ITC2203

Information
Technology in
Business

E – COMMERCE
 INTRODUCTION
You are welcome to ITC2203: Introduction to E-Commerce.

This is a 2 credit course for undergraduate that runs for 14 weeks.

The course consists of 6 modules which is divided into 20 units.
The course introduce you to the concept of E-commerce, types, benefits, e-
business, issues, catalog, online shopping, processing order, payment gateways,
purchasing, identifying shoppers and security.
The course addresses facilities for e-commerce, methodologies for developing
e-commerce websites and managing the e-commerce website.
 Course Objectives
The course objectives are to:

Explain the concept, types and benefits of E-commerce

Distinguish between E-commerce and E-business
Discuss the development of E-commerce Catalogue
Develop E-commerce Website
Explain how to Track Shoppers‟ Information
Explain the processes of securing E-commerce system
 Module 1: Introduction to Basic
Concepts and Definitions
Module Introduction
This module will introduce learners to concepts of e-commerce, what it entails
be it is regarded as e-commerce, types and benefits of e-commerce system and
key areas to which ecommerce can function. This module has three (3) units:
◦ Unit 1: Basic Definition of E-Commerce
◦ Unit 2: Types of E-Commerce
◦ Unit 3: Benefits and Key Ideas in E-Commerce
In each of these units, I will go through a topic and give a self-assessment
exercise(s) at the end of the unit. Then, give resources for further reading at the
end of each units.
 Definition of E-commerce
E-Commerce simply means Electronic Commerce;
A more complete definition of e-commerce is:
“e-commerce is the use of electronic communications and digital information
processing technology in business transactions to create, transform, and
redefine relationships for value creation between or among organizations, and
between organizations and individuals.”
 E-commerce
E-commerce is the buying and selling of goods, products, or services
using the internet as a medium whereby the buyer gets to see the
products online, order it and make payment through the mode accepted
by the seller.
The seller then delivers these products to the consumer via available
and accepted means. E-commerce is also known as internet commerce.
Online stores like Amazon, Shopify, Jumia, AliExpress, Ebay, Olx are
examples of E-commerce websites.
E-commerce concept is a fast rising one, gaining steady popularity as
there is Increased accessibility and availability of Internet access which is
making many small and medium and even large-scale businesses to be
considering e-commerce as a valid and more profitable sales channel.
 E-commerce 5C Models
Ecommerce is better understood with the concepts of the 5Cs, the 5C
model consists of:
Commerce which is like a market place that consist of the buyers and
sellers, transaction terms and facilities to perform business transactions.
This helps create and strengthen a universal supply chain.
Collaboration: the internet being a network of networks supports
interrelationships among businesses and individuals in a manner that is
not limited by space, time, national or organizational constraints.
 E-commerce 5C Models…
Communication: the internet technology and the world wide web provides a
great interactive medium for self-expression (as in reviews or comments of clients)
and self-presentation (as a means for businesses to showcase their products or
services; a kind of marketing)
Connection: it is likely that different businesses use different software platforms
to run their business processes, leveraging on the advantages of the internet, it is
achievable to incorporate the different software platforms of different businesses
that want to collaborate.
Computation: large scale sharing of resources is paramount to a successful
business transaction. The internet technology facilitates this to ease successful
completion of business processes.
 Features of E-commerce
Wider range of audience: with the internet as the backbone of
ecommerce, business transactions can take place across national
boundaries in a more convenient and cost-effective form.
Universal standard: internet technology has a universal standard, its not a
different one in UK and a different one in Nigeria.
Rich content: ecommerce allows for integration of the various forms of
content, one can use images, video, audio, combination of two or all three.
Ease of interaction: Clients interact with businesses from the comfort of
their homes. There is no need to physically visit a store as in the place of
the traditional commerce.
 Features of E-commerce …

Personalization or customization: The various technologies integrated to the

internet allows businesses to send personalized/customized messages that can be
delivered to individuals or even groups.
Ubiquity: The internet technology is widely available and accessible from
anywhere at any time; be it at home, at work via mobile devices like a mobile
phone phone, ipad, and even PCs.
Business digitalization: this involves comprehensively using the internet and
other tools of information and communication technologies to link
information and cooperate seamlessly every stakeholder of the business.
Automation of business processes to increase delivery speed
 Types of E-commerce

E-commerce can be divided into different types, these are:

1) Business to Business (B2B)
2) Business to Customer (B2C)
3) Customer to Customer (C2C)
4) Customer to Business (C2B)
5) Business to Government (B2G)
6) Consumer to Government (C2G)
7) Mobile Commerce(M-Commerce)
 1. Business to Business
(B2B):
Business to Business (B2B): only the companies are doing business with
each other. Here, the final consumers are not involved. Therefore, the
online transactions that are carried out in a business to business e-
commerce transaction involve parties like the manufacturers,
wholesalers, retailers etc.
B2B e-commerce is simply the electronic exchange of products, services
or information between businesses rather than between businesses and
consumers as expected.
Business to business ecommerce is the largest form of ecommerce and
it requires high level of security in exchanging data.
 2. Business to Customer
(B2C):
Business to Customer (B2C): here, the business sells directly to
customers. The customers can browse the website, see reviews and order
directly from the business.
After the order, the good is shipped directly to them (the customers).
Some of the most popular business to customer websites are; Amazon,
Jumia and Konga.
The businesses strive to reach individuals and not businesses as in
business to business type. Various means are employed for this purpose
like newsletters, email list, instant messaging and the likes
 Customer (C2C):
Customer to Customer (C2C): for this model, the consumers are in direct
contact with one another and they can buy or sell freely without any
middleman.
This model enables the consumers to buy and sell used goods like
furniture, mobile phones or electrical appliances. Examples of websites
that use this model are: OLX and Jiji.
Consumer to consumer ecommerce presents a means for consumers to
set their rules for the business transaction, they set their prices as well
and the buying party checks for themselves if the set prices and rules are
favorable before making a deal with the selling party.
 Business (C2B):
Consumer to Business (C2B): this model is the inverse of business to
consumer because here, as the name implies, it‟s the consumers that sell
to the business.
Freelancers and businesses that buy from then are a perfect example for
this model of E- Commerce. Here, individuals (that is, consumers) create
value (could be goods or services) that businesses consume.
A programmer for instance can give his/her service and abilities to utilize
and maintain the online resources of a system as a specialist in the
programming field. A platform known as “fiver” works on this model.
 Government B2G:
Business to Government B2G: This usually involve exchange of data
between businesses and the government via the internet, an example is
when a business wants to advertise its product or service at the
government level.
Business to administration type of ecommerce includes different services
like legal documents, social security, fiscal measures and the likes.
 6. Consumer to
Government C2G:

Consumer to administration: also known as consumer to government

entails electronic transaction between individuals (consumer) and the
government.
When an individual makes a request or a query from the government, it
works on the model of consumer to administration type of ecommerce. It
creates a way that is easy for communication between governments and
individuals.
Examples include payment of health services, distance learning,
information dissemination and so on.
 7. Mobile Commerce(M-
Commerce)
M-Commerce (mobile commerce) is the buying and selling of goods and
services through wireless technology-i.e., handheld devices such as cellular
telephones and personal digital assistants (PDAs).
It does not always require internet, such as mobile banking. It is also
referred to as next generation e-commerce. Japan is seen as a global leader
in m-commerce.
As content delivery over wireless devices becomes faster, more secure,
and scalable, some believe that m-commerce will surpass wireline e-
commerce as the method of choice for digital commerce transactions.
Industries affected by m-commerce include: financial services,
telecommunications, service/retail, and information services.
 Summary

