Credit Card Debts: Causes and Preventions

People like to use credit cards to make payments or purchase goods and services because of its convenience. Credit card is a system of payment named after the small plastic card issued to users of this system. Users buy goods and services based on users' promise to pay for it. Today, credit cards have become a necessity for most of us and it is very commonly used even among teenagers and students. Therefore many people face the problem of excessive credit card debts. Example of unsecured credit card debts is the total credit card debts which is borrowed from the creditor. Consumers will be charged higher interest rates for late payments. Let's look at the causes and prevention of credit card debts.

Causes of credit card debts

The first and most common cause is poor money management. We must plan our spending properly to prevent overspending. If we do not do so, it will lead to excessive debts because we are unaware of unnecessary overspending. As a result, we will be surprised when we receive our credit card bills with large amount of debts.

Second, gambling also is one of the causes of credit card debts. Gambling is the favorite entertainment for most of the people. However, it will cause many problems once you become addicted. Gamblers would like to take loans through credit cards and did not consider its consequences. Thus, their credit card debts become higher and unaffordable.

Next, saving too little or not at all is also a cause of credit card debts. Today, many people do not have saving habits especially teenagers. They tend to spend out all their money after receiving their income instead of saving. So, it will cause them unable to pay their credit card debts

In addition, many people facing reduced income but consistent expenses problems. Due to recession, salaries of individual tend to be reduced but the expenses are remained. This will increase the burden of individuals and cause the person unable to settle their credit card debts.

Another cause on credit card debts is college students' difficulties in adjusting to their new found financial independence. This is because they are thinking of their parents to help them pay all the debts. Therefore they are not aware of excessive debts of the credit card.

Prevention of credit card debts

It is important for us to prevent those credit card debts. We can reduce our credit card limit so that it will help us to spend according to the limit given. Another interesting suggestion from the web is to photocopy the credit card offers, including the interest rate and terms. Then, write a letter to the credit card companies giving them feedbacks that the competitors are offering a lower interest rate, this will encourage better offers for consumers as the credit card companies will not want to lose their customers.

Next, try to pay double the minimum payment when we can afford it. This means that if we have additional income in this month, we can pay extra for our credit card debts this month. It can help us to settle our credit card balance more quickly.

Third, cut up our cards so that you are not tempted to use them. If you have more than one credit card, try to cut up your cards. This can help you to reduce amount of spending.

Lastly, proper planning and budget for our spending. Everyone of us should set our budget for monthly spending to avoid unexpected expenditure. With proper planning, we can remind ourselves not to overspend. Thus, we will be able to stop credit card debts’ problems and begin our journey to financial freedom.

Online Security Threats: How Safe is Our Data?

In the current world, people rely on computers to create, store and manage their personal data. But, the threat of online security has become one of the biggest challenges on the Internet today. Because of this, the use of security software and hardware such as firewalls and authentication servers became the most effective way in order to protect users’ computer and users’ personal data. However, these types of protections are not effective enough for the security of the users’ computer and their personal data. This is due to the online security threats which are more advanced than ever.

There are various types of online security threats:

(a) Computer Viruses

Computer viruses are programs or a fragment of code that replicates by attaching copies of it to other programs. There are four main classes of viruses which included file infectors, system or boot-record infectors, macro viruses, and multi-part viruses.

(b) Online Fraud

Online fraud is a broad term that covers all the internet transactions that involve falsified information. The common forms of online fraud includes sales via Internet of counterfeit documents, such as fake IDs, certification, and recommendation letters sold as credentials.

(c) Identity Theft

Identity theft is another common form of online fraud, or the misrepresentation of information. In the online world, most of the information can be intercepted as a result of vulnerabilities in computer security. Thieves can then use such information like credit card numbers and do something which is illegal or violates with laws.

(d) File Sharing Applications

File sharing programs are used by most users of computers to share files and data. Computer users use the Peer- to- peer files to share files between themselves because it is easier to use. This file sharing is linking the computers to one another by using a network for the purpose of sharing the information. But, this will allow the hackers to have easier access to search or download files from any computers on the network. Because of this, many experts conclude that it is not a good idea for the computer users to use peer-to-peer programs to share files.

