Echelon Institute of Technology

Faridabad, Haryana-121001

Practical Lab File

of
E-Commerce

BRANCH : BBA

Submitted To: Submitted By:

Mrs. Luxmi mam Saurabh sharma

(A.P, CSE Department) (21BBA99)

PRACTICAL FILE
(2024)
 INDEX

S.NO NAME OF EXPERIMENT PAGE NO. DATE OF SIGNATURE

EXPERIMENT

1 Study of an

E-Commerce Website

2 Designing Business
Model for the Proposed
Website

3 Internet Banking

4 Case Study: Amazon.com

5 Case Study: Nissan

Motors and Nissan
Computers
 PRACTICAL – 1

Study of an E-Commerce Website

AIM: The practical consists of studying the applications of E-Commerce and E-
Business. Based on the same, the students are required to design an E-Commerce
website on paper. The website should be designed by taking into consideration all the
advantages of E-Commerce. The practical will help the students to understand the
forthcoming contents of the subject in a better fashion.

The minimum contents to be taught in the lab prior to assigning students the task of creating
a website are as follow:

“Electronic Commerce is the buying and selling of products or services over electronic
systems such as the Internet and other computer networks.”

Electronic Commerce, commonly known as E-Commerce, is the cutting edge for business
today. The amount of trade conducted electronically has grown dramatically since the world-
wide introduction of the Internet. A wide variety of commerce is conducted in this way, such
as electronic funds transfer, supply chain management, e-marketing, online marketing, online
transaction processing, electronic data interchange (EDI), etc.

Examples or Applications of E-Commerce

1) Online Shopping

Buying and selling goods on the Internet is one of the most popular examples of e-commerce.
Sellers create storefronts that are the online equivalents of retail outlets. Buyers browse and
purchase products with mouse clicks. Though Amazon.com is not the pioneer of online
shopping, it is arguably the most famous online shopping destination.

2) Electronic Payments

When you are buying goods online, there needs to be a mechanism to pay online too. That is
where payment processors and payment gateways come into the picture. Electronic payments
reduce the inefficiency associated with writing and mailing checks. It also does away with
many of the safety issues that arise due to payment made in currency notes. For example,
online deduction from savings account for payment of insurance or monthly bills etc.

3) Online Auctions

The Internet has made auctions accessible to a large number of buyers and sellers. Online
auctions are also an efficient mechanism for price discovery. An example of online auction
website is eBay.com.

4) Internet Banking

Today it is possible for you to perform the entire gamut of banking operations without
visiting a physical bank branch. Interfacing of websites with bank accounts, i.e. viewing
recent transactions, checking the current balance, etc., is the biggest driver of E-commerce.

5) Online Ticketing

Air tickets, movie tickets, train tickets, play tickets, and just about any kind of tickets can be
booked online. Online ticketing does away with the need to queue up at ticket counters.

6) Teleconferencing or Teleseminar

A teleconference or teleseminar is the live exchange of information among several persons

and machines remote (distant) from one another but linked by a telecommunications system.
For example, attending online lecture sessions that include paying for the sessions.

7) Newsgroups

A newsgroup is a repository that shares messages posted from many users in different
locations. Certain newsgroups are accessible for free whereas; the paid newsgroups refer to
an application of e-commerce.
 E-Business

Definition: “E-Business is conducting business processes online to deliver additional values

to customer.”

Examples or Applications of E-Business

1) Email marketing:

Email marketing to existing customers and prospects is an e-business activity, as it

electronically conducts a business process - in this case marketing.

2) Online Inventory Management System:

An online system that tracks inventory and triggers alerts at specific levels is also e-business.
Inventory management is a business process. When facilitated electronically, it becomes part
of e-business.

3) Content Management System:

A content management system that manages the work flow between content developer,
editor, manager, and publisher is another example of e-business. In the absence of an
electronic work flow, the physical movement of paper files would conduct this process. By
electronically enabling it, we are now in the realm of e-business.

4) Online Induction Programs:

An online induction program for new employees automates part or whole of its offline
counterpart.
 E-commerce versus E-business

E-commerce necessarily involves monetary transactions electronically whereas E-businesses

Information Technology to enhance the business.

