Chapter 1

table 1.1
The First Five Minutes: Why You Should Study E-commerce
•First quarter-century or so of e-commerce
–Still just the beginning
–Rapid growth and change
•Technologies evolve at exponential rates
–Disruptive business change
–New opportunities
•Why study e-commerce
–Understand opportunities and risks
–Analyze e-commerce ideas, models, issue
 Chapter 1 Terms
e-commerce: the use of the Internet, the Web, and mobile apps and browsers running on mobile devices to transact business. More formally,
table 1.2 digitally enabled commercial transactions between and among organizations and individuals
What Is E-commerce?
•Use of Internet to transact business e-business: the digital enabling of transactions and processes within a firm, involving information systems under the control of the firm
–Includes Web, mobile browsers and apps
•More formally: Internet: worldwide network of computer networks built on common standards
–Digitally enabled commercial transactions between and among organizations and individuals
The Difference Between E-commerce and E-business World Wide Web (the Web): an information system running on Internet infrastructure that provides access to billions of web pages
•E-business
–Digital enabling of transactions and processes within a firm, involving information systems under firm’s control mobile platform: provides the ability to access the Internet from a variety of mobile devices such as smartphones, tablets, and other
–Does not include commercial transactions involving an exchange of value across organizational boundaries ultralightweight laptop computers

information asymmetry: any disparity in relevant market information among parties in a transaction

marketplace: physical space you visit in order to transact

ubiquity: available just about everywhere, at all times

marketspace: marketplace extended beyond traditional boundaries and removed from a temporal and geographic location

reach: the total number of users or customers an e-commerce business can obtain

universal standards: standards that are shared by all nations around the world

richness: the complexity and content of a message

interactivity: technology that allows for two-way communication between merchant and consumer

information density: the total amount and quality of information available to all market participants

personalization: the targeting of marketing messages to specific individuals by adjusting the message to a person’s name, interests, and past
purchases

customization: changing the delivered product or service based on a user’s preferences or prior behavior

business-to-consumer (B2C): e-commerce online businesses selling to individual consumers

business-to-business (B2B): e-commerce online businesses selling to other businesses
consumer-toconsumer (C2C): e-commerce consumers selling to other consumers
mobile e-commerce (m-commerce): use of mobile devices to enable online transactions
social e-commerce: e-commerce enabled by social networks and online social relationships
Figure 1.4 local e-commerce: e-commerce that is focused on engaging the consumer based on his or her current geographic location

disintermediation: displacement of market middlemen who traditionally are intermediaries between producers and consumers by a new direct
relationship between producers and consumers

friction-free commerce: a vision of commerce in which information is equally distributed, transaction costs are low, prices can be dynamically
adjusted to reflect actual demand, intermediaries decline, and unfair competitive advantages are eliminated

first mover: a firm that is first to market in a particular area and that moves quickly to gather market share

network effect: occurs where users receive value from the fact that everyone else uses the same tool or product

Web 2.0: set of applications and technologies that enable user-generated content
Chapter 2
Table 2.2
Table 2.6

Table 2.3

Table 2.7
Table 2.4
 competitive advantage: achieved by a firm when it can produce a superior product and/or bring the product to market at a lower price
than most, or all, of its competitors
Table 2.9
asymmetry: exists whenever one participant in a market has more resources than other participants

first-mover advantage: a competitive market advantage for a firm that results from being the first into a marketplace with a serviceable
product or service

complementary resources: resources and assets not directly involved in the production of the product but required for success, such as
marketing, management, financial assets, and reputation

unfair competitive advantage: occurs when one firm develops an advantage based on a factor that other firms cannot purchase

perfect market: a market in which there are no competitive advantages or asymmetries because all firms have equal access to all the
factors of production

leverage: when a company uses its competitive advantages to achieve more advantage in surrounding markets

market strategy: the plan you put together that details exactly how you intend to enter a new market and attract new customers
Chapter 2 Terms
business model: a set of planned activities designed to result in a profit in a marketplace organizational development: plan that describes how the company will organize the work that needs to be accomplished

business plan: a document that describes a firm’s business model management team: employees of the company responsible for making the business model work

e-commerce business model: a business model that aims to use and leverage the unique qualities of the Internet, the Web, and the seed capital: typically, an entrepreneur’s personal funds derived from savings, credit card advances, home equity loans, or from family
mobile platform and friends

value proposition: defines how a company’s product or service fulfills the needs of customers elevator pitch: short two-to-three minute presentation aimed at convincing investors to invest

revenue model: describes how the firm will earn revenue, produce profits, and produce a superior return on invested capital incubators: typically provide a small amount of funding and also an array of services to start-up companies

