing the cost involved in
manual approach. Stock levels are also kept regularly updated and
visible.

2. Business Efficiency.
For the reason that human error is lessened, businesses can profit from
improved levels of proficiency. Rather than place attention on common
and tedious activities, staffs can dedicate their attention to more
significant value-adding tasks. EDI transfer guarantees immediate
processing and eradicates time wasting related with manual entering,
receiving, and sending orders. Improved quality of data provided by EDI
lessens data entry errors, improves accounts activity times as
procedures become efficient and can be made available for forecasting.

3. Collective Productivity.
The EDI technology permits more business to take on more operations
with less human resources. Business teams can handle tasks with
advanced additional worth. With EDI, the whole process is completed in
a matter of seconds. This is due to the reason that automated process
allows for instant completion of tasks like registering and balancing
validation.

4. Cost Savings
This is amongst the most popular benefits of EDI. With EDI, the costs for
processing business documents get at least 35% cut, but it can be much
more remarkable in case of electronic invoices, with 90% savings a
possibility. Then again, this extreme economic saving is due to
transactions automation, and, also the less involvement of paper usage.
EDI reduces your operating outlay by removing the costs of document
retrieval, filing, mailing, paper, postage, printing, recycling, reproduction,

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and storage. EDI significantly reduces administrative, maintenance, and

resource costs.

5. Enhancing Financial Ratios.

With the Implementation of EDI, transferring and getting e-invoices
takes place almost instantly. EDI also adds automatic authentication and
checking procedures, which enable rapid dispensation at the endpoint,
aiding estimate cash necessities. In appreciation of this foresight,
customers can take advantage of quick payment rebates and the
dealer’s liquidness is enhanced.

6. Environment-Friendly Services.
The movement from paper-based services to the use of electronic
transactions available on EDI decreases CO2 discharges. Thus, the use of
EDI encourages corporate social accountability and help organization
achieve sustainable supply chain management.

7. Information Availability on Process Status.

Replacing paper with e-documents makes it easy to maintain and track
data. EDI safeguards traceability and transactions integrability like
changes to purchase orders, invoices, pending payment status, receipt
acknowledgment, and other similar events. Additionally, sending data
through private networks, make available lasting control over message
status about processing, reading, and receipt, etc.

8. Improved Accuracy
Apart from inadequacy, the manual approach is also highly susceptible
to error, usually ensuing from entering and re-keying errors,
indecipherable handwriting, and improper document management. EDI
considerably improves your business data quality and removes the
problem of re-working orders by bringing at least a 30% to 40% drop in
transactions errors. The use of ethics acknowledged by both parties
(receiver and sender) guarantee correct interpretation of data,
irrespective of activity sectors or nationalities.

9. Operations Automation.
The benefits of EDI tool considerably lighten the burden on
management. Several tasks, like enveloping, franking or registering,
printing out business documents, would fade entirely. EDI’s

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adaptableness modernizes the communication flow and improves

typically business relations with other trade partners.

10. Refining Service to Partners and End Users.

Implementation of EDI implies the application of optimal workflows and
response time. The Implementation of EDI benefits the end user most of
all, as manufacture plans and distributions become much more accurate.
EDI also enlarges your customer base and managing trade partner
relationship due to its quicker goods and services distribution.

11. Security
EDI boosts the level of protection for any transactions by strongly
allocation data across a more extensive variation of communicating
protocols and safety standards, hence, reducing supply chain risks. Your
trading partners would profit from the seamless movement of data and
accessibility to the technology creates prospects for newer business
breaks.

Limitations/Drawbacks of EDI
While countless businesses enjoy the benefits of EDI, some companies
are still cautious to try it out due to the following limitations of EDI.

1. Cost of Implementation.
It is true that EDI provides massive cost savings benefits but for small
businesses re-designing and implementing software applications to fit in
EDI into current applications can be quite costly. Such limitations of EDI
must be considered if you plan on implementing such system.

2. Electronic System Safety

EDI also necessitates substantial investment in computer networks and
security systems for maximum security. Any EDI system installed would
require protection from hacking, malware, viruses, and other cyber
security threats.

3. Preliminary Setup Consumes Time

Not only is the implementation of EDI system expensive to install, but it
also consumes a considerable amount of time to set up the essential
parts. Thus, such limitations of EDI can hinder fast-tracking of services if
urgently required.

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4. Several Standards to Maintain.

Numerous businesses looking to implement EDI also consider the
several standards involved. These limitations of EDI do not allow small
businesses to exchange data with larger establishments that make use of
latest edition of a document standard. Some known measures include
ANSI ASC X12, GS1 EDI, HL7, TRADACOMS, and UN/EDIFACT.

