Chapter Six Questions and Answers

Chapter 6
Section 6.1

1. Define e-commerce and distinguish it from e-business.
E-Commerce is the process of buying, selling, transferring, or exchanging products. Services or information via computer networks, including the Internet. E-business adds to the above processes as it also refers to servicing customers, collaborating with business partners and performing electronic transactions within an organisation.

2. Distinguish among B2C, B2B, C2C and B2E electronic commerce.
B2C – sellers are orgs and buyers are individuals. B2B – both sellers and buyers are business orgsC2C – individual sells products or services to other individuals. B2E – an org uses electronic commerce internally to provide information and services to its employees.

3. List some benefits and limitations of e-commerce.
Some of the major benefits to E-Commerce is its’ easy accessibility and ability to lower costs. This in turn has benefitted organizations, minimizing costs of processing, distributing and retrieving information. Furthermore, the customer has benefitted through being able to access a vast number of products and services any time and at any location. On a whole, society can now benefit through e-commerce’s delivery of information, services and products to people in cities, rural areas and developing countries.With these benefits though, E-commerce has its’ drawbacks. These limitations include the lack of universally accepted security standards, expensive accessibility and insufficient telecommunications bandwidth.

Section 6.2

1. List the major issues relating to e-tailing.
The major issues relating to e-tailing are channel conflict and order fulfillment. Channel conflict is where conflict may occur for companies with their regular distributors when selling online to customers. Channel conflict can arise in areas such as pricing of products, services and resource allocation.Order fulfillment can occur at any given time where a company sells to customers directly and is involved in a variety of other order-fulfillment activities.

2. What are spamming, permission marketing and viral marketing?
-Spamming: is the indiscriminate distribution of electronic ads without permission of the receiver.
-Permission Marketing: as consumers to give their permission to voluntarily accept online advertising and e-mail.
-Viral Marketing: refers to online “word-of-mouth” marketing. The idea behind viral marketing is to have people forward messages to friends.

Section 6.4

1. List the various electronic payment mechanisms.
Electronic payment mechanisms include electronic checks, electronic credit cards, purchasing cards and electronic cash. Electronic credit cards allow customers to charge online payments to their credit card account. Electronic checks is where a customer wishes to use e-checks and established a checking account with a bank. And purchasing cards are normally used for unplanned B2B purchases where corporations normally limit the amount per purchase. Electronic cash appears in forms such as stored-value money cards, smart cards, person-to-person payments and digital wallets.

2. What are micropayments?
Micropayments are reffered to as small payments of a few dollars or less for goods that are purchased over the internet. These payments are normally transferred with a lower security.

Section 6.5

1. List some ethical issues in EC.
-Presents some threats to privacy. For example, most electronic payment systems know who their customers are.
-Issue of tracking. This is seen as an ethical issue as an individual’s activities on the internet can be tracked by cookies.
- It may eliminate the need for some of a company’s employees, as well as brokers or agents.

2. List the major legal issues of EC.
-Fraud on the Internet: For example, the internet allows stock promoters to falsely mislead and spread positive rumours about the prospects of the companies they recommend in order to boost the stock price.
-Domain Names: problems arise when companies with similar names compete over a domain name. As companies who sell goods and services want customers to find them easily over the internet; the most effective way in doing so is where the domain name matches the company’s name.
-Cybersquatting
-Taxes and other fees
-Copyright