Topic 4: Online goods and services

  • Created by: Myst123
  • Created on: 27-03-18 09:44

Technology Update

News and other information servicies:

  • Viral videos - A video could be said to have gone ‘viral’ when it has been shared online by many people. 
  • RSS - Rich Site Summary feed - method of subscribing to online content.

Software as a service

  • Cloud computing - Online data storage and hosted applications are often combined to provide a ‘cloud computing’ facility.
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Technology Update

Impact on organisations and individuals

  • QR codes (Quick Response) - QR codes provide a way to link to online services using a camera and QR reader. 
  • Geo-tagging - The addition of location data to files (e.g. images), usually set by built-in GPS. The data can be used for searching, filtering or for display purposes

Banking and other financial services

  • Chip authentication devices - E.g. PINsentry.
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Online shopping

- buying and selling of goods & services using websites accessed through Internet

Online shops

  • Virtual 'shopping basket'
  • 'Check out'
  • Payment made & confirmed


  • Facility sort & search for goods
  • Images provided of products
  • 24/7 availability
  • Comparison of prices
  • Recommendations
  • Customer reviews
  • Delivery service
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Online booking systems for travel, leisure and ent

  • Booking systems displays events available
  • Selects seat / film / holiday + places in virtual 'shopping basket'
  • Enters personal details
  • Payment made & confirmed
  • Confirmation email ticket sent & print ticket
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Advantages and disadvantages for customer


  • Far greater choice
  • Availability
  • Find best price using price comparison websites
  • Have right to return goods
  • Read other users' reviews


  • Need Internet access & computer skills
  • Cannot pay using cash
  • Cannot see/ touch products
  • Delivery price
  • Need to submit personal information
  • Risk of not receiving goods or having personal details stolen
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Online shopping

Impact on lifestyles:

Easier access for people with physical disabilities / young children

More choice for people in remote areas

Reduced carbon footprint

Available any time for people who work unsocial hours

Impact on businesses:

Online businesses can be located anywhere = no expensive high street rental prices

Smaller staff = money saved

Carry a greater range of products

Attract customers from all over the world

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Online auctions

  • Seller + bidder create online accounts + Description + photograph supplied of item for auction
  • Bidder with highest bid "wins" item + obliged to buy item they "won"
  • Seller & bidder exchange emails to arrange payment and delivery


  • Bidders search for items they want + See status of bids
  • Changes can be made before scheduled end time
  • Users of auction service can rate each other
  • Sellers can choose to make an item available for purchase immediately
  • Secure payment  arranged by auction site


  • Ability to search easily for goods
  • Community of users builds trust by rating both buyers & sellers
  • Third party payment options for secure payments
  • Large number of sellers competing for business = prices driven down
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Online education

Education and training

Student creates online account + select courses

Teaching material provided on website

Assignments submitted + returned to students electronically


Interactive teaching material

Communities of students interacting online

Provides personalised learning

Students work from home

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Online news

Information services

  • News reports written by newspaper & TV companies
  • Made available online for free / through subscription
  • Users access websites to read news / select news using RSS feeds


  • Easy to search for & sort news items
  • Up to date news available worldwide
  • Review news items from different sources
  • Allow users to select news
  • Presented in text, images, videos
  • Can add comments + subscribe to content
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Online banking

Banking and other financial services

Users create secure online bank account

Money transferred electronically into account

Payments made to other accounts


View up-to-date bank account details

View all transactions + Pay bills online

Create new bank accounts

Secure access provided

Offers promotions to online customers

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Online gaming and entertainment

Online gaming: enables players to connect via Internet & interact with each other

"On-demand" / streaming entertainement servcies: allow users to play media when / where they want it.

Online gaming

  • Central server: runs game software + streams each player's position & actions to all players over Internet
  • Players need high bandwidth low latency Internet connection ---> avoid lag when gaming
  • Select game & create online accounts --> interact with each other + against computer opponent
  • Store data e.g. graphics + sound locally on player's computers
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Selects entertainment service ---> Presses play ---> Programme continually sent from server + streamed over Internet ---> Player buffers (stores) some data in case of delays in data arriving


Selects entertainment service ---> Downloads entire file from server to computer ---> (Presses play ---> Programme plays) - No Internet connection needed

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How + why organisations operate online

  • e.g. website, online shop - through which customers can find information + buy organisation's goods & services
  • Overheads e.g. rent, salaries, fuel bills generally lower for online shops - more profitable than high street shops = Online shops can afford sell products more cheaply + still make a good profit

Advantages for retailer:

  • No need to distribute goods to shops, Easy to make changes to products + prices
  • Customers only need web browser, Internet connection + means of paying electronically
  • Inexpensive way to reach new markets, Minimal start up time + investment needed
  • Organisation can be located wherever it likes


  • Skilled staff needed to develop + run efficient website
  • Ensuring online payment security is difficult, Need delivery service + facility to handle returns
  • Customers limited to those with access to Internet + can pay electronically
  • High street shops may suffer + close down - can't compete with online shop
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Transnational data

  • Transaction: occurs every time something bought/sold
  • Transactional data: information collected about sale/purchase
  • Personalised information stored in cookies (small text files)

Commercial value: extremly valuable

  • Allows organisation keep record of purchases
  • Allows delivery to be tracked
  • Contains rich source of information about customer shopping habits & preferences


  • Understand customers' buying habits + see trends in sales
  • Produce more personalised experience
  • For targeted advertsing campaigns & produce personalised adverts
  • Create personalised marketing
  • Track delivery of goods
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Internet advertising

Another way in which organisation operate online. Takes form of text, image, videos inc link to website.