The unit shows that, e-commerce business to business involves only

companies doing business together. Business to consumer sells directly
to consumer, consumer to consumer have direct contact with one
another while consumer to business allows consumer to sell to business
and mobile commerce encourages buying and selling through wireless
technology.
 Benefits of E-Commerce
E-commerce has come with some benefits, which are:
Cheaper cost: E-Commerce is usually much cheaper than because a
physical store is not necessary. Businesses that have a physical store in a
popular location will have higher cost of operation and maintenance.
Wider reach: with e-commerce, there is no restriction, no limitation to
how large the audience to reach will be. People from different countries
who are willing and able to patronize an ecommerce business can contact
the business, place orders and the business works out delivery to them.
With ecommerce, businesses can have as many clients as possible.
 Benefits of E-Commerce
Contd..
Direct (face to face) interaction is not needed: unlike the traditional means of
commerce which is based on face to face interaction for when clients have an
enquiry and for the business‟s response too; ecommerce does not need this. The
electronic channels like email, live chats and the likes are used for these purposes
and more.
 E-Commerce removes geographical barriers. Which means you can buy and sell
from any part of the world.
E-Commerce enables sellers to lower transaction cost as they don‟t need to pay
rent for a physical store. This will enable them to maximize their profit.
Goods are delivered quickly and easily with little efforts on the side of the
consumer
 Benefits of E-Commerce
Contd..
Complaints are addressed quickly and consumers can see reviews of
other consumers before purchasing an item.
E-Commerce saves time, effort and energy of the consumers and of the
seller.
With E-Commerce, customers get to shop any day at any time as there is
no closing hour like physical stores.
E-Commerce enables the buyer and seller to be in direct contact with no
intermediary. This gives room for personal touch and quick transaction.
 Disadvantages of E-
commerce
Security: The platform being used for the ecommerce can be hacked
which can lead to client’s details being compromised and used for illegal
and fraudulent purposes.
Trust: It might take time for the ecommerce to get clients that will
actually patronize it. People have trust issues to entrust their money or
details via the internet as ecommerce usually has no physical store which
makes tracing very difficult or even impossible.
Credit card fraud is another security threat that ecommerce is exposed to
and this is like the most common and most accepted means of payment
for ecommerce transactions.
 Key Ideas in E-commerce
D2C: means direct to consumer. Middle men are cut off and business deliver
their product or services directly to the consumer without wholesalers or
retailers. It is direct!
White labelling: when a business applies its brand name to a generic product
after purchasing from a distributor. If a food business buys snacks from a
distributor of food company and then applies its own business brand name on
the snacks it has purchased, that is white labelling.
Private labelling: a business makes a deal with the manufacturer directly to
create a unique product specially for the business with an exclusive right for
them as the sole seller. If a food business approaches the manufacturers of
“minimie-chinchin” to exclusively start producing say chips for them with an
exclusive right that only this business can sell the chips, this is private labelling.
 Key Ideas in E-commerce
Wholesaling: wholesaling involves a retailer carrying out the business process
like a wholesaler by offering a discount in price when its products are sold in
bulk. The business will have piece prices and bulk prices so they can sell in bit
and also in bulk but there will be a discount in price for bulk purchase.
Drop-shipping: is a way of marketing and selling items that will be delivered by
a third party (manufacturer or supplier). Consumers pay the drop-shipper, drop-
shipper pays the supplier for the good or service to be delivered to the
consumer. Drop-shippers are like middle men that connect suppliers to
consumers. Shopify is a good example of drop-shipping platform.
Subscription: consumers pay certain agreed amount to business and business
delivers the equivalent good or service to consumer regularly at scheduled
intervals. A good example is DSTV subscription.
 E-Commerce vs E-
Business

Despite that some individuals interchangeably use e-commerce and e-

business, both are clearly different.
In e-commerce, ICT is used to enable the external activities and
relationships of the business with individuals, groups and other businesses.
While e-business is the transformation of an organization's processes to
deliver additional customer value through the application of technologies,
philosophies, and computing paradigm of the new economy. That is, e-
commerce is a particular form of e-business.
 E-Business
Compared to e‐Commerce, e‐Business is a more generic term because it
refers not only to information exchanges related to buying and selling but
also servicing customers and collaborating with business partners,
distributors and suppliers.
Interestingly, in e-business, there are three primary processes:
1. Production processes:
2. Customer-focused processes:
3. Internal management processes:
 E-Business Processes

1. Production processes: These include procurement, ordering and

replenishment of stocks; processing of payments; electronic links with
suppliers; and production control processes, among others;
2. Customer-focused processes: These include promotional and marketing
efforts, selling over the Internet, processing of customers‟ purchase orders
and payments, and customer support, among others; and
3. Internal management processes: These include employee services,
training, internal information-sharing, video-conferencing, and recruiting.
Electronic applications enhance information flow between production and
sales forces to improve sales force productivity.
KEY ELEMENTS OF AN E‐BUSINESS
SOLUTION

The key elements of an e‐Business solution are:

1. Enterprise resource planning (ERP)
2. Customer Resource management(CRM)
3. Supply Chain Management (SCM)
4. Knowledge Management
5. e‐Markets

Assignments….
 Enterprise Resource
Planning (ERP)
ERP is a type of software that organizations use
to manage and integrate the important parts of
their businesses. An ERP software system can
integrate planning, purchasing inventory, sales,
marketing, finance, human resources, and more.
 Key Features of ERP:
Integrated System: Operates in real-time, without relying on
periodic updates.
Common Database: Allows data to be defined once for the
enterprise, with every department having access to the same
data.
Consistent Look and Feel: Similar user interface across all
modules to reduce training costs and allow for smoother
transitions between modules.
 Core Modules in ERP:
1. Finance & Accounting
Tracking revenues, expenses, and profitability by individual project
or by department.
2. Human Resources (HR)
Managing employee records, payroll, recruitment, and
performance evaluations.
3. Supply Chain Management (SCM)
Monitoring the flow of products from manufacturing to delivery.
 Core Modules in ERP:
4. Customer Relationship Management (CRM)
Managing customer interactions, sales processes, and
customer support.
5. Inventory Management
Automating stock tracking and inventory control across
multiple locations.
6. Manufacturing
Planning and executing production schedules.
 Benefits of ERP:
Improved Efficiency: Reduces the need to manually
enter information, allowing faster data processing.
Better Collaboration: A centralized database enables
better communication across departments.
Enhanced Reporting: Real-time data reporting,
allowing for better decision-making.
Scalability: ERP systems can grow with your
business, allowing the addition of new modules.
 Examples of ERP Systems:
•SAP ERP: Widely used by large enterprises for comprehensive
business process integration.
•Oracle ERP Cloud: Known for its strong financial management
capabilities.
•Microsoft Dynamics 365: Provides a flexible and scalable ERP
solution for medium to large businesses.
•Odoo: An open-source ERP that offers a wide range of business
applications for small to medium enterprises.
 Customer Relationship
Management (CRM)
Customer Relationship Management (CRM) refers to the strategies,
practices, and technologies that companies use to manage and analyze
customer interactions and data throughout the customer lifecycle.
The goal is to improve customer service relationships, assist in customer
retention, and drive sales growth.
CRM systems compile customer data across different channels or points of
contact, such as the company’s website, telephone, live chat, direct mail,
marketing materials, and social networks.
 Components of CRM
1. Operational CRM:
• Focuses on automating and improving customer-facing
processes, such as sales, marketing, and customer service.
• Example: A call center using CRM software to
automatically log customer calls and direct them to the
right department.
 Components of CRM Cont…

