Ecommerce

BMS 5th Sem

 Intro to Ecommerce
1. Meaning 9. Implementation Issues
2. Features 10. Myths
3. Categories 11. Impact on Business
4. Advantages 12. Ecommerce in India
5. Limitations 13. Trends in Ecommerce
6. Traditional commerce vs 14. Mcommerce
Ecommerce a. Meaning
7. Environmental Factors b. Benefits
c. Trends
8. Growth Factors
Meaning
What is commerce?
Exchange of goods or services for money or in kind, usually on a scale large enough to require transportation from place to place or
across city, state, or national boundaries. Source: businessdictionary.com

What is e?
Electronic – But what is electronic?
Electronic Data Interchange - electronic communication method that provides standards for exchanging data via any electronic
means.

So what is ecommerce?
Commerce done electronically :P
E-commerce (electronic commerce or EC) is the buying and selling of goods and services, or the transmitting of funds or data, over
an electronic network, primarily the internet. Source: http://searchcio.techtarget.com/

Business conducted through the use of computers, telephones, fax machines, barcode readers, credit cards, automated teller
machines (ATM) or other electronic appliances (whether or not using the internet) without the exchange of paper-based
documents. It includes activities such as procurement, order entry, transaction processing, payment, authentication and non-
repudiation, inventory control, order fulfillment, and customer support. When a buyer pays with a bank card swiped through a
magnetic-stripe-reader, he or she is participating in e-commerce. Source: http://www.businessdictionary.com/
Key Highlights
829 million (59 percent of the Indian population) in 2021,
global networking giant Cisco

Ecommerce in India reached $14.5bn in 2016

Cash on delivery is the most preferred payment method,

accumulating 75% of the e-retail activities.

China is the largest market for e-commerce globally,

followed by the US; but it is India that is the fastest-growing
e-commerce market. India ranks third in ecommerce
500mn* as on June 2018 – Lets Read
https://economictimes.indiatimes.com/tech/internet/internet-users-in-india-expected-to-reach-500-million-by-june-iamai/articleshow/63000198.cms
The number of internet users in India is expected to reach 500
million by June 2018, said a report by the Internet and Mobile
Association of India (IAMAI) and Kantar IMRB on Tuesday. The
number of Internet users stood at 481 million in December 2017, an
increase of 11.34% over December 2016 said the report titled,
"Internet in India 2017."

Urban India with an estimated population of 455 million already has

295 million using the internet. Rural India, with an estimated
population of 918 million as per 2011 census, has only 186 million
internet users leaving out potential 732 million users in rural India.

"Given that total Urban Population is much lower than total rural
population, the Urban-Rural Digital divide is actually more acute than
what the penetration numbers portray.The future growth policies
therefore must focus on bridging the digital divide that exists
between urban and rural India today," the report added.

Internet penetration in Urban India was 64.84% in December 2017

as compared to 60.6% last December. In comparison, rural Internet
penetration has grown from 18% last December to 20.26% in
December 2017.

The report also finds that an estimated 281 Million daily Internet
users, out of which 182.9 million or 62% access internet daily in
urban area, as compared to only 98 million users or 53%, in rural
India. There are estimated 143 million Female internet users overall,
which is approximately 30% of Total Internet users. "While Digital
IndiaNSE 0.00 % is paving its way in rural India, the underlining
digital gender gap still persists. Digital literacy is therefore a key to
ensure everyone stays informed, engaged and safe online," it added.
Categories
Business-to-Business (B2B)
Examples: Indiamart, Tradeindia & Tradekey

Business-to-Consumer (B2C)
Do I need to share?