5. Suitable Backup System

EDI implementation also requires regular maintenance as the business
functionality is highly dependent on it. Some robust data backup system
is needed in case of system crash or for statistical purpose. Such
limitations of EDI can cost some substantial amount to implement.

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Unit-5 Network security and firewalls

Almost every medium and large-scale organization has a presence on
the Internet and has an organizational network connected to it.
Network partitioning at the boundary between the outside Internet
and the internal network is essential for network security. Sometimes
the inside network (intranet) is referred to as the “trusted” side and
the external Internet as the “un-trusted” side.

Network security/Firewalls
In computing, a firewall is a network security system that monitors and
controls incoming and outgoing network traffic based on predetermined
security rules. A firewall typically establishes a barrier between a trusted
internal network and un trusted external network, such as the Internet.

Firewalls are often categorized as either network firewalls or host-based

firewalls. Network firewalls filter traffic between two or more networks
and run on network hardware. Host-based firewalls run on host
computers and control network traffic in and out of those machines.

In the computing world, the terminology firewall security refers to a

network device which blocks certain kinds of network traffic. Actually,
it acts as a barrier between a trusted and an un-trusted network. The
firewall security wall can be compared to a physical firewall in the
sense that firewall security tries to block the spread of computer
attacks.

 Block attacks on your private network forced by other

networks
 Define a funnel and set-aside the non-authorized users.
 Let firewall security monitor the network and computer and
when questionable activity befalls, it will automatically
generate an alarm.
 Monitor and document services using FTP (File Transfer
Protocol), WWW (World Wide Web), and other protocols.
 Control the use of the Internet. Simply block inappropriate
content.
Due to a lack of absolute security solutions a network should be
contemporarily constructed with multilayer’s to form a barrier against

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violating activities. The act of information security in the network

focuses on protecting data stored on computers, especially on servers.

Network security is any activity designed to protect the usability and

integrity of your network and data.
 It includes both hardware and software technologies
 It targets a variety of threats
 It stops them from entering or spreading on your network
 Effective network security manages access to the network.
Network security combines multiple layers of defences at the edge and
in the network. Each network security layer implements policies and
controls. Authorized users gain access to network resources, but
malicious actors is blocked from carrying out exploits and threats.

Client server networking security

Client-server networking grew in popularity during the 1990s as personal
computers became the alternative to mainframe computers. Client-
server networking refers to a computer networking model that uses
both client hardware devices and servers, each with specific functions.

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The client-server model can be used on the internet as well as on a local

area network (LAN). Examples of client-server systems on the internet
include web browsers and web servers, FTP clients and servers, and the
DNS.

Client–server model is a distributed application structure that partitions

tasks or workloads between the providers of a resource or service, called
servers, and service requesters, called clients. Often clients and servers
communicate over a computer network on separate hardware, but both
client and server may reside in the same system. A server host runs one
or more server programs, which share their resources with clients. A
client does not share any of its resources, but it requests content or
service from a server. Clients therefore initiate communication sessions
with servers, which await incoming requests. Examples of computer
applications that use the client–server model are Email, network
printing, and the World Wide Web.

An application programme is knows as a client programme, running an

local machine that request for a service from an application.
Client- A client is a programme that runs on the local machine
requesting service from the server.
Server- A server is a programme that runs on the remote machine
providing service to the client.

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Firewall types

1. Packet filtering firewall

Packet filtering firewalls operate in line at junction points where devices
such as routers and switches do their work. However, these firewalls
don't route packets, but rather they compare each packet received to a
set of established criteria -- such as the allowed IP addresses, packet
type, port number and other aspects of the packet protocol headers.
Packets that are flagged as troublesome are, generally speaking,
unceremoniously dropped -- that is, they are not forwarded and, thus,
cease to exist.

2. Circuit-level gateway
Using another relatively quick way to identify malicious content, circuit-
level gateways monitor TCP handshakes and other network protocol
session initiation messages across the network as they are established
between the local and remote hosts to determine whether the session
being initiated is legitimate -- whether the remote system is considered
trusted. They don't inspect the packets themselves, however.

3. Stateful inspection firewall

State-aware devices, on the other hand, not only examine each packet,
but also keep track of whether or not that packet is part of an
established TCP or other network session. This offers more security than
either packet filtering or circuit monitoring alone but exacts a greater
toll on network performance.

4. Application-level gateway
This kind of device -- technically a proxy and sometimes referred to as a
proxy firewall -- combines some of the attributes of packet filtering
firewalls with those of circuit-level gateways. They filter packets not only
according to the service for which they are intended -- as specified by
the destination port -- but also by certain other characteristics, such as
the HTTP request string. While gateways that filter at the application
layer provide considerable data security, they can dramatically affect
network performance.