2. Analytical CRM:
• Analyzes customer data to gain insights and support
decision-making.
• Example: A retail store using purchase history data to
identify customer preferences and tailor marketing
campaigns accordingly.
 Components of CRM Cont…
3. Collaborative CRM:
• Ensures that different departments, such as sales,
marketing, and support, share information about
customers to improve the customer experience.
• Example: A company’s sales and support teams using
shared CRM data to provide a seamless customer
experience across channels.
 Benefits of CRM
Improved Customer Service: Centralized customer
information allows for quicker and more accurate responses to
customer inquiries. E.g A hotel chain using CRM to access a
guest’s preferences and providing personalized services.
Increased Sales: CRM tools can automate sales processes,
identify potential customers, and track sales leads. E.g An
online store using CRM to send automated follow-up emails to
customers who abandon their shopping carts.
 Benefits of CRM Cont…
Enhanced Customer Retention: CRM can identify at-risk
customers and trigger alerts for proactive customer
engagement. E.g A telecom company using CRM to offer
special deals to customers nearing the end of their contracts to
prevent churn.
Better Data Management: CRM systems centralize
customer data, making it easier to analyze and draw actionable
insights. E.g A financial institution using CRM to manage and
analyze data on client investments and preferences.
 CRM Strategies
•Personalization: Tailoring interactions and offerings to
individual customer needs and preferences. E.g Netflix
recommending movies based on a user’s viewing history.

•Customer Segmentation: Dividing customers into groups

based on characteristics such as demographics, buying
behavior, or interests. E.g An e-commerce platform creating
different marketing campaigns for first-time buyers and repeat
customers.
 CRM Strategies Cont…
•Omnichannel Communication: Providing a seamless
customer experience across multiple channels, including in-
person, online, and mobile. E.g A bank allowing customers to
start a loan application online and complete it in a branch.

•Customer Feedback Loops: Actively seeking and acting on

customer feedback to improve products and services. E.g A
software company using customer feedback from CRM to
refine its user interface and features.
 Challenges in Implementing
CRM

Data Privacy Concerns: Ensuring customer data is

protected and used ethically.
Integration Issues: Combining CRM with existing
systems and processes.
User Adoption: Ensuring employees effectively use
CRM tools. Cost: High costs associated with CRM
software and implementation.
 Supply Chain Management

•Supply Chain Management (SCM) refers to the

management of the flow of goods and services,
including all processes that transform raw materials into
final products.
•It involves the active streamlining of a business's
supply-side activities to maximize customer value and
gain a competitive advantage in the marketplace.
 Key Components of SCM
•Planning: Forecasting demand and aligning production
capacity. E.g Toyota's Just-In-Time (JIT) inventory system that
minimizes waste by receiving goods only when needed.
•Sourcing: Choosing suppliers who provide goods and services
for the production process. E.g Apple sourcing key components
from multiple global suppliers for its products.
•Manufacturing: Converting raw materials into finished
products. E.g Nike's use of contract manufacturers to produce
its footwear.
 Key Components of SCM
Cont…
•Delivery & Logistics: Distribution of products to
customers, involving transportation and warehousing.
E.g Amazon's advanced logistics network that ensures
fast delivery to customers worldwide.
•Return: Handling returns of defective or unwanted
products. E.g Zappos' customer-friendly return policy
that allows free returns within a specific period.
 Importance of SCM
Cost Efficiency: Reducing production costs by optimizing the
supply chain. E.g Walmart’s efficient supply chain enables it to offer
low prices to customers.
Improved Quality: Ensuring consistent product quality across the
supply chain. E.g Coca-Cola’s strict quality control measures from
sourcing to distribution.
Customer Satisfaction: Delivering products on time to meet
customer expectations. E.g Dell’s build-to-order model that allows
customers to customize PCs and get them delivered quickly.
 Challenges in SCM
Globalization: Managing a global supply chain across different
countries with varying regulations and standards. E.g The impact of
trade tariffs on supply chain costs.
Risk Management: Identifying and mitigating risks such as natural
disasters, economic instability, and supplier failures. E.g The
disruption of supply chains during the COVID-19 pandemic.
Technology Integration: Adopting new technologies like AI, IoT,
and blockchain in supply chain processes. E.g The use of
blockchain for transparency in food supply chains by companies like
IBM.
 SCM in Practice
•Case Study: Amazon
• Amazon's SCM involves a vast network of suppliers, warehouses, and logistics
services.
• Their innovative use of robotics and AI in warehouses increases efficiency and
reduces delivery times.
•Case Study: Zara
• Zara’s SCM is built on a responsive, fast-fashion model that allows for quick
turnover of new designs.
• They control most of the supply chain, from design to distribution, enabling
them to bring new styles to stores in just a few weeks.
 Knowledge Management (KM)
•Knowledge Management (KM) is the process of creating,
sharing, using, and managing the knowledge and information
of an organization.
•To enhance decision-making, streamline processes, and foster
innovation by efficiently managing both explicit and tacit
knowledge.
 Types of Knowledge in E-
Business

•Explicit Knowledge:
• Easily documented, stored, and shared (e.g., manuals, databases,
business plans). An online retail company uses a knowledge base
to train new employees on customer service protocols.
•Tacit Knowledge:
• Personal, context-specific, and hard to formalize (e.g., expertise,
insights). A senior manager's experience in negotiating with
international suppliers.
 The Role of KM in E-Business
•Enhancing Customer Service:
• Providing employees with access to knowledge bases and CRM tools to resolve customer
queries efficiently. E.g Amazon’s use of AI-powered chatbots to assist customers by
pulling information from a vast knowledge base.
•Streamlining Operations:
• Using KM to reduce redundancy and improve efficiency in business processes. E.g
Walmart’s integration of supply chain management systems to optimize inventory based
on shared knowledge.
•Innovation and Competitive Advantage:
• Encouraging knowledge sharing to drive innovation and maintain a competitive edge. E.g
Google’s use of internal knowledge-sharing platforms to foster a culture of innovation.
 Key KM Tools in E-Business
•Content Management Systems (CMS):
• For organizing and storing explicit knowledge. E.g WordPress or Joomla for
managing website content.
•Customer Relationship Management (CRM):
• For capturing customer interactions and preferences. E.g Salesforce for
managing customer data and driving sales strategies.
•Collaboration Tools:
• Facilitating knowledge sharing among employees. E.g Microsoft Teams or
Slack for communication and project management.
 Challenges in Implementing
KM in E-Business
Data Overload: Managing large volumes of data
and distinguishing valuable knowledge.
Knowledge Silos: Ensuring that knowledge is
shared across departments rather than being
confined.
Technology Adoption: Ensuring that all
employees are trained and comfortable with KM
tools.
 Best Practices for KM in E-
Business

