I can get on the Internet, tell a retail store that I want to buy a new pair of sneakers, and the store knows what color I like when I get there. Yes, and you can create this kind of personalized shopping experience for your customers with the Microsoft Merchant System. This new component of Microsoft's BackOffice, scheduled to be available in the fourth quarter of 1996, is one of the Normandy suite of servers and will make Internet shopping feasible.
Microsoft Merchant System lets retailers set up a complete store on the Internet to sell anything. The system can even host an electronic mall where customers can visit and use their credit cards to buy from many retailers.
Customers can use any Web browser that supports Secure Sockets Layer (SSL) or Secure Electronic Transactions (SETs), such as Netscape Navigator or Microsoft Internet Explorer (IE--for information about SSL and SET, see the sidebar, "Securing Commerce on the Web.") to come into the store, either from the Internet or an intranet. Merchant System lets you customize each customer's shopping experience to suit individual tastes. So when a customer accesses your store, you can have Merchant System build a customer profile to determine buying patterns and other interests.
Imagine the experience from a customer's point of view: You visit an online store, and Merchant System greets you with information about sale items you're interested in. The system knows about your preferences and spending habits--it even knows your shoe size! This personal service makes you want to visit that store again.
Setting Up Your Store
Merchant System lets you, the merchant, install and configure a store without complicated or costly custom application development. The system runs on Windows NT Server 3.51 or later and uses Internet Information Server (IIS) 1.0 or later. Your customers see your store as a series of standard Hypertext Markup Language (HTML) pages that they can access from an SSL- or SET-capable Web browser to purchase goods and services. With text, images, video, and audio, you can create a rich shopping experience for your customers. You can also add ActiveX and Java components to your Merchant System page to further enhance the shopping experience. Merchant System includes sample starter stores to help you go on line quickly.
Customers can see and purchase merchandise from any Open Database Connectivity (ODBC) datasource, such as a SQL Server, Sybase, or Oracle database. The database maintains all product, pricing, shipping, tax, and customer information. Merchant System generates Web pages dynamically to give the shopper a customized experience. The system is both database- and table schema-independent. This design lets you use an existing database, one of Microsoft's sample databases, or a new database that meets your needs. You can even leverage your existing systems by accessing information from a legacy database. For example, by using SNA Server and an ODBC driver, you can access existing product and price information from an AS/400. Figure 1 shows a typical Merchant System configuration.
Merchant System can link to your existing financial management system. If you run on a SQL Server or other ODBC-compliant database, you can easily access the financial data. If your financial system is on a legacy system, you may need some translation software, such as a DLL, to access this information.
You can set up Merchant System to use two databases--one for your store information and one for your financial management information. However, if your financial management database contains most of the information in your store database, you can add any missing store information to the financial information and use one integrated database to eliminate any overlapping information.
Let's look at a typical shopping experience and what happens behind the scenes. Mary uses her favorite SSL- or SET-compatibleWeb browser to access an online sporting goods store. The catchy opening screen shows a video clip of a runner winning a marathon underneath a sale banner that alerts Mary to a sale on running shoes. Mary clicks the sale information, and Merchant System accesses information in a SQL database to generate a Web page that shows Mary the sale shoe's information and price.
Because, in a previous visit to the store, Mary showed an interest in running apparel, Merchant System finds this information in her customer profile and displays running shorts. Mary also sees that if she purchases both items, she can get a 20% discount. The system dynamically generates the promotion and sale information for the customer from the database. Mary decides to purchase the two items and places them in an electronic shopping basket that holds her purchases until she is ready to check out. She clicks back on the home page to look for a runner's watch, but notices that she is late for a meeting and leaves the store.
The next day, Mary comes back to the store. The items she put in her shopping basket are still there. Merchant System sees the items in her shopping basket, checks her customer profile, and asks whether she is interested in purchasing the runner's socks that are on special for one day only. Mary looks at and buys a few pairs of socks.
Now she decides to check out and gets a prompt for payment method, shipping method, and shipping address. She picks a shipping company to deliver the items overnight and enters her credit card information and shipping address. The system then calculates her purchase total. Because Mary lives in London and the store is in New York, the system calculates the purchase price in pounds sterling, adds value-added taxes (VAT) if needed, and calculates shipping costs. Mary sees the system's calculations and information and confirms the accuracy of the information by clicking Purchase Now.
