E - COMMERCE

OBJECTIVES

“A modern business methodology

... to cut costs while improving the
quality of goods and services and
increasing the speed of service
delivery.”
END OF THIS SESSION STUDENT
WILL KNOW
(STUDENT’S OUTCOME)
• Studying e-commerce – Students learn to create a
better on line business presence.
• When we really graps the basics of the booming e
commerce market we are able to create fantastic
websites for our business or products. Getting the
basics under our belt also frees us from having to
rely on share platforms where the competition can
be huge. Don't rely on others learn for yourself.
WHY WE STUDY E-Commerce ?

• E-commerce technology is different and

more powerful than any of the other
technologies that we have seen in the past
century.
• E-commerce has challenged much
traditional business thinking
• E-commerce has a number of unique
features that help explain why we have so
much interest in e-commerce
 What is E-Commerce ?
• Electronic commerce, commonly known as e-commerce, is
the buying and selling of product or service over electronic
systems such as the Internet and other computer networks.
Electronic commerce draws on such technologies as
electronic Funds transfer, Supply chain Management,
Internet Marketing, Online transaction processing,
Electronic data interchange, (EDI), inventory management,
and automated data collection systems.
• Modern electronic commerce typically uses the World
Wide Web at least at one point in the transaction's life-
cycle, although it may encompass a wider range of
technologies such as e-mail, Mobile devices and
telephones as well.
 SEVEN UNIQUE FEATURES OF E-
COMMERCE TECHNOLOGY AND
THEIR SIGNIFICANCE

• Is ubiquitous (available everywhere, all the time)

• Offers global reach (across cultural/national boundaries)
• Operates according to universal standards (lowers market
entry for merchants and search costs for consumers)
• Provides information richness (more powerful selling
environment)
• Is interactive (can simulate face-to-face experience, but on
a global scale)
• Increases information density (amount and quality of
information available to all market participants)
• Permits personalization/customization
 History of E-commerce
• EC applications first developed in the early
1970s
- Electronic funds transfer (EFT)

• Limited to:
- Large corporations
- Financial institutions
- A few other daring businesses
 History of E-commerce

• Electronic data interchange (EDI)—electronic

transfer of documents:
- Purchase orders
- Invoices
- E-payments between firms doing business

• Enlarged pool of participants to include:

- Manufacturers
- Retailers
- Service providers
 TYPES OF E-COMMERCE

Classified by nature of market relationship

• Business-to-Consumer (B2C)
• Business-to-Business (B2B)
• Consumer-to-Consumer (C2C)

Classified by type of technology used

• Peer-to-Peer (P2P)
• Mobile commerce (M-commerce)
 Distinct Categories of E-Commerce
• Business to Business (B2B) refers to the full spectrum of e-
commerce that can occur between two organizations.
This includes purchasing and procurement, supplier
management, inventory management, channel management,
sales activities, payment management &service and support.
Examples: FreeMarkets, Dell and General Electric

• Business to Consumer (B2C) refers to exchanges between

business and consumers, activities tracked are consumer search,
frequently asked questions and service and support.
Examples: Amazon, Yahoo and Charles Schwab & Co
 Distinct Categories of E-Commerce
(cont’d)
• Peer to Peer (C2C) exchanges involve transactions
between and among consumers. These can include
third party involvement, as in the case of the auction
website Ebay.
Examples: Owners.com, Craiglist, Monster

• Consumer to Business (C2B) involves when

consumers band together to present themselves as a
buyer in group.
Example: www.planetfeedback.com
 Convergence of e-Commerce Categories
Business originating from…
Business Consumers
Publishers order Consumers search
paper supplies from out sellers, offers
Business

paper companies and initiate

purchases from
Amazon
Amazon orders
And Selling to…

from publishers
Consumers

Consumers buy
Consumers resell
thousands of Harry
copies on eBay
Potter books from
Amazon
 E-Commerce Mechanisms
• Transformation of economic activity into digital
media
- Exchange information, content, agreements, and services
among parties that are connected to through the
Internet.
• Enables new ways of creating, delivering and
capturing value to customers.
- Availability
- Convenience
 E-commerce Today
• The Internet is the perfect vehicle for e-commerce
because of its open standards and structure.
• No other methodology or technology has proven
to work as well as the Internet for distributing
information and bringing people together.
• It’s cheap and relatively easy to use it as a medium
for connecting customers, suppliers, and
employees of a firm.
• No other mechanism has been created that allow
organizations to reach out to anyone and everyone
like the Internet.
 E-commerce Today
• The Internet allows big businesses to act like small ones
and small businesses to act big.
• The challenge to businesses is to make transactions not just
cheaper and easier for themselves but also easier and more
convenient for customers and suppliers.
• It’s more than just posting a nice looking Web site with
lots of cute animations and expecting customers and
suppliers to figure it out
• Web-based solutions must be easier to use and more
convenient than traditional methods if a company hopes to
attract and keep customers.
 What is a web-based business
• Business that uses the WWW to fulfill it’s
business process
• Four basic business processes:
- information dissemination
- data capture
- promotions and marketing
- transacting with stakeholders
• Business objectives interact with web based
applications
 Key Drivers of E-commerce
• Technological – degree of advancement of
telecommunications infrastructure
• Political – role of government, creating
legislation, funding and support
• Social – IT skills, education and training of
users
• Economic – general wealth and commercial
health of the nation
Benefits and Challenges of E-commerce
Benefits Challenges

•Persistent connection with Cannibalization

customers
•New value for customers Channel conflict
•Access to new customers
•Scalability Customer confusion

Investor confusion
 E-commerce vs. E-business
• E-commerce is about doing business
electronically
• E-commerce conducting financial
transactions electronically
• E-business is conducting business on the
Internet
• E-business is the transformation of business
processes through the Internet
 Conclusion
• "E-commerce is an evolution"
- By using electronic technology through the internet, it
achieved
* More competitions, more marketplaces, faster
transactions, and more advanced technologies
to make activities between customers and producers
more active.
* We as customers and internet users are responsible to
keep our e-commerce healthy and safe so
that e-business can be more reliable in the future
 Fill in the blanks with words or set
of words.
• (i) A basic activity involving trading or buying and selling of goods is
__.
• (ii) The commercial transactions and business functions carried out on
mobile devices are called ___.
• (iii) EDI stands for ___.
• (iv) HTTP stands for ____.
• (v) eBay is the website for ___ type of E-commerce.
• (vi) E-commerce is more suitable for ___ category of E-commerce.
• (vii) Amazon.com is the example for ___ category of E-commerce.
• (viii) Two pillars supporting E-commerce are ____ and ___.
• (ix) CGI stands for ___.
• (x) SEPP stands for ____.
 Questions
1) How can you take credit cards payments across the net?
2) How should merchants promote their ecommerce sites?
3) What are the key things to turn browsers into buyers?
4) What one thing can impress buyers?
5) Describe the complete life cycle for the development of on-line E-
commerce system using any of the existing E-commerce systems.
6) Explain in belief the different types of E-Commerce from the
perspective of the buyer and seller relationship by giving suitable
example for each.
7) List the advantages of E-commerce. Also mention the disadvantages
8) Write short notes on
(a) Smart cards
(b) Digital or Electronic cash
(c) Electronic wallet
(d) Electronic cheques
(e) Digital copyrights
 References
1. Electronic commerce the new business
platform for the internet by Debra
Cameron
2. Designing Systems for Internet Commerce
by G. Winfield Treese, Lawrence C.
Stewart.