and password are entered these are then collected and used for removing money from the
recipient’s real account. Such scams are a modern version of the scam devised by criminals
where they install a false ATM in a wall with a card reader to access someone’s account
details. This form of scam is difficult to counter since the e-mail and web site can be made
to appear identical to those of the organisation through copying. The main countermea-
sure is education of users, so banks for instance will tell their customers that they would
never send this form of e-mail. However, this will not eradicate the problem since with
millions of online customers some will always respond to such scams. A further approach
is the use of multiple passwords, such that when an account is first accessed from a new
system an additional password is required which can only be obtained through mail or by
phone. Of course, this will only work if identity theft hasn’t occurred. So, for organisations
subject to phishing attacks, options for e-mail marketing are limited.The economic prosperity and competitive environment in different countries will deter-
mine the e-commerce potential of each. Managers developing e-commerce strategies will
target the countries that are most developed in the use of the technology. Knowledge of
different economic conditions is also part of budgeting for revenue from different coun-
tries. For example, Fisher (2000) noted that the Asian market for e-commerce is
predicted to triple within three years. However, within this marketplace there are large
variations. Relative to income, the cost of a PC is still high in many parts of Asia for
people on low incomes. In China there is regulation on foreign ownership of Internet
portals and ISPs which could hamper development. User access to certain content is also
restricted. Despite this, access in China is doubling every 6 months and at this rate
China could have the largest user base within 10 years!
The trend to globalisation can arguably insulate a company to some extent from fluc-
tuations in regional markets, but is of course no protection from a global recession.
Managers can also study e-commerce in leading countries to help predict future e-com-
merce trends in their own country.
In Chapter 2 we saw that there is wide variation in the level of use of the Internet in
different continents and countries, particularly for consumer use. According to Roussel
(2000), economic, regulatory and cultural issues are among the factors affecting use of
the Internet for commercial transactions. The relative importance of these means e-com-
merce will develop differently in every country. Roussel (2000) rated different countries
according to their readiness to use the Internet for business (Figure 3.12). This was based
on two factors – propensity for e-commerce and Internet penetration. To calculate the
propensity of a country for e-commerce transactions, the business environment was
evaluated using the Economic Intelligence Unit (www.eiu.com) rating of countries
according to 70 different indicators, such as the strength of the economy, political stabil-
ity, the regulatory climate, taxation policies and openness to trade and investment.
Cultural factors were also considered, including language and the attitude to online pur-
chasing as opposed to browsing. The two graphed factors do not correspond in all
countries, for example, Scandinavian users frequently use the Internet to gain informa-
tion, helped by widespread English usage, but they are less keen to purchase online due
to concerns about security. Internet penetration varies widely and is surprisingly low in
some countries, for example in France, which was earlier a leader in e-commerce
through its Minitel system, and in Japan.CHAPTER 3· THE INTERNET MACRO-ENVIRONMENT
Economic factors