Development of Online Auction Market

Development of Online Auction Market Abstract The world of online auction is a very competitive world, its also almost monopoly where companies such as e-bay take the biggest market share. Because the internet has no governing body and does not belong to any government there is no control over what users are selling or buying or whether there is ethical, moral or legal ramification on the act of the customers which use the services of these companies. Competing with companies such as e-bay, a well established brand with global dominance is not something I had in mind; Student Online Auction System is no exception in its need for these advantages and competitive edge to thrive in this highly competitive global market. This report will outline the stage in carrying out an investigation of a problem situation which is a real world and developing a new system. To be able to achieve tasks, various analytical and design methodologies were investigated. It is also important to consider the organizational structure and culture, this can play a vital role in information modeling because often a failure in an information system project may be more due to lack of recognition of or respect for the culture of the organization than because of the technology itself. Major organisations such as e-bay but lot of emphasizes on calling their customers Community members rather then customers. The original idea that help the birth of e-bay was to establish an online community were members meet in online forums were they engage in open discussions on how to improve the services provided, exchange ideas as well as selling and buying In this project an attempt will made to be more aware of the needs of the customer, and to make the system have the facility were customers, give a feedback on the systems functionality, usability and ease of navigation and then carrying out any relevant improvements suggested by these feedbacks at the maintenance stage. Chapter 1 Introduction The aim of this project is to design and set up an online business model where students at the university can buy and sell articles through effective bidding system. It also provides a guide for me to undertake the project successfully through gathering essential information and literature relating to the fundamental issues that can support and improve security. The projects objective is to create a tool that will reduce the operational risks related to do this type of business where fraudulent misuse of user accounts is very common. Information systems are fundamental part of organisations asset, its classed as an asset because information systems use data bases which are the building blocks of an information system. The information gathered and stored in these building blocks are then analysed and refined to help organisations decision making process. Although ordinary filing system will probably satisfy the definition of information system a Data Base Management System (DBMS) is a program design specifically to store and access data. It also has special features not present in cabinet filling system such as consistency, time saving, access control, reliability and recovery. This project is about developing a system which merges Database with website technology to produce an Online auction Business. http://www4.ncsu.edu/~wurman/Papers/Wurman-article.pdf 1.2 Description of Project Objectives. The main objective of this project is to make Students who want sell their unwanted items a computerized business by developing a database system together with a database driven site to give online services for their customers. In order to give a good service and stay competitive on the market, the business should be able to adopt this new system. The project will research on other Auction Businesses who already uses this technology and also investigate on how this business can give online services. In addition to that, the project will investigate the existing systems used by the existing online auction companies in day to day activity and identify the problem area of their system in order to come up with a better system. Starting from the research and analysis it will go to the implementation by having an appropriate report on the process undertaken including explanation of techniques and software used to develop the system. It will also analyse and identify the appropriate technology for SOAS Ltd to give an efficient service and to run the business more effectively. Finally there will be testing and evaluating the finished product to make sure that it meets the requirements in order to satisfy the client. Main points why set up Student Online Auction System. To provide fast and an efficient service to their customers. To get or attract more customers by giving online and fast services. To improve communication with customers. To protect data or information against unauthorised access. Online service will save journey (time) for any customers. Generate Revenue for both students and the company Stay competitive on the market. No interruption. Peace of mind. 1.3 Academic Objectives To design and implement a database management system for To gain an understanding of a database systems and the technology behind them. To research on other estate agents who currently have a database management system and online system. To discusses a range of methodologies, tools and techniques in order to select the most suitable approaches for the development of the project. To demonstrate all the practical and theoretical knowledge gained during my studies at the university. To meet deadlines following the software development principle including project management and documentation. To develop a website for London wide estates. 1.4 Personal Objectives To gain a valuable knowledge and experience in a variety of fields that should help build my future career. To gain confidence in my ability to make the right decision and cope with difficult situation during the development of the system with self-tuition and minimum supervision. To achieve an insight and hands-on practical experience of analyzing, designing, testing and documentation of a real world project. To prepare myself to face the real world in the computing industry with the experience I have gained in the past and will gain developing the system. By developing this system I hope to demonstrate my capability of mastering a real word project. 