Consumer-to-Consumer (C2C)
OLX & Quikr
What is A2B and A2C? (Assignment)
Consumer-to-Business (C2B)
Blogs, Adsense, Stockphoto (shutterstock & imagesbazaar) and Freelancing (Assignment)

Business-to-Administration (B2A)
Facilitating the government (Assignment)

Consumer-to-Administration (C2A)
Taxes, Voting and Suggestions to government (Assignment)
Advantages
1. Easy access – Just by click
2. No time constraint
3. New markets – Global and deeper reach
4. Easy market entry – Open to all
5. Lesser/Optimum Inventory
6. Low Operational Cost - No store, easy marketing
7. Variety
8. No middleman – Benefits both buyers and sellers
9. Better Customer Service
10. Easy Payment
11. Customisation
12. Secrecy
Limitations
1. Security
2. Lack of skilled personnel
3. Limited to category – Difficult to sell food, jewellery, homes and other large ticket
items which require touch & feel
4. Quality may vary
5. Customer Frauds
6. Investment and maintenance cost of technology
7. Transaction Size
8. Lack of Loyalty
9. Resistance to change – Trust is more on local kirana guy
10. Dependent on technological infrastructure
11. Marketplaces may suffer due to vendors
Session II
Traditional vs Ecommerce
• Meaning
• Accessibility – Limited Time
• Physical inspection – Presence of trial
and inspection possible before
purchase
• Customer Interaction – Face to face
• Geographical Scope - Limited
• Information Exchange – No uniformity,
heavily depends on personal
communication
• Standardisation – Absent
• Payment methods – Limited
• Overhead costs - High
• Meaning
• Accessibility – 24*7
• Absence of physical inspection- No
touch and feel or trial option
• Customer Interaction – Screen to Face
• Geographical Scope – Worldwide Reach
• Information Exchange – Uniform to
everyone as communication happens
with help of electronic technology
• Standardisation – Present
• Payment Methods – Diverse
• Overhead costs – Low
 Environmental Factors

Social & Cultural: Legal & Ethical: Economic Political Technological

Changing Inflation Government Policies Software's and tools

Registration/Licensin
Preferences – Training with each
g
Rate of interest Stability upgrade
Demographics Identity – Trademark
Monetary Policies – Unrest/Political Investment &
& Copyrights
Advertising – Most Demonitisation Crisis Maintenance
important Taxation – Abide
Efficiency is tech
with multiple
driven
geographies
Security & Privacy
Privacy & Security
Arrangements
Policies
Growth Factors
1. Rapid internet penetration leading to emerging markets refer to slide 4

2. Available – Anytime, Anywhere & Anyone

3. Low Operational Costs – Allows to sell at lower prices and give offers and discount coupons

4. Growing use of Plastic Money

5. Digital Revolution – Changing habits & lifestyle

6. Increasing Trust & Reliability

7. Improving Technological Infrastructure

8. Heavy investments from venture funds

9. Enhanced promotion of products & services

10. Information density – Opening up of markets & global competition

Implementation Challenges
• All Limitations
• Cost
• Value
• Security
• Existing Systems
• Resistance To Change
• SLEPT – Draft the answer in different tonality
Myths
1. Setting up business on web is inexpensive
2. Build it, They will come - Launching a website will get customers automatically -
http://www.internetlivestats.com/google-search-statistics/
3. Making money via ecommerce is easy
4. Privacy is not important - one of the most ignored factor by SME’s
5. Having good technology is important than any other part
6. Click & Mortar is same as Brick & Mortar - Same as starting building any other
brick and mortar business
7. Business loop is closed once sales is done
8. Ecommerce is only for retail
9. Low pricing is most important for sale
10. Ecommerce business is just for presence no real contribution to sales
 Important Articles
http://retail.economictimes.indiatimes.com/etanalytics/reports/e-commerce/deloitte-inr-60-000-cr-of-in-store-retail-purchase-
influenced-by-digital/103

http://retail.economictimes.indiatimes.com/etanalytics/reports/e-commerce/the-state-of-e-marketing-in-india-2015/100

http://retail.economictimes.indiatimes.com/etanalytics/reports/e-commerce/online-shopping-behavior-study-2015/338

http://retail.economictimes.indiatimes.com/etanalytics/reports/e-commerce/digital-retail-in-2020-rewriting-the-rules/400

http://retail.economictimes.indiatimes.com/etanalytics/reports/e-commerce/india-internet-primer-champions-of-online-retail/345