(e) Mail Client

Many hackers spread the devastating viruses and worms by sending emails to the computer users. The computer users can prevent or limit such threats by configuring their mail server properly and regularly so that the suspicious attachments or files can be blocked by them immediately.

(f) Spyware Attacks

Spyware attacks are the threat that most of the computer users are familiar with because they are the most common online security threat that are faced by many Internet users today. Spyware is a computer program that is designed by the hackers to steal information from computer users without their knowledge. The common types of spyware include Trojan horses, key loggers, dialers, and adware programs.

Review on Internet Security

Favourite Passwords Used Online

Nowadays, we need proper safeguards to protect our personal data since there are many viruses and hackers that may have unauthorized access to our data. A password is a secret word or characters to prove identity for authentication. Using strong passwords will lower the risk of security breach. A strong password is determined by its length and complexity. Although strong passwords is important for us to access personal information in our computer or online account, most of us would like to do the easy way to make the passwords simple such as "1234" or their first name.

According to the research on an analysis of 28000 passwords from popular websites, there are 16% who like to use their own name, spouse or childrens' name as a password, 14% prefer "1234" or "12345678" as a password because it is easier to remember, 4% like to use the word "password" or "password1". 5% like to use names of a singer, television shows or cartoon as a password, 3% of passwords expressed attitudes like "whatever", "yes", "no", and other favourite passwords include "iloveyou", "ihateyou".

According to the aggregate sample of passwords which are primarily from the UK, the most common favourite password is "123" which get 3.784% votes. Next is the word "password" which get 3.780%. "password" is often used as a default password for many programs, so it is extremely common and not secure at all. In my opinion, another favourite passwords used is our IC number which is easier to remember. However, it can also be known by others easily.

To keep our data well protected, it is necessary for us to have a strong password. Passwords should be longer than 8 characters, with combine letters, numbers and symbols. We should avoid repeated characters, login names and use more than 1 password everywhere.

How to Safeguard Our Personal and FInancial Data?

Introduction

Nowadays, identity theft and unauthorized access to personal and financial data becoming a serious problem since interest has been widely used. This is because internet is easier for theives to obtain personal and financial data especially in online banking. Hackers may have unauthorized access to customer database to steal their confidential information. However, even if you never use computer, your personal information such as credit card numbers, account numbers and address may be stolen by someone. Therefore, unauthorized access to personal and financial data is the most important area that draw companies' attention. So, it is neccessary to safeguard our personal and financial data properly.

Ways to safeguard our personal and financial data

There are several ways to safeguard our personal data. First, use and maintain firewall. Firewall is used to block unauthorized access to personal data. All message passed through firewall to examine the message and block those unauthorized internet users. Firewall is integrated into operating system but if you are using older computer, you have to install firewall.

Second, install and update antispyware and antivirus programs. Antivirus programs are the software that used to prevent and remove computer viruses, worms and trojan horses. It can detect and remove adware and spyware. Example of antovirus software are Norton Antivirus, Symantic and AVG. Microsoft and other applications allow user to update antispyware programs. For those who want to save costs, Alwil Avast allow for free virus protection. It is important for us to ensure that our virus definition are up to date.

Third, use passwords and encrypt sensitive files. By using password protection, we use secret words for authentication to gain access to particular resource. Another method is encrypting files to ensure unauthorize access to personal data. However, the drawbacks of file encryption is that we must remember passwords because we may lose our data if we forgot our passwords.

Fourth, avoid accessing financial information in public. We must avoid checking our financial information such as bank balance in public. For example, many people like to access to internet in coffee shops which offer wireless connection Although these systems are convenient, users may not know how strong is their firewall.

Fifth, do not open mystery attachments. We should not open an attachment or link that is sent by an unknown party. This is because these attachments may contain viruses or allow hackers to steal our information.

Lastly, regularly scan your computer for spyware. To protect our financial data, it is necessary for us to regularly scan our computer because spyware or adware may be hidden insoftware programs that can allow hackers to access our data. By scanning our computer, it can detect and remove them.