advertising revenue model: a company provides a forum for advertisements and receives fees from advertisers angel investors: typically wealthy individuals or a group of individuals who invest their own money in exchange for an equity share in the
stock of a business; often are the first outside investors in a start-up
subscription revenue model: a company offers its users content or services and charges a subscription fee for access to some or all of
its offerings venture capital investors: typically invest funds they manage for other investors; usually later-stage investors

freemium strategy: companies give away a certain level of product or services for free, but then charge a subscription fee for crowdfunding: involves using the Internet to enable individuals to collectively contribute money to support a project
premium levels of the product or service
e-tailer: online retail store
transaction fee revenue model: a company receives a fee for enabling or executing a transaction
barriers to entry: the total cost of entering a new marketplace
sales revenue model: a company derives revenue by selling goods, information, or services
community provider: creates an online environment where people with similar interests can transact (buy and sell goods); share
affiliate revenue model: a company steers business to an affiliate and receives a referral fee or percentage of the revenue from any interests, photos, and videos; communicate with likeminded people; and receive interest-related information
resulting sales
content provider: distributes information content, such as digital news, music, photos, video, and artwork
market opportunity: refers to the company’s intended marketspace and the overall potential financial opportunities available to the
firm in that marketspace portal: offers users powerful search tools as well as an integrated package of content and services all in one place

marketspace: the area of actual or potential commercial value in which a company intends to operate transaction broker: processes transactions for consumers that are normally handled in person, by phone, or by mail

competitive environment: refers to the other companies operating in the same marketspace selling similar products market creator: builds a digital environment where buyers and sellers can meet, display products, search for products, and establish a
price for products
service provider: offers services online Chapter 3
Figure 3.4
e-distributor: a company that supplies products and services directly to individual businesses

e-procurement firm: creates and sells access to digital markets

B2B service provider: sells business services to other firms

scale economies: efficiencies that arise from increasing the size of a business

exchange: an independent digital marketplace where suppliers and commercial purchasers can conduct transactions

industry consortia: industry-owned vertical marketplaces that serve specific industries

private industrial network: digital network designed to coordinate the flow of communications among firms engaged in business
together

industry structure: refers to the nature of the players in an industry and their relative bargaining power
Figure 3.5
industry structural analysis: an effort to understand and describe the nature of competition in an industry, the nature of
substitute products, the barriers to entry, and the relative strength of consumers and suppliers

value chain: the set of activities performed in an industry or in a firm that transforms raw inputs into final products and services

firm value chain: the set of activities a firm engages in to create final products from raw inputs

value web: networked business ecosystem that coordinates the value chains of several firms

business strategy: a set of plans for achieving superior long-term returns on the capital invested in a business firm Table 3.5

profit: the difference between the price a firm is able to charge for its products and the cost of producing and distributing goods

differentiation: refers to all the ways producers can make their products or services unique and different to distinguish them
from those of competitors

commoditization: a situation where there are no differences among products or services, and the only basis of choosing is price

strategy of cost competition: offering products and services at a lower cost than competitors Figure 3.6

scope strategy: competing in all markets around the globe, rather than just local, regional, or national markets

focus/market niche strategy: competing within a narrow market or product segment

customer intimacy: focuses on developing strong ties with customers in order to increase switching costs

disruptive technologies: technologies that underpin a business model disruption

Figure3.7
digital disruption: a business model disruption that is driven by changes in information technology

sustaining technologies: technologies that enable the incremental improvement of products and services

disruptors: the entrepreneurs and their business firms that lead a business model disruption
Figure 3.9 IPv4 Internet address Internet address expressed as a 32-bit number that appears as a series of four separate numbers marked
off by periods, such as [Link]

IPv6 Internet address Internet address expressed as a 128-bit number

domain name IP address expressed in natural language

Domain Name System (DNS) system for expressing numeric IP addresses in natural language

Uniform Resource Locator (URL) the address used by a web browser to identify the location of content on the Web
Table 3.9
client/server computing a model of computing in which client computers are connected in a network together with one or more
servers

client a powerful desktop computer that is part of a network

server networked computer dedicated to common functions that the client computers on the network need
Chapter 3 Terms
Internet an interconnected network of thousands of networks and millions of computers linking businesses, educational institutions, cloud computing model of computing in which computer processing, storage, software, and other services are provided as a
government agencies, and individuals shared pool of virtualized resources over the Internet