Foster a Knowledge-Sharing Culture: Encourage employees

to share insights and expertise.
Invest in the Right Tools: Choose KM tools that align with
business objectives.
Regularly Update Knowledge Repositories: Ensure that the
information is current and relevant.
Monitor and Measure KM Impact: Track the effectiveness
of KM initiatives through KPIs
 e-Markets
e-Markets, also known as electronic markets or online
marketplaces, are digital platforms that connect buyers and
sellers, facilitating the exchange of goods, services, and
information.
e-Markets provide a centralized space where businesses can
reach a broader audience, reduce transaction costs, and
improve efficiency in the buying and selling process.
 Benefits of e-Markets
Increased Sales Opportunities: Businesses can tap into new
markets and customer segments.
Enhanced Customer Experience: e-Markets offer a seamless
shopping experience with easy payment options and fast delivery.
Scalability: Businesses can scale operations easily, adjusting to
market demands without significant infrastructure investment.
Collaboration and Networking: e-Markets often provide
networking opportunities and partnerships through shared
platforms.
 Challenges in e-Markets

•Security Concerns: Risk of data breaches and fraud in online

transactions.
•Market Saturation: High competition as more businesses
enter e-markets.
•Dependence on Technology: Requires reliable internet and
advanced IT infrastructure.
•Regulatory Issues: Navigating different legal and tax
regulations across countries.
 Future of e-Markets
AI and Personalization: Advanced algorithms will provide
more personalized shopping experiences.
Blockchain Technology: Enhances security and transparency
in transactions.
Mobile Commerce: Increasing use of smartphones for
shopping will drive mobile-friendly e-markets.
Sustainability: e-Markets will focus more on eco-friendly
practices, such as reducing carbon footprints in logistics.
 Facilities that Support E-Commerce
and E-Business Systems
Various applications of e-commerce are continually affecting trends and
prospects for business over the Internet, including e-banking, e-tailing and
online publishing/online retailing.
A more developed and mature e-banking environment plays an
important role in ecommerce by encouraging a shift from traditional
modes of payment (i.e., cash, checks or any form of paper-based legal
tender) to electronic alternatives (such as e-payment systems), thereby
closing the e-commerce loop.
 Facilities that Support E-Commerce
and E-Business Systems
The traditional mode relationship and electronic alternatives are
diagrammatically represented in Figure 2. below;

◦ Figure 2: Traditional economy system vs Electronic economy system..

 Payment Methods
To achieve the mandates of the E-Commerce and E-Business Systems, the
following payment methods have been found to be supported facilities.
However, two payment methods have been found effectively.
These payment methods are as follow:
Traditional Payment Methods
◦ Cash-on-delivery: Many online transactions only involve submitting purchase
orders online. Payment is by cash upon the delivery of the physical goods.
◦ Bank payments: After ordering goods online, payment is made by depositing
cash into the bank account of the company from which the goods were
ordered. Delivery is likewise done the conventional way.
 Payment Methods
Electronic Payment Methods
◦ Innovations affecting consumers, include credit and debit cards,
automated teller machines (ATMs), stored value cards, and e-banking.
◦ Innovations enabling online commerce are e-cash, e-checks, smart cards,
and encrypted credit cards. These payment methods are not too popular
in developing countries. They are employed by a few large companies in
specific secured channels on a transaction basis.
◦ Innovations affecting companies pertain to payment mechanisms that
banks provide their clients, including inter-bank transfers through
automated clearing houses allowing payment by direct deposit.
 Incorporated facilities to
support e-commerce and e-
business
Some of the incorporated facilities to support e-commerce and e-
business systems are highlighted below:
◦ 1. Mobile (smart) phones
◦ 2. Website
◦ 3. Ecommerce shopping cart
◦ 4. Social media
 Relevant Components Of An
E-business Model
A shared digital business infrastructure, including digital production and
distribution technologies (broadband/wireless networks, content creation
technologies and information management systems), which will allow business
participants to create and utilize network economies of scale and scope
A sophisticated model for operations, including integrated value chains-both supply
chains and buy chains;
An e-business management model, consisting of business teams and/or
partnerships; and
Policy, regulatory and social systems-i.e., business policies consistent with e-
commerce laws, teleworking/virtual work, distance learning, incentive schemes,
among others.
 Issues and Problems that
affects E-Commerce and E-
Business Development
It is crystal clear that the present transaction systems have greatly
changed the manner and approach of transaction.
This is in line with the 21st century global economic agenda. However, as
much beneficial as e-commerce and e-business are, there are some
outstanding issues affecting this novel direction of transactions.
These challenges would undoubtful mitigate the exponential growth of
the system as well as down-speeding the take-over of these transactions
over the traditional means.
The issues affecting these systems could be majorly classified into two,
namely: technical and economic challenges.
 Technical Challenges

ICT systems which remain paramount in these systems have to be

effective not only within the boundaries of an organisation, rather
synergise with ICT systems of other organisations. This synergy rests on
user-centred design (UCD) interfaces.
Therefore, the issues and problems under this technical challenges are
the responses to the following questions:
How heterogeneous are the involved ICT systems allowed to be?
Is the present IT infrastructure, in developing countries and Nigeria in particular, fit for
e-commerce?
How to protect the ICT system to prevent its destruction, damage, or manipulation?
 Technical Challenges

Are the present ICT systems for e-commerce secure?

Are payment procedures and modules secure enough?
How guaranteed is the protection of personal data of
involved people, especially customer data?
Having realised that e-commerce depends on people, are the
IT personnel qualified enough?
How updated are the available technical support?
 Economic challenges
E-Commerce is primarily a concept of management and organization. It is
not solely a matter of technology. Some of the lingering issues confronting
e-commerce and e-business development under guise economic
perspectives are highlighted below.
Are the business protocols and procedures acceptably standardised among the actors?
Is the participation open to all? Who makes and how the decision of participation is
made?
How to adopt or change the business model?
What might happen after e-sales channel is opened? Will traditional sales channel suffer
from it?
How can we measure the success of our e-commerce activities? Will costs be
compensated through revenues?
 Economic challenges

How do we build relationship with customers, suppliers, and other

business partners to realise the merits of e-commerce?

How to redesign the business processes – in terms of employees change?

All aforelisted issues have been found in literature to be the

problems affecting the e-commerce and e-business development.
And until the necessary remedies are provided, e-commerce and e-
business would continue to witness snail development.
 E-commerce Website
Recently, e-commerce has emerged as a new way of performing business
transactions between buyers and sellers.
It offers several benefits and opportunities, and as such can help to
boost the business turnover.
E-commerce has changed the narratives of transacting as a lot of people
prefer to shop or buy online and this has brought about a lot of
competitors online.
Thereby, to have an edge ahead of competitors there is a need to have a
website that is interactive with good layouts, reliable information, great
payment options, and excellent customer service
 Benefits of E-commerce
Website

Ease and convenience: one of the major factors to be considered when

designing the e-commerce website is accessibility. The website has to be
easily accessible by potential customers. Effects such as hyperlinks, mouse
hover, and some other attributes can be part of the features on the
website for ease of use.
Products and services promotion: when a website is easily accessible and
usable, it will be easier to manage the target audience or anyone visiting
the page. E-commerce enhances interaction and directs connect with
customers, which can bring about various promotion strategies about
their products and services and thereby enhance the popularity of the
brand.
 Benefits of E-commerce
Website Cntd…

