Pres:Basics of Ecommerce - Architectures & Transaction

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Basics of Ecommerce - Architectures & Transaction

Basics of Ecommerce - Architectures & Transaction

Title Basics of Ecommerce - Architectures & Transaction
Target group Students, Beginners
Topics Omnichannel Architecture, Ecommerce IT Development, Online Security, Ecommerce Basics
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Public summary

Goal of the first two parts of this course lesson is to help students understand what the basic ICT Architectures are, how they are developed, managed and maintained. In the second part we will discuss the main relevant web standards for technology development. The third section will cover online payments in general and will also focus on local payment solutions and the payment developments in The Netherlands

The lesson is divided into 4 parts:

  • ICT Architectures (30 min. including videos)
  • Web hosting including a class assignment (40 min.)
  • Online security (20 min)
  • ICT Development Methodologies including a scrum exercise (50 min)
  • Payments including several videos. The last few slides zoom in on the Dutch market (30 min).

Slides

  • Product Information Management
  • Product visualizaton
  • Product Information Trends
Question Mark.jpg
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  • ICT Architectures
  • ICT Development and Management
  • Payments
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Typical internet infrastructure.png
Logo Ecommerce Foundation1.png Source: Dave Chaffey, Digital Business and ECommerce Management, Edition 6 7


Webbrowser webserver.png
Logo Ecommerce Foundation1.png Source: Dave Chaffey, Digital Business and ECommerce Management, Edition 6 8


Typical business.png
Logo Ecommerce Foundation1.png Source: Dave Chaffey, Digital Business and ECommerce Management, Edition 6 9


Fragmented applications.png
Logo Ecommerce Foundation1.png Source: Dave Chaffey, Digital Business and ECommerce Management, Edition 6 11


Integrated applications.png
Logo Ecommerce Foundation1.png Source: Dave Chaffey, Digital Business and ECommerce Management, Edition 6 12


Internet Service Providers:

    • manage the servers to host an organisation’s website
    • and its connections to the Internet backbones
    • often offer additional services like email, security services (e.g. virus scanners)

You do not see them, but need them!

There are thousands of ISP’s worldwide

Logo Ecommerce Foundation1.png Source: Source: Gartner 16


  • Availabity: guarantees given regarding the availability of the servers and internet access? Availability is often expressed in uptime percentage. An example:
    • 1 year = 365 days/year X 24 hours/day X 60 minutes/hour = 525,600 minutes
    • 99.9% is generally considered okay for most websites.
    • Total duration for which server will be down over a period of 1 year = 525,600 X 0.1% = 525.6 minutes = 21.9 hours
  • Performance: Which service leves are given regarding:
    • Internet access (Mbs)
    • Server performance (CPU/Transaction speed)
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  • A service-level agreement (SLA) is a part of a service contract where a service is formally defined.
  • Apart from availability and performance agreement typical other items that are part of an SLA can be:
    • Average Speed to Answer: Average time (in seconds) it takes for a call to be answered by the service desk.
    • Mean Time To Recover: Time taken to recover after an outage of service.
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  • In teams of 2 or 3 students:
  • You want to start a small new webshop.
  • Which local Internet Service Provider would you chose.
  • Why?
Class Assignment.jpg
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The more we sell online, the more data is available online the more value can be destroyed as:

  • Webshops are temporarily not available
  • Customer data is stolen (harming the company’s brand)
  • Products are stolen and money illegally transferred
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How do you make sure you are online assets (Facebook profile, email, laptop) remain save?

Question Mark.jpg
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  • Bespoke development:
    • The ecommerce system is developed from scratch.
  • Off-the-shelf (packaged):
    • An existing system is purchased.
  • Hosted Software as a Service (SaaS) solution:
    • All applications and databases are maintained and run on third-party servers.
  • Tailored development:
    • The off-the-shelf system is tailored according to an organisation’s needs.
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Web project.png
Logo Ecommerce Foundation1.png Source: Dave Chaffey, Digital Business and ECommerce Management, Edition 6 26

Notes

Many projects fail because the requirements are not clear, delivered too late or are unrealistic.