5. Next-generation firewall
A typical NGFW combines packet inspection with stateful inspection and
also includes some variety of deep packet inspection, as well as other

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network security systems, such as intrusion detection/prevention,

malware filtering and antivirus.
While packet inspection in traditional firewalls looks exclusively at the
protocol header of the packet, deep packet inspection looks at the
actual data the packet is carrying. A deep packet inspection firewall
tracks the progress of a web browsing session and is capable of noticing
whether a packet payload, when assembled with other packets in an
HTTP server reply, constitutes a legitimate HTML formatted response.

6. Cloud fire walls

Cloud Firewalls are software-based, cloud deployed network devices,
built to stop or mitigate unwanted access to private networks. As a new
technology, they are designed for modern business needs, and sit within
online application environments. It involves SaaS Firewalls{Software-as-
a-service firewall (SaaS firewall) ,Security-as-a-service (SECaaS),Firewall-
as-a-service (FWaaS)}, Next Generation Firewalls.

Encryption and Decryption

Encryption is the process in which a sender converts the original

information to another form and sends the resulting unintelligible
message out over the network. The sender requires an encryption
algorithm and a key to transform the plaintext (original message) into a
ciphertext (encrypted message), it’s also known as enciphering. In
cryptography, encryption is the process of encoding a message or
information in such a way that only authorized parties can access it and
those who are not authorized cannot. Encryption does not itself prevent
interference but denies the intelligible content to a would-be
interceptor. In an encryption scheme, the intended information or
message, referred to as plaintext, is encrypted using an encryption
algorithm–a cipher–generating ciphertext that can be read only if
decrypted. For technical reasons, an encryption scheme usually uses a

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pseudo-random encryption key generated by an algorithm. It is in

principle possible to decrypt the message without possessing the key,
but, for a well-designed encryption scheme, considerable computational
resources and skills are required. An authorized recipient can easily
decrypt the message with the key provided by the originator to
recipients but not to unauthorized users.

Decryption is generally the reverse process of encryption. It is the

process of decoding the data which has been encrypted into a secret
format. An authorized user can only decrypt data because decryption
requires a secret key or password. Decryption inverts the encryption
process in order to convert the message back to its real form. The
receiver uses a decryption algorithm and a key to transform the
ciphertext back to original plaintext, it is also known as deciphering. A
mathematical process utilized for decryption that generates original
plaintext as an outcome of any given ciphertext and decryption key is
known as Decryption algorithm. This process is the reverse process of
the encryption algorithm.
The keys used for encryption and decryption could be similar and
dissimilar depending on the type of cryptosystems used (i.e., Symmetric
key encryption and Asymmetric key encryption).
The encryption algorithm uses message (plaintext) and the key at the
time of encryption process. On the other hand, in the process of
decryption, the decryption algorithm converts the scrambled form of
the message (i.e., ciphertext )with the help of a key

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Secret key cryptography (Symmetric key)

In secret-key cryptography, a sequence of bits, called the secret key, is
used as an input to a mathematical function to encrypt a plaintext
message; the same key is also used to decrypt the resulting ciphertext
message and obtain the original plaintext. As the same key is used to
both encrypt and decrypt data, a secret key is also called a symmetric
key.
With secret key cryptography, both communicating parties, Alice and
Bob, use the same key to encrypt and decrypt the messages. Before any
encrypted data can be sent over the network, both Alice and Bob must
have the key and must agree on the cryptographic algorithm that they
will use for encryption and decryption.

One of the major problems with secret key cryptography is the logistical
issue of how to get the key from one party to the other without allowing
access to an attacker. If Alice and Bob are securing their data with secret
key cryptography, and if Charlie gains access to their key, Charlie can
understand any secret messages he intercepts between Alice and Bob.
Not only can Charlie decrypt Alice's and Bob's messages, but he can also
pretend that he is Alice and send encrypted data to Bob. Bob will not
know that the message came from Charlie, not Alice.
Secret key cryptography is also called symmetric cryptography because
the same key is used to both encrypt and decrypt the data. Well-known
secret key cryptographic algorithms include the Data Encryption
Standard (DES), triple-strength DES (3DES), Rivest Cipher 2 (RC2), and
Rivest Cipher 4 (RC4).

Public key cryptography (asymmetric cryptography)

Public key cryptography solves the logistical problem of key distribution
by using both a public key and a private key. The public key can be sent
openly through the network while the private key is kept private by one
of the communicating parties. The public and the private keys are
cryptographic inverses of each other; what one key encrypts, the other
key will decrypt.

Let's assume that Bob wants to send a secret message to Alice using
public key cryptography. Alice has both a public key and a private key, so
she keeps her private key in a safe place and sends her public key to Bob.

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Bob encrypts the secret message to Alice using Alice's public key. Alice
can later decrypt the message with her private key.