Phishing : Examples and Prevention Methods

Nowadays, phishing has become a serious network security problem in the organization. It has caused consumers and e-commerce companies suffer billions of dollars financial loss. Therefore, phishing has made e-commerce distrusted and less attractive to normal consumers.

What is phishing?

Phishing is a new type of network attack where the attacker creates a website to fool users to acquire sensitive personal information such as user names, passwords, national security ID and credit card details which are carried out by e-mails and instant messaging. The most frequent method which attackers used is to send e-mails to victims which look like it was sent by the bank or online organizations and then they will make up some causes like re-enter login credentials or providing update services. Paypal and ebay websites are the common targets for them.

Phishing attack procedure methods

In general, phishing attacks are performed with four steps.

1.) Phishers will set up a counterfeited website which looks exactly like the legitimate Web site. It includes setting up the web server, applying the DNS server name, and creating the web pages similar to the Web site.

2.) Send large amounts of spoofed e-mails to target users in the name of those legitimate companies and organizations. They try to convince the potential victims to visit their Web sites.

3.) Receivers receive the e-mail, then open it, and click the spoofed hyperlink in the e-mail, and input the required information.

4.) Phishers take this opportunity to steal the personal information and perform their fraud such as transferring money from the victims account.

How to identify the fraudulent e-mails?

1.) Update personal information- If you receive an e-mail from Microsoft that requires you to update your credit card personal information, there is a phishing attempt.

2.) Generic greeting- Phishing e-mail usually sent out in bulk such as “Dear User” or “Dear Customer” and does not contain your first name and last name.

3.) Sense of urgency-Phishing e-mail generally uses scare tactics. These messages convey a sense of urgency so that you will respond immediately without thinking. This e-mail stated with if customers do not take action within 24 hours, the customer account will be closed. It you see about this might be suspicious.

4.) Fake links-Normally, phishing e-mails will hide the true URL and the URL list in the email is not relates to the company URL. The websites where it is safe to enter personal information begin with “https”, the s means for secure. If you not see the word “http”, you must not process it.

Below are the examples of phishing:

Example 1

Example 2

Example 3

Example 4

How to prevent phishing ?

There are several steps to prevent phishing .Firstly, detect and block the phishing Web sites in time. When we detect the phishing Web sites, we must block the sites and prevent phishing immediately especially two master keywords of a legal website that periodically scans the root DNS for suspicious sites. For example, www.1cbc.com.cn vs. www.icbc.com.cn

Second, use strong passwords protection. Users must use several passwords instead of just one password. The passwords should combine uppercase and lowercase letters, numbers and symbols in order to avoid the phishers detect it. If you use different passwords between your blog and e-mail account, when a phisher gains access to your blogging account and e-mail address, they will be unable to access your account.

Third, do not click on suspicious links in emails. If you receive an email that requires you to update private information by clicking the link directly from the email, do not copy and paste links from messages into your browser. It is because the link might not be trustworthy. You may go to the organization website directly by typing the address in URL.

Fourth, do business only with companies you know and trust. Users should use well-known, established companies with a good reputation for quality services. Basically, the business web site should have a privacy statement that specifically states that the company will not pass personal information to others.

Fifth, install online anti-phishing software in the computer. When a user visits a Web site, the anti-phishing tool will search the address of that site in a blacklist store in a database. If the visited site is on the list, the anti-phishing software will warn the users. The tools include ScamBlocker from the Earth Link company, PhishGuard and Netcraft and others.

Lastly, use a browser that has a phishing filter. User can use the latest versions of browsers such as Firefox 3x, Internet Explorer 7, and Opera 9x. These browsers included phishing filters that provides safer web browsing experience without being interrupted by phishing activities.

Links:

http://www.digitalpurview.com/ways-to-identify-phishing-email/

http://www.microsoft.com/athome/security/email/phishing.mspx?ifs=0

http://office.microsoft.com/en-us/outlook/HA011400021033.aspx

http://www.uni.edu/its/security/phishingexamples.html

http://research.microsoft.com/en-us/um/people/chguo/phishing.pdf

Applications of 3rd Party Certifications in Malaysia

E-commerce is gradually becoming an essential part of our life. Internet users achieved to a number of 1.57 Billion users worldwide in 2009 and the total e-commerce sales in the U.S. has reached 145.6 billion US dollars in 2008. However, when it comes to internet safety, we are still concerned and worried on security problems. This is because e-commerce involves transaction processes with no boundaries and the transfer of data is highly exposed to potential attacks like phishing, hacking and virus attacks. Therefore, having a good security system is not enough for an online business to take place. We need an additional security feature which is the 3^rd party certification programme.