Web one of the Internet’s most popular services, providing access to billions, and perhaps trillions, of web pages public cloud third-party service providers that own and manage large, scalable data centers that offer computing, data storage,
and high speed Internet to multiple customers who pay for only the resources they use
packet switching a method of slicing digital messages into packets, sending the packets along different communication paths as
they become available, and then reassembling the packets once they arrive at their destination private cloud provides similar options as public cloud but only to a single tenant

packets the discrete units into which digital messages are sliced for transmission over the Internet hybrid cloud offers customers both a public cloud and a private cloud

router special-purpose computer that interconnects the computer networks that make up the Internet and routes packets to their HyperText Transfer Protocol (HTTP) the Internet protocol used for transferring web pages
ultimate destination as they travel the Internet
Simple Mail Transfer Protocol (SMTP) the Internet protocol used to send mail to a server
routing algorithm computer program that ensures that packets take the best available path toward their destination
Post Office Protocol 3 (POP3) a protocol used by the client to retrieve mail from an Internet server
protocol set of rules and standards for data transfer
Internet Message Access Protocol (IMAP) a more current e-mail protocol that allows users to search, organize, and filter their
Transmission Control Protocol/Internet Protocol (TCP/IP) core communications protocol for the Internet mail prior to downloading it from the server

TCP establishes connections among sending and receiving computers and handles assembly and reassembly of packets File Transfer Protocol (FTP) one of the original Internet services. Part of the TCP/IP protocol that permits users to transfer
files from the server to their client computer, and vice versa
IP provides the Internet’s addressing scheme and is responsible for delivery of packets
Telnet a terminal emulation program that runs in TCP/IP
Network Interface Layer responsible for placing packets on and receiving them from the network medium
Secure Sockets Layer (SSL) /Transport Layer Security (TLS) protocols that secure communications between the client and the
Internet Layer responsible for addressing, packaging, and routing messages on the Internet server

Transport Layer responsible for providing communication with other protocols within TCP/IP suite Ping a program that allows you to check the connection between your client and the server

Application Layer includes protocols used to provide user services or exchange data Tracert one of several route-tracing utilities that allow you to follow the path of a message you send from your client to a
remote computer on the Internet
Border Gateway Protocol enables exchange of routing information among systems on the Internet
Network Technology Substrate layer layer of Internet technology that is composed of telecommunications networks and protocols Wi-Fi Wireless standard for Ethernet networks with greater speed and range than Bluetooth

Transport Services and Representation Standards layer layer of Internet architecture that houses the TCP/IP protocol Bluetooth technology standard for short-range wireless communication under 30 feet

Applications layer layer of Internet architecture that contains client applications differentiated quality of service (diffserv) a new technology that assigns levels of priority to packets based on the type of data
being transmitted
Middleware Services layer the “glue” that ties the applications to the communications networks and includes such services as security,
authentication, addresses, and storage repositories Internet of Things (IoT) Use of the Internet to connect a wide variety of devices, machines, and sensors

Tier 1 Internet Service Providers (Tier 1 ISPs) own and control the major long-haul fiber-optic cable networks comprising the Internet’s Mosaic Web browser with a graphical user interface (GUI) that made it possible to view documents on the Web graphically
backbone
universal computing the sharing of files, information, graphics, sound, video, and other objects across all computer platforms in
backbone high-bandwidth fiber-optic cable that transports data across the Internet the world, regardless of operating system

bandwidth measures how much data can be transferred over a communications medium within a fixed period of time; is usually expressed Netscape Navigator the first commercial web browser
in bits per second (bps), kilobits per second (Kbps), megabits per second (Mbps), or gigabits per second (Gbps)
Internet Explorer Microsoft’s web browser
redundancy multiple duplicate devices and paths in a network
hypertext a way of formatting pages with embedded links that connect documents to one another, and that also link pages to
Internet Exchange Point (IXP) hub where the backbone intersects with local and regional networks and where backbone owners connect other objects such as sound, video, or animation files
with one another
HyperText Markup Language (HTML) GML that is relatively easy to use in web page design. HTML provides web page designers with
Tier 3 Internet Service Provider (Tier 3 ISP) firm that provides the lowest level of service in the multi-tiered Internet architecture by a fixed set of markup “tags” that are used to format a web page
leasing Internet access to home owners, small businesses, and some large institutions
eXtensible Markup Language (XML) a markup language specification developed by the World Wide Web Consortium (W3C) that is
narrowband the traditional telephone modem connection, now operating at 56.6 Kbps designed to describe data and information

broadband refers to any communication technology that permits clients to play streaming audio and video files at acceptable speeds Really Simple Syndication (RSS) program that allows users to have digital content, including text, articles, blogs, and podcast
audio files, automatically sent to their computers over the Internet
Digital Subscriber Line (DSL) delivers high-speed access through ordinary telephone lines found in homes or businesses
web server software software that enables a computer to deliver web pages written in HTML to client computers on a network
FiOS (fiber-optic service) a form of DSL that provides speeds of up to 500 Mbps that request this service by sending an HTTP request

cable Internet piggybacks digital access to the Internet on top of the analog video cable providing television signals to a home database server server designed to access specific information within a database

T1 an international telephone standard for digital communication that offers guaranteed delivery at 1.54 Mbps ad server server designed to deliver targeted banner ads