If Alice encrypts a message using her private key and sends the
encrypted message to Bob, Bob can be sure that the data he receives
comes from Alice; if Bob can decrypt the data with Alice's public key, the
message must have been encrypted by Alice with her private key, and
only Alice has Alice's private key. The problem is that anybody else can
read the message as well because Alice's public key is public. While this
scenario does not allow for secure data communication, it does provide
the basis for digital signatures. A digital signature is one of the
components of a public key certificate, and is used in SSL to authenticate
a client or a server. Public key certificates and digital signatures are
described in later sections.
Public key cryptography is also called asymmetric cryptography
because different keys are used to encrypt and decrypt the data. A well
known public key cryptographic algorithm often used with SSL is the
Rivest Shamir Adleman (RSA) algorithm. Another public key algorithm
used with SSL that is designed specifically for secret key exchange is the
Diffie-Hellman (DH) algorithm. Public key cryptography requires
extensive computations, making it very slow. It is therefore typically
used only for encrypting small pieces of data, such as secret keys,
rather than for the bulk of encrypted data communications.

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Digital Signature
A digital signature is a mathematical scheme for verifying the
authenticity of digital messages or documents. A valid digital signature,
where the prerequisites are satisfied, gives a recipient very strong
reason to believe that the message was created by a known sender
(authentication), and that the message was not altered in transit
(integrity).

Digital signatures are a standard element of most cryptographic protocol

suites, and are commonly used for software distribution, financial
transactions, contract management software, and in other cases where
it is important to detect forgery or tampering.

Digital signatures are often used to implement electronic signatures,

which include any electronic data that carries the intent of a signature,
but not all electronic signatures use digital signatures. In some countries,
including South Africa, the United States, Algeria, Turkey, India, Brazil,
Indonesia, Mexico, Saudi Arabia, Uruguay, Switzerland, Chile and the
countries of the European Union, electronic signatures have legal
significance.
Two main properties are required. First, the authenticity of a signature
generated from a fixed message and fixed private key can be verified by
using the corresponding public key. Secondly, it should be
computationally infeasible to generate a valid signature for a party
without knowing that party's private key. A digital signature is an
authentication mechanism that enables the creator of the message to
attach a code that acts as a signature. The Digital Signature Algorithm
(DSA), developed by the National Institute of Standards and Technology,
is one of many examples of a signing algorithm.

Digital certificate
A Digital Certificate is used to encrypt online data/information
communications between an end-users browser and a website. After
verifying that a company owns a website, certificate authority will sign
their certificate so it is trusted by internet browsers.
A Digital Certificate is an electronic "password" that allows a person,
organization to exchange data securely over the Internet using the public
key infrastructure (PKI). Digital Certificate is also known as a public key
certificate or identity certificate.

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A certificate is an electronic document that is used to identify an

individual, a server, a company, or some other entity, and to associate
that identity with a public key. Like a driver's license, a passport, a
student ID, a library card, or other commonly used personal IDs, a
certificate provides generally recognized proof of a person's identity.
Certificates use public key cryptography to address the problem of
impersonation.

Certificate authority
In cryptography, a certificate authority or certification authority (CA) is
an entity that issues digital certificates. A digital certificate certifies the
ownership of a public key by the named subject of the certificate. This
allows others (relying parties) to rely upon signatures or on assertions
made about the private key that corresponds to the certified public key.
A CA acts as a trusted third party—trusted both by the subject (owner)
of the certificate and by the party relying upon the certificate.
The digital certificate certifies the ownership of a public key by the
named subject of the certificate. This allows others (relying parties) to
rely upon signatures or assertions made by the private key that
corresponds to the public key that is certified.

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Unit-5 Electronic payment system

Digital token and e-pay system

An e-commerce payment system (or an electronic payment system)
facilitates the acceptance of electronic payment for online transactions.
Also known as a subcomponent of Electronic Data Interchange (EDI), e-
commerce payment systems have become increasingly popular due to
the widespread use of the internet-based shopping and banking. The
definition of an electronic payment system is a way of paying for a goods
or services electronically, instead of using cash or a check, in person or
by mail. An example of an electronic payment system is Pay Pal. An
example of an electronic payment system is the use of a credit card.

During the checkout process, you bring out your credit card and swipe it
or enter your number, the money is transferred, and you are on your
way. People make payments, online and in-person, every day without
thinking twice about the electronic payment systems that run
everything. An electronic payment system is a way of making
transactions or paying for goods and services electronically without
using cash or checks. In order to accept funding and meet customer
needs, companies are accepting payments in many more forms than
cash or checks.
The digital token based payment system is a new form of electronic
payment system which is based on electronic tokens rather than e-
cheque or e-cash. The electronic tokens are generated by the bank or
some financial institutions. Hence we can say that the electronic tokens
are equivalent to the cash which are to be made by the bank.
Digital tokens have come to the fore recently, firstly with excitement
about cryptocurrencies such as bitcoin, then with digital tokens being
used to represent different assets on a blockchain.

