Cyber Money, The Digital Currencies, E-Commerce

 Date: December 15, 2020

Title: Cyber Money, The Digital Currencies

Cyber money is also called digital currency, is a category of money represented in "electronic form" for financial transactions over the Internet. Mostly, virtual currencies are unregulated digital currencies that are issued and controlled by their developers.

Virtual money

To define it strongly, virtual money consists of value units, which are stored on electronic media and can be used to conduct payments. Or, to define it comprehensively, virtual currencies are all means of payments that lead to a substitution of notes and coins and bank reserves. The protection against theft can be ensured via an encrypted disc area or money storage on a separate medium.

However, one of the biggest challenges for virtual currencies is the authorization. Who is authorized to issue these currencies? And how to handle the exchanges of global multiple currencies from different countries? Moreover, the more anonymous a currency is, the more attractive it is to criminals

Many of these currencies have not yet seen widespread usage, and not be easily used or exchanged since banks generally do not accept or offer services for them. I think the value of virtual money such as Bitcoin, is largely just speculative trading.

E-Commerce Notebook, Electronic Payment, the assessment and selection of payment methods

Journal 5, E-Commerce Notebook

Date: December 13, 2020.

Title: Electronic Payment 1. the assessment and selection of payment methods

Money makes the world go round. Money plays a basic role in the economic cycle which involved deliver products or services, get money for them, offer money to get a product or service, and spend the money for the delivered product or service. But, how can we transfer “real” money into the economic area “Web”? So, here comes the payment challenges.

The categories of money are Money in cash, Book money, and E-money. Primary payment methods are Cash payment, Bank transfer, Debit note, and Wallet payment. Furthermore, there are Derivative payment methods such as Debt collection and billing, Check-based methods, Mobile phone based methods, Credit card based methods, E-Mail based methods, and Prepaid charge card based methods.

Then, Let's get to the assessment and selection of payment methods.

From a supplier’s point of view, it should be accepted by its customer, a shortfall in payment must be protected and avoided, and its costs must be as lower as possible.

Technical

The technical parameters for the selection of appropriate payment methods after satisfying the supplier's needs, 

are periodicity, subscriptions, internationality, privacy, payment guarantees.

The Cost Structure

Payment amounts and cost structure also determine the selection of payment methods. The invoiced amount, the costs per transaction, independent costs (setup and adjustment costs, periodic costs like basic charges for services and software, and rental fees for hardware).

Security requirements

The security requirements for selecting a payment method are control & monitoring, secure confirmation, and liability.

Date: December 14, 2020.

Title: Electronic Payment 2. Payment procedures

Now, integrate into the sales process after fulfilled these requirements through the whole procedures in detail.

i. Payment Per Invoice

The basic steps are order, delivery, sending an invoice, payment, and confirmation. The procedures of this payment method is not an integral part of E-Commerce and the risk is totally carried by the supplier.

Sounds very easy, but there are potential problems. For example, delivery without an invoice, invoice without delivery, deviations, frauds, or delayed payment.

ii. Cash in Advance

The actions are similar. Order, Invoicing, Payment, and Delivery. Let's talk about GiroPay provided by GiroPay GmbH. 

From getting the statement of a Bank identifier code (BIC), Log-in with account number and password by the customer, Pre-filled money transfer, Confirmation. 

However, you may notice that the procedures take a lot of time to complete. And its requirements are also not friendly. The customers' accounts must have an allowance for it and must cooperate with GiroPay. All participants must have a bank account and have signed a contract with a GiroPay.

Honestly, I don't it is a good payment plan. The risk is also completely assigned to the customer which is really a bad idea. The trust will become weaker and weaker. Besides, it makes payers too busy and mad for someone like me.....

iii. Cash on Delivery

Customer orders with C.O.D. and appoint a specific delivery address, and the delivery is done with an invoice. After the cashing is done on delivery, the service provider transfers the money to the merchant’s bank. To complete the procedure, the customer must provide delivery and payment data and the delivery service provider has to take over the cashing function. This method is risk-neutral since the money transfer is not before or after the delivery.