http://retail.economictimes.indiatimes.com/etanalytics/reports/e-commerce/a-comparison-between-flipkart-s-second-edition-of-the-
big-billion-days-sale-and-amazon-s-great-indian-festive-sale/237

http://retail.economictimes.indiatimes.com/etanalytics/reports/industry/demystifying-retail-go-digital/402
Impact on Business?
Marketing Finance
• Easier to reach niche • Flexible payment
• PLC is shortened • Multi currency – Even bitcoins
• Effective tracking of online promotion • Greater impact of exchange rate
• Dynamic pricing
• Localisation & Cusomisation
• Long Tail – Selling less of more

Impact

Operations Human Resource

• Software implementation – ERP • Skilled workforce
• Take up complex logistics • Workforce planning - Amazon hire 000's of extra staff during
• Better inventory planning peak periods
• More emphasis on supplier relationship • Automation impacts jobs and workforce requirements
Ecommerce In India

• Refer slide 4++

• Refer Deloitte Report
Trends in Ecommerce
• Social media is taking over – essential to stay connected
• Mobile is the key growth driver
• App is necessary – I don’t agree but textbook mein likha hai :P – Progressive web apps are
future – Read: https://developers.google.com/web/fundamentals/getting-
started/codelabs/your-first-pwapp/
• Watch for progressive app: https://www.youtube.com/watch?v=m-sCdS0sQO8
• Security – Yeh point har answer mein hai :P
• Strengthening of Logistics before massive rural penetration
Retail Sector
1. Low Price
2. No restriction
3. First online then offline – Omnichannel
4. No or Less Middlemen
5. Hyper Mediation**: Re-intermediation – Shifting or transfer of functions – warehousing,
inventory or shipment
6. Size means brand, trust and customer confidence – Fair chance to smaller brands
7. More payment Options
8. Shopping journey is online & offline integrated
9. Friction less shopping – Better UI & faster decision making using coupons/promotional
schemes
10. In-store mobile experience – VR by real estate & Bar Stock Exchange
11. More niche player will emerge
12. Traditional Players are adopting ecommerce leading to heavy investments and M&A
 Banking Sector
1. Digitisation of banking processes
2. Faster Remittances
3. ATMs
4. Telephone/Mobile Banking
5. Home Banking – PC
6. Credit Card
7. Online Loans
8. Internet Banking
9. Digital Wallets -
https://www.youtube.com/watch?v=L0w2EwWkicg&feature=youtu.be
10. RFID Payments - http://www.idfcbank.com/fastag/introduction.html
11. Automated Branches - http://www.thehindu.com/todays-paper/tp-national/tp-
tamilnadu/SBI-launches-fully-automated-branch/article14632365.ece
Tourism Sector
1. Easy booking and cancellations
2. Time Saving – No queues
3. More & better information
4. Customised packages
5. Easy comparison – Trivago
6. 24*7 booking facility
7. More choices – Red bus lets you select seats and gives you vehicle type info
8. One app for all bookings – MMT, Yatra etc
9. E-Visa – Boost to travel economy - https://www.hellotravel.com/stories/india-records-
high-increase-in-foreign-tourist-in-india-on-e-tourism-visa-in-january
10. Any time travel insurance
 Government Sector
1. Easy information
2. Easy booking
3. Online application
4. Tracking of applications
5. Helplines
6. Complaint Filing
7. Digital initiatives:
a. UID
b. BHIM
c. GST App
d. MyGov
http://www.thebetterindia.com/66736/digital-india-government-apps-citizen-services/
 Education Sector
1. Affordable
2. Accessible
3. More information
4. New ways to learn – BYJU’s - mLearning
5. Specialized Micro Learnings
6. Efficient – Involvement of specialised institutes that conduct exams – Pearson
Vue
7. Easy Admission Application
8. Interactive Learning
9. Gamification
10. Lesser Frauds & Cheating
M-Commerce

Mobile commerce, also referred as m-commerce, is the use of wireless handheld devices such
as cellular phones and laptops to conduct commercial transactions online

