Week Ten: Trust in eBusiness

1) What does this meant by the following statements?

Trust is not associative (non-symmetric)  

Since symmetric is defined as having similarity in size, shape, and relative position of corresponding parts( http://www.thefreedictionary.com/symmetric ) the above statement would mean that the trust is not the same on both parts. One party in the transaction would be more trusting than the other.

Trust is not transitive

An example will best explain this statement-just because I trust the head chef to cook my meal, does not mean that I will trust another chef he has trained. When searching for an answer to the statement ‘trust is not transitive’ I found a couple of funny statements that I had to share-

But, we often find we let our family and friends recommend service providers to us because they have told us they trust then they must be alright?????? Often you see ‘family transitive trust’ where Granddad went to Gove bikes so Mum went to Gove’s bikes and now I go to Gove’s bikes. I suppose a degree of trust can be transitive through association.      

• `In God we trust, all others pay cash.'' http://world.std.com/~cme/html/trust.html
•  We can assume that a trained pilot, when facing piloty thingies, will act like a trained pilot. WE CANNOT ASSUME THAT A TRAINED PILOT WILL ACT LIKE A TRAINED LION-TAMER WHEN FACING A WILD LION. http://peternbiddle.wordpress.com/2008/03/26/trust-isnt-transitive-or-someone-fired-a-gun-in-an-airplane-cockpit-and-it-was-probably-the-pilot/

Trust is always between exactly 2 parties

This is true when there is only two parties involved but what about when more than one party is involved. Today it is not uncommon for business transactions to involved many people. First of I thought if I was going into business with a group of people then there is trust between more than two people, I would be trusting the group. Right? Pondering the thought more I realized that even though it is a group of us in this transaction you would still trust the group on an individual basis because I would have differing relationships with different levels of trust with each member.

Trust will involve either direct trust or recommender trust

Direct trust would come from having direct personal experience with the other party while recommended trust would be like a family member recommending someone to you from their direct experiences. There is also an affiliated trust when people are connected with either a group or organisation then they recieve a certain level of trust. this can refer to police officers, priests, charity workers, fire brigade, doctors, pharmacists and so on.

2a) Have a look at the following websites. What are some of the elements that have been incorporated to increase your trust in the sites? If there are also some aspects which decrease your level of trust describe them as well.http://www.ebay.com.au/

Ebay has Paypal which gives buyer protection. Both buyers and sellers can give feedback about each other which is hoped to give more trust between the two parties. When a seller has had a lot of experience in selling on ebay they are known as a power seller who have 98% positive feedback. In 2009 ebay launched ‘top rated sellers’ for those who received constant positive feedback. Ebay is a global household name and we all have either direct or recommended experiences with eBay. Ebay's trust measures include member education, promotion of transparency and honesty, supports government rules and regulation, user agreement and customer support.

http://www.anz.com.au/

A well known global organisation Looks professional and really easy to use.Has a log in tab for clients.
A security tab is visible on the home page allowing cutomers to see all security measures being taken to ensure their protection through online banking.

There are a range of security measures including:

• ·         guaranteed protection by ANZ for online banking for any unauthorised trasnsactions.
• ·         fraud detection systems which are continually strenghtened and enhanced
• ·         Encryption, using 128- bit SSl (Secure Socket Layer) technology.
• ·         Extended Validation Certificates
• ·         Firewalls
• ·         Automatic time outs.
• ·         Account Aggregation
• ·         Tips fort protecting yourself online-passwords, hoax emails, protecting your identity   
•            and always using up dated software.

http://www.thinkgeek.com


Have not heard of this site before but appears to be a professional website not that this means anything. It’s like Ian's favourite cartoon (see below). It has a log in tab for members. The format reminds me of 'Catch of the day', another bargain selling website that send you an email every day. Under their customer service tab there is information about their privacy policy and security measures. They use Truste, an independent third party to review and approve their privacy policies which include transparency, accountability and procedures around collecting and using personal information.

http://www.paypal.com.au     

.

