Chapter 14

Ecommerce, Databases, and Data

Science
Learning Objectives

• Explain the issues, pros, and cons of

whether to create an ecommerce website.
• List the components of online transactions,
and explain what is involved in each step.
• List one other ecommerce model besides
the online retailer selling to the general
public and explain how it works.
• List one other electronic payment system
besides traditional credit cards and explain
how it works.
Learning Objectives

• Describe the relational database model

• Frame simple queries in SQL to retrieve
information from one or more tables in a
relational database
• Define data mining
• List three sources data brokers use to
collect data on individuals
• Give an example of data science used
"for the greater good"
 • The World Wide Web
enables businesses to
communicate with
customers through:
• Advertising
• Follow-up support
Introductio
• Sales to consumers
n • Sales to other
businesses
• Non-sales
transactions
(statements and bill
pay)
Ecommerce

• 2017 – 105.7 billion

• 2022 – 262 billion fourth quarter
• 2023 – 6.3 trillion
Ecommerce

• Ecommerce: business conducted with

the Internet and via the web including
sales, advertising, and bill pay options
• Setting up an organization for
ecommerce can be as intensive as
setting up a physical store front.
• What business problem are you solving?
• Broadening the customer base
• Recapturing customers lost to
online competitors
• Serving existing customers better
• Integrating departments of existing
business
Ecommerce

Risks of moving Costs of moving

online
Same customers moving online
Computer equipment and
from in-store to online infrastructure
Facing new competition Hiring personnel to manage
online the website
Existing customers don’t Legal expertise required to
need/want online store protect your intellectual
Employee concerns property, regulations online,
and customer privacy
Ecommerce

• Ecommerce decisions:
• Design website in-house or hire
an ASP (Application Service
Provider)
• Buy or lease equipment
• Use existing software or have
custom software written
Ecommerce

Customer transaction Order fulfillment

overview
Customer learns of your site and goes Update inventory
there
Identify return customers and Contact shipping system
personalize the site and shipping company
Provide a secure environment for
making purchase Arrange pick up and
Process the payment delivery to customer
Communicate with accounting and
credit company
Ecommerce
 • How do customers learn about
your site?
• Conventional print
advertising with URL
• An obvious domain name
(home page URL)
• ICANN (Internet
Corporation for Assigned
Ecommerc Names and Numbers)
e registers domain names
• Search engine results
(sponsored link)
• Presence on a portal (website
about a topic) with links to
retail, wholesale, and
informational websites
• https://blog.hootsuite.com/to
p-influencers/
Ecommerce

• Identify return customers and personalize the site

• Require the user to register and log in
• Connects to the database with the user’s
past history on the site
• Leave a cookie on the user’s computer
• Small text file containing information about
the user
• Allows continuity between one page of a
site and another
• (Relatively) harmless
Ecommerce

• First-Party Cookies – set by the website the

user is visiting
• Third-Party Cookies – Set by external domains
(advertisers, analytics)
• Session Cookies
• Cookie Laws
 Google
• Open a website (e.g.,
https://www.amazon.com).
• Right-click on the page and select "Inspect"
or press Ctrl + Shift + I (Windows) or Cmd +
Option + I (Mac).
• Go to the Application tab in the Developer
Tools.
• On the left side, click Cookies under the
Storage section.
Cookies • You can now see all cookies being stored by
the website. These cookies are categorized
by domain.
Safari
• Safari allows you to inspect cookies via the
Web Inspector.
• First, enable the Developer menu by going
to Safari Preferences → Advanced → check
"Show Develop menu in menu bar".
• Then, navigate to a website, right-click, and
select Inspect Element.
• Go to the Storage tab to view cookies.
Ecommerce

• Provide a secure environment for

making a purchase
• Encryption: ensure sensitive
information is encrypted for
transmission
• Authentication: verify that your
website is legitimate
Ecommerce
Ecommerce

• Process payment
• Option 1: while the customer waits
• Online form communicates with
accounting software
• Accounting system verifies customer
credit
• Customer can correct bad information
• No need to keep credit card numbers
• Option 2
• Record the order and payment
information
• Verify and complete the transaction
offline
• Send email confirmation to the
customer
Ecommerce

• Fulfill the order

• Communicate with online
inventory
• Reduce item counts for
purchased items
• Arrange for shipping
• Online shipping system
• External shipping company
• Arrange pick-up at the
warehouse and delivery to the
customer
What do you think?

