Chapter - Five

Mobile Electronic Commerce

Prepared by: Minale . D.

 Chapter Objectives
•After completing this chapter, students will be able to:

 Understand the Overview of Mobile Electronic

Commerce
 Discuss the Mobile Applications & Methods of Payment
 Explain the Advantage and disadvantages of M-commerce
 Discuss the Difference between PDA and Mobile phone

2
 Introduction
 M-Commerce is sometimes referred to as “Mobile E-

Commerce”, or M-Commerce.

 M-commerce or m commerce, is the use of wireless

handheld devices like cellphones and tablets to conduct

commercial transactions online, including the purchase

and sale of products, online banking, and paying bills.

 Mobile commerce refers to business or purchases

conducted over mobile devices like cellphones or tablets.

 Cont…
 Mobile commerce, also known as m-commerce, is the process of
buying and selling items through a mobile device, tablet, or other
handheld device.
 Mobile commerce is defined as the use of wireless devices like
mobile phones or tablets to perform commercial activities,
including:
Product sales and purchases
Online transactions
Bill payment &
Online banking
 Cont…
 M-Commerce, is a branch of commerce that deals with
the digital transactions made from the smartphone.
 It doesn’t require physical contact between two people
for sending or receiving the money.
 “M-Commerce is the buying and selling of goods and
services via
Mobile phones.
Personal data assistant (PDA)
 Smartphone.
 Difference between PDA and Mobile phone

 Personal digital/data assistant is a term for a small, mobile,

handheld device that provides computing and information storage
and retrieval capabilities for personal or business use, often for
keeping schedules, calendars and address book information
handy.
 A PDA is a small mobile device that commonly has a hardware
keyboard and no touch screen.
 Smartphones have a touch screen that works faster than the latter.

 A PDA cannot be used to make phone calls.

 A smartphone can be used to make phone calls.

Cont…
 Mobile Applications
 Individual mobile services of similar nature can be bundled
into an application.
 The following are diverse m-commerce applications.
 Mobile Banking: This application makes it possible to
complete bank-related transactions.
 E.g. checking account status, transferring money and selling
stocks, via mobile devices, independent of the current user
location.
 Cont…
 Mobile Entertainment: This application contains services that
provide the user digital data with entertainment value on mobile
devices, e.g. ring-tones, music and videos, on the one hand.
 On the other hand it opens an array of interactive services, e.g.

betting, gaming, dating and chatting.

 Mobile Information Services: This term refers to mobile services

that provide subscribers with content of informational character.

 Examples of such services are news updates of any nature (finance,

politics, sport etc.), travel information, access to search engines

and Mobile Office (e- mails, appointments etc.).
 Cont…
 Mobile Marketing: This term refers to services based on
mobile communication technologies.
 Mobile marketing relates to any promotional activity that takes
place on smartphones and other handheld devices, including
tablets and other cell/mobile phones.
 The Mobile Marketing refers to the marketing activities
undertaken to reach the consumers directly via mobile phones
 Mobile devices serve thereby as simple and relatively
inexpensive channels of interaction.
 Cont…

 Mobile Ticketing: All services that must be paid for,

before a lawful utilization can take place, are suitable
for mobile ticketing, e.g. travelling in public transport,
entry to a cultural event or cinema.
 This application ensures that the user can purchase a
right to utilization/entry (ticket) via a mobile device,
replacing the conventional paper ticket.
 The ticket is sent in digital form to the mobile device.
 Cont…
 Telematics Services: Telematics is an artificial term that refers to
innovative technologies that link telecommunication technologies
with informatics.
 The transport segment has been the primary area of this
application, which is also known as Intelligent Transport System
(ITS).
 Telematics devices can be installed in different ways depending on
their type. For example, a location-tracking GPS device might be
installed in a vehicle’s onboard diagnostics (OBD) port (which
makes the device easy to install and provides power whenever the
vehicle is active).
 Cont…
 Telematics is a method of monitoring cars, trucks,
equipment and other assets by using GPS/global
positioning system/ technology and on-board diagnostics
(OBD) or vehicle GPS tracker devices to plot the asset’s
movements on a computerized map.
 Mobile Payment
 The term “Mobile Payment” refers to payments that are made via
mobile hand-held devices in order to purchase goods and services.
 Mobile Payment services usually act as intermediary between
consumer and the vendor.
 It is an alternative payment method. Instead of paying with cash,
cheque or credit cards, that
 A consumer can use a mobile phone to pay for a wide range of services
and digital or hard goods such as:
 Music, videos, ringtones, online game
 Transportation fare (bus, subway or train)
 Books, magazines, tickets
Advantage and disadvantages of M-commerce

 While m-commerce offers significant

advantages like convenience, wider reach,
and personalized experiences, challenges
such as security, usability, and accessibility
must be addressed.
 Businesses investing in m-commerce should
focus on providing secure, user-friendly, and
innovative solutions to leverage its full
potential while building trust with their
 Advantage of M-commerce

 Convenience:- Users can shop, pay bills, and

manage finances anytime and anywhere, eliminating
the need for physical visits to stores or banks.
• Mobile devices make it easy to perform transactions
on the go.
 Wider Reach for Businesses:- M-commerce allows
businesses to target customers globally.
• Location-based services help businesses attract local
customers through personalized offers and
promotions.
 Personalized User Experience :- Data analytics
and AI can provide tailored recommendations,
product suggestions, and marketing campaigns.
• Geo-location features enable location-specific
promotions and offers.
 Cost-Effectiveness for Businesses:

• Mobile platforms often require less investment

compared to physical stores or traditional marketing.
• Direct communication channels reduce marketing
costs.
 Supports Emerging Technologies:

• Integration with augmented reality (AR), virtual reality

(VR), and voice assistants enhances user interaction.
• Features like virtual try-ons or voice-enabled
purchases create innovative shopping experiences.
 Faster Transactions:

• Digital wallets and mobile payment systems speed up

the checkout process, reducing friction for users.
• Features like one-click purchases enhance customer
satisfaction.
 Enhanced Customer Engagement:

• Push notifications, loyalty programs, and app-exclusive

offers help businesses maintain continuous interaction
with customers.
• Gamification elements and social media integration
drive engagement.
 Disadvantage of M-commerce

 Security Concerns:
• Risks of data breaches, phishing attacks, and
unauthorized access to sensitive information can
deter users.
• Users may hesitate to trust mobile platforms with
their personal and financial data.
 Connectivity Dependency:
• A reliable internet connection is essential for smooth
transactions. Poor connectivity can lead to failed
transactions or a frustrating user experience.
 Device Limitations:
• Small screens on mobile devices can hinder usability,
especially for browsing and comparing products.
• Limited battery life may also disrupt lengthy
transactions.
Technical Issues:
• Frequent app crashes, bugs, or slow-loading
websites can negatively impact user
experience.
• Compatibility issues with different devices,
operating systems, or screen sizes can pose
challenges for businesses.
Cost of Development and Maintenance:
• Developing and maintaining mobile-friendly
apps or websites for various platforms (iOS,
Android) can be expensive.
• Businesses need to frequently update their
platforms to keep up with technological
changes.
 Digital Divide:
– Not everyone has access to smartphones, high-speed
internet, or mobile banking facilities, creating a gap in
accessibility.
– Some users may prefer traditional shopping methods
due to lack of familiarity with mobile technology.
 Privacy Issues:
– Extensive use of customer data for personalization may
lead to concerns about data privacy and misuse.
– Tracking user location and behaviour might feel invasive
to some users.
 Fraud and Scams:
– Fake apps, phishing websites, and fraudulent
transactions are common risks in the m-commerce
landscape.
– Lack of trust in the platform may discourage potential
customers.
 Wireless Industry

 Wireless communication is the transfer of information between two or

more points that are not connected by an electrical conductor.

 Wireless operations permit services, such as a long-range

communications, that are impossible or impractical to implement with

the use of wires.

 The term is commonly used in the telecommunications industry to refer

to telecommunications systems (e.g. radio transmitters and receivers,

remote controls etc.) which use some form of energy (e.g. radio waves,

acoustic energy, etc.) to transfer information without the use of

wires.
•Wireless technology has already an impact on
your life today and Perhaps the ability to quickly
navigate a traffic jam with a mobile map
application,
•Advances in applications of communications
technology rapidly decreasing costs, resulted in
tremendous growth in the adoption of wireless
technology.
 Count….

•One of the key factors that led to wireless services’ growth was
customers’ migration from wire line to wireless
•Some of the key factors that contributed to the significant
data usage growth include
- Customers 'adoption of new devices,
- Declining prices, and
- Growing internet traffic
 Cont…
 Information is transferred in this manner over both short
and long distances.
 The word telecommunications comes from the Greek prefix
tele-, which means "distant," combined with the Latin
word communicate, which means "to share.“
 Important telecommunication technologies include the
telegraph, telephone, radio, television, video telephony,
satellites, closed computer networks and the public
internet.
 Cont…
 Telecommunications, also known as telecom, is the exchange
of information over significant distances by electronic means,
referring to all types of voice, data and video transmission.
 This is a broad term that includes a wide range of
information-transmitting technologies and communications
infrastructures. Therefore,
 Wireless communication is the transfer of information
between two or more points that do not use an electrical
conductor as a medium by which to perform the transfer.
 Types of Wireless Network
 There are three types of wireless network:

 Local Area Network (LAN) – is a computer network that

interconnects computers within a limited area such as a
residence, school, laboratory, university campus or office
building.
 A metropolitan area network (MAN) is a large computer network
that usually spans a city or a large campus.
 A MAN Network is optimized for a larger geographical area than
a LAN, ranging from several blocks of buildings to entire cities.
Cont…
Wide Area Network (WAN) – is a type of a network
extending over a larger area, and the Internet may be
considered a WAN.
 In short, the telecommunications sector consists of
companies that transmit data in words, voice, audio, or
video across the globe.
 Telecom equipment( cables, computers, wires, phones,
television etc) telecom services, and wireless
communication are the three basic sub-sectors of
telecommunications.
 Cont…

 The wireless industry is a collection of businesses

involved in the development and use of various electronic
devices that can receive and send information wirelessly.
 Mobile enterprises
 A mobile enterprise is a corporation or large
organization that supports critical business functions and
use of business applications via wireless mobile devices.
 Cont…
 In a mobile enterprise, employees use mobile devices to
do any or all of the following: access email, manage
projects, manage documents, provide customer
relationship management, conduct enterprise resource
planning, fill out invoices and receipts, accounting
vouchers, work orders, purchase orders, etc. and manage
a corporate calendar and address book.