However, the customer is not 100% sure free to get the package at the delivery address. Deviations between delivery and invoice are also problems that must consider. And, what is the return policy?

iv. Debit Note

From order to delivery, there are steps such as bank collection, clearance, and collections of the requested amount. Then, delivery to the customer and forwarding the invoice.

As we can see, there are many complex contracts with banks to deal with. The money collection may still burst and no delivery can possibly and accidentally happen. And again, a deviation is always possible.

This payment method highly relies on the trustee function of the bank. 

v. Credit Card

Those procedures we are very familiar with. We order, confirm the payment is accepted by credit card. Then, we get the delivery and invoice.

Ahead of these simple procedures, there are still full of complex contracts with banks and credit card companies. The customer must have a credit card contract with a bank to get a credit card. The merchant must have a credit card acceptance contract with a bank and must be technically linked to a Payment Service Provider.

As always, the potential problem top one is no delivery and deviations. In addition, payment dysfunctions may happen while the connection is bad.

However, payment is guaranteed by the credit card company. That's why we trust and widely use these payment methods.

vi. E-Payment

Finally, we here. E-payments have been developed especially for e-commerce and supplement the traditional payment methods. There are many methods we can pick such as PayPal, Smart card, cashing and billing methods, and mobile based methods.

E-Payment provider is a new service-based company for providing these kinds of services. E-Payment providers are the medium of the transactions. 

vi-1. Paypal

PayPal account owners are able to send and receive money, to and from any person who has also been a PayPal account owner. PayPal was one of the first organizations that try to fix problems with international payments. However, it's pretty similar to credit card companies who also charge fees from transactions.

PayPay is email based and be able to be connected with credit cards and bank accounts. I think, in the future, PayPay is trying to replace the traditional banks rather than credit card companies. 

 

vi-2 Smart Cards

This method is built to try to replace your wallet, but it still needs to connect with a bank. So, you use your balance in your bank account to fill up the smart card, and then, you can pay with it. 

Not a surprise, there are also contracts and connections with banks and security is still a potential issue since wallets are always the portable targets for thieving.

vi-3 ClickandBuy

This method is also built to replace traditional wallets. ClickandBuy manages customers' accounts associated with banking accounts and credit card data, and stores them in a server. So, customers only need to fill out their user names and passwords while shopping online. Banking account or credit card data do not transfer via the Web.

Discussion, E-Commerce, How can we transfer money through the Web?

How can we transfer money through the Web? After all, money is the most common power for doing business. But transactions online are not as simple as running a physical shop since transactions happen 24 hours a day and without limited by geography. 

However, to get the money, we still facing several challenges such as different currencies, different payment methods, security, and trust. From the supplier’s point of view, payment methods must be acceptable by their customers, safety(such as transaction control and monitoring), and as lower costs as possible. So, let's discuss the pros and cons. Before digging into them, I would like to introduce two types of payment that I have used in the past.

A Brief Introduction of The Types of Customer Payments

There are various payment methods for customers and sellers to choose and accept such as bank transfer, cash, wallet payment, mobile phone based methods, credit card based, or prepaid charged card. 

However, these methods have to be acceptable by the transaction participants, protected by authorities, and the cost of the procedures is relatively low. Moreover, these factors are influenced by each other. For example, the acceptance can be affected by the costs if it is too high or lower than the other methods. If a method is highly acceptable by the public, some authorities or governments may try to protect it. 

To select the methods, other factors we need to consider were the technical parameters and securities requirements. Technical parameters such as periodicity(subscriptions), international payment, privacy, and guarantees protection(like delays or shortfalls).

Two methods I frequently used in the past for online purchases were credit card based payments and mobile phone based payments. I think they have become more and more often nowadays due to the conveniences and mobile capability.

Credit Card Based Payments

This method is very common for online purchases since organizations like VISA, Mastercard, or JCB, and banks will handle all the hard procedures. After the decision to buy, click the CTA(calls to action) button, provide your credit card data, and get the 2-step verification number to finish the final step. Then, wait for the delivery.