Advantages of E-commerce

1) Overcomes Geographical Limitations

If you have a physical store, you are limited by the geographical area that you can service.
With an e-commerce website, the whole world is your playground.

2) Gaining New Customers with Search Engine Visibility

Physical retail (i.e. physical selling) is driven by branding and relationships. In addition to
these two drivers, online retail is also driven by traffic from search engines. Usually, the
customers follow a link in search engine results, and land up on an e-commerce website that
they have never heard of. This additional source of traffic can be a great benefit for some e-
commerce businesses.

3) Lowered Costs

One of the most substantial advantages of e-commerce is the lowered cost. A part of these
lowered costs could be passed on to customers in the form of discounted prices. Here are
some of the ways that costs can be reduced with ecommerce:

i. Personnel: The automation of checkout, billing, payments, inventory management,

and other operational processes, lowers the number of employees required to run an
e-commerce setup.

ii. Real Estate: An e-commerce merchant does not need a prominent physical location.

4) Locating the Product Quicker

On an e-commerce website, customers easily navigate or use a search box to immediately

narrow down their product search. Some websites remember customer preferences and
shopping lists to facilitate repeat purchase.
5) Eliminates Travel Time and Cost

Customers generally have to travel long distances to reach their preferred physical store. E-
commerce allows them to visit the same store virtually, with a few mouse clicks. For
purchase of e-books or a music file, e-commerce is faster than purchasing goods from a
physical store.

6) Providing Comparison Shopping

E-commerce facilitates comparison shopping. There are several online services that allow
customers to browse multiple e-commerce merchants and find the best prices.

7) Providing Abundant Information

There are limitations to the amount of information that can be displayed in a physical store. It
is difficult to equip employees to respond to customers who require information across
product lines. E-commerce websites can make additional information easily available to
customers. Most of this information is provided by vendors, and does not cost anything to
create or maintain.

8) Creates Targeted Communication

Using the information that a customer provides in the registration form, and by placing
cookies on the customer's computer, an e-commerce merchant can access a lot of information
about its customers. This, in turn, can be used to communicate relevant messages. An
example: If you are searching for a certain product on Amazon.com, you will automatically
be shown listings of other similar products. In addition, Amazon.com may also email you
about related products.

9) Remains Open All the Time

Online store timings are 24*7*365. E-commerce websites can run all the time. From the
merchant's point of view, this increases the number of orders they receive. From the
customer's point of view, an "always open" store is more convenient.
10) Create Markets for Niche Products

Buyers and sellers of niche products (related products) can find it difficult to locate each
other in the physical world. Online, it is only a matter of the customer searching for the
product in a search engine.

Websites like Amazon, Dell, Flip kart, Nokia, etc. can be created. The students are
required to design a website based on their knowledge of ECommerce gained in class
rooms and lab.
 PRACTICAL – 2

Designing Business Model for the Proposed Website

AIM: The practical intends to study e-commerce business model and ultimately make
the students design a business model of any website. For the same purpose, the students
should be taught the following basic concepts of E-Commerce business model and
should be asked to design the model for the website they have proposed in the previous
practical.

“A business model is a set of planned activities (sometimes referred to as business processes)

designed to result in a profit in a marketplace.”

An e-commerce business model aims to use and leverage the unique qualities of the Internet
and the World Wide Web.

A business model must effectively addresses the eight key elements listed as
follows:

Table 1: KEY ELEMENTS OF A BUSINESS MODEL

COMPONENTS KEY QUESTIONS

Value proposition Why should the customer buy from you?

Revenue model How will you earn money?

Market opportunity What marketspace do you intend to serve, and what is its size?

Competitive
Who else occupies your intended marketspace?
environment
Competitive advantage What special advantages does your firm bring to the marketspace?