T3 an international telephone standard for digital communication that offers guaranteed delivery at 45 Mbps mail server server that provides e-mail messages

satellite Internet high-speed broadband Internet access provided via satellite video server server that serves video clips

campus/corporate area network (CAN) generally, a local area network operating within a single organization that leases access to the web client any computing device attached to the Internet that is capable of making HTTP requests and displaying HTML pages,
Web directly from regional and national carriers most commonly a Windows PC or Macintosh

intranet a TCP/IP network located within a single organization for purposes of communications and information processing web browser software program whose primary purpose is to display web pages

latency delays in messages caused by the uneven flow of information packets through the network electronic mail (e-mail) the most-used application of the Internet. Uses a series of protocols to enable messages containing
text, images, sound, and video clips to be transferred from one Internet user to another
Internet2® advanced networking consortium of more than 450 member institutions working in partnership to facilitate the
development, deployment, and use of revolutionary Internet technologies attachment a file inserted within an e-mail message

fiber-optic cable consists of up to hundreds of strands of glass or plastic that use light to transmit data instant messaging (IM) displays text entered almost instantaneously. Recipients can then respond immediately to the sender
the same way, making the communication more like a live conversation than is possible through e-mail
online message board a web application that allows Internet users to communicate with each other, although not in real time
Table 4.2

IP telephony a general term for the technologies that use VoIP and the Internet’s packetswitched network to transmit voice and
other forms of audio communication over the Internet

Voice over Internet Protocol (VoIP) protocol that allows for transmission of voice and other forms of audio communication over
the Internet

search engine identifies web pages that appear to match keywords, also called queries, entered by the user and then provides a
list of the best matches

download transfers a file from a web server and stores it on a computer for later use

streaming media enables video, music, and other large-bandwidth files to be sent to a user in a variety of ways that enable the
user to play the files as they are being delivered

Figure 4.5
podcast an audio presentation— such as a radio show, audio from a movie, or simply a personal audio presentation—stored online
as a digital media file

blog personal web page that is created by an individual or corporation to communicate with readers

wiki web application that allows a user to easily add and edit content on a web page

virtual reality (VR) involves fully immersing users within a virtual world, typically through the use of a head-mounted display
(HMD) connected to headphones and other devices

augmented reality (AR) involves overlaying virtual objects over the real world, via smartphones, tablets or HMDs.

Chapter 4
Table 4.1
Figure 4.6 Table 4.6

Figure 4.2
Figure 4.7 system functionalities types of information systems capabilities you will need to achieve your business objectives

information requirements the information elements that the system must produce in order to achieve the business objectives

system design specification description of the main components in a system and their relationship to one another

logical design describes the flow of information at your e-commerce site, the processing functions that must be performed, the
databases that will be used, the security and emergency backup procedures that will be instituted, and the controls that will be
used in the system

physical design translates the logical design into physical components

Table 4.7 outsourcing hiring an outside vendor to provide the services you cannot perform with in-house personnel

WordPress open source content management and website design too

content management system (CMS) organizes, stores, and processes website content

co-location when a firm purchases or leases a web server (and has total control over its operation) but locates the server in a
vendor’s physical facility. The vendor maintains the facility, communications lines, and the machinery

unit testing involves testing the site’s program modules one at a time

system testing involves testing the site as a whole, in a way the typical user will use the site

acceptance testing verifies that the business objectives of the system as originally conceived are in fact working

A/B testing (split testing) involves showing two versions of a web page or website to different users to see which one performs
better

multivariate testing involves identifying specific elements, creating versions for each element, and then creating a unique
combination of each element and version to test

Figure 4.10 benchmarking a process in which the site is compared with those of competitors in terms of response speed, quality of layout,
and design

system architecture the arrangement of software, machinery, and tasks in an information system needed to achieve a specific
functionality

two-tier architecture e-commerce system architecture in which a web server responds to requests for web pages and a database
server provides backend data storage

multi-tier architecture e-commerce system architecture in which the web server is linked to a middletier layer that typically
includes a series of application servers that perform specific tasks as well as a backend layer of existing corporate systems

site management tools verify that links on pages are still valid and also identify orphan files
Chapter 4 Terms
SWOT analysis describes a firm’s strengths, weaknesses, opportunities, and threats dynamic page generation the contents of a web page are stored as objects in a database, rather than being hard-coded in HTML.
When the user requests a web page, the contents for that page are then fetched from the database
systems development life cycle (SDLC) a methodology for understanding the business objectives of any system and designing an
appropriate solution web application server software program that provides specific business functionality required of a website