The 3^rd party certification programme or commonly known as the digital certification programme is an additional attachment on a website or an electronic message for security purposes. So how does the certification process work? When a person wanted to send a confidential message, he needs to obtain a digital certificate from the certified authorities. The programme will help to encrypt the message then send it to the receiver. The encrypted message can only be accessed by using a private key given to the sender and the 3^rd party certification programme will also have a public key that is like a ‘spare key’ for the private key to encrypt and decrypt information. Popular certification programmes in Malaysia include Secure Sockets Layer (SSL), Digicert, MSC Trustgate, VeriSign and MyCert. These certification programmes help to enhance the security of data transfer by providing a certificate instead of requesting only a user name or password.

APPLICATIONS OF 3^RD PARTY CERTIFICATION:

Online business and Server Securtiy

When customers purchase products online, they would like to visit the websites they trusted

for. Digital certificates will help to ensure stronger security by providing better encryptions and more secured, instant verification that the websites are free from worries. For example, MSC Trustgate Malaysia provided services on Secure Socket Layer (SSL) Certificates for Internet, Intranet and Server security. The SSL provides two kinds of IDs, which are the Global Server ID and Secure Server ID. The Global Server ID enables 128 to 256 bits of encryption to secure the communication of business sites with its visitors. Customers can conduct business purchases with this service because it comes with a VeriSign Secured Seal that proves the website has been verified. The Secure Server ID protects transfers of sensitive data on the websites. With this SSL server IDs, online businesses can obtain purchase orders and volume discounts conveniently with easy set up steps and efficient security management because this certificate helps to manage the domain with multiple servers. Besides, the certificate will have flexible bundles according to business needs and wider compatibility with all types of web servers. DigiCert Malaysia also provides the DIGISIGN ID that is widely used in E-business applications like online banking, stock trading and insurance.

Enterprise Trust Services

Enterprises need to have quick and cost-effective web services in order to conduct their businesses with top security. Therefore, enterprises need to have an effective Public Key Infrastructure (PKI) and certificate authority system in order to have a more established security policy and certificate lifecycle management. In this case, Trustgate provides the Enterprise Managed PKI service that provides faster deployment and lower operating costs. These services help the enterprises to manage in designing, provisioning , staffing and maintaining its own system.

Transfer of Documents & E-mails

Everyday we have millions or billions of documents and emails transferred through the Internet. Some of the files transferred contain confidential information. Digital Certificates help to ensure information remains private during transit. It uses the private and public key to facilitate the authentication, privacy, authorization, integrity and non-repudiation of the information transferred online. This is in accordance to the Digital Signature Act 1997. MSC Trustgate Malaysia provides the CryptoSuite and Secured E-mail that enable security of confidential files and emails. The digital certificate encrypts the file and let the recipient with the public key to decrypt the contents. Confidential emails are substituted from handwritten signature and sealed envelopes using the Digital ID. DigiCert Malaysia, another certificate authority also provides the DigiSign File Manager that supports digital signature and asymmetrical key encryption and decryption of files with online or offline digital signing with multiple file formats.

Mobile Commerce

The advancement of M-commerce enables mobile banking and other financial services to take place. Besides, mobile phones can be used to transfer documents online. Therefore, an effective security feature should be added for mobile commerce. Trustgate advances their service by turning the SIM card into a Mobile Digital Identity to secure mobile banking transactions just like the encryption features in CryptoSuite. The only difference is this mobile feature runs on a wireless PKI platform and Mobile Operator Infrastructure. DigiCert Malaysia also offers DigiCert Mobile applications to attach the digital certificates that are able to store in the phone for application access. Mobile users can transact securely over the internet through GPRS, Bluetooth or 3G with these smart applications.