E-cash
eCash is an internet-based system that facilitates the transfer of funds
anonymously. Similar to credit cards, eCash historically has been free to
users, while sellers have paid a fee. Due to certain security concerns,
however, eCash remains more of an idea and less of a fully realized,
widespread payment system. Ecash was conceived by David Chaum as
an anonymous cryptographic electronic money or electronic cash system

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in 1983. It was realized through his corporation Digicash and used as

micropayment system at one US bank from 1995 to 1998.
A purely peer-to-peer version of electronic cash, ECash.com, would allow
online payments to be sent directly from one party to another without
going through a financial institution. ECash, ECash.com, is expected to
handle more than hundred millions US dollars in trading volume every
day. Blockchain is gradually being accepted by International banking
authorities worldwide, and supported by more and more legislation. All
these factors attribute to a promising, legitimate, and mainstream
bound future of cryptocurrency. From inception of Ecash platform, it
dedicated to advocating of cryptocurrency assets, which will pave the
way for cryptocurrencies to better serve the cryptocurrency society.
Acceptability:-
The payment infrastructure should not only be robust but also available
and accessible to a wide range of consumers and sellers of goods and
services. The value stored in the electronic cash should be honored and
accepted by other banks and financial institutions for reconciliation.

Reliability:-
Users and businesses want a payment system that is reliable because
the availability of services and smooth running of an enterprise will
depend on the availability and successful operation of the payment
infrastructure.

The users should be completely shielded infrastructures. The user should

be completely shielded from a system or single point failure.

Security:-
Digital currency should be stored in a form that is resistant to
replication, double-spending, and tampering. At the same time, it should
offer protection from the intruders trying to tap it to unauthorized use,
when transmitted over the internet.

Usability:-
The user of the payment mechanism should be able to use it as easily as
real currency. This requires that the payment system should be well
integrated with the existing applications and processes that acquire the
role of transacting parties in e-commerce.

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Scalability:-
The payment system infrastructure should be scalable, to be able to
handle the addition of new users and merchants, so that systems will
perform normally without performance degradation and maintain the
quality of service.

It should be able to offer the same performance and cost per transaction
overheads with a growing number of customers and transactions.

Anonymity, privacy:-
This characteristic refers to the desire of users to protect their privacy,
identity and personal information. In some transactions, the identities of
the parties could be protected by anonym it.

Anonymity means that it is not possible to discover someone’s identity

or to monitor an individual’s spending patterns.

Applicability:-
Applicability of a payment system is defined as the extent to which it is
accepted for payments at points of sale, or at online e-commerce sites.

Debit cards and credit cards have high applicability, as one can pay with
them in a variety of places. The applicability of a payment system may
vary from country to country.

Authorization type:-
Authorization type is defined as the form of control over the validity of
transactions. The authorization type can be offline. Offline authorization
means that users of the system can exchange money while not
connected to a network, without a third party mediating the transaction.
Paper cheques are the example of offline authorization.

Convertibility:-
Funds represented by one payment system should be easily convertible
into funds represented by other payment systems. Users should be able
to transfer money from electronic payment systems.

Users should be able to transfer money from electronic payment

systems to another accepted money from i.e. receive it in cash, or
transfer to a bank account.

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The electronic currency should be interoperable and exchangeable with

other forms electronic cash, paper currencies, and deposits in the bank
accounts, bank notes or any other financial instrument.

Interoperability:-
A payment system in interoperable if it is not dependent on one
company, but it is open and allows other interested parties to join. This
can be achieved by means of open standards for data transmission
protocols and infrastructure.

An interoperable system can faster gain the necessary customer base for
future development and will have a higher level of applicability.

Multi-currency:-
Effective and efficient payment systems between countries are possible
when a system allows processing multiple currencies, as it is currently
done with credit cards.

This feature is not implemented in the payment systems of many

countries, binding them to a particular region. Multi-currency payments
are required for payments in cross-border e-commerce.

Traceability:-
Traceability indicates how easy it is to trace money flows and sources of
funds that are going through a payment system and used for purchases.
In electronic payment systems, money can be traced by records that are
kept of payment activity.

Linkability:-
Linkability of an electronic payment system implies that payments can
be associated with a particular user, or that it is possible to recognize
several payments originating from some user.

Users can be linked to their spending even if the system they use is
anonymous. A relation between the user and his payments can be
established.

Trust:-

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Trust refers to the degree of customers confidence that their money and
personal information will be safe, and that all parties involved will not
act against users’ interests. Users need to trust that payments will be bot
be stolen or misused.

Flexibility:-
Payment systems should be in a position to accept several forms of
payment rather than limiting the users to a single form of currency.

