Is Web Commerce Risky?
The number of people online grew more than 64% in the year 2000 alone. Forrester Research estimates the worldwide net commerce -- both B2B and B2C -- will hit $6.8 trillion in 2004, more than a 10-fold increase from the year 2000. One of the challenges, however, is getting people comfortable with a new way of doing things. This progression is called the adoption curve. Remember when answering machines first hit the market? Comments such as "I hate to speak to a machine – it is so impersonal" were common. Now that people have gotten used to the idea, people now think "What? You don’t have voice mail?" This is an example of the adoption curve we go through with technology. People are experiencing this same curve with e-commerce – they are getting used to the idea of and will likely soon embrace it in a way that will revolutionize our buying habits.
A major obstacle for e-commerce, however, is the perception of Web security. Many are still uncomfortable with using credit cards on the Web and, therefore, are not purchasing. Is the Web safe? What and where are the risks? How can you, for example, convince your members or clients that it is safe to register on-line for a meeting or purchase items from you? This article will address each of these questions.
Why use Web commerce in the first place?
For the vendor, the simple answer is efficiency. The cost per transaction is usually far lower of other means of sale. The buyer does their own inputting of name/address/credit card information. An on-line meeting registration, for example, can be imported into existing meeting registration systems saving labor in answering the phone, handling mail/faxes/checks, re-entering data, etc. For the buyer, the Web has the potential to afford a feature-rich, user-friendly, customizable shopping experience that is available any time of the day or night anywhere you have access to the Web. The trend will be irresistible.
Are credit cards secure on the Web?
The answer is "yes" with some basic precautions. In most cases the Web is significantly more secure than face-to-face transactions. One caution, however, is to make sure that it is a secure site. You can tell if it is secure by the "closed padlock" or the "unbroken key" at the bottom of your Web browser. You can also tell by looking at the Web address line (URL) -- it should start with "https://..:" not just "http://..." These indicate that the site is secure. This is important because a secure site allows your browser to encrypt the transaction making it virtually impossible for someone to steal your card number while it is being routed from your computer to the vendor’s site. My recommendation is to not deal with vendors that haven’t taken this basic step towards security.
The Virtual Store Front – Use Caution!
This being said, you should know who you are dealing with. It is possible to set up a cyber "store-front" that looks legitimate but is a scam. As a vendor, offer ways to reassure the buyer. Give them multiple ways of contacting you (i.e. toll-free phone, fax, etc.). Give them information about your company background, list clients, and list testimonials – all serve to allay these fears.
Additional Security Measures
The next steps to reassure the buyer are "digital signatures" -- the electronic equivalent of a driver license or passport that works in your browser identifying the company as being who they say they are. An external authority vouches for the company after going through a checking and verification process. You will see this become commonplace. MPI's web site (www.mpiweb.org), for example, uses Verisign (www.verisign.com) for digital authentication. Another popular web authentication provider is Entrust (www.entrust.com).
Worst Case Scenarios
So, what happens in the very unlikely event that your card is stolen? Credit card companies commonly impose a $50 maximum liability if your card number is used fraudulently by someone else – web sites included! So, the risk of using your credit card just about anywhere is small. However, there is one caution that should be heeded at all times – never give out your bank account number on the Web, even if the site is secure. Scam artists have used this means to completely empty accounts. These instances are rare and should be caught by the banks. Nonetheless, never ask or never give this type of information.
If the above precautions are used, the Web is a very safe place to buy. It is, in fact, safer than other means of purchase. Web-based e-commerce will continue to mushroom and will become the preferred means of purchase by many. Meeting industry vendors, hoteliers, associations, and corporations should be making plans to maximize their Web-based sales as this irresistible trend continues.
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