Well known name through association with eBay. It is a security measure used by eBay so you know straight away that they are all about security. Not only is there a tab for security information but they also have security personal and business measures written on the home page. 
Paypal has partnered with crime stoppers to help with protection against unauthorised payments, buyers protection, fraud protection identity theft and tips on how to stay safe online

                           

2b) Find a web site yourself that you think looks untrustworthy.

http://www.scribd.com/doc/9726/Project-Charter-Guide

 

Week Nine: Channel Conflict

Channel conflict can be defined as 'any situation where two different marketing or distribution channels are competing for the same sale with the same brand'.

Week Eight: Online Auctions

This weeks topic is online auctions. I am sure you have all heard of eBay, and many of you may have bought or sold goods by online auction. The nature of (online) auctions has changed from selling mainly collectable goods, to selling everyday items. There are now thousands of businesses that get the majority of their income from auction listings.


Q1: eBay is one of the only major Internet "pure plays" to consistently make a profit from its inception. What is eBay's business model? Why has it been so successful?

eBay’s business model is an online broker. eBay has been so successful because it has a diverse range of products and consumers and has a global reach. A swot analysis by Coghlan, Pauley and Scott (http://www.slideshare.net/ebayworld/ebay-company-analysisdoc) identified the strengths of eBay to be the largest online trading forum, sense of community, over 250 alliances, global reach, over 27,000 categories, publicly traded, zero inventory held by company, partnershipswith international companies, and recognised brand name. 
In addition eBay is constantly researching ways for improvement and customer satisfaction. They constantly seek and use customer feedback which has formed a sense of community around ebay and has resulted in strong customer loyality. http://www.creatingcustomerevangelists.com/resources/evangelists/meg_whitman.asp


Q2: Other major web sites, like Amazon.com and Yahoo!, have entered the auction marketplace with far less success than eBay. How has eBay been able to maintain its dominant position?  

• strong powerful brand name
• sound reputation. 
• Happy and loyal customers
• Cheap for sellers to use
• Customers in control of transactions
• used by millions of people
• ebay is for everyone, individuals can sell second hand goods while businesses can sell new items
• secure payment options for users.
• always updating and improving
• transparent transactions
• rating system for buyers and sellers

http://www.mcafee.cc/Classes/BEM106/Papers/2005/eBay.pdf


                                     


                                                                
Q3: What method does eBay use to reduce the potential for fraud among traders on its site? What kinds of fraud, if any, are eBay users most susceptible? 

 If you scrollto the bottom of the ebay home page you will find  a heading 'inside eBay' . Under this is a section titled 'trust  & safety'. It is here you can find solutions to certain buying and selling problems, and opportunities fro users to learn ways to help them protect themselves and how to report threats to eBay. They use procedural and technical safeguards like firewalls, encryption and secure socket layers to protect users personal informtion. eBay provides buyer protection through a pay-pal buyer protection policy which protects buyers on purchases up to $20,000.   eBay has established a Global Asset Protection (GAP) team to promote the safe use of its platforms and to collaborate with local, federal and international law enforcement in apprehending and prosecuting criminals.

Q4: eBay makes every effort to conceptualize its users as a community (as opposed to, say "customers" or "clients"). What is the purpose of this conceptual twist and does eBay gain something by doing it? The purpose is to promote customer loyality by engaging them through information and feedback opportunities. On the home page of eBay under the tab COMMUNITY there is an eBay newsletter, discussion forum, question & answers forum, groups and a feedback form which allows users of eBay to communicate not only to eBay but also other users. This is a great networking strategy by eBay and they are clever to value their customer input as this is a major contributor to their success.

Q5: eBay has long been a marketplace for used goods and collectibles. Today, it is increasingly a place where major businesses come to auction their wares. Why would a brand name vendor set-up shop on eBay?
Because of the high volume of eBay users. It is an opportunity to generate awareness of brand and to increase sales.

 

Q6. I have a few businesses, and I have used eBay for about 12 years on and off. Currently I have about 600 books listed on eBay (seller name ozrural). I stopped selling on eBay for a few years but they changed the rules this July and it is viable again (for me). What do you think changed?

WHich July????

In July 2012, eBay sellers will face a number of policy changes about the photos that the use to sell goods in their eBay auctions. http://ebay.about.com/od/mistakestoavoid/a/Rules-And-Fees-For-Ebay-Photos.htm .

In July 2011, ebay changed listing requiremnewts for clothing. All new and revised listings in Clothing, Shoes & Accessories categories must include the following custom item specifics: Brand, Size Type, Size, Style, and Color.