M-commerce (mobile commerce) is the buying and selling of goods and services through
wireless handheld devices such as cellular telephone and personal digital assistants (PDAs).
Known as next-generation e-commerce, m-commerce enables users to access the Internet
without needing to find a place to plug in.
Types
1. Carreir Based Transaction - https://fortumo.com/direct-
carrier-billing/

2. Credit Card Based Transaction

3. Financial Services Based Transaction – Transfer of money

using wireless technology
Benefits
1. Mobile Banking
2. Mobile Payments – Cards, Wallets and NFC
3. Travel & Tourism
4. Social Networking For Business
5. Mobile Marketing – Newer avenues
6. Online Learning
7. Online Healthcare – Practo, Video Consulting, Netmeds etc
8. Mobile Shopping
9. Mobile Entertainment
10. On Demand Services From Mobile – Swiggy, Urbanclap etc
Problems
1. Screen size
2. Fast evolution of Devices
3. Fragmentation of Devices
4. Bandwidth issues
5. Limited storage
6. Problem of many – Apps, screen sizes, configurations, operating systems and
device types
7. Cross device tracking
8. Additional cost of setup for businesses
9. Heavy infrastructure investment
10. Security concerns – especially open os like android
Trends
1.India’s market for mobile commerce would expand from $2 billion in 2014 to $19 billion by
2019
2.Increasing no. of shoppers - 83% of people owning smartphone shop online
3.90% of people in age group 25-34 shop online
4.Overall, gadgets and electronics was the most popular product category at 60%, followed
distantly by clothing and accessories at 20%. While 66% of men shopped for gadgets
online, only 31% of women did so. On the other hand more women (65%) shopped online
for clothing, accessories and home products as compared to men (27%)
5.Hyperlocal mobile commerce is the future
6.Chat services will improve the overall quality of service delivery
7.4G reaches less than 1% market so the growth potential is tremendous
8.Android has more than 90% share
9. Growth in wearable technology will comes because of mobile which in turn will drive
mcommerce growth
10. Games dominate the mobile content market - Indian mobile gaming industry, currently
estimated at $200 million, is all set to breach the billion-dollar mark to reach $3 billion by 2019
according to a recent study
11. OTT players will redefine media mix – OTT = Over the top
12. Fintech will provide more than just payment options
E-Business & Application
Meaning
Electronic business (e-business) refers to the use of the Web, Internet, intranets, extranets or
some combination thereof to conduct business.
E-business is similar to e-commerce, but it goes beyond the simple buying and selling of
products and services online. E-business includes a much wider range of businesses
processes, such as supply chain management, electronic order processing and customer
relationship management. E-business processes, therefore, can help companies to operate
more effectively and efficiently.
The term e-business was first used by IBM in 1997.

E-business: Automated – Business Process – Network

 E-Business vs E-commerce
1. Ecommerce is limited to buying and selling or exchange of data but e-business much more like running
the entire business using internet

2. Ecommerce is subset of e-business

3. Ecommerce is limited only to money whereas e-business is not

4. E-commerce requires website/app/wap whereas e-business requires website/app/wap+crm+erp

5. e-commerce has an extroverted approach that covers customers, suppliers, distributors, etc. On the
other hand, e-business has an ambivert approach that covers internal as well as external processes

6. E-business example - Using of Internet by Dell, Amazon for maintaing business processes like Online
customer support, email marketing, suplly chain management
Significance of E-business
Additional Points:
https://www.volusion.co
m/blog/e-business-
advantages/
Steps to Launch E-business
1. Choosing/Finding a product to sell or serivce to offer
2. Evaluating the idea
3. Obtain the product
a. Make the product
b. Find a manufacturer
c. Buy in wholesale
d. Dropshipping**
4. Prepare a Business Plan
5. Register the Business
6. Set up the business – Naming, logo, copyrights etc
7. Understand SEO
4. Build the store
5. Setup SEO
6. Prepare for Launch – Ensure everything in place to avoid customer dissatisfaction. Best way
is to test in beta
7. Post Launch – Customer acquisition and marketing