1.5 Project Proposal Although traditional auction houses still enjoy some popularity by restricting their trade on e few reserved items such as art effects and memorabilias. They have in some way or other adopted technology to conduct their business. This is because of the fast pace of technological revolution that is taken over the way that business is conducted all over world. These days everything seems to be done on a computer and paper work is becoming thing of the past. It is well known fact that Information technology is so important in making the life of many businesses much easier. It is also essential that businesses depend on a computerized database system to provide or record information for running their business on daily basis. Student Online Auction Systems Ltds purpose is to set up a database driven website were customers primarily students sell and buy items from each other. The project will make use of the web-driven database technology to implement and set up fully functioning online business. The purposed online system will allow customers to browse, search without registering and only allow to buy, sell or both after registration. In order to set up the system a variety of different softwares will be used HTML XML JAVASCRIPT ASP.net Visual studio SQL Express Chapter 2 2.1 Background The history of internet auctions started in mid 1990s, and quickly become one of the most successful applications of electronic commerce. Perhaps EBay, the premier consumer-to-consumer (C2C) internet auction site, is generally perceived as pioneer for the industry. As the business to business (B2B) auctions transaction volume increases the potential for the industry is greater then that of conventional auctions. With auction sites such as eBay and U-Bid being common household names, it seems hard to believe that the online auction phenomenon is actually very young. But young it is. In fact, the world of online auctions as we know it found its beginning in the year 1995 with a company dedicated to holding auctions for geeks wanting to buy, sell and trade computers and peripherals. Today, this site, fondly known as eBay, has become the worlds largest online marketplace hosting more than 100,000 auctions daily in 315 categories. With more than 40 million bids placed on eBay since its in ception, it is no wonder that other entrepreneurs hoping to claim a piece of the internet auction market quickly followed suit. Far from being a lonely beacon in the world of online trading, eBay is now competing with several other extremely successful online auctions sites. In fact, hundreds of auction sites can be found listed in various auction directories on the web. On these sites, consumers world wide buy, sell and trade items ranging from rare collectibles to daily essentials. Virtually everything imaginable can be found on internet auctions at a great price. http://www.unc.edu/~draughn/assignment1.html http://www.usatoday.com/tech/science/columnist/2006-06-25-physics-of-ebay_x.htm 2.2 What is an online Auction? An online auction is an internet-based activity, which is used to negotiate prices for purchasing or sale of direct materials, capital or services. Online auctions can be used to sell: these are called Forward (or Seller) Auctions and closely resemble the activity on B2C auction websites. Companies have used forward auctions to sell off surplus assets or in times of shortages -highest bid wins. However, most companies are starting to use Reverse (or Buyer) Auctions, where purchasers seek market pricing, inviting suppliers to compete for business in an online event. Auctions can be either private/closed where there are typically few bidders who have no visibility of each others bids, or open, where a greater number of participants are invited. In this case participants have visibility of either their rank or the bidding itself. Bidding on an internet auction is as simple as surfing the web. All you need to do is register at an auction site and begin browsing for merchandise. Once you find exactly what you are looking for, you can place a bid and monitor the bidding action with just a few clicks of your mouse. Most auctions sites also allow you to transfer payments through PayPal, an online payment system. That means that your personal credit card information is not given to any buyer or auction site directly. So, no matter whether you are searching for a one-of-a-kind antique or looking for a bottle of discount designer perfume, you can bet that you will find what you seek at the online auctions. http://www.caslon.com.au/auctionsprofile.htm 2.3 How do Online Auctions Work? Internet auctions are giant flea markets. Sellers may offer one item at a time or multiple lots of the same item. In theory, online auctions run much like local auctions, but behind the scenes there is a collection of data going on continuously. Just like local auctions, there are sellers and bidders and winners and losers. Winners are expected to pay for what they bid on at the conclusion of the auction. But that is where the similarities between online and local auctions end. 2.3.1 Registration At online auctions you will be required to register before you can buy or sell an item (s). This is required to track items you bid on or sell, keep up with the bids, determine the winning bids and build a database on seller and bidder feedback. 2.3.2 Winning Bids The bidding for each auction closes at the scheduled time. In the case of sales of multiple lots, the participants with the highest bids at the close of the auction are obligated to buy the items. If no one bids at or above the reserve price, the auction closes without a winner. At the close of a successful auction, the buyer and seller communicate, usually by email, to arrange for payment and delivery of the goods. 