E-Business Theory 05

APPLICATION CASE: 01     EC APPLICATION: CRUTCHFIELD GOES

 

Questions

1.      Why was Crutchfield interested in implementing a mobile payment solution?

Crutchfield's Senior Manager of E-commerce, Todd Cabell told Computerworld the company has seen a 34 percent increase in conversions of shoppers to buyers on its mobile Web site since bringing the system online. He said sales on the mobile site are small a portion of the online visits but the numbers are growing quickly. PayPal's global reach, with more than 95 million users, has helped a large number of customers new to Crutchfield; customers that would have had to enter shipping and payment information from small mobile devices. Fully 65 percent of those using Mobile Express Checkout were new customers, according to a senior manager of PayPal Mobile Solutions, Stephen Strauss, the Crutchfield integration with the Mobile Express Checkout product took only about two weeks.
 

 

2.      What the solution did Crutchfield select?

PayPal Mobile Solutions

 

3.      What were the outcomes of the mobile payment implementation?

 “We are thrilled with both the great response our customers have given us in our new mobile channel and how PayPal helps to make the payment experience a pleasure for our buyers,” Cabell says. “Our data show that PayPal Mobile Express Checkout not only drives conversion but that it is also delivering a significant number of new customers,” he says. Sixty-five percent of the PayPal mobile customers are entirely new customers to Crutchfield. Believing it was important to let its customers know that Crutchfield was offering a fast and secure payment method, Crutchfield also placed a “Now Accepting PayPal” banner throughout its mobile site. “We want folks to see, whenever they come to the website, that we make it easy for them to pay with PayPal,” Cabell says. “And we are doing more marketing efforts in conjunction with PayPal to let people know that we accept it. Turning to PayPal has been a success for us, and our customers appreciate the choice we are providing them.”

 

 

CLOSING CASE: INNOVATIVE CREDIT CARD MICROPAYMENTS FOR THE KOREAN METROPOLITAN UNIFIED FARE SYSTEM

 

Questions

 

 

 

1. How can credit cards be processed as quickly as stored-value cards at the ticket gate?

To pay transportation fares quickly, credit card payments for subways and buses must be processed without the full authorization procedure. This risk is tolerable because the frequency and amount of micropayment abuse are low in Korea. Therefore, the transportation ticket gate merely automatically checks whether the card is valid and not on a “blacklist.” The gate displays not only the fare but also the charges incurred during the current month the first credit-based MRT card was adopted by Kookmin Bank in 1998. Today, several issuers support this type of card. Stored-value cards differ from debit cards, where the money is on deposit with the issuer, and credit cards are subject to credit limits set by the issuer and are connected to accounts at financial institutions. Thus, makes credit card quicker than a stored-value card.

 

2.      What is the major benefit of owning a credit-based transportation card for commuters?

 

The credit-based transportation card has revolutionized the recharge service process.

 

·         Reduce the expense

In the early stage, both MRT cards and bus cards had to be recharged at manned booths. To reduce the expense of the recharge service, unmanned booths were installed at MRT stations. However, with the credit card, recharge booths can be eliminated altogether and users do not have to spend time recharging their cards. Therefore, both the users and the city transportation authority benefit.

 

·         Convenient for citizens

Another benefit of the smart transportation card is that it can restructure the city’s transportation system by aligning and coordinating the routes of subways and buses. In the past, bus routes were designed in consideration of the departure and destination points of citizens’ trips. This approach intended to make it convenient for citizens to take only one bus to reach their destination. However, too many buses created bottle-necks in busy streets, causing traffic jams. To avoid such congestion, the MRT and main bus companies planned to design the transportation system so that bus branch routes are connected to the subway and to the main bus routes.

3.    What is the major benefit of credit-based transportation cards to the city government?

 

By reducing to the expense by installing unmanned booths which eliminated to spend time recharging cards. Thus, both the users and the city transportation authority benefit.

 

 

4.      How can the Metropolitan Unified Fare System enable the restructuring of public transportation infrastructure?

 

This approach intended to make it convenient for citizens to take only one bus to reach their destination. However, too many buses created bottle-necks in busy streets, causing traffic jams. To avoid such congestion, the MRT and main bus companies planned to design the transportation system so that bus branch routes are connected to the subway and to the main bus routes.