Credit card payments have one significant benefit, that is payments are guaranteed by the credit card company. Trust is very important for every transaction and relationship. Credit card companies build this kind of trust by using their unique information technologies.

However, things are not just as easy as I said. There are some requirements to do ahead of the procedures. The participants all must have a credit card contract with a bank and linked to a Payment Service Provider. By the way, I think reducing the mediums can improve the efficiency of the process, so the payment service providers may all facing more and more challenges shortly.

Another potential issue is the delivery. What to do if I do not get what I purchased? Each time you click on the checkout, you must somewhat concerned if you did not buy anything on a particular website before. Furthermore, what to do if there are deviations? We must have a solution to deal with this sort of situation. 

Mobile Phone and Cloud Based Payments

Mobile phone based payments such as Apple Pay and LINE Pay have become more and more common today. When you use Safari on your iPhone, iPad, or Mac to make purchases on the web, you can pay through Apple Pay without having to create an account or fill out lengthy forms. Apple Pay uses a device-specific number and a unique transaction code. Therefore, your card number will never be stored on your device or Apple’s servers. And when you pay for anything, Apple will never reveal your card number to the merchant. Its safety level is pretty reliable.

LINE Pay is very a very convenient payment method, similar to a connected e-wallet build inside your phone. LINE app generates barcodes and a series of numbers for every transaction. Merchants scan the barcode and then get paid. The money is pre-charged from one of your bank account or credit by your credit card

However, not every card and every bank has a contract with Apple or LINE. And also, not every merchant accepts Apple Pay or LINE Pay. So, you still have to consider the acceptances before you pick up your phone. Moreover, you also need a well-connected environment since it is necessary for all transactions through this kind of payment method. Dysfunctions will happen if there is a poor connection.

The Encountered Issue

I did encounter an issue before, a fraud. A criminal stole my credit card data and used it for two Disneyland tickets. I aware of it while I was checking the bill. Then, I call the bank and tell the customer service that I did not make those purchases. After I fill out a form and sent it to the bank, I don't have to pay for the fraud. 

I also have encountered an issue with LINE Pay. As I said, it only works within a well-connected environment. Therefore, while I tried to open the app to make a payment, it unexpectedly shut down. So, I have to change my option and it's a little emotionally painful. 

Reference

Kutz, M. (2016). Introduction to Electronic Commerce: Combining Business and Information Technology. Bookboon.com

The elements of web analytics, Goals, events, and key performance indicators (KPI), and the examples.

The Goals

If you want to succeed, you need to set goals. Without goals, you will lack focus and direction. However, business objectives are strategic and high level. Instead of, setting objectives like selling more stuff, create happy customers, improve marketing effectiveness, goals are something like "how to do it? Step by step". Setting goals allows you to take control of your direction and also provides you a benchmark for determining whether you are actually succeeding. Having a million visitors linked into your website is only proof of the number is actually there, but how many visitors means success to you, depends on what the exact number is your goal. In short, it depends on how you think and what you want to achieve.

To accomplish your goals, you need to know how to set them. It's not as easy as a daydream. It's not gonna happen if you "just" expect it to happen. Knowing the steps to achieve your goal will allow you to formulate and eventually accomplish it. The simple fact is that for goals to be powerful, they should be designed to be SMART, Specific, Measurable, Attainable, Relevant, and Time-Bound.

For example, a specific, clear, and well-defined goal will be much more achievable. Generalized goals such as more sales, more traffic, and more attractiveness are bad ideas because they don't provide precise direction. A measurable and precise amounts, dates, and so on in your goals so you can measure your degree of success. For example, "To reduce expenses" is not enough, you must measure it with some standards such as 1% reduction or $1,000 reduction. Without a way to measure, you miss out on how to know you have actually achieved it or not. Then, your goal must be achievable and attainable. Almost impossible goals such as living forever, run over the speed of light, or even become a superhero someday, are just waste your time, efforts, and even lose your confidence. However, that does not mean you have to set an easy goal like writing your name on the title of an exam. To accomplishing a goal, you must cost some level of effort. In addition, don't forget to set relevant goals. Goals also should be relevant to the direction you want. Finally, goals must have a deadline, a time-bound. Or, you just have a whole life or even forever to make it happen, and your end up with zero accomplishment and succeed in nothing. Use your sense of urgency increases and achievement will come that much quicker.

