Electronic Commerce Fundamentals
CIW Website Design Manager Course Section 1, Part A, Chapter 9
Electronic Commerce Definition
Electronic Commerce has traditionally been defined as commerce conducted via any electronic medium. Issues such as data management and security were well understood. The Internet has changed the equation to a certain degree because it is fairly new and constantly changing.
Electronic Commerce must be defined on a broader scope: It is the integration of communications, data management, and security capabilities that allows organisations to exchange information related to the sale of goods and services.
Advantages of Electronic Commerce
Electronic commerce has the potential to markedly increase the speed, accuracy and efficiency of business and personal transactions.
- Constant Availability: Online store is open 24/7
- Streamlined buyer/seller relationship
- Reduction of errors, time and overhead costs
- Reduced time for transaction completion
Disadvantages of Electronic Commerce
Electronic Commerce may lead to a greater degree of vulnerability. With public network transactions, complete with names, addresses and credit card numbers, the potential for fraud increases. Other issues may include:
- Protection of Intellectual Property
- Ensuring the confidentiality of data and payment instructions
- Taxation: Varies considerably from location to location
Secure Electronic Transactions (SET)
SET is a protocol that could represent a substantial step forward in security and capabilities for electronic commerce. SET requires that all participants have certificates for definite identification, and requiring all transactions to be signed at each step of the process almost eliminates the potential for fraud. In fact, by requiring cryptographic identification, the authentication will surpass that of non-electronic transactions.