Efficiency:-
Efficiency here refers mainly to the cost overheads involved in the
operation of digital payments. The cost of payment per transaction
should be negligible.

E-Cheque
An electronic check, or e-check, is a form of payment made via the
Internet, or another data network, designed to perform the same
function as a conventional paper check. Since the check is in an
electronic format, it can be processed in fewer steps. Additionally, it has
more security features than standard paper checks including
authentication, public key cryptography, digital signatures, and
encryption, among others.
 An electronic check is a form of payment made via the internet
that is designed to perform the same function as a
conventional paper check.
 One of the more frequently used versions of the electronic
check is the direct deposit system offered by many employers.
 Generally, the costs associated with issuing an electronic check
are notably lower than those associated with paper checks.
 An electronic check has more security features than standard
paper checks.

Generally, the costs associated with issuing an electronic check are

notably lower than those associated with paper checks. Not only is there
no requirement for a physical paper check, which costs money to
produce, but also electronic checks do not require physical postage in
cases of payments being made to entities outside the direct reach of the
entity issuing the funds.

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Smart card
A smart card, chip card, or integrated circuit card (ICC) is a physical
electronic authorization device, used to control access to a resource. It is
typically a plastic credit card-sized card with an embedded integrated
circuit (IC) chip. Many smart cards include a pattern of metal contacts to
electrically connect to the internal chip. Others are contactless, and
some are both. Smart cards can provide personal identification,
authentication, data storage, and application processing. Applications
include identification, financial, mobile phones (SIM), public transit,
computer security, schools, and healthcare. Smart cards may provide
strong security authentication for single sign-on (SSO) within
organizations. Numerous nations have deployed smart cards throughout
their populations.

Credit card based payment system

Credit card is the most popular payment method used in Internet
shopping. The idea of credit card payment is to buy first and pay later.
The cardholder can pay at the end of the statement cycle or they can
pay interest on the outstanding balance. Therefore, there are many
credit card-based electronic payment systems (EPSs) that have been
developed to facilitate the purchase of goods and services over the
Internet such as CyberCash (VeriSign), iKP (Bellare, Garary, Hauser, et al,
1995), SET (Visa and MasterCard, 1997), CCT (Li & Zhange, 2004), and so
forth. Usually a credit card-based EPS involves five parties: cardholder,
merchant, acquirer bank, issuer bank, and financial institution.

Internet is an open system and the communication path between each

other is insecure. All communications are potentially open for an
eavesdropper to read and modify as they pass between the
communicating endpoints. Therefore, the payment information
transmitted between the cardholder and the merchant through Internet
is dangerous without a secure path. SSL (Zeus Technology, 2000) is a
good example to secure the communication channel. Besides the issue
of insecure communication, there are a number of factors that each
participant must consider. For example, merchant concerns about
whether the credit card or the cardholder is genuine. There is no way to
know the consumer is a genuine cardholder. As a result, the merchant is
incurring the increase in losses due to cardholder disputes and frauds.
On the other hand, cardholders are worried about the theft of the
privacy or sensitive information such as the credit card number. They

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don’t want any unauthorized usage of their credit cards and any
modification to the transaction amount by a third party. These security
issues have deterred many potential consumers from purchasing online.

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Unit-6 E-marketing

E-Marketing (Electronic Marketing) are also known as Internet

Marketing, Web Marketing, Digital Marketing, or Online Marketing. E-
marketing is the process of marketing a product or service using the
Internet. Emarkerting not only includes marketing on the Internet, but
also includes marketing done via e-mail and wireless media. It uses a
range of technologies to help connect businesses to their customers.
Like many other media channels, e-marketing is also a part of integrated
marketing communications (IMC), which helps a brand grow across
different channels. E-marketing has become a pivotal tactic in the
marketing strategy adopted by companies using several digital media
channels.

There are several ways in which companies can use internet for
marketing. Some ways of e-marketing are:
1. Article marketing
2. Affiliate marketing
3. Video marketing
4. Email marketing
5. Blogging

E-Commerce describes the exploitation of electronic means and

platforms to conduct company business. e-Marketing (also referred to as
web marketing or internet marketing) uses electronic communication
technologies including the Internet, mobile phones and digital
televisions to accomplish marketing objectives (McDonald and Wilson,

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1999). More specifically, e-Marketing portrays company efforts to

inform and communicate with buyers, and promote and sell its products
and services over the Internet.
E-marketing is the mix of modern communication technology and
traditional principles that marketers usually apply. When we talk about
modern communication technology, this is electronic media, more
known as the internet (in the realm of e-marketing, the terms of online
marketing and internet marketing are usually interchangeable).

E-marketing focuses on marketing your company online. You may use

direct or indirect marketing features on the internet to connect your
company to new customers, retain present customers, and build a brand
identity.