• https://www.lingscars.com/
• https://www.carvana.com/
 Ecommerce

• Website design: overall

• Attractive with new
products displayed
• Good design principles
• Organize for natural
shopping habits
• Make it easy to
navigate
• Provide site map
or navigation bar
• No more than four
clicks from one
page to another
• Encourage browsing
and targeted searching
• Ensure the site works
on different platforms
and browsers
• Multiple software systems
must communicate
• Website, accounting,
inventory, and shipping
• Suppliers, orders, and
billing
• Personnel
• Legacy code: existing old
software still in use Ecommerce
• Middleware: software to
enable separate systems
to communicate
• Disaster recovery
strategy: response to
natural disasters,
equipment failures, or
being hacked
Ecommerce

• Other ecommerce models

• eBay: peer-to-peer auction-style sales
• Craigslist: peer-to-peer classified ads
• Groupon: group coupons
• Businesses post coupons for one day only
• Minimum number required
• PayPal: online payment service
• Apple Pay and similar system: mobile payment
systems
• Bitcoin: virtual currency
Databases

• Databases store large amounts of data

• Businesses require databases for:
• Inventory, personnel, customers,
suppliers, and financials
• Data organization
• Bits and bytes: basic pieces of
computer data
• Field: one meaningful piece of
information
• Record: a set of related fields
• Data file: a set of related records
• Database: a set of related data files
Databases
Databases

• Data files are represented as tables

• Records are rows; fields are columns
Databases

• example of an employee record

• Record = one employee
• Each field has:
• A field name (a category) with a specific data
type
• A value in the field for the selected record
(employee)
Databases

Database management system

(DBMS)
• Manages files in a database

Relational database model: files are

2-d tables
• Entity: a distinguishable component of system
• Example: an employee, a customer, or a rug
for sale
• Tuple: a row of a relational table
• Attribute: category of a field
• Primary key: attribute(s) that uniquely identify a
tuple
Databases
Databases

• SQL (Structured Query Language)

• Standard query language for
DBMS
• Use SQL queries to retrieve
data according to some criteria
• Example 1: retrieve employee
name, pay rate, and hours
worked for employees named
Perreira
Databases

• Multiple tables may contain

related data
• Example: insurance policies for
Rugs-for-You
• Foreign key: an attribute in
one table that is the key in
another
• Connects data in one table
with another
• Example: EmployeeID
Databases

• use CustomerData
• select * from customer, ordertbl
• where customer.custno = ordertbl.custno
Databases
Data Science

• Big data: Huge amounts of available data

• Data analysis: Process of finding the right
data sets, putting data in the right format,
and writing queries to extract information
• Data science: Incorporates data analysis
tasks, but requires knowledge of the
enterprise for useful queries and the use of
statistics and visualization techniques to
interpret the results and predict future
strategies to achieve a predetermined goal
• Data warehouse: A collection of databases
that contain current and archived data for
research and analysis
 • Data mining: Process of analyzing
data to extract and interpret
previously hidden patterns through
several steps:
• 1. Determine the problem to be
solved
• 2. Review the condition of the
data: Does all data have the
same structure? Are any tuples
Data missing information?
• 3. Determine a model that will
Science help bring out the patterns:
Patterns classify the data to
determine the strongest
predictors of a given outcome –
this is the data mining part:
creation of a model
• 4. Evaluate your model: Are the
results predicted borne out by
further data? Would a different
model give better results?
Data Science

• Decision Tree
• One type of
model
• Easy to convert
to an algorithm
• Is the model
too simplistic?
• Is the resulting
algorithm
biased?
Data Science

• Other Data
Science Tools
• Statistical
analysis
• Graphical
visualization
• Language R can
help with both
these tasks
Data Science

• Privacy issues associated with data mining

• Automatically analyzing large amounts of data to
uncover hidden patterns
• Data brokers: companies that collect and sell data such
as:
• Birth certificates, marriage certificates, publically
available information, and nonpublic data purchased
or acquired from other companies or data brokers.
• Nontheless, data science can make contributions to
• Medicine, science, ecology, and many more fields
 Ecommerce is a central part of our
economy

Businesses deciding to enter the

online world must plan carefully

Ecommerce web design is

complicated

Summary Ecommerce requires integrating

multiple computer systems:
inventory, accounting, suppliers, etc.

Databases are systems to store large

amounts of data

Data is organized into fields, records,

data files, and databases
Summary

DBMS manages files of databases

The relational database model is the most common: records represent

entities; all data is viewed as sets of 2-d tables
SQL is the most common query language for retrieving data from a
DBMS
Databases must ensure integrity, efficiency, and (sometimes)
distributed access to data
Data mining discovers hidden patterns in a big data set

Privacy issues arise due to data mining techniques