In July 2010, eBay’s payment policy will be revised to include two new accepted safer payment options.

The revised policy will require sellers to offer one or more of the following three safer payment methods to buyers:

PayPal,Paymate, Merchant credit card

Additional (optional) task: If not already a member, join ebay and explore the functions of the site (optional). Consider making a purchase, or perhaps try your hand at selling. Auctions are impacting on all aspects of business so it is useful to understand how they work.

Reflection

I usually will not try something unless there is a need for me to do so especially where computers are concerned. It is only because of work and study requirements that I have become familiar with the basic computer skills and I stress basic. I sent my first email 3 years ago!!!! Taking this into consideration I have come a long way in three years but I am definitely very far behind. I think my primary school age children still know more. I can actually remember asking them when they where 4 years old to turn the computer on for me! The point is that I needed to learn the unit e-business to ensure that I expand my knowledge and get on the same wave length as everyone else.

Ironically, a week before I starting e-business I was asking my work colleagues what is a blog? It was all science fiction to me. I am very happy that I took on my personal challenge of studying e-business because I have tried things that I otherwise wouldn’t have. Just after seven weeks I’m a blogger, a twitterer, I can post you-tube videos, add links, purchased my first item online and have even recorded my voice on a voice discussion board . The only thing I did not enjoy and found hard to navigate was The Global Information Technology Report 2010-2011.

Week Seven: Digital Automata

This week we are looking at Digital Automata

1) Check this link to my ‘intelligent’ cybertwin which I also mentioned in the Powerpoint. You may like to create your own cybertwin as well. The more you 'train' your twin, the better the responses will be. While it is just a fun exercise, Think of the opportunities. Imagine if we had a cybertwin that could answer your questions about the course. Or perhaps a shopping assistant?

So I went and had a chat with Ian’s cybertwin and found that he really does need to learn his manners, but it was fun so, now I have a cybertwin. If you would like to go chat with me click on  https://mycybertwin.com/chat/kimlee

Below is the conversation that Ian and I had:

You: Gday!
Ian: Hello, just catching up on work are you?
You: Yes Im catching up on ebusiness
Ian: You might be, but you will never be as evil as me!
Ian: Have you thought about studying eBusiness?
You: Yes I do study ebusiness
Ian: No you don't, I said so!
You: Whats the weather like where you are?
Ian: are you an idiot?
You: What?
Ian: Oh, don't strain yourself there Kim.
Ian: What job do you see yourself doing in 10 years?
You: Goodbye
Ian: Yes it is a good bye isn't it? I couldn't be happier that it's over.

The dream of scientists and business leaders alike is a machine that can think. Sounds like science fiction but it is closer than you may think. Alan Turing first wrote about the possibilities in the 1940's.

2) Write a one paragraph describing the Turing test and another paragraph describing an argument against the Turing Test, known as the about the Chinese room.

 Turing Test is a test of a machines ability to think intelligently. The test was introduced by Alan Turing in 1950 and it involves a human judge, a human and a machine. They are all separated and the human judge talks to both the human and the machine via a computer and has to decide which one is a machine. If the human judge cannot distinguish between the two then the computer wins!

The Chinese room argument is an argument against the possibility of true artificial intelligence. This argument is presented by John Searle. He believes that a computer who can pass as a human in a conversation test does not mean it is intelligent. John argues that the computer is just carrying out instructions in the program and has no understanding of what is going on.  John proposes that if he was alone in a locked room with an English version of a computer program, paper, pencils, erases and a filing cabinet and was fed Chinese characters through a slot in the door, he could use the program to process them and produce Chinese characters as output without knowing the Chinese language. This reinforces John’s argument that, without understanding, we cannot describe what the machine is doing as thinking.

http://en.wikipedia.org/wiki/Turing_test
http://en.wikipedia.org/wiki/Chinese_room
http://plato.stanford.edu/entries/chinese-room/
http://site.mycybertwin.com/build-a-free-twin
http://www.alexandria.nu/ai/blog/attachments/00000050_ChineseRoom.jpg

The video (linked in the Powerpoint) 'Creativity: The Mind, Machines, and Mathematics: Public Debate' is a debate which asks the question 'will machines one day achieve consciousness'. Following on from this debate consider the following question -

3) Can virtual agents succeed in delivering high-quality customer service over the Web? Think of examples which support or disprove the question or just offer an opinion based on your personal experience. Write you answer on your blog page or express an opinion on this voice discussion board (it's simple to join). If you choose this option please link (live in an hour or so) to it from your blog page.