How do you plan to promote your products or services to attract

Market strategy
your target audience?
Organizational What types of organizational structures within the firm are
development necessary to carry out the business plan?
What kinds of experiences and background are important for the
Management team
company’s leaders to have?
A detailed explanation of each of the above stated key elements is as
follows:

1) Value Proposition

To develop and/or analyse a firm’s value proposition, it is required to understand why

customers will choose to do business with the firm instead of another company and what the
firm provides that other firms do not and cannot. From the consumer point of view,
successful e-commerce value propositions include: reduction of product search costs, better
offers, reduction of price discovery costs, and facilitation of transactions by managing
product delivery, etc.

Before Amazon existed, most customers personally travelled to book retailers to place an
order. In some cases, the desired book might not be available and the customer would have to
wait several days or weeks, and then return to the bookstore to pick it up. Amazon makes it
possible for book lovers to shop for virtually any book in print from the comfort of their
home or office, 24 hours a day, and to know immediately whether a book is in stock.
Amazon’s primary value propositions are unparalleled selection and convenience.

2) Revenue Model

A firm’s revenue model describes how the firm will earn revenue, generate profits, and
produce a superior return on invested capital. The terms revenue model and financial model
can be used interchangeably. The function of business organizations is both to generate
profits and to produce returns on invested capital that exceed alternative investments.

The profits from the business constitute the return on invested capital, and these returns must
be greater than the merchant could obtain elsewhere, say, by investing in real estate or just
putting the money into a savings account.

3) Market opportunity

The term market opportunity refers to the company’s intended marketspace and the overall
potential financial opportunities available to the firm in that marketspace.
Marketspace refers to the area of actual or potential commercial value in which a company
intends to operate.

4) Competitive Environment

A firm’s competitive environment refers to the other companies selling similar products and
operating in the same marketspace. It also refers to the presence of substitute products and
potential new entrants to the market.

Firms typically have both direct and indirect competitors. Direct competitors are those
companies that sell products and services that are very similar and into the same market
segment. For example, Kingfisher Airlines and SpiceJet, both of whom sell discount airline
tickets online, are direct competitors because both companies sell identical products—cheap
tickets. Indirect competitors are companies that may be in different industries but still
compete indirectly because their products can substitute for one another. For instance,
automobile manufacturers and airline companies operate in different industries, but they still
compete indirectly because they offer consumers alternative means of transportation.

The existence of a large number of competitors in any one segment may be a sign that the
market is saturated and that it may be difficult to become profitable. On the other hand, a lack
of competitors could either signal a market that has already been tried without success
because there is no money to be made.

5) Competitive Advantage

Firms achieve a competitive advantage when they can produce a superior product and/or
bring the product to market at a lower price than most, or all, of their competitors.

Maybe the firm has a patent on a product that others cannot imitate, or a brand name and
popular image that other firms cannot duplicate.

One rather unique competitive advantage derives from being first mover. A first-mover
advantage is a competitive market advantage for a firm that results from being the first into a
marketplace with a serviceable product or service. If first movers develop a loyal following
or a unique interface that is difficult to imitate, they can sustain their first-mover advantage
for long periods. Amazon provides a good example. However, most first movers lack the
complimentary resources needed to sustain their advantages, and often follower firms reap
the largest rewards.

Companies that are slow followers gain knowledge from failure of pioneering firms and enter
into the market late but still earn good marketspace and revenue.

6) Market Strategy

Everything you do to promote your company’s products and services to potential customers
is known as marketing. Market strategy is the plan you put together that details exactly how
you intend to enter a new market and attract new customers.

7) Organizational Development

Companies that hope to grow and thrive need to have a plan for organizational
development that describes how the company will organize the work that needs to be
accomplished. Typically, work is divided into functional departments, such as production,
shipping, marketing, customer support, and finance.

Typically, in the beginning, generalists who can perform multiple tasks are hired. As the
company grows, recruiting becomes more specialized. For instance, at the outset, a business
may have one marketing manager. But after two or three years of steady growth, that one
marketing position may be broken down into seven separate jobs done by seven individuals.

8) Management Team

A strong management team may not be able to salvage a weak business model, but the team
should be able to change the model and redefine the business as it becomes necessary. The
challenge is to find people who have both the experience and the ability to apply that
experience to new situations.

