E-commerce is rapidly becoming an important component in any company’s arsenal of business strategies—so much so, in fact, that when it comes to doing business over the Web, those who hesitate may be lost. Fear not, however; this article offers an overview of e-commerce tactics and strategies as viewed through the example of Domino deployment.
E veryone has some idea of what e-commerce is, with “business on the ’net” being the simplest definition that comes to mind. However, for most people, such a definition means that the entire process of marketing and selling their products and services resides solely on the Web. To others, it means a company has a Web site from which to market its products and solutions. To others still, it means “selling without the middl eman ” in a s upply-chain business. And to service-oriented companies, e-commerce signifies providing customer service over the Internet. While there are many other variations of these perspectives, which one is correct?
E-business vs. E-commerce
The perspectives above collectively define e-business rather than e-commerce. E- business refers to the transformation of key business processes through the use of Internet/Web technologies. When Internet technologies are applied to core business processes, they begin to achieve real business value. Small, midsize, and large companies are using the Web to interact with their customers and partners, connect to their back-end data systems, provide online services, and transact commerce. E-business applications were developed to be interactive, to be transaction-intensive, and to let people do business in more meaningful ways.
Unlike e-business, however, e-commerce deals with transacting business between a buyer and a seller. The transaction usually indicates the process of buying a product or service on the Web, and during this process, the buyer has no human contact with the seller.
E-commerce is also different in that it does not offer the other types of electronic services inherent to an e-business. Online customer support and online customer service, for example, while essential ways a company provides services online, usually do not include a buying
transaction. Such online services are broadly termed the online customer/management relationship and fall under the umbrella of e-business (see Figure 1).
An effective e-commerce strategy is one that is closely tied with a company’s business processes. But what can you really expect should you implement e-commerce solutions aligned with your business objectives? Nothing short of a sales revolution, including the potential to reap the following benefits:
• An increase in your customer base, customer longevity, brand awareness, and
• Open opportunities for innovative partnerships and joint ma rket ing vent ures
• More-effective communication and quicker turnaround with your suppliers and distributors
• Reduced operating costs through automation of certain business processes
• The ability to provide 24/7 support to your customers around the world
• The chance to obtain valuable market feedback crucial to designing the next versions of your products and services
Case Study: Cisco’s E-commerce Site Many companies have implemented e-commerce solutions and have reaped the aforementioned revolutionary benefits. Cisco Systems, for example, is a good case study for successful e-commerce implementation. Visitors to Cisco’s Web site (www.cisco.com) are able to easily find the products and services that the company offers. It provides quick links to customer service and support, shows, events, partners, and resellers. Besides pointing to other areas of interest, the Web site offers a forum for visitors to ask questions and receive feedback. But the best aspect of the site that makes it truly a successful implementation is that customers can purchase hardware online and get detailed help to configure it. Cisco’s Web site has evolved through constant feedback from customers. Cisco’s reward for a well-orchestrated e-commerce implementation is over $3 million in Internet sales!
Numerous other companies have shown successful implementations of e-commerce solutions with current technology. But rapidly evolving technology has resulted in evermore innovative products that provide effective and easy deployment of e-commerce applications. A prime example of such a product is Lotus Domino.Merchant, which targets small to midsize businesses, enabling them to adopt an e-commerce strategy.
A Typical E-commerce Framework
From my Cisco reference, you may think that to make a good e-commerce framework requires many component systems. But if you analyze the steps involved to transact business on the Internet, you will find that each step reveals the general components required to build a basic framework for an e-commerce strategy.
Th e e- comm erce fra mewo rk c an b e br oadl y di vide d in to a two -par t system: front-end and back-end (see Figure 2). The front-end system interacts with customers to provide information and retrieve payment details. An e-commerce Web site is basically the front-end system. The back-end system processes user transactions and communicates the results of the transactions to the customers via the front-end system. Domino.Merchant provides templates and tools to create an e-business front-end for your Web site. Its back- end consists of complete modules to process payment transactions.
The Web Site Front-end
The first, and most obvious, need for an e-commerce application is a well-designed Web site. The contributing factors that make a good Web site include the following components:
• An easily remembered domain name
• Meta search keywords to make your site available through search engines
• An intuitive interface
• Simple navigation strategies
• Comprehensive information on your company and its products
• Effective graphics
• Links for support and online help
• Contact information via phone numbers and email addresses To enumerate the details of security, graphics, content, and design for good Web sites is beyond the scope of this article. (Plenty of information on how to build a good Web site is available in books and on the Internet itself.) However, I must emphasize the need for Web sites that will not only attract more traffic but also entice your customers and potential customers to keep coming back.
