E-COMMERCE RESEARCH, PHYSICAL STOREFRONT BUYING


            Electronic commerce, better known as e-commerce, is in itself, [i] the buying and selling of products or services over electronic systems such as the Internet and other computer networks.


            However, there are certain problems that consumers and e-retailers alike are encountering. One of this is the payment mechanism. Although the Internet can process retail transactions anywhere in the world, at any time of day or night, however small or large the transaction amount, it still has problems regarding payment.


            As of the present, the common way of paying when buying something on the Internet is through the use of the credit card. However, imparting personal and credit card information carries with it a high risk especially if server security is not known or the information has not been encrypted. There are also situations wherein credit cards are not accepted, especially when the amount being purchased is small. There are also instances when the buyer does not want to divulge his identity, or the buyer does not have a credit card.   Transactions between countries have a tendency to create misunderstandings on the amount purchased especially when the price of a product is in a foreign currency.


            To counter the above problems, digital cash and checks are being investigated. Digital cash enables buyers to purchase small amounts of purchases anonymously over the Internet. [ii]Digital cash is a string of digits, issued by a bank and attributed with a defined value. It is in a form of a token and  carries with it a digital stamp which cannot be replicated. Each token is only for a single transaction only.


            The digital check has the same  principles as digital cash. The difference is that the amount indicated in the digital or electronic cheque can be encrypted if the payer wishes to maintain confidentiality.


            Another option is the smart card which is comparable to telephone cards. Each card has a specific value. The “wallet” is a more sophisticated version of the smart card.  It can be recharged by the bank. A Personal Identification Number or PIN number is required to make use of these cards.


            Aside from payment problems, there are also several consumer issues that need to be looked into to encourage consumer researchers to buy their products on-line. These are the following:  absence of physical address or location; online merchant is situated in a different country making it hard and difficult to return “wrong” products; difficulty in claiming warranty; upon delivery; the product bought might not be fitted in local environment;; the consumer, if not satisfied with the product bought, has no access to redress as e-trader is at times unidentified in the Internet; and, privacy concerns.


            No definite counter-measures are being imposed as of this time. However, it is strongly suggested that initiatives on consumer protection be widened to include the e-retail industry that should include self-regulation of the e-commerce industry as well as the structuring of laws and rules that will govern the worldwide marketplace. An international approach to the problem is necessary to address consumer issues.


            Another major issue that prevents consumers from buying online is the risk involved when transferring information, personal information and credit card information,  via the Internet. Online transactions sometimes encounter message integrity problems. This means that the message sent by the buyer has the possibility of being tampered in the interval between being sent and being received. The consumer is in peril of theft of his or her personal and/or credit card information while the e-trader faces negation of the transaction and/or non-payment.


            To offset this problem, encryption techniques are recommended. [iii](It) involves the encoding and decoding of information by use of an algorithm. Its main objective is to sustain message integrity. Although anyone can read the message during the message’s transit, it cannot be understood except by the intended recipient. Yet, there is no guarantee that the transaction information will remain confidential. Once the encryption is decoded, it is already susceptible to theft and security risks.


            Another main problem deals with Identify. There is definitely no way to ensure that the given identity of an individual or an organization is valid and real.


            The Internet is a novel medium that needs a unique, vital, and imperative consideration. It should not be paralleled with other mediums as televisions and telephones. It is a commercial tool with global impact that it requires regulations as to intellectual property, confidentiality and privacy, even defamation. 



 

[i] En.wikipedia.org


[ii] www.austlii.edu.au


[iii] www.austli.edu.au



Credit:ivythesis.typepad.com


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