Time and Cost saving: once the website is created rightly, it will be
instantaneous and this will put a lot of things in order, there will be more
time to manage the customers, products, services, and promotions. Also,
customers will enjoy the use of the website more as they can easily view
various available products, place orders, make payments, and get their
goods as soon as possible. Website maintenance or updates to be carried
out on it will be done at a low cost.
Consistency of Information: consistency and accuracy of information are
ensured in an e-commerce website. This will be possible because all
information will be updated and shared at once on the same platform.
 Techniques for Designing E-
Commerce Website
It is essential to master the tricks involved in designing an
exceptional website, to stand out amongst competitors. To have a
responsive and interactive e-commerce web design that will benefit
both parties (buyers and sellers) visiting the website as well as increase
traffic. There are certain steps or techniques in setting up a website,
these include:
Domain Name Selection or Registration
Web Hosting
Communication Strategy
 Techniques for Designing E-
Commerce Website Cntd…
Domain name selection or registration: To set up a website, the basic step to be
taken is the domain name registration. This should be carefully done and uniquely
selected (). This will rightfully guide whoever wants to access the website with any
search engine via the internet.
Web hosts: are computers or organizations that render services with technologies
to host websites on the internet. Some people outsource their website to a
company or organization for hosting while few others have their servers to manage
their hosting in-house, which tends to save time and reduce cost.
Communication strategy: It is no doubt that e-commerce has modernized the way
business are been done, this has been made possible with effective and efficient
communication strategy which includes marketing, advertising, and search engine
use.
 Managing and Methodologies for
Developing E-Commerce Websites
1.0 Introduction
In this unit, you will acquire knowledge on managing website,
customer service, communication and methodologies for developing
websites.
2.0 Intended Learning Outcomes (ILOs)
By the end of this unit, you will be able to:
◦ Manage website
◦ Develop methodologies for e-commerce website
 Managing E-commerce
Website

To manage a website, it is very important to place customer

service into high consideration.
Customer service will bring about satisfaction to potential
customers or associated organizations and this will automatically
boost business sales and improve the business turnover.
Since products and services can only be viewed online, it is
therefore essential for an e-commerce website to have a good
customer and communication service strategy.
 Roles of Customer
Service
Some of the roles of customer service include:
Identity maintenance: It is important to maintain the company
or organization's originality and a true picture of what the
organization sells to enable buyers to have a true perception of
their products and services as well as build trust in them
Relationship maintenance: A strong professional skill is required
to be nice and friendly, as well as build a good customer and
communication relationship. This will bring about a good
relationship and trust in the brand.
 Communication Service
Strategy for Pre-sales and
After-sales
The customer and communication service strategy for pre-sales and
after-sales cannot be overemphasized, some of them are:
Sound and improved communication and technical skill.
A clear understanding of the organization and the customer needs.
Maintenance of the relationship between the old and new customers, as
well as frequently reminding them about the organization's sales and
promotion activities.
Always keep in touch with customers by calling or chatting to remind them
of a new product and ensure they drop a review on every purchase as this
will help in ensuring standards of products and services.
Effective and efficient product and service delivery after purchase.
 E-Commerce Website
Development Methodologies
The E-Commerce website methodology is a methodology that has
been in use over the years and proved successful. It is made up of
five main phases which include:
Analysis/Planning:
Design:
Building the Website:
Testing the System:
Implementation and Maintenance:
 Phase
In this phase, the aim and objectives of the business are being identified.
This is an important phase to plan, gather all essential information, and
determine solutions to the business challenges.
The analysis and planning will lead an organization to certain functionalities
that will help in achieving the vision and mission of the business.
This phase investigates the order flow, recommended features, and
direction on the overall e-commerce website development.
The purpose and content of the website should be carefully handled here,
as this is what the target audience shall look out for as well as trigger traffic
on the site.
 Design Phase:
This stage is about the logical and physical design of the website. It is a stage
that describes the website result, the system components, functionalities, and
relationships between all components.
This phase also handles the type of database management system software
to be used, the security mechanisms, and control measures to be put together
for the development.
It is crucial at this stage to have an outstanding and well-captured logo with
colors depicting what the business represents, as this will attract the target
audience.
It is therefore important to include any addition or changes and remove any
unnecessary functionality.
 Building the Website Phase:
This involves prototype design and system application building.
This phase should be handled with care as it will display the final
look of the website.
Good knowledge of Web Development Technologies is needed
because all coding will be performed at this stage.
 Testing the System Phase
As soon as the coding and building of the system are completed, the
system needs to be tested.
At this point, there is a need to check that all the HTML and CSS code
used for designing meets the latest web development standards.
This stage also includes the website delivery (the point at which website
can be uploaded to the server) once all the requirements have been met,
the account has been set up, all files rightly uploaded and website SEO
performed.
 Implementation and
Maintenance Phase:
Implementation occurs after the website design and
development; it is the final phase after which you began to use
the website.
Maintenance is another crucial thing, just like any other
software, it is very important to ensure continuous technical
checking, testing, and repair of any faults as soon as possible to
avoid the website break down.
 Creating and Maintaining a
Successful Web Presence
Introduction This unit highlight steps used to create and
successfully maintain a website.
2.0 Intended Learning Outcomes (ILOs): By the end of this
unit, you will be able to:
Create a website
Maintain a website
 Creating and Maintaining Website

The steps to create and maintain a successful website

includes:
Setting the website goals:
Target audience:
Be consistent:
Branding:
Website style:
 Setting The Website Goals:
From the onset, every website should set its aim and objectives.
This will guide them through making decisions, reaching their goals, and
maximizing their web presence.
Some of the goals to set include; information about the organization,
information about products and services, how to sell the products, and of
course customer service.
From time to time all the goals should be measured, such as; checking
the number of old and new visitors on the website, number of phone calls,
the feedback being received, etc.
 Target audience:
After setting the goals, the next question to ask and answer is „who
is the target audience‟.
Once the audience is known, you can easily set priorities and make
decisions for website relevancy.
You have to find out why the customers visit the website, the kind of
information they are looking for and most important things to do to
protect the site content and make it more appealing
 Be consistent:

It is essential to focus on the website's content, meeting

customer's needs and making the needed information
available will greatly enhance the web presence and
improve productivity.
 Branding:
The web presence is a true reflection of the website, and as such it has
to be well branded because this is likely the only information the website
visitors know about the seller or the organization.
The brand is a way the organization or company is perceived by the
customers (a true picture of who or what the organization is) which has to
do with the overall packaging from the product quality to the customer
service.
It can also involve having a consistent logo and printed materials like a
shirt, cap, business cards, or writing materials that has the company name
and logo boldly written.
 Website style:
The website should be accessible and usable.
The site design should have a good interface, a responsive design;
that can easily be used on a smaller or large screen, graphics with
adobe fireworks, adobe flash, or photoshop should be optimally used
to ensure easy navigation and a GUI environment to users
 Product Catalogue and
Processing Orders
Definition: A product catalogue is a document that lists the details of the
products or services offered by a business that aids the purchase decision
of buyers.
A catalogue shows the features, descriptions, availability, size, price, and
even reviews of the business‟ products and services.
Product catalogue is useful not only for the customers but for the
business stakeholders like the sales representatives, store managers and
even for the business owner or decision-makers
 Product Catalogue and Processing Orders