The Events

Businesses use the events to collect data about interactions with their potential customers. Events are user interactions with content that can be measured independently from web pages such as downloads, link clicks, and video plays. 

For example, while users click a certain link, but do not stay for enough time to read the full introduction or actually purchase the product. There must be something boring or does not attractive enough. So, business owners can make some changes when they understand this sort of interaction.

The Key Performance Indicators (KPI)

It is the Key Performance Indicator. In brief, it is a measurable value that shows how effectively a company is achieving its business objectives, the overall performance, or just in particular departments such as sales, marketing, HR, support. In other words, KPIs specifically help determine a company's strategic, financial, and operational achievements. But keep in mind, not all KPI is good. KPI is only great if it inspires action, so will you actually measure and influence these actions. And, make sure to pick the appropriate time frame since the different industry has its own cycle.

My father owns a pork processing company in Taiwan that manufactures pork processing products. In the recent 3 years, he decided to sell his products online. So, he cooperates with a local e-commerce company and signed an agreement to built a long-term relationship with the business. 

Start with the measure, he sets targets such as new customers, return customers, and reviews. Then, he sets the numbers of these targets, 1,000 new customers, 3,000 return customers, and 500 reviews are over 5-star. The sources of these measurable targets are from the platform provider, it collects the customer behaviors data in real-time for the users on the platform. 

Then, my father has to choose the time frames such as a week, a month, or a year to do his analysis. To choose the right frequency, he must be careful about the key characters of the industry he is in. Not just plan to achieve the goal, he still has to truly understand how many targets are gets, how many are not, and why. Therefore, he measures the number of new customers, the return customers, and how many reviews are excellent. So, the number will be the percentage of 1,000 new customers are get, the percentage of 3,000 return customers are getting, and the percentage of the excellent reviews. 

However, to get these percentage numbers, he still needs to set the time frame. How many reviews are 5-star this year, how many customers are new this month, or how many customers are returned for his products last month? We are not always perfect, we need to do some changes and adjustments. For example, if the weather is not so nice or due to the pandemic of COVID-19, some fulfillments may not be doing as well as they normally did. Therefore, the plan and the progress must be considered to change quickly to meet the real-world situation. The new customers and the return customers may be changed lower than 30% of their original numbers.

Google Analytics

Google Analytics is a web analytics service offered by Google that tracks and reports website traffic, currently as a platform inside the Google Marketing Platform brand. Google Analytics is used to track website activity such as session duration, pages per session, and bounce rate along with the information on the source of the traffic. It can be integrated with Google Ads, with which users can create and review online campaigns by tracking landing pages and goals such as sales, lead generation, or viewing a specific page. 

How Businesses Are Utilizing Google Analytics to Increase Business and Retain Customers?

Google Analytics' approach is to show high-level, dashboard-type data for users, and more in-depth data further into the reports.

For example, Google Analytics analysis can identify poorly performing pages with techniques such as funnel visualization, where visitors came from, how long they stayed on the website, and their geographical position. Retailers can monitor those data, and make instant decisions and changes such as provides more products that customers actually desire.

More advanced features such as custom visitor segmentation, track sales activity, and performance, or even the site's transactions and revenue. Google Analytics helps businesses to better understand the behavior of their users. It is beneficial to marketers and analysts to customize their marketing strategies.

An Evaluation of Where You See This Reliance on Data Going in The Future

If you know your customer well enough, you have a better chance to win their loyalty. Reliance on data is better than relying on just feelings since they are real activities, not guesses. In the future, there are even more data analysis will be replaced by AI(Artificial Intelligence). The market for enterprise web analytics tools has dramatically expanded in recent years. More companies and organizations are becoming more sophisticated with their internal analytics capabilities and also with their digital marketing activities. Moreover, with free tools like Google Analytics, data freshness can vary widely depending on the amount of traffic your properties receive. If you’re a larger company with some high-cost marketing campaigns, you won’t want to wait 1-2 days to measure its performance.