*Not all points above are in order always

Data Warehouse
• Popularly also known as EDW – Enterprise Data Warehouse
• System used for reporting and data analysis and is core component of business intelligence
• It is an information based approach to decision making
• Data is store in multiple systems and represented differently as per the organizational
needs

Refer: http://www.investinganswers.com/financial-dictionary/businesses-corporations/data-
warehousing-5470
Advantages & Types
Advantages:
• Timely and accurate information for decision making
• Analytical reports for applications in different
processes
• Better customer service
• Improved information systems
• Manage and access large data in one cohesive
framework

Types:
• Physical data warehouse – Gathers corporate data
which needs to be converted
• Logical data warehouse – Meta data (data about data)
• Data library – Sub sets
• Decision support system (DSS) – Applications of DW
Refer:
https://www.tutorialspoint.com/dwh/dwh_quick_guide.h
tm
CRM
CRM is a systematic approach that recognizes that customers are the core of a business and the the
company's success depends on effectively managing relationship with them

Benefits:
1. Providing right products and the one that are actually demanded
2. Better customer support
3. Sell more effectively
4. Retain existing customers
5. Identify and get back lost customers
6. Expansion of market

**Lets see sample report

SCM + Objectives
• Reduce inventory cost
• Better inventory planning
• Reduce production cost
• Increased output
• Improve information flow between all
parties directly or indirectly involved in
fulfilling a customer request – enterprise,
supplier, wholesaler and retailer
• Faster delivery – Lesser delay
SCM Example
ERP
Enterprise resource planning (ERP) is a process by which a company (often a manufacturer) manages and integrates the important
parts of its business. An ERP management information system integrates areas such as planning, purchasing, inventory, sales,
marketing, finance and human resources.

Enterprise resource planning (ERP) is an industry term for the broad set of activities that help an organization manage its business.
An important goal of ERP software is to integrate back office business processes and facilitate the flow of information within an
organization so business decisions can be data-driven.

Examples:

1. Tally
2. Sage
Advantage of ERP – Refer: http://www.workwisellc.com/erp-software/15-benefits-implementing-erp-software/
 Disadvantages of ERP
• The cost of ERP Software, planning, customization, configuration, testing, implementation, etc. is too high.

• ERP deployments are highly time-consuming – projects may take 1-3 years (or more) to get completed and fully
functional.

• Too little customization may not integrate the ERP system with the business process & too much customization may slow
down the project and make it difficult to upgrade.

• Returns are not immediately visible - The cost savings/payback may not be realized immediately after the ERP
implementation & it is quite difficult to measure the same.

• The participation of users is very important for successful implementation of ERP projects – hence, exhaustive user
training and simple user interface might be critical. But ERP systems are generally difficult to learn (and use).
 Continued
• There maybe additional indirect costs due to ERP implementation – like new IT infrastructure, upgrading the WAN links,
etc.

• Migration of existing data to the new ERP systems is difficult (or impossible) to achieve. Integrating ERP systems with
other stand alone software systems is equally difficult (if possible). These activities may consume a lot of time, money &
resources, if attempted.

• ERP implementations can be a mammoth task/challenging for especially for large organizations

• Dependency - Once an ERP systems is implemented it becomes a single vendor lock-in for further upgrades,
customizations etc. Companies are at the discretion of a single vendor and may not be able to negotiate effectively for
their services.

• Evaluation prior to implementation of ERP system is critical. If this step is not done properly and experienced
technical/business resources are not available while evaluating, ERP implementations can (and have) become a failure.
 Business Model & Key Elements
http://www.investopedia.com/terms/b/businessmodel.asp

A business model is the way in which a company generates revenue and makes a profit from company
operations. Analysts use the metric gross profit as a way to compare the efficiency and effectiveness of a
firm's business model. Gross profit is calculated by subtracting the cost of goods sold from revenues.
-- Investopedia
Elements:
1) Value Proposition
2) Revenue Model
3) Market Opportunity
4) Competitive Environment
5) Competitive Advantage
6) Market Strategy
7) Organizational Development
8) Management Team.
Types of Business Models
• Brick & Mortar - Traditional
• Pure Online – Complete replica of traditional but online
• Bricks & Clicks – News age – Omnichannel

What are the advantages & limitations of business models above?