A good product catalogue presents clear and concise information,

enhances branding and smooth flow of information, ensures positive
user experience and makes the whole business procedure generally
easier.
An order is a request by a person to another who is to deliver the
product or service that is being ordered.
When a customer places an order for a product or service, then a sales
rep for a business receives the order, gets additional needed information
from the customer to ensure smooth delivery of their product or service
to satisfy the customer's order, that is order processing.
 E-Commerce Catalogue
Development
E-commerce catalogue development is a process that requires a lot of
planning because you don‟t want to piss off your customers with
unordered or irrelevant information that can make them not to end up
patronizing you. The following are some things to note in developing a
good e-commerce catalogue:
Highlighting Products
Use of Images
Applying Cross selling
Designing Appealing Interface
 Highlighting Products

 Highlight each product and service with their features, descriptions,

availability, size, price, and reviews if available as it convinces people
about how genuine a business and its products are.
 Jumia as an example, has the products properly labelled and described,
price is stated, availability status is made known, reviews are also
displayed if available.
 If a customer wants to buy a lady shoe on Jumia, the maker or designer
of the shoe is made known, the sizes available, the colours available,
type of heels, the material (maybe suede or leather) and other details
that is relevant to the purchase decision of the customer.
 Create Unique Content
Create your own content, do not copy content. Be creative and carve
out your own rich, unique and quality keywords as this improves the
search engine optimisation of your e-commerce rather than copying
content and be in supplemental results of searches.
The content Jumia uses is unique to them, it is original.
If one is starting an e-commerce, a content creator could be
outsourced for as it is very essential.
 Use Images
Words are good, image is better.
Having professional photographs with well-crafted descriptions of your
products as well as instructions and manuals can serve as advantages
that one can leverage on to generate relevant search engine traffic.
Jumia uses clear pictures to describe goods, their pictures are taken
from different angles to have a clear view and knowledge of product ton
be purchased.
The picture can aid customer's understanding of the size or colour of
the product.
 Apply Cross Selling
Cross selling is a very important aspect to consider. Identify the
Popular products, related products, and purchased.
If your customer's search is sweater, various popular sweaters
could be returned such as hoodie or knitted sweater as popular
products, socks and gloves could be returned as also purchased and
turtleneck clothing could be returned as related products.
 Design Appealing
Interface
Let your interface be appealing to sight.
Use large font and bold colors, catchy buttons and a generally
attractive environment.
Ensure simplicity also, customers will get discouraged in using a
complicated platform.
Jumia.com is quite appealing to sight, the colors used are catchy,
the texts are legible, the navigation is understandable, it is easy to
use (creating an account, logging in, shopping, adding items to cart,
making payment and the likes are all achievable).
 Processing Orders in E-
Commerce
Definition: Order processing are the activities or procedures that takes
place to ensure that placed orders are efficiently sorted so that they reach
the customers at the right time and in perfect condition.
However, from the time an order is placed by a customer to the time
that they receive the order, the business is responsible and held
accountable for delivering the ordered product or service within the
shortest time frame and in the most efficient way; this activity is called
order processing.
 Example of Order Processing
Hence, Taking a clothing line as an example of the e-commerce to be
patronize; their catalog should have provided the customers with
relevant information of material of cloth, sizes available, dimension,
available colors and the likes.
After knowing all these, if the customer decides to eventually place an
order, the ecommerce platform should allow the customers to specify
their preferences and make payment including specified delivery fee.
Finally, the business should make cloths according to the specified
preferences of customers and should ensure that they do not deliver
later than agreed day of delivery.
 Process Flow
To keep costs as low as possible, it is important that businesses have a clear process
flow to follow which will help maintain the smooth running of e-commerce operation.
It reduces stress on the business because all the necessary information are put out
already rather than telling the same thing to a thousand people in a thousand times.
Let's take Lolu’s cuisine as an example, this is a catering outlet in Kano, the following
steps describes their order processing
 ONLINE SHOP
Definition: An online shop is a website through which customers
place orders and makes payment through channels approved by the
shop.
It may represent a small local store, a major retailer, an e-commerce
store or an individual who sells products through a third-party site,
such as e-Bay.
 Models
The online store can operate under a number of business models
such as:
Business-to-consumer: this model allows the final consumer to buy directly
from the retailer like a regular physical store.
Business-to business: this model will allow businesses to purchase products
from some other businesses.
Examples of online shops include; jumia, Alibaba, konga and OLX
among others. The products in online shops range from physical
products like clothes and gadgets to digital products like software and
music and even food and beverages.
 Advantages of Online
Shopping
Convenience: the online shop is very convenient for users, it‟s opened for 24
hours and you can buy anything, from anywhere at any time; especially with
the provision of delivery companies everywhere.
Online shop also makes it easier to get reviews and enough information
products from customers after their patronage as these feedbacks helps to
improve the business process.
Selection of products is also made easy by online shops by the availability of
filters and search engines, hereby saving shopping time. Consumers can easily
filter goods based on price, colour, size and delivery in a short period of time.
Merchants as well face low risk of robbery as they operate with warehouses
instead of having regular shelves and counters with money in drawers
 Disadvantages Of Online
Shopping
Fraud: A lot of people are concerned about fraud and security which might be a
discouragement for people to actually patronize online shops. Since they haven‟t
been able to inspect the products thoroughly and physically before purchase,
customers can only hope to get what they ordered.
Phishing: Consumers sometimes face the risk of having to deal with fake
websites and providing sensitive details to malicious parties.
Sometimes, costs and fees are not fully disclosed till checkout point or delivery
point.
Privacy of personal information is very important to a lot of consumers. Online
shops sometimes use these pieces information without the knowledge of the
consumers for example, sharing of catalogues by e-mail.
 Shopping Cart
Definition: A shopping cart is a piece of software embedded on an online
market platform that facilitates the purchase of a product or service. That
is, it keeps record of products a buyer has selected for subsequent
purchase.
The customer typically picks goods for purchase on the online market, the
shopping cart then catalogs the items that has been choosen by the
customers and then places the items in his or her Shopping cart.
The Shopping cart usually keeps a sum of the items kept therein.
It allows a buyer to gather products, assess the selected items and make
changes or add extra items if needed before going on to make purchase
immediately or later in the future.
 Types of Shopping Carts
There are basically three types of shopping carts:
Open source shopping cart
Licensed shopping cart
Hosted shopping cart
 Open Source Shopping
Cart
This type of shopping cart is easily available, free to own, modify and
use. No licensing fee is required in order to gain complete control over
the site.
It is better to have an open source shopping cart when you intend on
setting up and handling a complex large shop with a different variety of
products. Developer skills is necessary when using open source software
and Customer support is very limited.
It has a well-designed user interface and also Numerous integration can
be added to it. Open source shopping cart requires Adds on to perform
higher level functions.
 Licensed Shopping Cart
Licensed shopping cart is usually owned by the owner of a business. the
owner acquires in order to host on his own server.
It is a more direct type compared to open source. It is created by business
organizations then they make it accessible for buyer to purchase and use.
To use this software a user must acquire license from the organization. All
modifications are managed by the organization that created it, although
they may create a method for independent developers to create addons.
Example of licensed shopping carts include OpenCart, Magento, and
Woocommerce .
 Hosted Shopping
Cart
These are standard solutions managed by the company that developed
them. Users only need to sign up with the host they have chosen and
commence selling immediately. It consists both shopping cart software
and web hosting.
Unlike the other types hosted software, it provides a web based user
interface with which a user can manage his store instead of downloading
software which enables them to run their business directly.
Most hosted shopping carts are charged on monthly basis depending on
your subscription. Costlier plans have more built in features and
advantages.
 Shopping Cart
Software
The storefront and the administration are the two main
components of a shopping cart.
The Store Front: The store front is the part of the web store that
the customers can easily access. These parts include product
pages, category navigation, search pages and checkout pages
where the customer can complete their transaction after
entering the product details. The appearance of the store front
can normally be modified the online shop owner in for better
customer satisfaction.
 Components Of A
Shopping Cart
Software Cntd…
The Administration: The administration is the part of the web
store which is only accessible to the merchant. Management
and maintenance of these web store is done here. On the
administration page a merchant is able to remove add or edit
product categories, shipping options, currency and sales tax
and accounting tools. Orders and inventories can also be
managed in administration. The administration area can be
web based or desktop based.
 Functions of Shopping
Cart
Shopping security: With certain compliance and certification, a shopping
cart protect customer's identity and information from theft. The shopping
cart secures all credit card and financial information that are used on the site
by customers. Ensuring that payment and transactions are enabled and well
managed, a shopping cart addresses security issues associated with online
shopping.
A solitary hub for data management: Order and payment history of each
costumer are maintained on the shopping cart. credit card information and
banking details are also stored with customer's permission which makes
subsequent transactions easier. User browsing criteria and activities are
monitored and collected, thereby helping them develop more image of what
the selling trend is for different periods of time.
 Functions of Shopping
Cart Cntd…
 An established retail store front A shopping cart provides easy access to
selected products and it also collects other related pages that may interest
customer. Shopping cart improves the shopping experience of a customer by
keeping track of all the activities of customers. This aids in creating a more
professional image of what a shopping cart owner can offer to the
customers.
Compatibility of Various Payment Modes The last step a customer must
carry out is paying for a purchase. An important function of a shopping cart is
the ability to collect payments in a stress-free way. The shopping cart
provides all the necessary tools to charge customers without them needing
to abandon their carts. The shopping cart ensures every payment can be
processed.
 Functions of Shopping
Cart Cntd…
Feedback and Product Review: According to a study by the
Nielsen company in 2009, up to 70% of respondents find
“consumers opinion posted online” reliable. Customers are asked to
rate the store‟s service and give 58 tips on what more can be done
to improve the offered services. This ratings and reviews give new
customers insight on making better buying choices.
 Payment Gateways For
Shopping Carts
Introduction
Payment gateway securely authorizes online payment. It
allows for the transmission of credit card information,
approval code, and any confirmation details back to
shopping carts in a secured way. Examples include;
Remitta, PayPal, Mollie, Square, Venmo, Apple Pay, Amazon
Pay, etc.
 Types of Shopping Carts
Payment Gateways
There are different ways with which a consumer can pay for
items purchased. Each gateway has it peculiarities so, a
consumer chose based on the type of gateway they feel is
best.
The following are the types of shopping carts payment
gateway:
 IMA (Internet merchant account)
TTP (Third party payment)
MPP (Manual payment processing)
 IMA (Internet Merchant
Account)

