Information Systems Today: Managing in The Digital World: Eighth Edition

Information Systems Today: Managing in
the Digital World

Eighth Edition
Chapter 4
Enabling Business-to-
Consumer Electronic
Commerce
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E-Commerce (EC) Defined
• The exchange of goods, services, and money among

firms, between firms and their customers, and between
customers, supported by communication technologies
and, in particular, the Internet
Source: U.S. Census Bureau News, U.S. Department of Commerce.

Types of Electronic Commerce
Type of EC Description Example
Business-to- Transactions between A person buys a book from
consumer (B2C) businesses and their Amazon.com
customers
Business-to- Transactions among A manufacturer conducts
business (B2B) businesses business over the Web with its
suppliers
Consumer-to- Transactions between A person offers his
business (C2B) customers and businesses photography at
shutterstock.com
Consumer-to- Transactions between A person purchases some
consumer (C2C) people not necessarily memorabilia from another
working together person via eBay.com
All of the above types of EC are in the private sector

E-Government
• Government-to-
Citizens (G2C)
• Government-to-
Business (G2B)
• Government-to-
Government (G2G)
Source: Photographs in the Carol M. Highsmith Archive, Library of Congress,

Prints and Photographs Division.
E-finance
• E-finance is the use of information systems to provide

financial services and markets
• E-finance consists of:
– E-banking and online brokerage
EC Business Strategies
E-tailing: Capabilities and
Opportunities (1 of 2)
• Firms from across the world can effectively compete for

customers and gain access to new markets
• Disintermediation
• The Long Tail
• Mass Customization
E-tailing: Capabilities and
Opportunities (2 of 2)
• Group Buying
• New Revenue and Pricing Models
• Social Commerce
Mass Customization
Mass customization
generates additional
value for customers
and profits for
producers
New Revenue and Pricing Models
Reverse pricing
“Name your own
price”
Benefits of e-Tailing
• Product benefits
• Place benefits
• Price benefits
Drawbacks of e-tailing
• Trust
• Direct Product Experience
• Product Delivery and Returns
Internet Marketing
• If you build it, they won’t come

unless you market it
source: based on Vanboskirk, s. (2014, november

18). US Digital Marketing Forecast, 2014 to 2019.
Cambridge, ma: Forrester research.
Search Engine Optimization (SEO)
• SEO attempts to
improve a page’s
ranking in search
engines like Google
• Techniques include
having other pages
link to the page,
keeping content
updated, and
including key words
Source: 2016 Google Inc. All rights reserved. Google and the Google Logo are
registered trademarks of Google Inc.
Paid Search
• Paid Search is a way to ensure that your company’s page

appears on the first page users see
• Paid Inclusion is where some search engines offer to
elevate a page’s position in the organic results after
paying a fee
Mobile Commerce, Consumer-To-Consumer
EC, and Consumer-To-Business EC
• C2C EC
• C2B EC
Source: Diego Cervo/ shutterstock.
Mobile EC
• Location-Based M-Commerce
• Information on the Go
• Product and Content Sales
C2C EC
source: scanrail/ Fotolia.
Opportunities and Threats of C2C EC
Opportunities Threats
Consumers can buy and sell to broader No quality control
markets
Eliminates the middleman that increases Higher risk of fraud
the final price of products and services
Always available for consumers, 24/7/365 Harder to use traditional payment

methods (checks, cash, ATM
cards)
Market demand is an efficient mechanism blank
for setting prices in the electronic
environment
Increases the numbers of buyers and blank
sellers who can find each other
E-Auctions and Online Classifieds
• E-Auctions
– Individual sellers can sell or barter items at online auctions
– Consumers place bids
– Examples: eBay.com and swap.com
– Revenue model based on small transaction fees, highly
profitable
• Online Classifieds
– Just advertising, no online transactions
– Freecycling
– Examples: craigslist.com
C2B EC
Securing Payments in the Digital World
• Must be sure that online transactions are secure

• Issues related to different forms of online payments are:
1. Payment Services
2. Cryptocurrencies
3. Managing Risk
Ways to Protect Yourself When Shopping
Online
• Use a secure browser • Give payment information

only to businesses you
• Check the site’s privacy
know and trust
policy
• Keep records of your
• Read and understand
online transactions and
the refund and shipping
check your e-mail
policies
• Review you monthly credit
• Keep your personal
card and bank
information private
transactions
Source: Based on Privacy Rights Clearinghouse (2016)
Possible Indicators of Fraud
• Email addresses
• Shipping and billing
addresses
• Transactions
patterns
Legal Issues in EC
• Taxation
• Digital Rights Management
• Net Neutrality

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Information Systems Today: Managing in

the Digital World

Slides in this presentation contain hyperlinks.

• The exchange of goods, services, and money among

Source: U.S. Census Bureau News, U.S. Department of Commerce.

All of the above types of EC are in the private sector

Source: Photographs in the Carol M. Highsmith Archive, Library of Congress,

• E-finance is the use of information systems to provide

• Firms from across the world can effectively compete for

• If you build it, they won’t come

source: based on Vanboskirk, s. (2014, november

• Paid Search is a way to ensure that your company’s page

Source: Diego Cervo/ shutterstock.

source: scanrail/ Fotolia.

Always available for consumers, 24/7/365 Harder to use traditional payment

• Must be sure that online transactions are secure

• Use a secure browser • Give payment information

Source: Based on Privacy Rights Clearinghouse (2016)

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