Reference

About Events - Analytics Help. (n.d.). Retrieved December 08, 2020, from https://support.google.com/analytics/answer/1033068?hl=en

Pateman, N. & Holt, D. (2011).  Inbound Marketing. Bookboon.

The Mind Tools Content Team By the Mind Tools Content Team, Team, T., Wrote, B., Wrote, L., & Wrote, M. (n.d.). Golden Rules of Goal Setting: Five Rules to Set Yourself Up for Success. Retrieved December 07, 2020, from https://www.mindtools.com/pages/article/newHTE_90.htm

What The Key Performance Indicators (KPI) We Should Rely on to Measure The Success?

What Is KPI?

It is the Key Performance Indicator. In brief, it is a measurable value that shows how effectively a company is achieving its business objectives, the overall performance, or just in particular departments such as sales, marketing, HR, support. In other words, KPIs specifically help determine a company's strategic, financial, and operational achievements. But keep in mind, not all KPI is good. KPI is only great if it inspires action, so will you actually measure and influence these actions. And, make sure to pick the appropriate time frame since the different industry has its own cycle.

A Business Which Is Local to Me

I would use my father's food processing company as my example. My father owns a pork processing company in Taiwan that manufactures pork processing products. In the recent 3 years, he decided to sell his products online. So, he cooperates with a local e-commerce company and signed an agreement to built a long-term relationship with the business.

What The Key Performance Indicators (KPI) He Would Rely on to Measure The Success of Its Internet Presence?

Plan, The Raw 

Start with the measure, he sets targets such as new customers, return customers, and reviews. Then, he sets the numbers of these targets, 1,000 new customers, 3,000 return customers, and 500 reviews are over 5-star.

The sources of these measurable targets are from the platform provider, it collects the customer behaviors data in real-time for the users on the platform. Then, my father has to choose the time frames such as a week, a month, or a year to do his analysis. To choose the right frequency, he must be careful about the key characters of the industry he is in.

In Progress, Control and Monitoring

Not just plan to achieve the goal, he still has to truly understand how many targets are gets, how many are not, and why. Therefore, he measures the number of new customers, the return customers, and how many reviews are excellent. So, the number will be the percentage of 1,000 new customers are get, the percentage of 3,000 return customers are getting, and the percentage of the excellent reviews.

However, to get these percentage numbers, he still needs to set the time frame. How many reviews are 5-star this year, how many customers are new this month, or how many customers are returned for his products last month?

Actions and Changes

We are not always perfect, we need to do some changes and adjustments. For example, if the weather is not so nice or due to the pandemic of COVID-19, some fulfillments may not be doing as well as they normally did. Therefore, the plan and the progress must be considered to change quickly to meet the real-world situation. The new customers and the return customers may be changed lower than 30% of their original numbers.

Reference

Twin, A. (2020, August 28). Understanding Key Performance Indicators (KPIs). Retrieved December 04, 2020, from https://www.investopedia.com/terms/k/kpi.asp

What is a KPI? Definition, Best-Practices, and Examples. (n.d.). Retrieved December 04, 2020, from https://www.klipfolio.com/resources/articles/what-is-a-key-performance-indicator

Promotion Purchases, Measuring The Effectiveness, Web Marketing Communication

Promotion Purchases, Measuring The Effectiveness, Web Marketing Communication

The process of Web marketing communication. The attractiveness of having a Web site for the organization depends on the number of potentially interested surfers on the Web. 

i. The awareness efficiency

Awareness efficiency = people aware of the site / people with Web access. To get aware surfers to find the Web site. 

Active seekers are those who intentionally seek to hit the Web site.

Passive seekers are primary purpose in surfing, not necessarily to hit the Web site. 

ii. The Locatability/attractability efficiency

How effectively the organization is able to convert aware surfers into Web site hits?

Attractability efficiency = hits on the site / people aware of the site 

iii. The Contact efficiency

Converting the hits to visits. This measures how effectively the organization transforms Web site hits into visits. The hit should be interesting, hold the visitor's attention, and persuade them to stay awhile to browse. 

