DESIGN AND IMPLEMENTATION OF AN ONLINE AUCTION SYSTEM

DESIGN AND IMPLEMENTATION OF AN ONLINE AUCTION SYSTEM

Background of Study

Electronic commerce, also known as e-commerce, has developed rapidly in recent years. More and more and more consumers prefer to shop online for convenience and other benefits. E-commerce and auctions are also attracting attention. Many internet companies like eBay and Yahoo have launched their own auction platforms (Lin, Chang, Chang, & Zheng, 2020).Consumer to consumer (C2C) is a business model whereby customers can trade with each other. The consumer to consumer auction is usually an online environment where one customer purchases good from another customer using a third-party platform to facilitate the auction process. The global reach of online auction market allows for the buyers and sellers to overcome geographical constraints and purchase products anytime from anywhere over the internet (Ghose, Smith, & and Telang, 2006). Online auction systems provide a more convenient platform for purchasing products than a traditional market (Shil, Mouhoub, & Sadaoui, 2013). It provides the consumers with great advantages of low prices, greater product selection and greater efficiency compared to the usual traditional offline markets. The reputation of C2C auctions may be attributed to the simplicity in price negotiations - certainly considered the most frustrating part of the interaction between buyers and sellers (Jin & Andrew, 2006).It provides a flexible price point for products unlike the traditional online stores or physical stores. The functional and operational characteristics of the C2C online auctions are different from those of other e-commerce companies. Unlike other e-commerce sites, C2C auction houses like eBay and Amazon operate as designated third parties (Rauniar, Rawski, Crumbly, & Simms, 2009).They serve as the middleman creating a virtual platform to connect auction users (sellers and buyers).

 

1.2 Statement of Problem

The problem which usually arises in the traditional method of auctioning is that the participants would have to leave their various homes to auctions, this cannot be easy at times and also there are risks involves, for example, a participant may be a victim of a targeted armed robbery attack after bidding . Another issue is the amount of preparation needed before each auction, combined with the high cost of setting up the auction, which made the traditional method efficient for only for the auction of expensive items (Theodoropoulos, 2000). With internet, most of these issues have been resolved but there are still a few issues with the existing online auction systems. The major problem with online auctions is inability of buyers to properly and physically evaluate the product quality as the whole process happens over the internet, this greatly affects a buyer’s choice when it comes to partaking in online auctions (Melnik, 2005). These problems discourages users from participating in online auctions and hurts the online auction industry. Angelika Dimoka and Paul Pavlou (2008) proposed that these product uncertainty problems can be mitigated by a set of product information signals, mechanisms used by sellers to disclose product information. In their study, they proposed that buyers can tackle product uncertainty with a set of product information signals: (1) online product descriptions (text, pictures, multimedia); (2) third-party product certifications (inspection, history report, warranty); (3) posted prices (reserve, starting, buy-it-now); and (4) intrinsic product characteristics (book value and usage).

 

1.3 Aim and Objective of Study

This research is aimed at implementing a secure C2C auction platform using web technologies to tackle product uncertainty in online auctions. The objectives are:

1. Develop a user-friendly secure web application.
2. Create a database where user and product information is stored
3. Compute the seller rating using feedback scores from buyers (bid winners)
4. Implement the product information signal in the system

 

1.4 Overview of Methodology

Any new system that needs to be developed is required to follow a planned development methodology. Software Development Life Cycle (SDLC) provides a systematic methodology comprising of technologies and methods with the aim to develop high quality software systems (Roebuck, 2011). The system requirement gathering of the auction system was carried out by studying Kumar Mishra’s (2010) research on eBay. After conducting the research, the following are the key requirements identified:

i.A welcome/landing page

ii.Registration/Authentication

iii.Search/Browse functionality

iv.Posting/Deleting/Editing of listings by users

v.Placing bids on listings

Based on the requirements above, this study proposes an online auction system in which usage comprises of four key activities - registration, browse, post listings and place bids. All users must be registered to be eligible for participation in any auction. Another added functionality of the online auction system is the seller rating score. Using eBay as a case study, the seller rating is a metric determined through feedback from buyers and it will be used to evaluate the seller trustworthiness.

1.5 Research Scope

This online auction system is being developed specifically for the auctions of used computers by individuals and also by organizations.

1.6 Significance of Study

There are online auction systems in which the full product description (using the product information signals) are not available to buyers and this increases the product and seller uncertainty (Dimoka & Pavlou, 2008). This new system is trying to improve the buyer’s certainty on the product and the seller they choose to bid on, with the aid of the four important product information signals (text, visual, necessary certifications, book value and usage). The successful implementation of this project results in an auction site which allows for far more effective product evaluations that are comparable to or equal to physical product evaluations.

1.7 Definition of Terms

Consumer-to-Consumer: This is a business strategy in which two individuals or consumers engage or do business directly with each other.

Online Auction: An online auction is a service in which users or participants sell or bid for products over the internet.

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