business objectives capabilities you want your site to have

e-commerce merchant server software software that provides the basic functionality needed for online sales, including an online Django open source web application framework based on Python programming language
catalog, order taking via an online shopping cart, and online credit card processing
widget a small, prebuilt chunk of code that executes automatically in your HTML web page; capable of performing a wide variety of
online catalog list of products available on a website tasks

shopping cart allows shoppers to set aside desired purchases in preparation for checkout, review what they have selected, edit privacy policy a set of public statements declaring to your customers how you treat their personal information that you gather
their selections as necessary, and then actually make the purchase by clicking a button on the site

merchant server software package (e-commerce software platform) offers an integrated environment that provides most or all accessibility rules a set of design objectives that ensure disabled users can effectively access your site
of the functionality and capabilities needed to develop a sophisticated, customercentric site
mobile website version of a regular desktop website that is scaled down in content and navigation
open source software software that is developed by a community of programmers and designers, and is free to use and modify
mobile web app application built to run on the mobile web browser built into a smartphone or tablet computer
hardware platform refers to all the underlying computing equipment that the system uses to achieve its e-commerce
functionality native app application designed specifically to operate using the mobile device’s hardware and operating system

stateless refers to the fact that the server does not have to maintain an ongoing, dedicated interaction with the client hybrid app has many of the features of both a native app and a mobile web app

I/O intensive requires input/output operations rather than heavy-duty processing power mobile first design beginning the e-commerce development process with a mobile presence rather than a desktop website

scalability the ability of a site to increase in size as demand warrants responsive web design (RWD) tools and design principles that automatically adjust the layout of a website depending on the
screen resolution of the device on which it is being viewed
vertical scaling increasing the processing power of individual components
adaptive web design (AWD) server-side technique that detects the attributes of the device making the request and, using
horizontal scaling employing multiple computers to share the workload predefined templates based on device screen size along with CSS and JavaScript, loads a version of the site that is optimized for
the device
Common Gateway Interface (CGI) a set of standards for communication between a browser and a program running on a server
that allows for interaction between the user and the server Chapter 5
Table 5.2
Active Server Pages (ASP) a proprietary software development tool that enables programmers using Microsoft’s IIS package to
build dynamic pages

[Link] successor to ASP

Java a programming language that allows programmers to create interactivity and active content on the client computer,
thereby saving considerable load on the server

Java Server Pages (JSP) like CGI and ASP, a web page coding standard that allows developers to dynamically generate web pages
in response to user requests

JavaScript a programming language invented by Netscape that is used to control the objects on an HTML page and handle
interactions with the browser

ActiveX a programming language created by Microsoft to compete with Java figure 5.2

VBScript a programming language invented by Microsoft to compete with JavaScript

ColdFusion an integrated server-side environment for developing interactive web applications

PHP open source, general purpose scripting language

Ruby on Rails (RoR/ Rails) open source web application framework based on Ruby programming language
Figure 5.4
Figure 5.6

Figure 5.7
Figure 5.5
Figure 5.8 confidentiality the ability to ensure that messages and data are available only to those who are authorized to view them

privacy the ability to control the use of information about oneself

availability the ability to ensure that an e-commerce site continues to function as intended

malicious code (malware) includes a variety of threats such as viruses, worms, Trojan horses, and bots

exploit kit collection of exploits bundled together and rented or sold as a commercial product

maladvertising online advertising that contains malicious code

drive-by download malware that comes with a downloaded file that a user requests

virus a computer program that has the ability to replicate or make copies of itself, and spread to other files

worm malware that is designed to spread from computer to computer

Figure 5.10
ransomware (scareware) malware that prevents you from accessing your computer or files and demands that you pay a fine

Trojan horse appears to be benign, but then does something other than expected. Often a way for viruses or other malicious code
to be introduced into a computer system

backdoor feature of viruses, worms, and Trojans that allows an attacker to remotely access a compromised computer

bot type of malicious code that can be covertly installed on a computer when connected to the Internet. Once installed, the bot
responds to external commands sent by the attacker

botnet collection of captured bot computers

Figure 5.12 potentially unwanted program (PUP) program that installs itself on a computer, typically without the user’s informed consent

adware a PUP that serves pop-up ads to your computer

browser parasite a program that can monitor and change the settings of a user’s browser

spyware a program used to obtain information such as a user’s keystrokes, e-mail, instant messages, and so on

social engineering exploitation of human fallibility and gullibility to distribute malware

phishing any deceptive, online attempt by a third party to obtain confidential information for financial gain

hacker an individual who intends to gain unauthorized access to a computer system

cracker within the hacking community, a term typically used to denote a hacker with criminal intent
Chapter 5 Terms
cybervandalism intentionally disrupting, defacing, or even destroying a site
integrity the ability to ensure that information being displayed on a website or transmitted or received over the Internet has not
been altered in any way by an unauthorized party hacktivism cybervandalism and data theft for political purposes

