E-commerce 2016

business. technology. society.

twelfth edition
global edition

Kenneth C. Laudon
Carol Guercio Traver

Copyright © 2017 Pearson Education Ltd.

 Chapter 4
Building an E-commerce Presence

Copyright © 2017 Pearson Education Ltd.

 Class Discussion

Thegioididong.com

 Mục tiêu của thế giới di động khi thiết kế trang web
TMĐT của doanh nghiệp mình?
 Những cân nhắc trong việc thiết kế website của
thegioididong?
 Thế giới di động đã làm gì để đáp ứng nhu cầu của
người dùng thiết bị di động?

Copyright © 2017 Pearson Education, Inc. Slide 3-4

 Imagine Your E-commerce Presence
 What’s the idea? Vision includes:
 Mission statement
 Target audience
 Intended market space
 Strategic analysis
 Marketing matrix
 Development timeline
 Preliminary budget

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Imagine Your E-commerce Presence (cont.)
 Where’s the money?
 Business model(s):
 Portal, e-tailer, content provider, transaction broker,
market creator, service provider, community
provider (social networks)
 Revenue model(s):
 Advertising, subscriptions, transaction fees, sales,
and affiliate revenue

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Imagine Your E-commerce Presence (cont.)
 Who and where is the target audience?
 Describing your audience
 Demographics
 Age, gender, income, location

 Behavior patterns (lifestyle)

 Consumption patterns (purchasing habits)
 Digital usage patterns
 Content creation patterns (blogs, Facebook)
 Buyer personas

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Imagine Your E-commerce Presence (cont.)
 Characterize the marketplace
 Demographics
 Size, growth, changes
 Structure
 Competitors
 Suppliers
 Substitute products

 Where is the content coming from?

 Static or dynamic?

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Imagine Your E-commerce Presence (cont.)
 Know yourself—SWOT analysis
 Develop an e-commerce presence map
 Develop a timeline: Milestones
 How much will this cost?
 Simple Web sites: up to $5000
 Small Web start-up: $25,000 to $50,000
 Large corporate site: $100,000+ to millions

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 SWOT Analysis

Figure 4.1, page 193

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 E-commerce Presence Map

Figure 4.2, page 194

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 Building an E-commerce Site:
A Systematic Approach
 Most important management
challenges:
Developing a clear understanding of
business objectives
Knowing how to choose the right
technology to achieve those objectives

Copyright © 2017 Pearson Education Ltd. Slide 4-12

 Pieces of the Site-Building Puzzle
 Main areas where you will need to make
decisions:
 Human resources and organizational
capabilities
 Creating team with skill set needed to build and
manage a successful site
 Hardware/software
 Telecommunications
 Site design

Copyright © 2017 Pearson Education Ltd. Slide 4-13

 The Systems Development Life Cycle
 Methodology for understanding business
objectives of a system and designing an
appropriate solution
 Five major steps:
 Systems analysis/planning
 Systems design
 Building the system
 Testing
 Implementation

Copyright © 2017 Pearson Education Ltd. Slide 4-14

Web Site Systems Development Life Cycle

Figure 4.5, Page 198

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 System Analysis/Planning
 Business objectives:
 List of capabilities you want your site to have

 System functionalities:
 List of information system capabilities needed
to achieve business objectives
 Information requirements:
 Information elements that system must produce
in order to achieve business objectives

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Table 4.2, page 199

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 Systems Design:
Hardware and Software Platforms
 System design specification:
 Description of main components of a system and their
relationship to one another
 Two components of system design:
 Logical design
 Data flow diagrams, processing functions, databases

 Physical design
 Specifies actual physical, software components, models, and
so on

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 Logical Design for a Simple Web Site

Figure 4.6 (a), Page 201

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 Physical Design for a Simple Web Site

Figure 4.6 (b), Page 201

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 Build/Host Your Own vs. Outsourcing
 Outsourcing: Hiring vendors to provide
services involved in building site
 Build own vs. outsourcing:
 Build your own requires team with diverse skill set; choice of
software tools; both risks and possible benefits
 Host own vs. outsourcing
 Hosting: Hosting company responsible for ensuring site is
accessible 24/7, for monthly fee
 Co-location: Firm purchases or leases Web server (with control
over its operation), but server is located at vendor’s facility