Yes I do believe virtual agents can succeed in delivering high quality customer service over the web. A great example of this is netbank through the Commonwealth Bank. I find this online service very easy to navigate. Recently I experienced purchasing my first item online and at first, found it difficult to work out how to purchase. The item had 10 minutes left and i was unable to ask anyone for help. Not being able to have your questions answered immediately is a major limitation of customer service online.
I have expressed my opinion on  voice discussion board  please visit and add to the discussion.

Week Six: Digital Markets

Week Six: Digital Markets

Digital Markets

Read or listen to the podcast on the Digital Enterprise (32 minutes) on digital markets, then answer the questions about an online shopping experience you have had. There are three questions to answer.

Question 1

a) What experiences have you had with shopping online?

This is an easy question. I have never purchased anything online! There has never    been the need for me to do so. My sisters regularly purchase online so I will live  through them to complete this week’s task!

b) Describe a good experience.

A good experience is purchasing the product at a cheaper price than retail prices, you receive the product quickly and it is everything you expected it to be. I know people who have purchased jewellery for bargain prices on ebay. One example is purchasing a sterling silver item and it turns out to be white gold!

c) What did you like about the online store you used?

·         Not leaving the house!

·         Price Transparency

·         Global access from any location

·         Comparison

d) Describe a bad experience.

 Purchasing an expensive item through ebay and depositing the money in the sellers   bank account and never receiving the product. Even though you speak to the seller on the phone who is now claiming to be a third party and you give authorities their details including their address, you do not receive your money back and they are not held accountable! The good old saying ‘if it’s too good to be true, it is’

Another bad experience I know of is when a deb dress was purchased online from China and when it arrived it did not resemble the picture that was on the net at all. Luckily enough when contacted the company did agree to a refund. Phew!

e) What problems did you have with the online store?

I imagine the most frustrating issue is having to wait an extended period of time for an     answer to a query about the product especially if the site is inadequate in informing or  instructing customers.

f) What features make an online store more appealing?

·         Special discounts for shopping online

·         Access to items not available in stores

·         Convenient

·         Anywhere, anytime

·         Little effort

·         Extra information about product online

g) What features make an online store less appealing?

·         Fraud and security concerns

·         Lack of cost disclosure. My example is plane tickets over the internet, they advertise the tickets for $50 but then charge you an additional $30 for using your credit card!! To add to the frustration they do not offer any alternative payment method!@#$%^ RIP OFF

·         No hands on inspection can lead to disappointment

·         Privacy

·         Receiving annoying emails after purchase.

h) Should we expect to see the prices of goods and services rise or fall due to the migration of consumers online?

I expect the prices of goods and services to fall due to the migration of consumers   online. Cutting out the middle man, no market entry costs and no overheads allows    businesses to sell at a more competitive price. As consumers shopping online we are  empowered through the transparency of prices which again will generate greater competition between businesses.

Marketplace elements include:
Communications infrastructure
Structured environment
Transaction mechanism
Delivery

I have included an additional reading from MIT (Understanding Digital Markets). After reading it please discuss the following statements and indicate if you agree with them or not. Please note there may not be a right or wrong answer.

Question 2

a) The dispersion of prices (that is, the spread between the lowest and highest price for a particular product) will narrow.

No. Research by Bailey (1998a, 1998b), Brynjolfsson and Smith (1999) find that price dispersion is no lower in Internet markets as compared to conventional markets. The factors they give for this result is market immaturity and awareness. Since the report is from 1999, |I wonder if this would change in a more updated report?

There are several potential sources of price dispersion in electronic markets that need to be researched further which include, product heterogeneity, convenience, shopping experience, neural real estate, trust, low menu costs and price discrimination.

b) The importance of brand names will decrease.

No I believe they will remain important especially while we still have celebrities to endorse them and teenagers who want to be trendy! Also, the report revealed that sites that have missing information regarding products will result in consumers relying more heavily on known brand names that they can trust for quality.

 c) Price competition will make all products cheaper.