This is an account issued by a financial institution.

It enables merchants to accept credit card payment online.
Business has to have separate account for every type of credit
card they intend to accept (E.G master card, VISA E.T.C).
 TTP(Third Party Payment):
This involves the introduction of another body that serves as an
intermediary between the merchants and the consumers.
The benefit of the third party is that they make selling of goods easier and quicker.
Here, the money for the transaction is deposited in a special account that is controlled
by the service provider.
In order the merchant to obtain the money, they will make request to the service
provider, the service provider will in turn request for the proof of the transaction
success,
if they are to provide it, then the funds will be released and if there is a dispute over
the transaction, they may withhold the funds for a loner period.
The most common type of the third party payment is the PAYPAL.
 MPP (Manual Payment
Processing)
This the type of gateway option usually employed when there is
limited number of online orders.
Here, users can make orders online but payment will be done
manually (i.e credit cards are processed manually instead of
automatic processing).
Credit card information are acquired via a secure server.
Factors To Consider When
Choosing A Payment
Gateway

Privacy of the transaction data

Credibility of the service provider
Cost associated with payment gateways.
 Shopping Cart Problems
Introduction
Shopping carts are widely known for its benefits which is
rightly so.
However, there has been a massive drop in the usage of
shopping c, arts due to the problems associated with it.
Some of the problems are explained further.
 Security and fraud
issue
Due to the fact that items bought online cannot be physically inspected,
there is always the risk of purchasing substandard or even fake goods.
A phenomenon called” phishing” is also a huge security problem. It‟s a
situation where by false websites are created with the aim of fooling
people in to thinking they are dealing with trustworthy entities.
Consumers are required to provide sensitive details such as credit card
detail, passwords, username and so on. The provided details can then be
used to attack them.
Issues of stolen cards being used to purchase goods which leads to
repudiation is also rampant.
 Confidentiality
There are many websites that keep track of consumers shopping
habit in order to recommend other items and websites to view.
Some keep record of mail addresses and phone numbers and in
turn utilizes it to advertise their product which is not something
every consumer want.
 Lack Of Total
Disclosure
The lack of full disclosure with respect to the price of items purchase is
one of the reasons people abandon the usage of shopping carts.
This is so because the total cost of goods cannot be seen until the final
stages of the purchasing process as additional fees such as shipping fees
are not usually included at the first steps of the purchasing process.
This situation is more evident when it involves international purchases
where additional fees like brokerages and duties fee are not even
included at the final stages of the purchasing process but rather at the
delivery point.
 Shopping Cart
Abandonment
After selecting items for purchase on their shopping cart, customers
leave the shopping cart for different reasons and fail to complete their
purchase i.e. the shopping cart has been abandoned.
The most common reason is that most people are just browsing for
options. Some of these reasons include:
The checkout process taking too long.
Check outs can be done without creating an account with the merchants.
Crashing during checkout or website interrupted by bugs.
Bad return policies dissuade customers from buying.
Credit card not verified.
Unavailability of mobile-friendly payment options.
 Option For Online
Store
Payment processing is an important part of an ecommerce website.
Therefore, webstore owners must consider some factors while chosen the
payment option for their shop.
Some of these factors include but not limited to:
Associated Cost: this include the cost for setting up the system and its maintenance e.g
monthly; charge back fees, and the fees associated with the various payment options and
accounts.
Security and protection: ability to ensure secure transaction, provide data privacy and
detect fraudulent transaction in a real time
Credibility of the Service provider: such as expert staff, user friendly policies, no hidden
charges.
Support Services: ability to provide support services at any time.
 Online Purchasing Process
Typically, depending on the method adopted, online purchase process
begins with a buyer visiting a seller‟s website either as a registered
customer or a guest. As a registered customer, a buyer will enter the store
via buyer‟s “My Account” and non-register user will enter through the
store catalog.
Part of the important tools available for buyers is the search engine that
can help customers search through the large E-catalog database and
present the details of the products related to the used “search terms”.
Nowadays, some merchants provide features where buyers can compare
prices with their competitors
 Online Purchasing Process
If customer is not satisfied with the price or any other description, the
buyer may abandon the site. Otherwise, the buyer may select one or more
item as s/he wants and placed it in shopping cart.
After the items have been selected for purchase, the buyer moves to a
checkout by clicking on “Proceed to checkout”, add address and select a
shipping (standard, next day etc) and billing option for delivery such as
(first class, express etc).
The system calculates the total sum of the selected items including the
shipping fee. A payment method is selected such as payment by credit
cards, PayPal, check after billing, instalments and so on. Finally, the buyer
clicks on “submit” after confirming the accuracy of the ordered items.
 Online Purchasing Process
This process can be summarized in the following shopping process
flowchart;
 Tracking Shoppers’
Information
Customer can be regarded as the most important part of eCommerce
ecosystem. In fact, they are the reason for the existence of eCommerce
websites in the first place.
Therefore, it is very essential for businesses to know their customers
(current and potential customers). Customer tracking is a technique for
collecting and organizing customer's information.
Many businesses collect information about their customers such as name,
address, and phone numbers. However, the evolvement of the eCommerce
and its related technologies show that there is more to customer tracking
than just collecting names.
 Techniques for Tracking
Customer Information
In order to track customer‟s information, online shop owners use one or
more techniques. Some of the popular techniques are as follows:
Cookies
Tracking Pixel
Web Beacons
Browser Fingerprinting
Other Techniques: Other user information tracking techniques
are zombie cookies, dynamic cookies, flash cookies, IndexedDB
etc.
 Cookies:
Cookie is a computer program that a website install on user‟s computer
(or browser) and gets loaded whenever the website is visited.
Cookie enables websites to identify and remember its users. It is the used
online tracking technique used on eCommerce websites.
In addition, cookies can also be used to serve the purpose of monitoring
users and give insight about user‟s behaviours.
Cookies can also be employed for user profiling as well as a tool to aid
targeted marketing. Cookies placed by the website visited is referred to as