The students are required to answer the key questions of all the components of the
business model.
 PRACTICAL - 3

Internet Banking
AIM: The aim of the practical is to make students understand Internet Banking and
identify the phishing attacks possible with EC & EB. The students should also prepare a
list of counter-measures against the phishing attacks possible.

Specific concerns one might have when considering an online bank.

1) Security

When the matter comes about money the first thing that comes to our mind is security. As it
is online banking there is many chances of misusage or theft of money hence online banking
must assure their customers about security matters & take major responsibilities on them.

2) Easy understanding

As it is said the more simple it looks, more people would prefer it. So it the GUI is simple
and easy customer can easily access it with little knowledge of the computer field.

3) Pay high interest on customer deposits.

Customers should be given more interest on their deposits as much as possible. If online bank
provides more interest than customer would prefer online bank instead of physical bank.

4) FAQ Features

This feature plays important role in online banking. It reduces customer enquires
dramatically.

5) Check images online and offer statements

Online bank should provide this facility that check images are available online the day after
the check is cleared.

6) Stay in touch

Bank should keep on updating recent facilities or new interest rate to customers through mail,
calls, advertisements and post.
7) Transaction should be easy and Acknowledgment should be received on time.

Transaction should take place in few steps. So no ambiguity arises.

8) At least one physical bank should be there

9) Bank’s survival assurance

Customers have fear about bank getting sold or closed all of a sudden, so online bankers need
to provide their survival assurance.

10) Less transactions fees/ No fees

The Bank should either be charging nominal fees per transaction or should not be charging
anything.

Phishing Threats

• Phishing means the attacker sends email message to a large no. of recipients stating that
his account access is restricted.

• Email that include link which appears like login page and however customer leads to
phishers.

• Personal info of customers may be misused.

• Link shown of different website and when opened, some other website opens.

• Funds can be withdrawn under his/her name.

• Attackers in order to hide URL they include pop-up windows which exactly looks like a
browser address bar.

Counter Measures against Phishing

• Find source of email

• Assure your own customers that your bank does not send such phishing mails.

• Frequent pop-ups in your website should alert users.

• Online bankers should find solution by watching other phishing exploits.
• Anti-phishing working groups
 PRACTICAL – 4

Case Study: Amazon.com

AIM: The aim of the practical is to make the students understand the issues that might
occur with E-Commerce website owners. The students should be asked to make an in-
depth study of the case given below and answer the questions based on the contents of
the case.

In 1994, a 29-year-old financial analyst and fund manager named Jeff Bezos became
intrigued by the rapid growth of the Internet. Looking for a way to capitalize on this hot new
marketing tool, he made a list of 20 products that might sell well on the Internet. After some
intense analysis, he determined that books were at the top of that list. Although Bezos liked
the name Abracadabra, he decided to call his online bookshop Amazon.com. Today,
Amazon.com has more than 40 million customers and sells billions of dollar worth of all
types of merchandise.

When he started, Bezos had no experience in the book-selling business, but he realized that
books had an ideal shipping profile for online sales. He believed that many customers would
be willing to buy books without inspecting them in person and that books could be impulse
purchase items if properly promoted on a Web site. By accepting orders on its Web site,
Bezos believed that Amazon.com could reduce transaction costs in the sale to the customer.

More than 4 million book titles are in print at any one time throughout the world, and more
than 1 million of those are in English. However, the largest physical bookstore cannot stock
more than 200,000 books and carries even fewer titles because bookstores stock more than
one copy of each title. Having a wide selection was important because Bezos believed it
would help create a network economic effect. People would visit Amazon.com whenever
they wanted to buy a book because it would be the most likely store (physical or online) to
have a particular title. After becoming satisfied customers, people would return to
Amazon.com to buy more books and would eventually stop looking elsewhere.
The structure of the supply side of the book business was equally important to
Amazon.com’s success. Music CDs, which were second on Bezos’ list, were produced by a
few major recording companies who could easily control Amazon.com’ supply. In contrast,
there were a large number of book publishers, none of which held a dominant position in the
book-selling marketplace. Thus, it was unlikely that a single supplier could restrict Bezos’
supply of books or enter his market as a competitor. He decided to locate his firm in Seattle,
close to a large pool of programming talent and near one of the largest book distribution
warehouses in the world. These supply factors were important because Bezos wanted to
develop efficiencies that would allow Amazon.com to reduce transaction costs for its
purchases as well as its sales transactions.