MyKad Applications

Malaysians now can use their own identification card to process transactions through the ATM machine. All we need to have is a microchip on our IC. This is a special feature brought by MSC Trustgate by providing this special MyKey PKI that works with the physical MyKad. This enables Malaysians to digitally sign documents or transactions online. This MyKey PKI provides a few types of modules for businesses to develop the applications of the MyKad. The modules include MyKey Application Programming Interface, Signing and Verification Module and the MyKad Client Kit.

From the information provided above, we can observe that the 3^rd party certification is in more priority for this ever developing e-commerce world. Nevertheless, this digital certificate authorities play a very important role by ensuring online security and enhancing customer confidence to use more online services.

Sources: http://www.msctrustgate.com

http://www.digicert.com.my/

http://www.verisign.com

History and Evolution of E-commerce

Electronic Commerce is defined as the process of buying, selling, transferring, or exchanging products, services, and information via computer networks.

History and Evolution of E Commerce

In 1960s Electronic Data Interchange (EDI) was invented and it is used to transfer data between different companies which use networks in its earlier stage, such as VANs or the Internet. Later on, the technology evolved to Electronic Funds Transfer (EFT).

EFT is used to provide for electronic payments and collections. Funds could be transferred electronically online from one to another without using any existence of paper money. Because of this, EFT can help the users to save on administrative costs, increase efficiency, simplify bookkeeping, and enhance stronger security.

EDI and EFT gave an opportunity for users to exchange their business information and operate various types of electronic transactions. The ability to use such technologies appeared in the late 1970s and such technologies allow all the business companies to send their commercial documentation to each other electronically.

In the 1980s, e-commerce has grown rapidly when the credit cards, automated teller machines (ATM) and telephone banking using online services have developed and accepted by the public. Besides this, the airline reservation system like Sabre in the USA and Travicom in the UK also facilitate the development of e-commerce. The other important steps for the rapid growth of e-commerce are the first online shopping site that was invented in the UK in 1979 by Michael Aldrich and the online shopping website was used extensively particularly by many of the auto manufacturers.

From 1990 onwards, e-commerce was used widely including enterprise resource planning systems (ERP), data mining and data warehousing. In 1991, the first online information marketplace, including online consulting and another pre-Internet online system were being introduced. But, the commercial enterprise on the Internet was strictly prohibited. E- commerce started to be used widely in 1991 when the Internet was available for commercial use to the public.


In 1992, the development of Mosaic web-browser contributes an important step for the development of e-commerce. This web browser was given in the form of a browser which can be downloaded and it was named as Netscape. This web browser was further broadened on the scope and possibility of electronic commercial transaction.

In 2000, a major merger between AOL and Time Warner contributed another important step for the development of E-Commerce. By the end of 2000, there is an increasing number of European and American business companies that start to offer their services through the World Wide Web. Then people began to associate a word "e-commerce" with the ability of purchasing various goods and services through the Internet by using the secure protocols and electronic payment services.

In 2004, the term Web 2.0 was introduced by O’Reilly Media which refers to the second-generation of Internet-based services that enables people to collect and share information online with new methods such as networking sites, wikis, communication tools and folksonomies. Many researchers predicted that the booming of e-commerce will become more and more popular in future which will also generate large revenues to the companies.

Review on Real-World Case: Google is Changing Everything

Google nowadays has indeed evolved to become an essential part of our life. It is the most popular search engine in the world of World Wide Web. I believe that most of us have a default web browser and the default web page will be Google Search. This proves that Google Search Engine is widely used nowadays. Students and researchers especially, will need to access to Google Search Engine to search for any information they want. Most of us are satisfied with Google Search because it provides efficient and effective search technology which gives a convenient and user-friendly environment for its users.

Past studies has proven that Google is now expanding on its services. From a search engine, it is now developing its own user-friendly application software. Its goal is to develop technologies in order to organize the information from all around the world and make it easily accessible and useful. Besides providing a useful space for advertising, Google is now inventing in web-based application spreadsheet software to help users organize their information. This program helps users to organize information easily and also overcome the limitations in Microsoft Excel.