“first-party cookies”, while a cookie placed by someone other the website
visited is referred to as “third-party cookies”. A third-party cookie may be
 TYPES OF COOKIES
There exist different kinds of cookies, the most popular ones are
analytics, necessary, and marketing cookies.
a) Analytics cookies: Analytics (or statistics cookies) is (often) a third-
part cookies that collects, logs, and analyse user data using advance or
statistical techniques to provide insight about the user behaviour to the
website owner.
b) Necessary cookies: This is the basic cookies that allow website
performs its normal function.
c) Marketing cookies: Marketing (or advertisement) cookies are used
to target visitors for advertisement purpose. These cookies track user
behaviour in order to determine what product customer is likely to buy.
 Tracking Pixel:
Tracking pixel (or pixel tag) is a user tracking technique that contains
invisible and transparent images of a single pixel, usually present on a
webpage or an email.
The invisible images load when a user loads a webpage or open an email
and allows the sender of the tracking pixel (an ad server) to read and
record the opening of the webpage or email and monitor the user
activities.
Information that may be obtained from user include: operating system,
browser, Email program, website visitation/loading time, user IP address
and location, as well as user behaviour.
 Web beacons:
Web beacons (or ultrasound beacons) are online user tracking technique
that emits high-pitch sounds from the device a user is using to access a
webpage that has beacon installed.
The sound is inaudible to humans but all the nearby devices can react to
it. Web beacons also known as Ultrasound cross-device tracking (uXDT) are
technology to bridge the gap between physical world and the digital world.
For example, an IT based store with an ultrasound beacon installed on
their website may gain insight from the connected devices and probably use
it to suggest similar or alternative products to the ones a customer is
currently using.
 Browser fingerprinting:
Browser (or device) fingerprinting is an online user tracking technique
that collects user highly specific information about their system and
settings.
The collected information is used to create a fingerprint (a unique
identification) for the device that can be tracked across the web.
This technique works irrespective of whether cookie is blocked or not.
 Security in E-Commerce
Electronic commerce (EC) security refers to the principles that allow buying
and selling of goods and services online are conducted in a safe and secure
conditions.
EC security ensures the protection of E-Commerce assets (including
computers, servers, networks, databases and user data) from unauthorized
access or use, alteration, or destruction with the use of security protocols and
mechanisms.
EC security is an integral part of any online business, as it determines the
success of online stores. In other words, the level of trust and patronage enjoin
by online stores depend on how customers feel safe and secure while
performing e-payment or transaction on their platforms.
 Commerce
It is very important for online store owners and customers to be aware of
various security threats associated with online transactions.
Some common security threats to E-commerce include fraudulent use of
credit cards, identity theft, loss or modification of personal information,
information leakages or illegal disclosure of personal data, phishing, spam,
computer viruses, ransomware and other forms of malware attacks.
It is highly important for eCommerce website owners and users to be
aware of the various security and privacy issues associated with the
platform and ensure that standard security measures are included from
the inception of webstores.
 Electronic Commerce
Security Requirement
A good security determines the success of electronic commerce. To
provide a safe and secure online transaction, the following security
requirements are required to prevent or minimize online transaction risks:
1) Confidentiality: This is the assurance that information is accessed or used only
by an authorized person. A good EC webstore must ensure that information is not
accessible to an unauthorized individual during the storage, processing, and
transmission.
2) Integrity: The assurance that information stored or transmitted over the
network is not altered by an unauthorized person (or illegally).
3) Availability: the assurance that information should be available to the
authorized users whenever and wherever. It requires that EC transactions are
always available to the authorized persons.
 Electronic Commerce
Security Requirements
Contd…
 4) Authenticity: This requires that a mechanism be put in place to ensure that
users are authenticated before granting access to the required information. It
ensures that only people with correct credentials get access to the information.
5) Authorization: it ensures that an authenticated person has permission to
perform a specified operation on a specific system.
6) Non-Repudiation: This requires the use of mechanism to protect users against
denial of order or denial or payment. The makes sure that sender could not deny
sending a message, while the recipient could not deny the receipt either.
7) Encryption: This ensures that information is encrypted and decrypted only be
an authorized user.
8) Auditability: it ensures that data is recorded in a manner that make it possible
to conduct auditing for integrity requirement.
 Security Protocol for
Ecommerce
One of the most commonly used protocols for ensuring secure online
transactions is secure socket layer (SSL)
This is the most commonly used security protocol for online transaction.
This protocol encrypts information between user devices and webstore
servers. It makes it difficult for an authorized party to decode any
information exchange such as credit card number.
To identify an EC website with a secure transaction between user‟s
computer and the website, the following measures should be noticed:
a) A URL address that begins with “https//” instead of the popular “http//”.
b) A browser that shows a lock icon or a message that notifies you that you are on a
secure site.
 Minimizing Security
Threat on EC Website
To ensure a secure transaction on electronic commerce website, a great
deal of efforts must be put in place to minimize security threats. Some of
the processes for minimizing security threats are:
1. Security risk assessment: A security risk assessment must be performed
from time to time to identify the level of security required for each of the
firm‟s assets. To do this, the list of information assets must be identified and
the security priority level must be ascertained.
2. Security policy: A security policy statement must be developed specifying
the responsibility of the stakeholders and how to go about their day to day
activities without compromising security standards.
 Minimizing Security
Threat on EC Website
3. Implementation plan: A clear plan must be developed to describe
the steps to be taken in order to achieve the security goals.
4. Security organization: A unit or department to be overseeing the
administration of security policy needs to be created. This unit is
responsible for ensuring that everyone works in
5. Security audit: A review of policies, security access and procedure
need performed in a routine manner. The review process provides an
evaluation procedure to uncover the vulnerability in your security
architecture. tandem with the developed security policy.