  • Six cycles:
    • Analyise, design, code test
  • Waterfall
    • Traditional, long cycles
  • Prototyping:
    • Fast, Simple, Iterative, Incremental, User-centred
  • Agile:
    • SCRUM
    • Very frequent, ‘’sprint’’ releases
Logo Ecommerce Foundation1.png Source: http://agilemanifesto.org 27


  • How fast can you eat a 300 gram hamburger?
  • How fast can you drink 300 grams of water?
Question Mark.jpg
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A user story describes functionality that is valuable to either a user or purchaser of a system.

User stories are composed of three aspects:

    • Cards: a written description of the story used for planning and reminder.
    • Conversations: communication about the story
    • Confirmations: tests that document details that can be used to determine when a story is complete (and done).

A user story should ideally be coded and tested in one to three days.

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Notes

Epics can be detailed into users stories and prioritized into when they should be developed.


  • Create 1 or 2 new user epic for a webshop you have chosen to improve its conversion.
  • Why did you chose for these epics?
  • Present in class.
Class Assignment.jpg
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  • Emphasize verbal rather than written communication.
  • Are understood by both users as well as developers.
  • Defer detail until needed.
  • Are the right size for planning.
  • Support iterative, incremental development
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  • Independent: Interdependencies lead to estimation and prioritization issues. Combine the story or split it differently.
  • Negotiable: User Stories are not contracts but functional reminders which are further negotiable in a conversation between the user and the developer.
  • Valuable: for either the User (how does it help him achieve his goals) or the Purchaser (e.g. non-functional requirements).
  • Estimatable: for planning purposes. Compound stories can be broken up. Very complex stories can be split into a research and a code user story.
  • Small: to make them fit within a iteration.
  • Testable: Upon that the user can test and approve a user story.
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  • Treat generic Non-Functional Requirements also as User Stories:
    • So they are not forgotten.
    • Upon they can be planned.
  • Examples of Non-Functional Requirements:
    • Security demands.
    • Performance demands.
    • Supported browsers.
    • SEO demands.
    • Usability standards.
    • HTML standards (e.g. HTML 5.0).
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  • Acceptance tests can be added to a user story
    • Tests describe the assumptions behind a User Story in detail.
    • Tests should in principle be written and tested by the User.
    • Tests should be written as much as possible before the Use Story is coded.
    • Tests can and should be used as reminders for programmers.
  • Goal is not to test everything but to add tests as long as they add value.
  • The team (and not only the User) however is responsible for testing.
  • As code changes per iteration, all tests from previous iterations should be retested (or at least during the User Acceptance Test phase).
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Notes

Acceptance tests are often skipped in a project. The development phase often takes to long. To get the product live, testing is not done sufficiently or not at all. As a result low quality software is released.


  • Online payments overview
    • Architecture
    • Payment Service Providers
  • Mobile payments
  • Paypal, Bitcoin
  • iDEAL
  • eCommerce Payment Monitor
Payments.png
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Payments.2.png
Logo Ecommerce Foundation1.png Source: Source: www.adyen.com 50

Notes

iDEAL is succesful in Netherlands, but there are many, many local providers, not easy to get an overview or connect with all systems/providers


Notes

There are many types of credit or debit cards, some are valid worldwide, some are local. There are plugins for the most widely accepted creditcards available, but this implies a webshop needs to connect to every single card or other payment method. So, there is a need for integration of payment technologies……..


A payment service provider (PSP) offers shops online services for accepting electronic payments by a variety of payment methods including credit card, bank-based payments such as direct debit, bank transfer, and real-time bank transfer based on online banking.


Typically, they use a software as a service model and form a single payment gateway for their clients (merchants) to multiple payment methods.

Logo Ecommerce Foundation1.png Source: Source: www.wikipedia.com 53


Notes

Step1: The merchant's website sends a CC transaction to "Payment Gateway" via a secure site connection.

Step2: The "Payment Gateway" receives the credit card transaction request and submits it using a secure site connection to the "Merchant Bank’s Processor".

Step3 : The "Merchant Bank’s Processor" sends the complete transaction request to the "CC Network" (financial system network that is used to process CC transactions).