nonrepudiation the ability to ensure that e-commerce participants do not deny (i.e., repudiate) their online actions white hats “good” hackers who help organizations locate and fix security flaws

authenticity the ability to identify the identity of a person or entity with whom you are dealing on the Internet
black hats hackers who act with the intention of causing harm public key cryptography two mathematically related digital keys are used: a public key and a private key. The private key is kept
secret by the owner, and the public key is widely disseminated. Both keys can be used to encrypt and decrypt a message. However,
grey hats hackers who believe they are pursuing some greater good by breaking in and revealing system flaws once the keys are used to encrypt a message, that same key cannot be used to unencrypt the message

data breach occurs when an organization loses control over its information to outsiders hash function an algorithm that produces a fixed-length number called a hash or message digest

identity fraud involves the unauthorized use of another person’s personal data for illegal financial benefit digital signature (e-signature) “signed” cipher text that can be sent over the Internet

spoofing involves attempting to hide a true identity by using someone else’s e-mail or IP address digital envelope a technique that uses symmetric encryption for large documents, but public key cryptography to encrypt and
send the symmetric key
pharming automatically redirecting a web link to an address different from the intended one, with the site masquerading as the
intended destination digital certificate a digital document issued by a certification authority that contains a variety of identifying information

spam (junk) websites also referred to as link farms; promise to offer products or services, but in fact are just collections of certification authority (CA) a trusted third party that issues digital certificates
advertisements
public key infrastructure (PKI) CAs and digital certificate procedures that are accepted by all parties
sniffer a type of eavesdropping program that monitors information traveling over a network
Pretty Good Privacy (PGP) a widely used e-mail public key encryption software program
man-in-the-middle (MitM) attack attack in which the attacker is able to intercept communications between two parties who
believe they are directly communicating with one another, when in fact the attacker is controlling the communications secure negotiated session a client-server session in which the URL of the requested document, along with the contents, contents
of forms, and the cookies exchanged, are encrypted
Denial of Service (DoS) attack flooding a website with useless traffic to inundate and overwhelm the network
session key a unique symmetric encryption key chosen for a single secure session
Distributed Denial of Service (DDoS) attack using numerous computers to attack the target network from numerous launch
points virtual private network (VPN) allows remote users to securely access internal networks via the Internet, using the Point-to-
Point Tunneling Protocol (PPTP)
SQL injection attack takes advantage of poorly coded web application software that fails to properly validate or filter data
entered by a user on a web page WPA2 wireless security standard that uses the AES algorithm for encryption and CCMP, a more advanced authentication code
protocol
zero-day vulnerability software vulnerability that has been previously unreported and for which no patch yet exists
firewall refers to either hardware or software that filters communication packets and prevents some packets from entering the
Heartbleed bug flaw in OpenSSL encryption system that allowed hackers to decrypt an SSL session and discover user names, network based on a security policy
passwords, and other user data
proxy server (proxy) software server that handles all communications originating from or being sent to the Internet, acting as
encryption the process of transforming plain text or data into cipher text that cannot be read by anyone other than the sender a spokesperson or bodyguard for the organization
and the receiver. The purpose of encryption is (a) to secure stored information and (b) to secure information transmission
intrusion detection system (IDS) examines network traffic, watching to see if it matches certain patterns or preconfigured rules
cipher text text that has been encrypted and thus cannot be read by anyone other than the sender and the receiver indicative of an attack

key (cipher) any method for transforming plain text to cipher text intrusion prevention system (IPS) has all the functionality of an IDS, with the additional ability to take steps to prevent and
block suspicious activities
substitution cipher every occurrence of a given letter is replaced systematically by another letter
risk assessment an assessment of the risks and points of vulnerability
transposition cipher the ordering of the letters in each word is changed in some systematic way
security policy a set of statements prioritizing the information risks, identifying acceptable risk targets, and identifying the
symmetric key cryptography (secret key cryptography) both the sender and the receiver use the same key to encrypt and mechanisms for achieving these targets
decrypt the message
implementation plan the action steps you will take to achieve the security plan goals
Data Encryption Standard (DES) developed by the National Security Agency (NSA) and IBM. Uses a 56-bit encryption key
security organization educates and trains users, keeps management aware of security threats and breakdowns, and maintains the
Advanced Encryption Standard (AES) the most widely used symmetric key algorithm, offering 128-, 192-, and 256-bit keys tools chosen to implement security
access controls determine who can gain legitimate access to a network Figure 6.2

authentication procedures include the use of digital signatures, certificates of authority, and public key infrastructure

biometrics the study of measurable biological or physical characteristics

security token physical device or software that generates an identifier that can be used in addition to or in place of a password

authorization policies determine differing levels of access to information assets for differing levels of users

authorization management system establishes where and when a user is permitted to access certain parts of a website

security audit involves the routine review of access logs (identifying how outsiders are using the site as well as how insiders are
accessing the site’s assets)