Of course price competition will make all products cheaper! This statement is already proven. But seriously how low can they go? There has to be a limitation if we value quality.

d) Digital markets will become dominated by a handful of mega-sites, like Amazon.com.

As the article suggested, Amazon is a mega site due to the extensive advertising they undertook to ensure people were aware of their site and what they have to offer.  To ensure you are not ‘a needle in the haystack’ you will need to advertise just like any business online or not.

e) How do you think the balance of power between buyer’s and seller’s will change?

As stated before ‘information is power’ and as consumers we are more informed and more empowered when making purchasing decisions. We are more aware of prices and have a whole world to browse so I think our power has increased. But thinking about Kony 2012 I remember how convincing this was and feel that with the right advertising the seller’s power has also increased.

f) Prices are clustered online.

Reminds me of the cardboard price fixing scandal!  I don’t think so, what a huge job. It would be easier for the business to let the customer do all the work (if they want to). I feel businesses will be more inclined undercut one another. An example was given in the report where Books.com has a compare button for customers to use to see fi their prices are lower.. This is also evident in the physical market where retailers like JB HIFI and |Bunnings will match competitors prices.

g) Online prices are elastic. (i.e. immune to change up and down with demand)

People will always try to make the most money they can from products in demand which generally are the latest brand name fad

h) Online prices are generally transparent (the extent to which prices for a given product or service are known by buyers in the marketplace.).

When shopping online prices are generally transparent. When comparing identical products between sellers we can achieve transparency but as consumers if we desire full transparency we need to be aware of product heterogeneity. Also I remember when we were looking at good and bad web sites that I came across a site which did not offer prices for their lounge suites. As a consumer I didn’t appreciate it nor would I bother calling or emailing them for a price.

Question 3

a) What types of m-commerce services does your cell phone provider offer?

Telstra equals bigpond tv, city search, foxtel, games, gmail, access to work emails, internet, maps, gps, my account details.

b) Which of these services do you use?

gps, games, internet.

c) What types of transactions do you perform through your cell phone or other wireless device?

Internet banking, emails, google maps, facebook, city search for businesses, access work emails.

d) What types of transactions would you like to perform, but are currently unable to?

I would like my phone to have voice recognition not only for when you want to call someone but for your gps. How good would it be to say how do I get to the Regent Theatre and your phone tells you or “Is it going to rain?|’

e) What is your opinion of wireless advertising/mobile marketing?

When Telstra SMS me about special deals I find it annoying and rude. I like receiving SMS that remind me of appointments or when credit card payments are due.

Further research:

Chris Anderson, the editor of Wired Magazine, wrote a book called 'The Long Tail'. Anderson's theory of 'The Long Tail' has been widely acclaimed, but there has also been recent research which questions it's veracity.

Conduct your own research about 'The Long Tail', and state your opinion in favour or against the theory.

I agree with the theory.

I don’t feel that Anderson is claiming the tail will overtake the head but merely that there is a market out there and is proven in businesses like Amazon and Ebay.  

The head represents the products found in retail stores while the tail represents products only found on the internet. I do believe that with time, awareness and the better we become with using the digital enterprise, the tail will grow. Ian’s horse book business is an example of a tail business.

It is also worth reading about Pareto's Principle, the 80/20 Rule. How do the two relate to each other?

The 80/20 Rule is a golden business rule which means that 80% of your business or sales will be generated from 20% of your customers. In other words 20% of your efforts or customers are responsible for 80% of your businesses' revenue. The Long Tail Theory is a concept that somewhat counters the golden 80/20 Rule. The Long Tail Theory is derived from Pareto's thinking that low demand can effectively and collectively make up a market share that exceeds the few of those that are in high demand. In other words, a large number small customers can potentially out-perform a small number of large customers.  http://www.developer-resource.com/long-tail-vs-80-20.htm

Research Readings:

http://techcrunch.com/2008/07/02/poking-holes-in-the-long-tail-theory/

http://www.slate.com/articles/technology/technology/2008/07/long_tails_and_big_heads.html

http://www.longtail.com/the_long_tail/2008/06/excellent-hbr-p.html .

http://www.developer-resource.com/long-tail-vs-80-20.htm