E-Commerce (continued)

Security

There are two principal security concerns in e-commerce: The customer is concerned about the security of his data, particularly his credit card number, submitted during an online transaction. The merchant is concerned about credit card fraud due to the difficulties surrounding cardholder authentication. The subsequent chargebacks can be costly.

Data security is addressed through the use of secure servers, digital certificates and SSL. These technologies make 'hacking' virtually impossible. In fact, online transactions are generally considered more secure than the traditional 'customer present' transactions.

Credit card fraud in 'customer not present' transactions is a concern for the merchant, since repudiated transactions generally lead to chargebacks, paid for by the merchant. There are a number of things the merchant can do to guard against fraud, such as not selling to certain countries, verifying the address of the customer, querying bulk orders. The latest technological advances are in cardholder authentication. These are "Verified by Visa" from Visa and "SecureCode" from MasterCard. These work by requiring that the customer type in a password or security number in addition to their card number. By adopting these technologies, merchants are no longer liable for customer not present chargebacks.

Shopping Cart - Advanced Features

CROSS SELLING
The shopping cart suggests another product to complement the selected item.

QUANTITY DISCOUNTS
The shopping cart calculates a discount based on the quantity bought.

COUPONS
Special codes issued to customers, for marketing purposes. These match up with particular goods, enabling a discount to be gained by the customer.

AUTORESPONDERS
Allows you to follow up clients with email offers.

AFFILIATE MODULES
Handles the administration associated with signing up and paying affiliates.

INVENTORY TRACKING
Keeps track of stock, and informs the customer when an item is out of stock.

SALES TAX CALCULATION
Calculates different levels of tax for different regions - not generally applicable in UK.

STATIONERY CREATION / MANAGEMENT

SHIPPING OPTIONS
Allows different options, and calculates the cost associated with each.

DOWNLOADABLE GOODS
Soft items (music, video, text files) can be downloadable immediately on payment by the customer. There are various possible solutions.

Other Considerations

Before selling on the Internet, the merchant has to be aware of the laws of this country and of the country into which he is selling. Most of the rules are common sense. The UK trading laws are contained in:

The Electronic Commerce (EC Directive) Regulations August 2002
Consumer Protection (Distance Selling) Regulations 2000

One crucial aspect of the e-commerce web site is its Terms and Conditions. These must be comprehensive and clearly understandable. It is a good idea to ensure that the potential customer reads these. This can be achieved by having an 'Accept' button in the payment processing part of the site. The customer can be denied access to the final stage until he has clicked the button.

Lots of useful information can be found at the Department of Trade and Industry web site

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