E-marketing, through online tools and resources, can be used by your

company via direct emails, blogs, SMS or text messaging, web pages,
videos, banners, pictures, advertisements (like pay per click, display or
social media advertising), search engine optimization, social media,
affiliate marketing, and many more.

Traditional Marketing

Traditional marketing is a rather broad category that incorporates many

forms of advertising and marketing. It's the most recognizable types of
marketing, encompassing the advertisements that we see and hear
every day. Most traditional marketing strategies fall under one of four
categories: print, broadcast, direct mail, and telephone.
Print marketing is the oldest form of traditional marketing. Loosely
defined as advertising in paper form, this strategy has been in use since
ancient times, when Egyptians created sales messages and wall posters
on papyrus. Today, print marketing usually refers to advertising space in

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newspapers, magazines, newsletters, and other printed materials

intended for distribution
In the age of digital marketing, traditional marketing is not dead. To this
day, cold calls remain the #1 method to generate warm leads and hot
sales. The massive success of AU eVoice and similar call answering
services is a testament to that fact. Even as the digital revolution
continues to boom, traditional marketing has hardly gone bust, and
allied businesses are flourishing too. The most Hi-Tech marketers
recognize how traditional marketing techniques hold value and
relevance, especially when combined with online strategies.

Traditional marketing normally refers to offline marketing channels as

opposed to online marketing channels in digital marketing. So traditional
marketing is the term for every promotion and communication channels
used to reach customers without using internet technology. They can be
in the form of magazine & newspaper ads, flyers or pamphlets, TV and
radio advertising etc. Because of the tangible or physical nature of its
material, traditional marketing exposure is mostly limited to certain
localities.

On-line marketing /digital marketing

Online marketing is a set of tools and methodologies used for promoting
products and services through the internet. Online marketing includes a
wider range of marketing elements than traditional business marketing
due to the extra channels and marketing mechanisms available on the
internet.

Online marketing can deliver benefits such as:

 Growth in potential
 Reduced expenses
 Elegant communications
 Better control
 Improved customer service
 Competitive advantage
Online marketing is also known as internet marketing, web marketing,
digital marketing and search engine marketing (SEM).

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The broad online marketing spectrum varies according to business

requirements. Effective online marketing programs leverage consumer
data and customer relationship management (CRM) systems. Online
marketing connects organizations with qualified potential customers and
takes business development to a much higher level than traditional
marketing.

Online marketing combines the internet's creative and technical tools,

including design, development, sales and advertising, while focusing on
the following primary business models:
 E-commerce
 Lead-based websites
 Affiliate marketing
 Local search
Online marketing has several advantages, including:
 Low costs: Large audiences are reachable at a fraction of
traditional advertising budgets, allowing businesses to create
appealing consumer ads.
 Flexibility and convenience: Consumers may research and
purchase products and services at their leisure.
 Analytics: Efficient statistical results are facilitated without
extra costs.
 Multiple options: Advertising tools include pay-per-click
advertising, email marketing and local search integration (like
Google Maps).
 Demographic targeting: Consumers can be demographically
targeted much more effectively in an online rather than an
offline process.

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E-advertising
Electronic advertising is advertising that uses the Internet and other
forms of digital media to help a business promote and sell goods and
services. The purpose of using Electronic advertising is to reach a wider
range of potential customers by connecting with them over the web. It is
also a lot more cost effective as you can fund your advertising within the
boundaries of your own budget. Another luxury of Electronic advertising
is ‘Target Marketing’. This means that you can target your desired group
of customers based on a wide range of criteria such as age, location,
gender and religion.
Online advertising, also known as online marketing, Internet advertising,
digital advertising or web advertising, is a form of marketing and

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advertising which uses the Internet to deliver promotional marketing

messages to consumers. Many consumers find online advertising
disruptive and have increasingly turned to ad blocking for a variety of
reasons. When software is used to do the purchasing, it is known as
programmatic advertising. Online advertising includes email marketing,
search engine marketing (SEM), social media marketing, many types of
display advertising (including web banner advertising), and mobile
advertising. Like other advertising media, online advertising frequently
involves a publisher, who integrates advertisements into its online
content, and an advertiser, who provides the advertisements to be
displayed on the publisher's content. Other potential participants
include advertising agencies that help generate and place the ad copy,
an ad server which technologically delivers the ad and tracks statistics,
and advertising affiliates who do independent promotional work for the
advertiser.
As new technology continues to change how we use the internet,
marketers continue to find new ways to reach their audiences. While
there are many free ways to promote your business, paid advertising is
often worth the investment. Online advertising, in particular, has
become a lucrative option for businesses big and small, and with any size
budget. Online ads come in a variety of styles, each with its benefits and
weaknesses. This post will go over 6 forms of online advertising to help
you determine which one(s) are best for your business.