US-CERT division of the U.S. Department of Homeland Security that coordinates cyber incident warnings and responses across
government and private sectors

CERT Coordination Center monitors and tracks online criminal activity reported to it by private corporations and government Table 6.2
agencies that seek out its help

merchant account a bank account that allows companies to process credit card payments and receive funds from those
transactions

PCI-DSS (Payment Card Industry-Data Security Standards) data security standards instituted by the five major credit card
companies

online stored value payment system permits consumers to make instant, online payments to merchants and other individuals
based on value stored in an online account

near field communication (NFC) a set of short-range wireless technologies used to share information among devices

digital cash an alternative payment system in which unique, authenticated tokens represent cash value

virtual currency typically circulates within an internal virtual world community or is issued by a specific corporate entity, and
used to purchase virtual goods
Figure 6.3
electronic billing presentment and payment (EBPP) system form of online payment system for monthly bills

Chapter 6
Figure 6.1
Table 6.4 Table 6.6

Table 6.5

Figure 6.6
Figure 6.9

Figure 6.10
Chapter 6 Terms interstitial ad a way of placing a fullpage message between the current and destination pages of a user

consumer behavior a social science discipline that attempts to model and understand the behavior of humans in a marketplace video ad TV-like advertisement that appears as an in-page video commercial or before, during, or after content

clickstream behavior the transaction log that consumers establish as they move about the Web sponsorship a paid effort to tie an advertiser’s name to information, an event, or a venue in a way that reinforces its brand in a
positive yet not overtly commercial manner
customer experience the totality of experiences that a customer has with a firm, including the search, informing, purchase,
consumption, and aftersales support for its products, services, and various retail channels native advertising advertising that looks similar to editorial content

online advertising a paid message on a website, online service, or other interactive medium advertising networks connect online marketers with publishers by displaying ads to consumers based on detailed customer
information
ad targeting the sending of market messages to specific subgroups in the population
ad exchanges auction-based digital marketplace where ad networks sell ad space to marketers
search engine marketing (SEM) involves the use of search engines to build and sustain brands
programmatic advertising automated, auction-based method for matching demand and supply for online display ads
search engine advertising involves the use of search engines to support direct sales to online
real-time bidding (RTB) process used to match advertiser demand for display ads with publisher supply of web page space
organic search inclusion and ranking of sites depends on a more or less unbiased application of a set of rules imposed by the
search engine ad fraud falsifying web or mobile traffic in order to charge advertisers for impressions, clicks, or other actions that never
actually occurred
paid inclusion for a fee, guarantees a website’s inclusion in its list of sites, more frequent visits by its web crawler, and
suggestions for improving the results of organic searching direct e-mail marketing e-mail marketing messages sent directly to interested users

pay-per-click (PPC) search ad primary type of search engine advertising keyword advertising merchants purchase keywords spam unsolicited commercial e-mail
through a bidding process at search sites, and whenever a consumer searches for that word, their advertisement shows up
somewhere on the page network affiliate marketing commissions paid by advertisers to affiliate websites for referring potential customers to their website

keyword advertising (context advertising) publishers accept ads placed by Google on their websites, and receive a fee for any viral marketing the process of getting customers to pass along a company’s marketing message to friends, family, and
click-throughs from those ads colleagues

search engine optimization (SEO) techniques to improve the ranking of web pages generated by search engine algorithms lead generation marketing uses multiple e-commerce presences to generate leads for businesses who later can be contacted
and converted into customers
Panda change in the Google algorithm to eliminate low-quality sites from search results
one-to-one marketing (personalization) segmenting the market based on a precise and timely understanding of an individual’s
Penguin change in the Google algorithm to eliminate sites with low-quality back links needs, targeting specific marketing messages to these individuals, and then positioning the product vis-à-vis competitors to be
truly unique
Hummingbird semantic search component of Google’s search algorithm
behavioral targeting involves using online and offline behavior of consumers to adjust the advertising messages delivered to
Knowledge Graph function in Google’s search engine that displays a selection of facts related to your search term that you may them online
be interested in knowing more about
behavioral targeting involves using online and offline behavior of consumers to adjust the advertising messages delivered to
social search effort to provide fewer, more relevant, and trustworthy results based on the social graph them online

link farms groups of websites that link to one another, thereby boosting their ranking in search engines retargeting showing the same ad to individuals across multiple websites

content farms companies that generate large volumes of textual content for multiple websites designed to attract viewers and customization changing the product, not just the marketing message, according to user preferences
search engines
customer coproduction in the web environment, takes customization one step further by allowing the customer to interactively
click fraud occurs when a competitor clicks on search engine results and ads, forcing the advertiser to pay for the click even create the product
though the click is not legitimate
frequently asked questions (FAQs) a text-based listing of common questions and answers
banner ad displays a promotional message in a rectangular box at the top or bottom of a computer screen
real-time customer service chat systems a company’s customer service representatives interactively exchange text-based
rich media ad ad employing animation, sound, and interactivity, using Flash, HTML5, Java, and JavaScript messages with one or more customers on a real-time basis
automated response system sends e-mail order confirmations and acknowledgments of e-mailed inquiries
query-driven data mining data mining based on specific queries