Contact efficiency = active visitors / hits on the site

iv. The Conversion efficiency, turn visitors into purchasers

The conversionefficiency = purchases / active visitors

v. Converting purchases into re-purchases, the loyal customers. Update and refreshing of the Web site regularly, the purchase satisfaction and feedback to improve the products.

Retention efficiency = repurchases / purchases

vi. The overall average Web site efficiency index

Web site efficiency = 1/5 ∑(i+ii+...+v)

The weighted average index = 1/5 ∑(i+ii+...+v) x Ui

Ui is the weighting accorded to each of the five efficiency indices in the model.

Reference

Watson, R.T., Berthon, P., Pitt, L. F. & Zinkham, G. M. (2008). Electronic Commerce: The Strategic Perspective. Global Text Project. Licensed under a Creative Commons Attribution 3.0 License.

How to Control Objectives in The ICT

CONTROL OBJECTS IN THE ICT AREA

Elementary objects

• ICT Service

By your internal IT department or an external ICT service provider, controlled by the service level agreement (SLA). The scorecards of different services may be similar or even identical.

• ICT Process

The internal or external process of your ICT services, but not business processes. 

• ICT System

The hardware, software, and applications. 

• ICT Project

Projects are conducted to build new ICT services, processes, or systems or to improve ICT services, processes, or systems. 

Portfolio objects

Control the groups of the elementary control objects, instead of each single service, process, system, or project.

• ICT Service portfolio (Service catalog (ITIL)), a service catalog or structured list of services. 
• ICT Process portfolio: A team, group, or department. 
• ICT System portfolio: System landscape or system architecture. 
• ICT Project portfolio

Cross-section control objects

To integrate an ICT organization completely, we must control objects, services, processes, systems, and projects. 

Important control objects

1. ICT resources, Employees, ICT infrastructure,
2. Information security management
3. GRC management: Governance, Risk, Compliance.

Reference

Kutz, M. (2016). Introduction to Electronic Commerce: Combining Business and Information Technology. Bookboon.com

ICT Overall view, Most organizations use ICT to support their business processes

ICT Overall view 

Most organizations use ICT to support their business processes. 

IT Demand

The responsibility of the ICT customer or consumer, to plan and communicate the needs, to use ICT services in his business processes efficiently.

IT Supply

The internal or external ICT service provider, to make service offerings.

IT Governance

The top management, to establish the rules for the organization, who is allowed to provide ICT services? Who is allowed to consume the ICT services?

Management, The Control Cycle

Setting Targets (Target agreement): Agree with principle on the targets and to reach these targets. 

Planning, plan how to reach the agreed targets.

Monitoring, operate to reach the agreed targets, and monitor the degree of target fulfillment.

Reporting, prepare monitoring data for management.

Analysis & Forecast, analyse reported data.

Communication, to inform the situations.

Actions, run corrective actions.

Scorecards in ICT(Internet & Communication Technology)

Scorecards in ICT(Internet & Communication Technology)

Ticket Management Process

• Number of registered tickets
• Average duration from initiation to completion of tickets
• Number of successfully closed tickets per file.
• Reopen rate of closed tickets (means customers are not satisfied with the result)

Project Management

• Target achievement
• Quality of the results
• Budget consumed
• Deadlines
• How many changes
• How many unresolved problems

Indicators

Management indicators are included in target agreements such as target values to be reached. The manager is able to change things. 

Information indicators

The environment of the management task, the reachability of the agreed targets. Expected values are documented. Indicators are like the weather, cannot be changed by the management, but they have to know the actual values to do their job properly.

Benchmarks

With Benchmarks, we can compare the differences, often used to compare control objects from different organizations. Comparable and measurable are the bases for management here. The same project could be generated similarly by different organizations. 

Analytic indicators

Some values are changing over time such as our abilities to get what I wanted. So, this sort of indicator should be generated only from time to time.

Reference

Kutz, M. (2016). Introduction to Electronic Commerce: Combining Business and Information Technology. Bookboon.com