Merchant System uses VeriFone's point-of-sale (vPOS) software to send Mary's credit card information to the merchant's financial institution for authorization. The financial institution authorizes payment, and the merchant shows Mary a confirmation receipt and tracking number. Merchant System then updates the sporting goods store's inventory and customer information, based on Mary's recent purchase.
Personalizing the Experience
As you can see from Mary's experience, a key piece of managing your store is giving your customers, especially frequent visitors, a reason to return to your site. In addition to considering special product promotions and sales, you can update your Web page content often.
Merchant System makes the process of updating your pages easy. You can modify your Web pages with any standard Web page development utility, including Microsoft's FrontPage, Adobe's PageMill, SoftQuad's HoTMetaL, Sausage Software's HotDog, and good old Windows Notepad.
One caveat applies to creating Web pages for use with Merchant System: After you create or modify your pages with a development tool, you need to edit them in Notepad or some other text editor to develop the HTML code to implement your database queries and tags. The sample stores and pages that Microsoft provides with Merchant System can help guide you through this process.
Besides letting you create a unique shopping experience for your customers, Merchant System can also take over the management and administration of your store. The Merchant Utilities, which you access through a standard Web browser, let you create and maintain one or more stores. The Utilities include a set of starter stores; HTML templates to develop the look of your store or stores; and product, order, shopper, and promotion management tools.
The HTML templates let you show your customers product pages and order forms and give customers querying capabilities. To add a promotional item for frequent buyers or to add a product, simply point and click a few times in your browser, and you're finished. You don't need a staff of database experts or programmers to set up these features.
One of the first questions any Internet shopper asks is, "How can you guarantee that my credit card information is secure?" Merchant System uses secure transactions to ensure credit card confidentiality. The system supports SSL and will support SET when the computer banking industry finalizes the SET specification later this year.
At present, Merchant System accepts only credit card payments; however, it will accept purchase orders and other payment methods in the future (Microsoft has not set a timetable for these payment alternatives). In addition, a new feature, Microsoft Wallet, is integrated in Merchant System. The Wallet will hold virtual credit cards, shipping and billing information, personal credentials, and digital signature (SET) information.
To take advantage of the Wallet features, users will need to use a Wallet-enabled browser. All transactions between the Wallet-enabled browser and Merchant System will be encrypted, so the customer won't need to send credit card information during a purchase. Each customer will have an encrypted certificate that contains credit information. Merchant System will send this information to the financial institution--the merchant's store will never see it.
Ready, Set, Sell
IS managers can prepare to implement Merchant System by learning about NT Server and IIS. All the good, common-sense practices of Internet access and Web publishing also apply to Merchant System. These practices include implementing security measures such as firewalls and proxy servers.
If you have a Web site today, you can extend your knowledge to easily add Merchant System. IS managers will need to work with their database administrators to understand what information they need to retrieve, how best to present it to a customer, and how to integrate the database with Merchant System.
The system's sample databases, table schema, and queries can facilitate this process. For example, you can use the sample queries to understand how to extract information from an existing database and to see how the table schema is set up. You can see what information Merchant System expects to insert into a database and how it retrieves information.
Because Merchant System uses any existing table schema or ODBC-compliant database, you probably won't need to heavily modify your existing database information. Reviewing the existing database information now will facilitate Merchant's deployment later. Financial systems and databases that aren't OBDC-compliant will need some cleanup and some translation software to prepare them for use with Merchant.
Merchant System follows Microsoft's strategy of helping companies build business systems easily, at a reasonable cost, without requiring a lot of customization. Merchant System uses the third-generation, UNIX-based eShop product that Microsoft purchased and translated to run on NT. The market for online shopping applications is very new, and only a few companies have competing products. For example, Open Market's products require extensive customization and don't support NT; Netscape's Merchant System platform also does not support NT. You can find other solutions that target companies that provide electronic malls, but they are highly customized and very expensive.
Microsoft Merchant System pricing has not been set but will be comparable to other BackOffice products. Merchant System is scheduled to be available by the time you read this.
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Price: Not determined yet