Apart from software businesses, Google also offers a range of Web services including Google Earth, Google Maps, Google Mini, Froogle and many other services. They also partner with other enterprises in order to improve their services and performance. For example, America’s largest nonprofit health maintenance organization, Kaiser Permanente.org has used Google to share information with its members and has a wide, established network to enable its members to connect and share information with each other.

From all the services offered by Google today, we can see that one day in future, Google will be offering more and more services that are needed for us users, which will become an important service we can obtain online. This is indeed a good idea for other search engines to follow because expanding services will increase revenues for these online services companies.

Sources: Turban, E., King, D., McKay, J., Marshall, P., Lee, J., & Viehland, D., (2008).

Electronic Commerce: A Managerial Perspective 2008 (International Edition).

Upper Saddle River, NJ: Pearson-Education International, pg 38

An Example of an E-commerce Success and Its Causes -Ebay

Ebay is a major auction service on the Web. It popularises the concept of buying and selling online,and both individuals and commercial enterprises list items for sale. The process of buying and selling is through price bidding, whereby the person with the highest price bid will be able to purchase the product and a transaction will be taken place. EBay is one of the successful examples for e-commerce and also the most favourable website among online shoppers.

EBay's incorporation was launched in 1995. It is founded by a French-born Italian computer programmer Pierre Omidyar who wrote the code for an auction website that he ran from his home computer. In the earlier stage, it is meant to be a marketplace for the sale of goods and services for individuals.



Nowadays, EBay is the world’s largest online marketplace. It has built an online person-to-person trading community on internet, using the World Wide Web. Every user or seller can sell or purchase anything throughout this website (www EBay.com). They can browse the listed items in a fully automated way. The items are arranged by topics, where each type of auction has its own category. These facilities are easy for the buyers to explore and enable the sellers to immediately list an item within minutes of registering.





The factor that causes EBay to be successful is the provision of an open trading platform where the market determines the values of items that are sold. EBay also provides many things for users to buy such as accessories, toys, clothing, and household goods to attract people to browse through eBay. It brings convenience and saves time for us because we can buy those goods without going shopping to shopping malls. Besides, it is a secured online transaction because it uses credit card payments under the Paypal service to make purchases so that the users will have lesser risks in terms of payments.

Furthermore, the users really enjoy the competition of the bidding process. They enjoy looking around for merchandise and gather more information from many sources so that they can make comparison of prices and product details for the same product. It gives more comfort for people to make use of purchasing goods and services online.

Ebay history
About Ebay
http://www.pcmag.com/encyclopedia_term/0,2542,t=eBay&i=42306,00.asp
http://www.ecommercetimes.com/story/2127.html?welcome=1213184390

Comparison of The Revenue Models of Google, Amazon.com and eBay

The Revenue Model, according to Turban(2006), is a description on the way a company or an E-commerce project will earn its revenue. Revenue models include sales revenue model, transaction fees, subscription fees, advertising fees, affiliate fees, online donations and other revenue sources. It is a way businesses earn revenue mainly through advertising and charging to its customers.



In Google, the revenue model used is focused on advertising and search solutions. The types of revenue models used are Google Adwords, Google Adsense, Google Answers, Froogle and the latest revenue model, Google-as-per-email.


Now, let me share with you what are all these revenue models are about. When advertisers want to advertise on the Google website, Google allows them to do so by using the Google Adwords revenue model. It is a pay-per-click advertising program that enables users to view the advertisements on the Google web page when they search through the Google search engine.
The relevant advertisements will be shown on the ‘sponsored links’ column located at the right side of the search results and some of the other advertisements can be found on top of the search results. The advertisers will have to pay every time their advertisements receive a click from the users. When they advertise, they have to decide on the keywords used or the advertisement and the rate of payment they are willing to pay for a click on their advertisement.


Google Adsense, on the other hand is a more advanced advertisement tool offered by Google. It is a web serving program whereby the advertisers can use the program to edit text, graphics or videos for their advertisements rather than just a keyword in Google Adwords. The rates charged are on a per-click or per-thousand-ads-displayed basis.

Besides advertising, Google also offers Google Answers, an Internet search and research based service offered with a fee charged. The customers will ask the questions they want and offer a price for the answers. Then, Google, as an intermediary will help to look for researchers to answer those questions posted, and earn some money partially from the customers.