How is Bricks & Clicks Superior to Pure Online?

Difference between traditional and e-business?

E-business Applications
1.E-procurement
2.E-communication
3.E-delivery
4.E-auction
5.E-trading
 E-Procurement
E-procurement (electronic procurement, sometimes also known as supplier exchange) is the business-to-
business or business-to-consumer or business-to-government purchase and sale of supplies, work, and services
through the Internet as well as other information and networking systems, such as electronic data interchange
and enterprise resource planning

Advantages: Limitations:

1. Reduced Transaction Time 1. Dependency on technology

2. Access to wider network of suppliers 2. Shift of power to vendor
3. Global operations 3. Technical issues
4. Elimination of paperwork 4. Might complicate instead if simplifying
5. Transparency
6. Better inventory management
7. Reduced cost
8. Increased Productivity
E-communication
E-communication, or electronic communication, refers to the transfer of writing, signals, data, sounds, images, signs or intelligence sent
via an electronic device. Some examples of e-communication are email, text messages, social media messaging and image sharing.

Ways to e-cmmunicate:
1. Telephone
2. Telex
3. Fax
4. Email
5. Vmail
6. Tele text
7. Video text
8. Teleconferencing
9. Video conferencing
10.Social media
11.SMS
Advantages
• Speedy transmission
• Wide coverage
• Low cost
• Exchange of feedback
• Managing global operation

Disadvantages
• Volume of data
• Development cost
• Legal status
• Undelivered data – technical issues
• Dependency
 E-delivery
E-delivery includes electronic delivery of goods and rendering of services. Goods may
be computer software, videos, e-books and other multimedia content and services
include medical, legal etc.

Advantages: Limitations:
1. Cost effective 1. Waiting
2. Time Saving 2. Refunds/Returns
3. Wide Range 3. Shipping rates – T&C
4. Access
E-auction
The electronic auction (eAuction) is an e-business between auctioneers and bidders, which
takes place on an electronic marketplace. It is an electronic commerce which occurs business
to business (B2B), business to consumer (B2C), or consumer-to-consumer (C2C).

Types of Auction:
1.Forward Auction
a. English
b. Dutch
c. Japanese
d. Yankee (Consumer to consumer)

2.Reverse Auction
3.Internet Exchange Auction
Benefits of e-auction Limitations/Risks/Costs
1. Liquidity 1. Delayed Consumption Cost
2. Price Discovery 2. Monitoring Costs
3. Price Transparency 3. Equipment Costs
4. Market Efficiency 4. Trust Risks
5. Lower Transaction Cost 5. Fulfillment Costs
6. Consumer Aggregation
7. Network Effects
 E-trading/OnlineTrading
Electronic trading, sometimes called etrading, is a method of trading securities (such as
stocks, and bonds), foreign exchange or financial derivatives electronically. Information
technology is used to bring together buyers and sellers through an electronic trading
platform and network to create virtual market places. Example – BSE & NSE

Advantages:
1. Cost effective – reduced transaction cost
2. More competition – Globalisation
3. Transparency
4. Wide Range – Greater liquidity
5. Tighter Spread*
Limitations:
1. Tech Dependency – Trade can be lost due to
system failure
2. Website/Server Performance
3. Power cut off – heavy investment in back up
generators
4. First Time Investors might go with the flow and
forget that real money is involved
5. High Brokerage to first timers
6. Learning of tech can be difficult
EDI
• Electronic exchange of business documents in a standard, computer processable,
universally accepted format between trading partners
• Also refers to communicating business information in standardised electronic format
• This standard is defined by ANSI (American Standards Institute)
• Apps on which EDI takes place are known as TPs – Trading Partners – Common
business transactions/documents which are often shared by TPs are:
• Purchase Order
• Sales Order
• Invoice
• Shipping Request
• Acknowledgment
• Business Correspondence Letters
• Financial Information Letters
Components of EDI
• EDI Software
• Communication Networks
• EDI Standards (next slide)
• Trading Partners
Applications of EDI
• International Cross Border Trade
• Electronic Fund Transfer
• Health Care EDI – Insurance
Claims Processing
• Manufacturing & Retail
Procurement
 EDI Standards
Standardized EDI format Below are some of the examples of EDI standard format used by different organizations-

1) UN/EDIFACT standard It is basically used for administration, Commerce and Transport. It is developed under UNITED
NATIONS (UN) in 1987.