Copyright © 2017 Pearson Education Ltd. Slide 4-21

 Choices in Building and Hosting

Figure 4.7 Page 202

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 Testing, Implementation, and
 Testing
Maintenance
 Unit testing
 System testing
 Acceptance testing
 A/B testing (split testing)
 Multivariate testing

 Implementation and maintenance:

 Maintenance is ongoing
 Maintenance costs: Similar to development costs
 Benchmarking

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 Factors in Web Site Optimization

Figure 4.10, Page 209

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 Simple vs. Multi-tiered
Web Site Architecture
 System architecture
 Arrangement of software, machinery, and tasks in an
information system needed to achieve a specific
functionality
 Two-tier
 Web server and database server
 Multi-tier
 Web application servers
 Backend, legacy databases

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 Two-Tier E-commerce Architecture

Figure 4.11(a), Page 211

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 Multi-Tier E-commerce Architecture

Figure 4.11(b), Page 211

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 Web Server Software
 Apache
 Leading Web server software
 Works with UNIX, Linux operating systems
 Reliable, stable, part of open software community

 Microsoft’s Internet Information Server

(IIS)
 Second major Web server software
 Windows-based
 Integrated, easy-to-use

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Table 4.4, Page 212

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 Site Management Tools
 Basic tools
 Included in all Web servers
 Verify that links on pages are still valid
 Identify orphan files

 Third-party software for advanced

management
 Monitor customer purchases, marketing campaign
effectiveness, and so on
 Webtrends Analytics 10

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 Dynamic Page Generation Tools
 Dynamic page generation:
 Contents stored in database and fetched when needed

 Common tools:
 CGI, ASP, JSP, ODBC, JDBC

 Advantages
 Lowers menu costs
 Permits easy online market segmentation
 Enables cost-free price discrimination
 Enables content management system (CMS)

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 Application Servers
 Web application servers:
 Provide specific business functionality required
for a Web site
 Type of middleware
 Isolate business applications from Web servers and
databases
 Single-function applications being replaced by
integrated software tools that combine all
functionality needed for e-commerce site

Copyright © 2017 Pearson Education Ltd. Slide 4-33

E-commerce Merchant Server Software
 Provides basic functionality for sales
 Online catalog
 List of products available on Web site

 Shopping cart
 Allows shoppers to set aside, review, edit selections,
and then make purchase
 Credit card processing
 Typically works in conjunction with shopping cart
 Verifies card and puts through credit to company’s
account at checkout

Copyright © 2017 Pearson Education Ltd. Slide 4-34

 Merchant Server Software Packages
 Integrated environment that includes most of
functionality needed
 Key factors in selecting a package
 Functionality
 Support for different business models, including (m-commerce)
 Business process modeling tools
 Visual site management and reporting
 Performance and scalability
 Connectivity to existing business systems
 Compliance with standards
 Global and multicultural capability
 Local sales tax and shipping rules

Copyright © 2017 Pearson Education Ltd. Slide 4-35

Web Services and Open-Source Options
 Options for small firms
 Hosted e-commerce sites
 Offer site building tools and templates
 Example: Yahoo Stores Basic

 Open-source merchant server software

 Enables you to build truly custom sites
 Requires programmer with expertise, time

Copyright © 2017 Pearson Education Ltd. Slide 4-36

 Choosing Hardware
 Hardware platform:
 Underlying computing equipment needed for
e-commerce functionality
 Objective:
 Enough platform capacity to meet peak demand
without wasting money
 Important to understand the factors that
affect speed, capacity, and scalability of a
site

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 Right-Sizing Your Hardware Platform:
The Demand Side
 Customer demand:
 Most important factor affecting speed of site

 Factors in overall demand:

 Number of simultaneous users in peak periods
 Nature of customer requests (user profile)
 Type of content (dynamic vs. static Web pages)
 Required security
 Number of items in inventory
 Number of page requests
 Speed of legacy applications