Bezos encouraged early customers to submit reviews of books, which he posted with the
publisher’s information about the book and with reviews written by Amazon.com employees.
This customer participation served as a substitute for the corner bookshop staff’s friendly
advice and recommendations. Bezos saw the power of the Internet in reaching small, highly
focused market segments, but he realized that his comprehensive bookstore could not be all
things to all people. Therefore, he created a sales associate program in which Web sites
devoted to a particular topic, such as model railroading, could provide links to Amazon.com
books that related to that topic. In return, Amazon.com remits a percentage of the referred
sales to the owner of the referring site.

Although Bezos’ original vision was to create an online bookstore with the world’s best
selection, Amazon has moved into other product lines where opportunities for network
economic effects and transaction cost reductions looked promising. In 1998, Amazon.com
began selling music CDs and videotapes. The Web site’s software can track a customer’s
purchases and recommend similar book, CD, or video titles. In fact, the site can recommend
related products in a variety of product categories now sold on Amazon.com. These product
categories include consumer electronics, computers, toys, clothing, art, tools, hardware,
housewares, furniture, and car parts.

By paying attention to every process involved in buying, promoting, selling, and shipping
consumer goods, and by working to improve each process continually Bezos and
Amazon.com have become one of the first highly visible success stories in electronic
commerce. In fact, Amazon.com now generates significant revenue by supplying other
sellers of consumer goods with the technology to sell those goods online. One of its first
partnerships was with Toys R Us, a company that had experienced difficulties in selling
online and making deliveries on time in the 1999 holiday shopping season. Toys R Us signed
an agreement with Amazon.com in 2000 that placed Toys R Us products on the Amazon.com
Web site. Amazon.com would accept the orders on its Web site and would ship products to
customers for Toys R Us in exchange for a percentage of each sale. Amazon.com also agreed
not to sell toys itself or on behalf of other partners for whom it might provide online sales
services in the future. For example, when Amazon agreed to sell Target products online, it
could not sell Target’s toy lines on its Web site. (Target is the third largest toy retailer in the
world, behind Wal-Mart and Toys R Us.)
44
In addition to the online sales services Amazon.com provides to Toys R Us, Target, Borders,
CD Now, and other large companies, it provides similar services to many smaller companies
with its Shops offering. In Shops, small retailers become members of an online shopping
mall on Amazon’s site.

Toys R Us sells more than $300 million worth of toys each year through the Amazon.com
site. Both Toys R Us and Amazon.com benefit from the network economics effect they
obtain by having toys available for sale on Amazon.com’s well-known electronic commerce
site. Many small retailers in the Shops program who sell toys also benefit because shoppers
visit the Amazon.com site looking for toys. When a site visitor searches for a toy, the Shops
retailers’ offerings are presented on the search results page along with results from Toys R
Us, Amazon.com, and other companies for which Amazon.com provides online sales
services.
Required:

1. In 2004, Toys R Us sued Amazon.com for violating terms of the agreement between
the companies (specifically, Toys R Us objected to Amazon.com’s permitting toys to be sold
on its Shops Web pages). Amazon.com responded by filing a countersuit. Prepare a report of
about 200 words in which you summarize the current state of the litigation.

2. Outline the advantages and disadvantages that Amazon.com would have considered
before it made the agreement with Toys R Us to limit competing toy sales. In about 200
words, summarize these advantages and disadvantages, and then evaluate Amazon.com’s
decision to enter such an agreement.

3. In about 200 words, outline specific recommendations to Amazon.com for negotiating

a settlement with Toys R Us that would benefit both companies.
 PRACTICAL – 5

Case Study: Nissan Motors and Nissan Computers

AIM: The practical aims to make the students understand the legal and ethical
environment of E-Commerce. Based on the case given below, they are required to
answer the questions given after the passage.