Browsing behaviour
Customer Behaviour analytics analyze customer behaviour based on
three different aspects (browsing behaviour, purchase behaviour &
email behaviour) and identify the actionable insights that drive Valuable
Outcomes.
1. Browsing Behaviour in Retail ecommerce
The objective of analysing On-site or Browsing behaviour of customers
can be understood by these three words:
“Know Thy Customers”
Analyzing the browsing behaviour of customers is the most important
aspect of modern retail e-commerce. It focuses upon tracking and
understanding the finest details of customer’s on-site activity.

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The more information an online store has about the customer, better
it’ll be able to serve them. When every behavioural aspect of the
customer is wholly understood, the site can offer personalized on-site
experience to the customer.

The process of knowing customer’s behavioural action starts when a

user interacts with the website. The interaction begins when a customer
is attracted to visit the platform. Most often, a landing page is the first
interaction of the visitor.

Once a visitor lands upon a page, his browsing or on-site behaviour is the
first information which is used for providing more relevant information
to him. Based upon his searches and interest shown in specific products,
more similar products are suggested. For example: If a visitor is looking
at a product, then he is interested in such products, so more of such
similar products can be recommended to him.

Also note that depending upon all the products a visitor or customer
looked at, other customers with similar interests can be found.
Therefore, all the products of a similar customer base become
‘Recommendations Based on Browsing’ for the primary customer.

Thus, keeping a track record of on-site customer’s behaviour provides

the core foundation of important analytics for modern-day retail.
Personalized experiences on landing page result into higher conversion
ratio.

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Kasthmandap college of management

Unit-7 M-Commerce
Definition of M-Commerce
M-commerce is the buying, selling, and ordering of goods and services
using a mobile phone or other mobile equipment. Mobile commerce,
also known as m-commerce or m-commerce, is the use of wireless
handheld devices like cell phones and tablets to conduct commercial
transactions online, including the purchase and sale of products, online
banking, and paying bills. The use of m-commerce activity is on the rise.
 Mobile commerce refers to business or purchases conducted
over mobile devices like cell phones or tablets.
 Mobile commerce has increased rapidly as security issues have
been resolved.
 Companies like Apple and Google have introduced their own
mobile commerce services.
Mobile commerce is an increasingly large subset of electronic
commerce, a model where firms or individuals conduct business over
the internet. The rapid growth of mobile commerce has been driven by a
number of factors, including increased wireless handheld device
computing power, a proliferation of m-commerce applications, and the
broad resolution of security issues. Electronic commerce (e-commerce)
transacted over mobile communication devices such as cell phones or
personal digital assistants (PDA). The term refers to the purchasing and
selling of products and services using mobile phones and other wireless
handheld devices. PDA’s (personal digital assistants), for example, are
handheld wireless devices. The emergence of mobile commerce
triggered many new online businesses. Below is a list of the most
popular ones today:
 Mobile banking.
 Information services such as stock quotes, sports scores, news, traffic
reporting, and emergency alerts.
 Location-based services.
 Electronic boarding passes.
 Mobile ticketing.
 Mobile money transfers.
 In-app payments.
 Contactless payments.
 Loyalty cards, coupons, and other mobile marketing features.
 Digital content purchases.
 Digital content delivery.

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Kasthmandap college of management

The difference between E-commerce and M-commerce

Application of m-commerce
 Mobile Banking: Using a mobile website or application to
perform all your banking functions. It is one step ahead of
online banking and has become commonplace these days. For
example, in Nigeria, the majority of banking transactions
happen on mobile phones.
 Mobile Ticketing and Booking: Making bookings and receiving
your tickets on the mobile. The digital ticket or boarding pass is
sent directly to your phone after you make the payment from
it.
 E-bills: This includes mobile vouchers, mobile coupons to be
redeemed and even loyalty points or cards system.

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Kasthmandap college of management

 Auctions: Online auctions having now been developed to be

made available via mobile phones as well.
 Stock Market Reports and even stock market trading over
mobile applications.

Advantages of M-commerce
 It provides a very convenient and easy to use the system to
conduct business transactions.
 Mobile commerce has a very wide reach. A huge part of the
world’s population has a mobile phone in their pocket. So the
sheer size of the market is tremendous.
 M-commerce also helps businesses target customers according
to their location, service provider, the type of device they use
and various other criteria. This can be a good marketing tool.
 The costs of the company also reduced. This is due to the
streamlined processes, now transaction cost, low carrying cost
and low order processing cost as well.
Disadvantages of M-commerce
 The existing technology to set up an m-commerce business is
very expensive. It has great start-up costs and many
complications arise.
 In developing countries, the networks and service providers are
not reliable. It is not most suitable for data transfer.
 Then there is the issue of security. There are many concerns
about the safety of the customer’s private information. And
the possibility of a data leak is very daunting.

The END.

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