If customers want to buy or survey about goods or services offered online, Google launches the ‘Froogle’ service, which is a price engine website that makes it easy for the users to look for products and services for sale online. It does not charge sales commissions but will earn on the advertisements of the products.

Lastly, the latest revenue model of Google is the Cost-per-Action basis revenue model. It is different from the Google Adsense model because this model is more flexible in promoting. The advertiser will only need to pay if the users click on the advertisement and take some actions on the products offered like purchasing the product.




Founded since 1994 and launched online in 1995, Amazon.com started by selling books online. It caters to a revenue model of direct selling or e-tailing by selling specific products to customers like retailers online. From books, it now ranges from selling all types of products, including music, videos, electronic and household products. It has the largest supplies of products online. Not just selling products online, Amazon.com also offers excellent services on delivery, with combinations of lower price products and shipping promotions. It is certainly focused on retailing business by having good supplier and customer relationships.

Later on, Amazon.com shifted from direct retailing to the affiliate revenue model when it discovered that many small e-businesses would like to be an affiliate of Amazon.com. This model is also known as the ‘Click-through’ model whereby small online merchants will be an affiliate partner with Amazon.com and they will contribute a commission to Amazon.com when the customers clicked through the affiliate to the merchant and generated sales. By having affiliates like content-based websites, web Portals and small e-businesses will help to generate new traffic on the website in order to increase revenues. Today, Amazon.com is still using this method because it is effective in generating revenues for them.



If you like something new rather than fixed price goods, eBay will be a good choice for you because it is a popular online auction site which provides buyers and sellers worldwide to trade on goods and services. The auction is done ‘silently’ whereby the buyers will bid for the price in order to purchase the product from the seller. The highest bidder will be able to obtain the desired goods. eBay charges its sellers a small amount of listing fees in order to let the sellers to list the products to be sold online. From there, the sellers can start to bid their prices with the buyers. This is also known as the ‘Fees-per-transaction’ revenue model. Sellers who have good selling in their products can enjoy extra benefits from eBay by having its PowerSeller program, which will cost them lower fees for listing. Buyers too are guaranteed on their service by having goods delivered on time.

The types of selling fees that eBay will charge on its sellers are Insertion Fees and Final Value Fee. Insertion fees are charged if the sellers want to list an item for sale on eBay. The final value fee will take place if a transaction is being made, which includes Auction Listing Fees, Fixed Price Listing Fees and other optional feature fees in order for a sale to take place.

For buyers, they can pay for their goods using the credit card or bank transfer through the eBay Pay-pal system. This system will help the customers to track their payments made to eBay.

For more information, feel free to explore:
www.google.com
www.amazon.com
www.ebay.com

Example of an E-commerce Failure and Its Causes--Pets.com

Introduction

One of the example of an E-commerce failure is Pets.com. Pets.com is a dot-com enterprise that sells pets or pet accessories to the customers directly. It starts its operation in February 1999 to provide pet products, information, and resources to customers. The major competitors for pets.com are petopia.com, petsmart.com, and petplanet.com. Pets.com was the first of these pet stores to enter the online pet industry. pets.com is the successful online pet store in the beginning of 1999 but it closed down in November 2000. It is the second Amazon aligned e-tailer to shut down the business.

The causes of Pets.com failure

There are several factors that cause the failure of Pets.com in E-commerce. The main cause is it never brought profit for pets.com since it is having negative gross profit margin. pets.com lost money on every items sold because it sells its product at a lower price than the cost to purchase from the supplier. Therefore, pets.com had suffered $7.6 million loss on its sales.

Second, the shipping cost is extremely costly for customer because pets.com is a market that sells low-margin food and goods. Nowadays, customers would like to shop at discount stores which is near to their location because it is more convenient for them than shopping at online pet stores.

Third, pets.com business model are not unique since there are many competitors which are selling the same products. Also, in 2000, pets.com decided to go into public. However, it went into public and spent money too quickly, causing excessive spending on marketing and advertising costs.

Lastly, cost of doing business online are high because they tend to sell products below cost in order to compete with competitors. However, they still can't recover from their losses.

http://pets.com/