The Nissan Motor Company of Japan had sold its cars in the United States under the brand
name Datsun for many years. In the late 1980s, the company changed its branding policy and
began selling cars in the U.S. market with the name of Nissan. However, the company did
not realize that the Web would become an important marketing tool and did not register the
name nissan.com as soon as it became available.

Nissan was not the only auto company to miss an opportunity to register its brand’s domain
name early. General Motors had registered the domain gm.com in 1992, but it had not
registered generalmotors.com. The company had to purchase that name from Gil Vanorder,
who had registered it in 1997.Vanorder’s site featured a cigar-smoking, uniform-wearing
cartoon character named “General John C. Motors.” Volkswagen (which had registered
vw.com when it first became available) successfully sued Virtual Works (an ISP) to obtain
the domain name vw.net.

Other auto companies have purchased or sued (with mixed results) to obtain domain names
that included their product brand names. DaimlerChrysler was able to purchase dodge.com in
2001 from the London financial software company that had registered it originally. Ford had
to sue National A-1 advertising to obtain the right to use lincoln.com. However, Ford was
unsuccessful in its attempts to obtain mercury.com. That name is still used by the New York
City information technology services company, Mercury Technologies that first registered
the name.

In 1991, Uzi Nissan formed a company named Nissan Computer Corp. in North Carolina to
sell computer hardware and provide related repair and consulting services. Nissan’s company
also offered networking hardware for sale, along with related services. In 1994, the company
registered the name nissan.com. In 1996, the company registered the domain name nissan.net
and began offering ISP services to individuals and companies at that Web site.
In 1995, he received a letter from a lawyer representing Nissan Motor Company. The letter
requested information about how Nissan was planning to use the domain name nissan.com.
Since he was operating a computer company and Nissan was an auto company, Nissan
decided there would be no potential confusion in customers’ minds about the relationship (or
lack thereof) between Nissan Computer and Nissan Motors. Nissan did not respond to the
letter. The lawyer did not follow up with any other contact, so Nissan considered the issue
closed.

In 2000, Nissan Motors sued Nissan Computer under the U.S. Anti-cybersquatting Consumer
Protection Act for $10 million and the exclusive right to use the names nissan.com and
nissan.net. Uzi Nissan argued in court that he was just using his family name (which is a
common name in the Middle East) to which he had a basic right, that he had no intent to
profit from the name (he was unwilling to sell it to Nissan Motors at any price), and that there
was little likelihood that his computer store would be confused in the minds of the consumers
with the international auto company of the same name. Nissan Motors argued that its brand
name was so well known that any alternative use of the name would be confusing to
consumers.

In 2002, opinions issued by the California Superior Court and the U.S. Ninth Circuit District
Court held that Nissan Computer had not acted in bad faith when it acquired the disputed
domain names. However, the court ruled that Nissan Computer could no longer use the
domain names for commercial purposes because of the potential confusion it could create in
the minds of consumers. Nissan Computer would have to find a different domain name for its
business. The court also ordered that Nissan could not place any advertising on his Web sites
at nissan.com or nissan.net and prohibited him from placing disparaging remarks or negative
commentary about Nissan Motors (or links to such remarks or commentary) on the two sites.
The court did not, however, order the transfer of the two domain names to Nissan Motor.

The Online Companion includes links to the Web sites operated today by Nissan Computer
and Nissan Motors.
Required:

1. U.S. courts sometimes appoint advisors (often called Special Masters) to help them
decide cases that involve complex business or technical issues. Assume you are a
business advisor to a court that is hearing an appeal of the Nissan Motor Co. v. Nissan
Computer Corp case. In about 200 words, explain why Nissan Motors is so concerned
about the use of these two domain names and how a monetary damages judgment of $10
million could

Be justified (if you do not believe that the monetary damages are justified, explain why).
2. In about 200 words, provide an outline of the ethics of the position taken by Uzi Nissan in
this dispute.
3. In about 200 words, provide an outline of the ethics of the position taken by Nissan
Motors in this dispute.
4. If you believe that the courts’ decisions in this case are fair to the parties and the general
public, explain why in about 200 words. If you believe that the courts’ decisions are not
fair, outline a decision (in about 200 words) that you believe would be fair.