Exercise 1: Analysis of the online communities' paradigm

1. Visit http://yahoo.com and http://facebook.com as examples of online communities.

a. What is meant by an online community and how is it important for e-commerce?
b. Is there a common thread and a local community sense in action?

A.
An online community is a virtual community that exists online whose members enable its existence through taking part in membership rituals (Amy Jo Kim, 2000). An online community can take the form of an information system where anyone can post content, such as a Bulletin board system or one where only a restricted number of people can initiate posts, such as Weblogs. Online communities have also become a supplemental form of communication between people who know each other primarily in real life. Many means are used in social software separately or in combination, including text-based chat rooms and forums that use voice, video text or avatars. Significant socio-technical change may have resulted from the proliferation of such Internet-based social networks
It is important for e-commerce, because not having to be in the same place and at the same time and still be able to communicate by using Internet, it means that time, location will less consider when doing business and make the business more sample.

B.
Facebook is one of the examples of a local community sense in action. It allows users to form or join a group to communicate others user with same interest.

1. Visit the famous online store front at http://www.amazon.com
a. Why has it been a successful site? How does the purchase of a book work?
b. Are there any secure transactions not involving money?

a. There are many factors that have contributed to the success of Amazon：

• speed of delivery
• competitive pricing
• strong focus on customer experience
• security

Purchase workflow
1. registered as a member
2. find a book to purchase
3. add the selected book into shopping cart
4. Proceed to a secure checkout to verify the contents of the cart and complete the purchase
5. select a payment
6. Payment is validated and the order created

b. when the user access the personal information in Amazon.com is secure, because Amazon.com will use the HTTPS protocol to connect the user PC and Amazon server and all the data transaction between user PC and server is secured

2. What happens with new models emerging such as price comparison sites?

Price comparison sites typically do not charge users anything to use the site. Instead, they are monetized through payments from retailers who are listed on the site. Depending on the particular business model of the comparison shopping site, retailers will either pay a flat fee to be included on the site or pay a fee each time a user clicks through to the retailer web site or pay every time a user completes a specified action - for example, when they buy something or register with their e-mail address. Comparison shopping sites obtain large product data feeds covering many different retailers from affiliate networks such as LinkShare and Commission Junction. There are also companies that specialize in data feed consolidation for the purpose of price comparison and charge users for accessing this data. This has since been expanded the technology for business consumers in recruitment