Copyright © 2017 Pearson Education Ltd. Slide 4-38

 Right-Sizing Your Hardware Platform:
The Supply Side
 Scalability:
 Ability of site to increase in size as demand warrants

 Ways to scale hardware:

 Vertically
 Increase processing power of individual components

 Horizontally
 Employ multiple computers to share workload

 Improve processing architecture

 Outsource to cloud service, CDN

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Table 4.8, Page 223

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Table 4.9, Page 224

Copyright © 2017 Pearson Education Ltd. Slide 4-41

 Other E-commerce Site Tools
 Web site design: Basic business considerations
 Enabling customers to find and buy what they need
 Tools for Web site optimization
 Search engine placement
 Metatags, titles, content
 Identify market niches, localize site
 Offer expertise
 Links
 Buy ads
 Local e-commerce

Copyright © 2017 Pearson Education Ltd. Slide 4-42

Table 4.10, Page 225

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Table 4.11, Page 226

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 Tools for Interactivity and
Active Content
 CGI (Common Gateway Interface)
 ASP (Active Server Pages)/ASP.NET
 Java, JSP, and JavaScript
 ActiveX and VBScript
 ColdFusion
 PHP, Ruby on Rails, Django
 Other design elements:
 Widgets, mashups

Copyright © 2017 Pearson Education Ltd. Slide 4-45

 Personalization Tools
 Personalization
 Ability to treat people based on personal
qualities and prior history with site
 Customization
 Ability to change the product to better fit the
needs of the customer
 Cookies
 Primary method to achieve personalization

Copyright © 2017 Pearson Education Ltd. Slide 4-46

 The Information Policy Set
 Privacy policy
 Set of public statements declaring how site will
treat customers’ personal information that is
gathered by site
 Accessibility rules
 Set of design objectives that ensure disabled
users can effectively access site

Copyright © 2017 Pearson Education Ltd. Slide 4-47

 Insight on Technology: Class Discussion

Designing for Accessibility

 Why might some merchants be reluctant to make
their Web sites accessible to the disabled?
 How can Web sites be made more accessible?
 Should all Web sites be required by law to provide
“equivalent alternatives” for visual and sound
content?
 What additional accessibility problems do mobile
devices pose?

Copyright © 2017 Pearson Education, Inc. Slide 3-48

 Developing a Mobile Web Site and
Building Mobile Applications
 Types of m-commerce software
 Mobile Web site
 Responsive Web design

 Mobile Web app

 Native app
 Hybrid app
 Runs inside native container
 App distribution
 Based on HTML5, CSS, Javascript

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 Planning and Building a Mobile
Presence
 Identify business objectives, system
functionality, and information
requirements
 Choice:
 Mobile Web site or mobile Web app
 Less expensive

 Native app
 Can use device hardware, available offline

Copyright © 2017 Pearson Education Ltd. Slide 4-50

Table 4.13, Page 237

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Mobile Presence Design Considerations
 Platform constraints
 Graphics, file sizes
 Mobile first design
 Desktop Web site design after mobile design
 Responsive Web design (RWD)
 CSS site adjusts layout of site according to device screen
resolutions
 Adaptive Web design (AWD)
 Server delivers different templates or versions of site
optimized for device

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 Cross-Platform Mobile App
Development Tools
 Objective C, Java
 Low cost, open-source alternatives
 Appery.io
 Codiqa
 PhoneGap
 MoSync
 Appcelerator

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 Performance and Cost Considerations
 Mobile first design: Most efficient
 Mobile Web site:
 Resizing existing Web site for mobile access is least
expensive
 Mobile Web app:
 Can utilize browser API

 Native app:
 Most expensive; requires more programming

Copyright © 2017 Pearson Education Ltd. Slide 4-54

 Insight on Technology: Class Discussion

Building a Mobile Presence

 What are the key differences between user
experience on a Web site and on a mobile
device?
 Why would a mobile Web site or app from the
same merchant need different content or
functionality?
 In which cases would a merchant want to
develop a mobile app over a mobile Web site?

Copyright © 2017 Pearson Education, Inc. Slide 3-55