E-Commerce and Internet Marketing

E-commerce is the buying and selling of goods and services, and the transfer of money and data, over the Internet and other computer networks.

1. Ubiquity (available anywhere, anytime)
2. Global reach
3. Universal standards
4. Richness (video, audio and text in one message)

Other features include interactivity, information density, personalisation/customisation and social technology.

An e-commerce business model is the set of planned activities that describes how an online business creates value, reaches its customers and earns revenue (profit) through the Internet.

• Portal
• E-tailer (online retailer)
• Content provider
• Transaction broker
• Market creator
• Service provider
• Community provider

Client/server computing is a model of network computing in which processing is split between clients (user devices that request services, such as a browser) and servers (powerful computers that store data, run applications and respond to requests). The two communicate over a network, and the web is the best-known example.

• Website (company or transaction site)
• E-mail
• Social media presence (Facebook, Instagram, etc.)
• Offline media (print, TV, radio)
• Mobile presence (m-commerce sites and apps)

• Business objectives and target audience
• Budget and cost
• Technology and hardware/software platform
• Content and website design (usability, navigation)
• Security
• Marketing and customer support
• Time to market and scalability

1. Malicious code (viruses, worms, Trojan horses, ransomware)
2. Phishing and identity theft
3. Hacking and denial-of-service (DoS/DDoS) attacks
4. Credit card fraud / data breaches (also sniffing and spoofing)

Search Engine Optimization (SEO) is the process of improving a website's content, structure and links so that it ranks higher in the unpaid (organic) results of search engines such as Google, bringing more visitors to the site.

Web analytics is the collection, measurement, analysis and reporting of website data (visitors, page views, bounce rate, conversion rate, traffic sources) to understand user behaviour and improve the site and its marketing.

E-commerce vs. e-business

• E-commerce covers the commercial transactions, buying and selling, carried out over the Internet.
• E-business is broader. It covers all digitally enabled activities of a firm, including e-commerce plus internal operations such as supply chain management, production, HR, accounting and collaboration with partners.

So all e-commerce is part of e-business, but not all e-business is e-commerce.

Types of e-commerce

• B2C (business to consumer), e.g. an online shop selling to individuals.
• B2B (business to business), e.g. a manufacturer trading with distributors.
• C2C (consumer to consumer), e.g. an online auction or classified site.
• M-commerce, transactions made using mobile devices.
• P2P (peer to peer) and social e-commerce are further types.

A market creator is a B2C business model in which a firm builds a digital environment where buyers and sellers meet, search for products, compare prices and carry out transactions. It does not usually own the goods itself.

Revenue comes from transaction fees or commissions, listing fees and advertising.

Examples: eBay (auctions), Daraz (online marketplace), Priceline.

It reduces search costs for buyers and gives sellers access to a wide market.

Mobile apps are a major part of m-commerce. Their roles are:

• Convenient shopping: customers browse, order and pay anytime and anywhere (for example Daraz, eSewa, Khalti apps).
• Mobile payments: wallets, QR codes and banking apps make payment fast and easy.
• Personalised engagement: push notifications, offers and recommendations improve customer loyalty.
• Better user experience: apps are faster than mobile websites and can use device features such as the camera, GPS and contacts.
• Wider reach and data: they reach smartphone users and give the business data on user behaviour.

Main factors to consider in developing an e-commerce presence:

1. Business objectives and target market: what the site must achieve and who the customers are.
2. Budget and cost: development, hosting, maintenance and marketing costs.
3. Technology platform: choice of hardware, software, hosting and scalability.
4. Website design and content: usability, navigation, product information and mobile friendliness.
5. Security and payment systems: protection of customer data and safe payment options.
6. Marketing and customer support: SEO, social media, e-mail and after-sales service.
7. Timeline and skills: time to launch and whether to build in-house or outsource.

Good e-commerce security means protecting the website, its data, customers and transactions from threats so that online business can be conducted safely and with trust. It uses technology, policies and procedures together to prevent, detect and respond to attacks.

Dimensions of e-commerce security:

1. Integrity: data is not altered by unauthorised parties.
2. Non-repudiation: a party cannot deny having taken part in a transaction.
3. Authenticity: the identity of the user or site is verified.
4. Confidentiality: information is visible only to authorised persons.
5. Privacy: control over the use of personal information.
6. Availability: the site and its services keep working when needed.

E-mail marketing is the use of e-mail to send promotional messages, newsletters, offers and updates directly to customers and prospects. It is low cost, can be targeted and personalised, and its results are easy to track. It should be permission-based to avoid spam.

Measuring effectiveness with these metrics:

• Open rate: share of recipients who open the e-mail.
• Click-through rate (CTR): share who click a link in it.
• Conversion rate: share who complete the desired action, such as a purchase.
• Bounce rate: share of e-mails not delivered.
• Unsubscribe rate: share who opt out.
• Return on investment (ROI): revenue earned compared with campaign cost.