While the entire Web site can be considered the front-end, it is composed of distinct elements that, taken together, allow an e-commerce transaction to run smoothly. What follows is a review of typical e-commerce functions.
Cataloging Products and Services
The reason visitors have hit your Web site is obviously because of their interest in what your company has to offer. Access to the area of your Web site that contains your products and services must be easy and obvious. An online catalog usually mirrors a hard copy catalog. On the Web, however, you have more space to present comprehensive details about the product or service and provide reference links for further explanation.
You may neither need nor wish to invest in creating an online catalog if you do not have many products. A simple link to a Web document might be all that is necessary to present your offerings. In any case, it is important that your presentation is comprehensive and that all questions a potential customer may have are addressed in this section.
A Web site “shopping cart” serves the same purpose as its counterpart in the real world: It “holds” a shopper’s items before that shopper proceeds to the checkout stand to pay. This shopping cart metaphor goes well with an online catalog of products—that is, if your company has multiple products that customers might want to purchase during their visit to your site. When customers are ready to buy the items they have placed in the cart, the back-end system gives them the total sales cost along with taxes and other charges.
When a customer is ready to offer his or her credit card, purchase order number, or other means of purchasing your product or service, you must have a back-end system in place to process this transaction. The process of purchasing can be further split into a purchasing validation system.
Whatever the mode of purchase, be it electronic cash (e-cash), credit card, or purchase order, you must be able to validate the transaction as genuine. For credit card purchases, for example, you may need to partner with or buy the services of another vendor that can provide verification of card holder and expiration date. If you are connected to online banking systems or credit card authorization systems that offer account verification services, then the transaction can be instantly validated.
Note that such instant validation, unlike a potentially risky personal-check payment, either completes the sale or guarantees realization of monies. Validation is the key step in the sale because, from a selling perspective, it completes the transaction.
Accounts Receivable System
You must, however, provide for customers who may choose to purchase items from your Web site but who may prefer to send in a check payment. In such cases, although the transaction may not be validated instantly, your accounts receivable system must nonetheless be updated to record the transaction. Further processing may then be initiated when the check from the customer does arrive.
At the end of a sale or, in the case of payments that cannot be processed in stan tly, the in tent to purc hase , th e cu stom er m ust be n otif ied of the completion of the transaction. Your back-end system must provide the necessary information so that the customer may refer
to the sale in the future. Notifications ideally occur during several individual steps: validation, sale completion, order queuing, and order fulfillment.
Order Processing and Fulfillment
The e-commerce back-end system must then process the sales order. In the case of products, these products must be shipped to the customer. This means that the accounts receivable system must initiate the order fulfillment process in the order processing system. In the case of services purchased, such services must be scheduled.
It is a basic expectation that online transactions are secure. While most e-commerce applications ensure security of data flow, payment online hasn’t necessarily caught on with the public en masse as quickly as expected. But adoption of secure online transaction systems by banks and stockbrokers has made it easy for people to trust online payment options. Business-to-business commerce is carried out using extranets and firewalls. Most Web servers and commerce servers are equipped with secure transaction mechanisms using Secured Sockets Layer (SSL) and Secure HTTP (S-HTTP).
SSL is a security protocol that prevents others from viewing or capturing the data a customer sends via an SSL connection. Forms that request and transmit credit card information use SSL. The customer must have a Web browser that supports SSL and has it enabled in its security options. S-HTTP is quite different than SSL. While SSL is designed to establish a secure connection between two computers, S-HTTP is designed to send individual messages securely.
Domino’s Compelling Case for E-commerce Strategy
It is important to note that adopting an e-commerce strategy must not alter your current business processes. E-commerce solution offerings are constantly changing and evolving with technology. While most commerce servers provide robust, scalable features, you must plan for rapid growth of your online revenue. Best practices of e-commerce implementations suggest that your company should start simply (but plan to grow fast) and that you should build on top of your current business processes.
You needn’t reinvent your business; rather, e-commerce and e-business are about streamlining your current business practices to improve operating efficiency, which, in turn, will enhance the value you provide to your customers. It is this customer value that gives you a significant advantage over your competition. And to best serve the interests of both your company and your customers, the better off you will be to keep costs low and deployment time short.