2.3.3 Payment Options Buyers may have several payment options, including credit card, debit card, personal check, cashiers check, money order, cash on delivery and escrow services. However, all sellers do not accept all forms of payment. Credit cards offer buyers the most consumer protections, including the right to seek a credit from the credit card issuer if the product is not delivered or if the product received is not the product ordered. Typically, sellers using business-to-person auction sites accept payment by credit card. But many sellers in person-to-person auctions do not. Usually they require payment by cashiers check or money order before they send the item to the winning bidder 2.3.4 Types of auctions. There are two types of Internet auctions business-to-person or person-to-person. Sellers of business-to-person auction sites have physical control of the merchandise being offered and accept payment for the goods. In person-to-person auctions, individual sellers or small businesses offer their items for auction directly to consumers. Generally, the seller, not the site, has physical possession of the merchandise. After the auction closes, the seller is responsible for dealing directly with the highest bidder to arrange for payment and delivery. Chapter 3 3.0 Introduction Internet auctions can be characterised in two ways: third-party auction sellers such as e-Bay, Amazon.com and Yahoo! that auction goods for others (either individual sellers or corporate chains), and direct auction sellers which create their own auctions online via their company websites. A substantial number of retailers and catalogue firms are taking advantage of the boom in these online auctions to unload merchandise and increase sales, and growth in the online auction category is now well documented. Catalogue marketers as diverse as The Sharper Image, Ross-Simons, Cameraworld.com, and CompUSA are all successfully auctioning products online. A business model is the mechanism by which a business intends to specify a value proposition or a value cluster for targeted customers, a financial model and a market offering 3.1 ebays Business Model eBay has built an online person-to-person trading community on the Internet, using the World Wide Web. Buyers and sellers are brought together in a manner where sellers are permitted to list items for sale, buyers to bid on items of interest and all eBay users to browse through listed items in a fully automated way. The items are arranged by topics, where each type of auction has its own category. eBay has both streamlined and globalized traditional person-to-person trading, which has traditionally been conducted through such forms as garage sales, collectibles shows, flea markets and more, with their web interface. This facilitates easy exploration for buyers and enables the sellers to immediately list an item for sale within minutes of registering. Browsing and bidding on auctions is free of charge, but sellers are charged two kinds of charges: When an item is listed on eBay a non-refundable Insertion Fee is charged, which ranges between 30 cents and $3.30, depending on the sellers opening bid on the item. A fee is charged for additional listing options to promote the item, such as highlighted or bold listing. A Final Value (final sale price) fee is charged at the end of the sellers auction. This fee generally ranges from 1.25% to 5% of the final sale price. eBay notifies the buyer and seller via e-mail at the end of the auction if a bid exceeds the sellers minimum price, and the seller and buyer finish the transaction independently of eBay. The binding contract of the auction is between the winning bidder and the seller only. 3.2 Amazons Business Model Amazons business model is one in which Amazon depends on third party to deliver information goods or services to end customers. There are three operational strategies that have helped Amazon.com to enhance its competitive advantage, including cost-leadership, customer differentiation and focus strategies (Saunders, 2001, pp.122-123). The first strategy, cost-leadership is pursued by Amazon.com by differentiating itself primarily on the basis of price. Due to this strategy, Amazon.com always makes sure that it offers the same quality products as other companies for a considerably less price. Their second strategy is customer differentiation. Amazon.com provided current and prospective customers with differentiation though design, quality or convenience and Amazon.com always selects a differentiator that is different among the competitor. So, Amazon.com consumers can recognize and differentiate its product from competitors (Saunders, 2001, pp.122-123). The last strategy that it uses, i s a focus strategy. This strategy takes one of the two earlier strategies and applies it to a niche within the market (Saunders, 2001, pp.122-123). Amazon.com focuses on outstanding customer service as a niche but not the whole market because each niche has its own demand and requirement. 3.3 Customer interface To a certain extent, the Amazon.com customer interface can be customized to each users preferences. When a user logs in to Amazon.com after purchasing, the website reconfigures and presents content that pertains to individual users, depending upon the users responses or profile (2004, p.188). For Amazon.com, collaborative-filtering software is used to tailor the website to each user through comparing each users purchases with the purchases of other users with similar preferences (2004, p.188). A list is then compiled of additional purchase recommendations, with suggestions across product categories as well, such as similar areas of interest in CD or DVD format (2004, p.188). Additionally, the website promotes and fosters a community of customers through encouraging readers to submit book reviews and facilitating online discussions about previously read books (Spector, 2000, p.78). These activities provide users with an interactive component and give them an opportunity to contribute to the websites content as well as develop a group identity and sense of belonging which can lead to possible friendships (Spector, 2000, p.78).    