Step4: The "CC Network" forwards the complete transaction to the "Customer’s CC Issuing Bank".

Step5: The "Customer’s CC Issuing Bank" accepts or refuses the transaction depending on the customer’s available funds and sends back the results to the "CC Network".

Step6: Then the "CC Network" transmits the results to the "Merchant Bank’s Processor".

Step7 : The "Merchant Bank’s Processor" sends the results to the "Payment Gateway".

Step8: The "Payment Gateway" saves the results of the transaction and then transmits those results to the merchant’s website who deliver them to the end customer. This is the end of the approval process, which usually takes less than 3 seconds.

Step9 : If the The "Customer’s CC Issuing Bank" has approved the transaction, it will send the funds to the "CC Network".

Step10: The "CC Network" sends the funds to the Merchant’s Bank. Within two to four business days the "Merchant’s Bank" will deposit the funds in the Merchant's bank account. That is called the settlement process.


  • Collecting Payment Service Provider (CPSP)
    • A Collector delivers one single interface to one or more payment methods, does collect payouts on your behalf but does not set commission rates or fees.
    • They enable you to streamline payout for different payment methods (cards, bank transfers, wallets).
  • Aggregator
    • An Aggregator delivers one single interface to one or more payment methods, collects the payouts and contracts with banks or financial institution.
    • You only would need to contract with the Aggregator. They set your transaction fees.
  • Distributor
    • A Distributor delivers one single interface to one or more online payment methods.
    • You need to contract the bank or financial institution and negotiate commission rates, fees and payout terms.
Logo Ecommerce Foundation1.png Source: Source: www.about-payments.com 55


Overview payments.png
Logo Ecommerce Foundation1.png Source: Source: www.about-payments.com 56


Alternative payments.png
Logo Ecommerce Foundation1.png Source: Source: www.about-payments.com 57

Notes

There are many other types of payments, here referred to als alternative payments.


PayPal is an American, international digital wallet based ecommerce business allowing payments and money transfers to be made through the Internet. Online money transfers serve as electronic alternatives to paying with traditional paper methods, such as checks and money orders. PayPal is one of the world's largest internet payment companies. The company operates as an acquirer, performing payment processing for online vendors, auction sites and other commercial users, for which it charges a fee.

Paypal.png
Logo Ecommerce Foundation1.png Source: Source: wikipedia 60

Notes

Movie link to be embedded in presentation


Bitcoins, like real coins, can be swopped to dollars, pounds or euro (and other currencies). Bitcoin allows people to anonymously buy goods and services over the internet. Merchants benefit from worldwide acceptance, low transaction fees, no bank costs and chargeback protection.

Bitcoins.png
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Notes

Anonymous, risk of fraude, what is the past/present/future value of a bitcoin…..


  • iDEAL is a standard payment method for making secure online payments directly between bank accounts.
  • When you offer iDEAL as a payment method in your online store, a direct link is established with the systems of your bank.
Ideal logo.png
Logo Ecommerce Foundation1.png Source: Source: www.ideal.nl 64

Notes

iDEAL is only used as payment method in the Netherlands. Comparable services are available in Germany (giropay) and Belgium (Mister Cash).


Work.png
Logo Ecommerce Foundation1.png Source: Source: www.currence.nl 66

Notes

Video embedded


  • Payment will be possible everywhere
  • Payment will become invisible
  • Payment will include new services like customer recognition, loyalty, up & cross selling
  • The traditional cash registry will be replaced by ‘online’ payment methods
  • Payment will become increasingly global
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Notes

  • Payment will be possible everywhere using mobile devices.
  • Payment will become invisible: consider mobile purchasing of apps. A fingerprint is enough.
  • Payment will include new services like customer recognition, loyalty, up & cross selling: PSPs will not only help with payment but also offer added value services.
  • The traditional cash registry will be replaced by ‘online’ payment methods
  • Payment will become increasingly global. Many countries still have their own local credit, debit cards and specific payment types (like Ideal in the Netherlands). Increasingly European standard and foreign payment methods (like Apple Pay) will gain market share.


The End.jpg
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