The key elements of an e-commerce business model are:

1. Value proposition: why customers should buy from the firm; the benefits offered, such as convenience, lower price, wide choice, personalisation or speed.
2. Revenue model: how the firm earns money. Examples are the advertising model, subscription model, transaction fee model, sales model and affiliate model.
3. Market opportunity: the market space the firm intends to serve and the overall potential financial opportunity in it.
4. Competitive environment: the other firms selling similar products in the same market, their size, strength and pricing.
5. Competitive advantage: what makes the firm better than rivals, such as unique products, lower cost, better technology, first-mover position or strong brand.
6. Market strategy: the plan for promoting products and reaching the target audience.
7. Organisational development: the structure, roles and teams required to carry out the business plan.
8. Management team: experienced people who can make the model work and attract investors.

Together these elements show how the business will create value and make a profit.

The Internet is a global network of interconnected computer networks using TCP/IP.

Features:

• Worldwide reach and connectivity
• Open standards (TCP/IP) that let different systems communicate
• Packet switching
• Decentralised, with no single owner
• Support for text, audio, video and graphics
• Scalable, available 24x7 and low cost

Services:

• World Wide Web (WWW): access to web pages through browsers.
• E-mail: sending and receiving electronic messages.
• FTP: transfer of files between computers.
• Telnet/SSH: remote login to other computers.
• Instant messaging and VoIP: chat, voice and video calls.
• Search engines: finding information.
• Social networking, e-commerce and online banking.
• Cloud services and streaming: storage, software and media on demand.

Single-tier vs. multi-tier site architecture

Factors in choosing the best hardware platform

• Demand (load): number of simultaneous users and expected traffic.
• Scalability: ability to upgrade or add servers as traffic grows.
• Processing power, memory and storage needed for the application and database.
• Reliability and availability: redundancy, backup and fault tolerance.
• Cost: initial purchase and running cost.
• Security and support: vendor support, maintenance and compatibility with the software.

Protecting networks, servers and clients

Networks

• Firewalls filter incoming and outgoing traffic by rules (packet filters, proxy/application firewalls).
• Virtual private networks (VPN) and encryption (SSL/TLS) protect data in transit.
• Proxy servers hide internal addresses and limit access.
• Secure wireless (WPA2/WPA3) and network segmentation.

Servers

• Operating system hardening, regular patches and updates.
• Strong authentication and access control (passwords, two-factor authentication, least privilege).
• Antivirus software, backups and logging.
• Secure coding and database protection.

Clients

• Antivirus and anti-malware software, personal firewalls.
• Updated browsers and operating systems.
• User awareness training against phishing and unsafe downloads.
• Strong passwords and two-factor authentication.

Intrusion detection and prevention

• An Intrusion Detection System (IDS) monitors network or system activity for suspicious behaviour or known attack signatures and raises an alert. It does not stop the attack.
• An Intrusion Prevention System (IPS) also sits in the traffic path and actively blocks or drops malicious traffic, resets connections or changes firewall rules.
• Detection is either signature-based (matching known attacks) or anomaly-based (deviation from normal behaviour).

Systems development life cycle (SDLC) is a structured, step-by-step methodology for planning, creating, testing, deploying and maintaining an information system. It is used for building an e-commerce site so that the project is organised, on budget and meets business needs.

Steps in creating an e-commerce site

1. Systems planning / identifying objectives: define the business objectives, the target audience, and the scope, budget and schedule. A feasibility study is done.
2. Systems analysis: collect and analyse requirements. Identify the functions the site needs (catalogue, shopping cart, payment, order tracking), the information requirements, and the business process flow.
3. Systems design: prepare the design specification:
   • Logical design: data flow diagrams, site map, database design and processing.
   • Physical design: hardware and software platform, interface, site layout, security and payment design.
4. Building the system (implementation/coding): the system is built in-house or outsourced. The decision is made to buy, build or host the website, and the database, pages and payment gateway are developed. The site is hosted on a web server.
5. Testing: unit, system and acceptance testing, including usability, performance, security and load testing, to find and fix errors.
6. Implementation (deployment): the site is launched, data is loaded, users and staff are trained, and the marketing campaign begins.
7. Maintenance and evaluation: regular updates, bug fixes, monitoring of traffic with web analytics, backups, and improvement through user feedback.

The SDLC may be run in a waterfall or an iterative way, with phases repeated as requirements change.

Social media marketing (SMM) is the use of social platforms such as Facebook, Instagram, YouTube, X (Twitter), TikTok and LinkedIn to promote products, build brand awareness, engage with customers and drive traffic and sales. It combines content posting, paid advertising, influencer collaboration and community interaction.

Examples:

• A clothing store in Kathmandu posts product photos and reels on Instagram and runs Facebook ads targeted by age and location.
• Daraz uses Facebook and YouTube campaigns for festival sales, such as Dashain offers.
• A restaurant shares customer reviews and runs contests to encourage sharing.

Advantages: low cost, wide reach, precise targeting, two-way communication and measurable results (likes, shares, reach, clicks, conversions).

On-page and off-page optimization (SEO)

On-page optimization covers the factors controlled within the website itself:

• Keyword research and use of keywords in titles, headings, content and URLs.
• Meta title and description tags.
• High-quality, original content.
• Image alt text, internal linking and clean site structure.
• Fast loading speed and mobile-friendly design.

Off-page optimization covers the factors outside the website that affect its ranking:

• Quality backlinks from other reputable sites.
• Social media sharing and mentions.
• Guest posting and influencer outreach.
• Online reviews, directory listings and brand mentions.

On-page work makes the site relevant and understandable to search engines, while off-page work builds its authority and trust. Both are needed for a high search ranking.