3.4 Technology behind the Online Auctions Secure Internet system is safer then handing over your card details on the phone. The application used to secure the online monitory system is the Secure Socket layer SSL. This technology is a military strength encryption technology, which works in conjunction with secure servers. This technology scrambles and encrypts sensitive information such as credit card details with a code before passing by a merchant server from a PC and that of the company taking a customers money. One of the other applications is a system of digital certification. When a user visits the website, intending to purchase over the Internet online, the website will display a lock sign on the toolbar below and provide information that the website is secure to use, the SSL lock will identify if the website is certified or not? The certificate is to authorise secure online transaction processing, which acts like an Identity card for the site and for the company behind the site. Its confirmed that the site belong to a register trader. 3.4.2 Methodology The Structured Systems Analysis and Design Method (SSADM) is thorough method of system development and if not understood fully it can lead into confusion into the mass of details available on the different stages of this methodology. SSDAM looks at the system from three different, but highly interdependent perspectives. The first is that of functionality or processing. This looks at the way in which data is passed around the system and the processes or activities that transform it, i.e. it sets out the functions provided for users by the system. The second is that of data. An information system (IS) exists only to store and act upon organisations data. By understanding the true nature and structure of data we get to real heart of the system. Data structures are far more constant than processing or functions, which tend to change fairly frequently; therefore its the data view that forms the backbone of SSADM. The final view looks at the effects of time and real world events on the dat a held within the system. Whereas the function and data views are rather ‘snapshot in nature, the events view is dynamic; it is specifically designed to model system behaviour over time. 3.4.2.1Advantages of using SSADM Timelines: Theoretically, SSADM allows one to plan, manage and control a project well. These points are essential to deliver the product on time. Usability: Within SSADM special emphasis is put on the analysis of user needs. Simultaneously, the systems model is developed and a comprehensive demand analysis is carried out. Both are tried to see if they are well suited to each other.6 Respond to changes in the business environment: As in SSADM documentation of the project†²s progress is taken very seriously, issues like business objectives and business needs are considered while the project is being developed. This offers the possibility to tailor the planning of the project to the actual requirements of the business. Effective use of skills: SSADM does not require very special skills and can easily be taught to the staff. Normally, common modelling and diagramming tools are used. Commercial CASE tools are also offered in order to be able to set up SSADM easily. Better quality: SSADM reduces the error rate of IS by defining a certain quality level in the beginning and constantly checking the system. Improvement of productivity: By encouraging on-time delivery, meeting business requirements, ensuring better quality, using human resources effectively as well as trying to avoid bureaucracy, SSADM improves the overall productivity of the specific project and the company. Cuts costs: SSADM separates the logical and the physical systems design. So the system does not have to be implemented again with new hard -or software.7 3.4.2.2 Disadvantages of using SSADM SSADM puts special emphasis on the analysis of the system and its documentation. This causes the danger of over-analysing, which can be very time and cost consuming. Due to various types of description methods, checks of consistence cannot be carried out. Especially with large systems, the outline diagram can become very unclear, because all relevant data flows have to be included. However, large companies carrying out various projects, can profit from the fact that SSADM gives the possibility to reuse certain techniques and tools for other projects. This reduces cost and time spent enormously in the long run. So, the danger of spending too much money on analysis can be compensated by the reuse of the developed systems and experience gained. 3.4.3 UML The unified modelling language defines the industry standard notation and semantics for properly applying that notation for software built using object-oriented (OO) or component based technology. UML2.0 provides common and consistent notation with which to describe (OO) and component software systems. The UML potentially decreases the learning curve for developers because they only need to learn the one modelling language. 3.4.3.1 Advantages of using UML Wide industry acceptance Wide range of tool support Consistent modelling notation 3.4.3.2 Disadvantages of using UML Modelling tools do not fully support it and sometimes get the notation wrong when they do Not yet complete Many developers only understand UML notations, often because most books and modelling tools do not go beyond the UML to address user interface modelling, or even business rules The full notation is overkill for most projects, most efforts only need a small subset of the notation 3.4.5 Using SSADM with UML Complex information systems require a methodology for their development in a structured manner. Many different methodologies exist, each suitable for a particular type of application. In this report we develop a taxonomy covering two different classification features for methodologies targeted at the workflow area. Features identified include concerns, method structure, data gathering means, people involved, notations, adaptability, flexibility, exception, CASE tool. Unified Modelling Language (UML) and Unified Process are relatively strong on hard aspects and weak on soft aspects. Structured Systems Analysis and Design Method (SSADM) is perhaps the most comprehensive but some soft aspects are omitted. The combination of techniques such as UML and Workflow is identified as a way forward. Hypertext Markup Language (HTML) HTML is one of the next generations of Generalised Markup Languages (GMLs). HTML is very easy to use language for web designing. HTML allows web developers to format web page using set of markup tags provided by HTML. HTML can be used within asp.net codes. This can only be made possible by using a asp.net function called asp followed by â€Å"(HTML)†, e.g. â€Å" Hello Word †. HTML is used within asp.net to design the interface to make it easy to navigate through a site. HTML forms static Web sites, but with the use of ASP.net is can be dynamic. 