  • Can be targeted at particular customers + Statistics can be gathered
  • Cheaper + reachers customers faster than traditional advertising
  • Reaches wide range of customers 

Using search engines:

  • Advertisement displayed - search using key words
  • Google Adwords - advertsing company only pays when people click on their adverts: cost-per-click
  • Key words carefully chosen + advert carefully worded to make people want to click on it

Using social networking:

  • use information known about users to target adverts at particular users
  • Organisations pay to display adverts on particular users' pages
  • Select custoemrs by location, age and interests
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Internet advertising

Viral marketing: when organisation creates interesting & entertaining content - makes people want to 'pass it on' to friends using social networking, email, texting

  • Content goes 'viral' - spreads very quickly
  • Cheap - organisations does not have to pay for adverts
  • Memorable content - people remember brand name

Online targeted marketing: concentratin online advertsing on groups of customers who most likely to buy product

  • Collect + combine online data
  • Then query data to send adverts just to those users whose age, gender, interests or previous purchases suggest they might buy particular product

Personalisation techniques: make advertisements relevant to particular customer using personal information + aim of persuading customer to buy related products

To avoid target marketing: opt out sharing personal information , delete cookies, be careful with personal information added to online profiles

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Payment systems

Credit / debit cards: Authorising organisation buying from totransfer money from bank account to its own bank account

  • Debit cards: customer pay by taking money directly out of account
  • Credit cards: allow customer to borrow money. Customer pays money back at later date, often with interest
  • Paying online give following details:
    • Card number + Cardholder's name
    • Expiry date
    • Credit card verification (CCV) code
      • number on back of card - not included on magnetic stripe/chip

Secure website:

  • URL - https
  • Change in address bar's colour (often green)
  • Padlock symbol
  • 'Norton Secured' - further layer of authentication
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Payment systems

Online bank transfer: keep customers safe from online fraud

  • checking bank accounts - no unusual activity
  • providing secure encrypted web services
  • login protection schemes e.g. PINsentry

Online coupons and eVouchers: sent to people electonically by email / printed out & sent by post. Redeem -creates online account + enters unique reference numbers given on eVoucher/ coupon

Third part payment processors: Trusted organisations stand between customers & retailers - payment not made directly

  • Buyer creates third party payment processor account - information never shared with retailers
  • Buyer pays third party - holds money until payment is authorised
  • Once payment authorised - third party transfers it to seller
  • Seller no need to offer secure site (expensive) + buyers not exposed to fraud
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Payment systems

Near field communcation (NFC): contactless payment service - allows devcies to communicate when close together - can be used to make payments


  • Good security - short transmission range
  • Losing NFc card only loses credit in account
  • Convenience of not having to enter payment details repeatedly


  • Only pay small accounts
  • Need to protect against accidental payments
  • If NFC card lost, anyone can use credit on it
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Consumer protection

Consumer rights under Uk Law:

  • When buying something, item must be of satifactory quality, fit for purpose & as described.
  • If item is faulty, has to be replaced, repaired or money refunded
  • Byying online from UK-based retailer: same rights buying online as buying in a shop

"Cooling off" period for online purchases: orders placed online can be cancelled, for any reason, up to 7 working days after receiving items & full refund of any money paid will be made. Applies to everything except:

  • Goods made to perosnalised specification
  • Perishable goods e.g. food, flowers
  • CDs/DVDs/software where seal has been broken
  • Newspapers, magazines or other reading material ( not books)
  • Gaming, betting & lotteries
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Applications software

Applications software: software used to carry out particular task. Two types:

Locally installed software: Obtains software on DVD/ Downloads from Internet. Installs software on computer or file server.

  • Advantages:
    • Works without being online
    • Hold licence to use software
    • Access controlled to computer = good security
  • Disadvantages:
    • Large amount of file space
    • Install upgrades / patches to fix bugs
    • Data stored locally - must be backed up
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Applications software

Hosted software ( Software as a Service): logs in through Internet. Runs on web-server over Internet.

  • Advantages:
    • Doesn't take up any file space on compuet
    • Allow users from different parts of world to work on same document at same time
  • Disadvantages: 
    • Can't work without Internet connection
    • Not as secure - hosted company might be targeted by online hackers
    • Response time depends on network speed

Proprietary software: Developed by company. Pay to use on computer / online. e.g. Microsoft Word

Open source software: Developed by volunteers. Free to use. e.g.

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Commercial response to SaaS

Some 'software as a service' applications now available for free - business of commercial providers could be threatened - customers use free 'software as a service' online applications

Response to SaaS:

  • Make products more appealing + of better quality by incl more facilities & functions
  • Provide software applications installed when buying computer
  • Provide technical support, help services & training materials
  • Copyright - protect products + stop similar "free" products offered as a "software service"
  • Offer own verisons of software as a service
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Local/Online storage

Local data storage: stored on digital device

  • Control over access to files & security of data
  • Data accessed quickly
  • No need Internet connection
  • Responsible for keeping data safe
  • Difficult to share data with others
  • Have to back up data

Online data storage: stored on server elsewhere + access using Internet

  • Available anywhere you have Internet access + browser
  • Some are free + Easy to share data with others
  • Data backed up for you
  • Have to trust organisation to keep data secure
  • Online data storage may not be reliable
  • Need Internet connection + Less control of data
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Search engines

Search techniques:

Add more key words to narrow down search

Use advanced search facilities

Search by date / langauge

Use more than one search engine

Different types of searches:

" " - finds exact phase

AND or + finds web pages containing both words

OR finds web pages containing either words

- finds web pages not containing that word

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