Law of One Price with complete price transparency in a perfect information marketplace, there will be one world price for every product
model-driven data mining involves the use of a model that analyzes the key variables of interest to decision makers

pricing putting a value on goods and services

big data huge data sets, often from different sources, in the petabyte and exabyte range

demand curve the quantity of goods that can be sold at various prices
Hadoop a software framework for working with various big data sets

price discrimination selling products to different people and groups based on their willingness to pay
marketing automation systems software tools that marketers use to track all the steps in the lead generation part of the marketing
process
versioning creating multiple versions of information goods and selling essentially the same product to different market segments at
different prices
customer relationship management (CRM) system a repository of customer information that records all of the contacts that a
customer has with a firm and generates a customer profile available to everyone in the firm with a need to “know the customer”
bundling offers consumers two or more goods for a reduced price

customer touchpoints the ways in which customers interact with the firm
dynamic pricing the price of the product varies, depending on the demand characteristics of the customer and the supply situation of
the seller
reach percentage of the total number of consumers in a market who will visit a site recency average number of days elapsed between
visits
long tail effect a colloquial name given to various statistical distributions characterized by a small number of events of high amplitude
and a very large number of events with low amplitude
click-through rate (CTR) the percentage of people exposed to an online advertisement who actually click on the banner impressions
number of times an ad is served
transaction log records user activity at a website

view-through rate (VTR) measures the 30-day response rate to an ad

registration forms gather personal data on name, address, phone, zip code, e-mail address, and other optional selfconfessed
information on interests and tastes
hits number of http requests received by a firm’s server

shopping cart database captures all the item selection, purchase, and payment data
page views number of pages requested by visitors

cookie small text file that websites place on the hard disk of visitors’ client computers that allows the website to store data about the
viewability rate percentage of ads that are actually seen by people online
visitor on the computer and later retrieve it

unique visitors the number of distinct, unique visitors to a site

deterministic crossdevice tracking relies on personally identifiable information such as e-mail address used to log into an app and
website on different devices
loyalty percentage of purchasers who return in a year

probabilistic crossdevice tracking uses algorithms to analyze thousands of anonymous data points to create a possible match
acquisition rate percentage of visitors who register or visit product pages

profiling profiling uses a variety of tools to create a digital image for each consumer
stickiness (duration) average length of time visitors remain at a site

database a software application that stores records and attributes database management system (DBMS) a software application used by
conversion rate percentage of visitors who purchase something
organizations to create, maintain, and access databases

recency average number of days elapsed between visits

structured query language (SQL) industry-standard database query language used in relational databases

browse-to-buy ratio ratio of items purchased to product

relational databases represent data as twodimensional tables with records organized in rows and attributes in columns; data within
different tables can be flexibly related as long as the tables share a common data element
views view-to-cart ratio ratio of “Add to cart” clicks to product views

data warehouse a database that collects a firm’s transactional and customer data in a single location for offline analysis
cart conversion rate ratio of actual orders to “Add to cart” clicks

data mining a set of analytical techniques that look for patterns in the data of a database or data warehouse, or seek to model the
checkout conversion rate ratio of actual orders to checkouts started
behavior of customers

abandonment rate % of shoppers who begin a shopping cart, but then fail to complete it
customer profile a description of the typical behavior of a customer or a group of customers at a website

retention rate % of existing customers who continue to buy

delivery rate % of e-mail recipients who received e-mail completion rate how many viewers watch the complete video ad

open rate % of customers who open e-mail

attrition rate % of customers who purchase once, but do not return within a year

bounce-back rate percentage of e-mails that could not be delivered

cross-platform attribution understanding how to assign appropriate credit to different marketing initiatives that may have
influenced a consumer on the way to a purchase

cost per thousand (CPM) advertiser pays for impressions in 1,000-unit lots

cost per click (CPC) advertiser pays prenegotiated fee for each click an ad receives

cost per action (CPA) advertiser pays only for those users who perform a specific action

effective cost-perthousand (eCPM) measures return on investment from an ad by dividing the total earnings from the ad by the
total number of impressions in thousands

marketing analytics software collects, stores, analyzes, and graphically presents data on each of the stages in the conversion of
shoppers to customers process on e-commerce sites