This brings us to Domino e-commerce solutions, which have proved ideal for companies that already have an investment in Notes and Domino. Standard Domino applications are already workflow applications. Back-end databases and processes, such as customer service and marketing literature, are already streamlined for Web exposure through Domino. Domino provides a robust, scalable platform that allows you to start simply and to build on after leveraging your existing investment. Its open application architecture, which allows you to tailor applications for your specific needs, and its ability to interact with databases such as DB2/400 make Domino the platform of choice on which to integrate many of the back-end systems.
The success of Domino has encouraged several vendors to provide e-commerce solutions and products that use the Domino platform. One such product is Lotus’ own Domino.Merchant, which includes in its base package the Domino server itself. Domino.Merchant is easy to install and configure. With no programming effort, you can deploy all its features, including the capability to perform the following actions:
• Register visitors (potential customers) at your site
• Create and maintain a catalog of products
• Accept orders
• Process credit card payments securely
• Offer special promotions to select customers
• Calculate taxes and shipping charges automatically
• Provide the ability for customers to track the shipment of the orders Domino.Merchant provides tools and templates to build your own custom Web front-end and includes the necessary back-end systems of the e-commerce architecture.
Lotus uses Domino.Merchant on its own LotusStore site to sell products directly to its customers and resellers. Figure 3 shows a screen shot of the LotusStore site. To know the workings of this application, I recommend you visit and browse this site at www.lotus.com/home.nsf/welcome/store.
The first page contains but a few simple options: You can search for a product, access the demos and trials, or begin your shopping experience by clicking on the Shop Now! shopping cart icon. The shopping cart takes you to a catalog of available products (see Figure 4) listed by different criteria, such as alphabetical listing and functional area listing.
Once you select an item, the product page provides details about the features of that item, where it can be purchased, the price of the product, and links to resellers in the United States that are close to you. When you choose a product to buy, the applicable taxes are automatically calculated with the Taxware module that comes with Domino.Merchant.
Selecting the Purchase Product option simply adds an item to your shopping cart. Links are provided on the side navigator for easy access to the product catalog, shopping cart list, and so on. This framed environment with easy navigation is important, and Domino.Merchant provides the means by which you can create such a Web site.
Accessing the shopping cart happens only over secure connections. At any time, you may remove a product from your shopping cart. The View My Shopping Cart option (Figure 5) gives you the list of products you have added to your cart for purchase and a running total of your current purchases.
Ordering the selected products is a simple three-step process:
1. Review your shopping list.
2. Provide shipment information using a secure form.
3. Provide credit card payment information. Credit card verification is performed by a company called CyberCash (a CyberCash module is included with the purchase of Domino.Mercant). If you choose to accept invoices or other forms of payment, you will need to develop or purchase systems (where available) that can connect to other financial institutions to verify such payment.
To build your Web site and shopping catalog, Domino.Merchant provides a tool called the SiteCreator to create your home page and other pages for your site. Because it is dependent on PC-oriented back-end systems, the current version of Domino.Merchant is available only for NT. The front-end of Domino.Merchant is itself a Domino-based application and can be used on all hardware platforms that support Domino. However, if you choose a platform other than NT, you must customize the product to integrate it with back-end and third-party vendor systems. (See Figure 6 for a partial list of Domino-based e-commerce products from various third-party vendors.)
Live Long and Prosper
Adopting an e-commerce strategy is proving to be vital to the survival of businesses. This new technology means widening your marketing efforts and quickening your sales. The total online purchases made in 1997 were approximately $10 billion with estimates for 2001 to peak well above $220 billion, according to International Data Corporation (IDC), a firm specializing in IT research. It is imperative that you analyze this strategy and how it might affect your business processes and your customers. It is equally important to understand that strategically applied e-commerce solutions add tremendous value to both your customers and your enterprise.
Figure 1: E-commerce is a specific subset of e-business applications.
Figure 2: The framework of a typical e-commerce application has both back-end and front- end systems.
Figure 3: The Lotus Store Web site was developed using Domino.Merchant.
Figure 4: Visitors to the Lotus Store may browse through a comprehensive catalog of products.
Figure 5: The Lotus Store uses a “shopping cart” strategy to make multiple purchases easy for customers.