3.4.5.1 ASP.NET ASP stands for Active Server Pages. This is one of Microsofts latest software product. ASP.NET is built upon the .NET Framework. The .NET Framework consists of two main components: the common language runtime (CLR) and the .NET Framework class library. The foundation of the .NET Framework is the CLR. It is like an agent that manages codes at execution time for both Windows and ASP.NET applications. The class library is an object-oriented collection of reusable components. It can be used to develop applications for both Windows and the Web. The .NET Framework is a free download, but the development tools can be expensive. ASP.NET is used by Web developers to create dynamic Web pages. It offers a set of reusable, predefined and ready to use controls. This control saves time as it minimises the amount of codes to be written. 3.4.5.2 Java Script JavaScript is a client side scripting language. It is highly efficient as many tasks are client-side processing. JavaScript is an interpreted programming language with object oriented capabilities. JavaScript can be embedded into the HTML to add functionality. JavaScript is very useful for setting validations on a page to minimize error entry. Microsoft SQL 2000 Microsoft SQL Server 2000 is a full-featured relational database management system (RDBMS) that offers a variety of administrative tools to ease the burdens of database development, maintenance and administration. It has features such as Enterprise Manager, Query Analyzer, SQL Profiler, Service Manager, Data Transformation Services and Books 3.5.0 Primary Research Primary research involves getting original data directly about the product and market. Primary research data is data that did not exist before. It is designed to answer specific questions of interest to the business. Here a questionnaire was chosen to be the method of conducting market research in to online auction website as the primary source. A questionnaire with composed of ten questions were distributed into ten students at different times and days to get maximum answer ratio. See Appendix A Chapter 4 4.0 Fact finding analysis All projects that involve system development must have thorough fact finding or investigation carried out before the specification, design and construction of the application. Its important for the project to be clear about what the system needs to do and this will require obtaining information about a potentially wide range of subjects. 4.0.1 Examining any existing documentation Although there was physical documentation available to examine for existing companies such as e-bay, it was relatively small amounts of electronic journals available at the research web resources such as Mental. 4.0.2 Interviewing Interviewing is the most and common techniques that is used almost in every computing or business project. This is because is an easy way of collecting information face-to-face with the people involved in the old or new system. This process has started from the first day of the project by meeting both my supervisor Mrs Patricia Robertson, for more updates. The process started by drawing some business activity model (for more information please look at the BAM (Business Activity Model). These activities had to be change few several times to meet the systems requirements. Through out the project it was important to interview regular users of the existing systems used by other companies such as e-bay and Amazon for feedbacks and updates. The project had faced some sit back at the beginning due to the fact that the original sole use of SSADM as methodology was not good idea, which made it hard getting the exact system requirement. With the help of some of the SSADM techniques such as the BAM and ER diagram coupled with UML CASE diagrams we managed to reach an over look of the system. Questionnaire As part of the investigation process, questionnaires were prepared and handed out to some randomly selected people from the Westminster harrow Campus ,as they could be the new potential customers , these were filled out on the while they were in the Hall ways and student union centre. Questionnaires generally tend to be an inexpensive method of getting people to provide information. The technique used will be closed questions. This will allow people to write their short answers on a fixed set of options, to avoid people getting bored by long open questions which they have no time for. 4.0.4. Analysis of the questionnaire The questionnaire started with asking potential customers how often they visit Online auction? The group of people questioned consisted 60% of (19-30) years olds, 20% of the age (18) and 20% of the age (31-45), 30% of the participants answered that they visit online auction websites at least once a week 1% answered everyday 40% said they visit once a month and 20% percent said they never visit online auction websites. But perhaps more surprisingly of all questions, participants were undecided 50% yes and 50 % No when asked whether online auctions offer a better deal. There was however good result when participants were asked whether they actually sold or bought from online auctions the result was 60% yes and 40% no. see graph below 4.1.0 Market Positioning Once a potential market segments have being identified and target audience selected, SOS Ltd would need to determine the positioning of its services amongst service industries in the market place. Effective management of marketing communication will enable the companys marketers to position their services in the mind of the customers, its therefore important for the company to position itself along side the Specialist online auction web site: such sites need to build a good reputation for