1) ANSI ASC X12 It is used by health care, insurance, government and transportation. It is chartered American National
Standards Institute (ANSI) in 1979.

2) GS1 EDI It is used by Supply chain process for carrying out processes like Order, Dispatch Advice (Shipping Notice),
Invoice, Transport Instruction, etc.

3) TRADACOMS It is used by UK retail sector. It contains transaction like Product information file, Price information file, the
customer Information file, the order file and many more operations.

4) HL7 It provides standard format for exchange of information related with retrieval of electronic health information.
 Benefits of EDI
1) Expedite transmission Information is transmitted from one organization to another organization efficiently and
swiftly.
2) Automated Data entry Data is entered automatically by EDI software. For instance, when purchase order (PO) from
one company is received by another company. Sales order (SO) is automatically generated at other company’s
system with the help of EDI software.
3) Receipt verification Receipt verification can easily be done with help of EDI software. No human intervention is
involved so there are minimal chances of error or delay.
4) Data Validation Data validation is automatically done.
5) Availability of free software Free softwares are available depending upon the EDI format chosen. For example- In
TRADACOMS EDI format, Price Information file and order files are available for free.
6) Low cost Lower administrative, resource and maintenance cost.
7) Faster processing With the help of EDI, business processes can be executed at a much faster rate as compared to
the traditional method sending information.
8) Building long-term relationships EDI helps in building long term relationships with trading partners and hence helps
in business growth.
9) Reduction in error EDI has discarded manual data entry and paperwork. So there are minimal chances of error.
 Drawbacks of EDI
1) Expensive Setup and maintenance of some of the formats of EDI is expensive.

2) Initial setup is time consuming.

3) EDI standard changes The business process depends on EDI standard format. If any of the standard format changes then the business
process has to be changed accordingly.

4) System electronic protection An EDI enabled system needs electronic protection from viruses, hacking, malware and other frauds.

5) Staff training cost Staff needs training in order to run EDI enabled software. Investment has to be done in training.

6) Proper backup should be maintained as the whole data depends on EDI. In case of any crash of EDI system, proper backup has to be
maintained and extra cost is required for it.

7) Limit your trading partners Some organization stops doing business which don’t use EDI. For instance, Wal-Mart prefers to do business only
with those organization which uses EDI.
Website
Key Components Contents of Website
• Home Page • Home Page
• Web Page • Company Page
• Link • Product Page
• Banner Ad – Not always required but
needs to be kept in mind for future • Promotions
monetisation • Technical Support
• Customer Testimonial
• Online Ordering
• Response Setup
Advantages of Website
https://www.thisisparachute.com/2014/03/10/top-10-
benefits-of-having-a-website/

Some award winning websites -

https://www.impactbnd.com/blog/18-award-winning-
website-designs
 Types Of Websites
• Information – Wiki & News

• Personal – Celebrity/ Influencer/ Freelancers

• Search Engines - ???

• Company Website - ???

• Social Networking - ???

• Forums – Quora, Answers.com

• Ecommerce Website – Wow this is not in textbook 

Web Page Design – Consideration, Principles & Criteria's

• Purpose
• Location
• Budget
• Scalability
• Security
• Error Prevention
• Recognition & not Recall
• https://shortiedesigns.com/2014/03/10-top-principles-effective-web-design/
• https://design.tutsplus.com/tutorials/9-essential-principles-for-good-web-design--psd-56

• Additional:
• http://joomstore.com.au/blog/the-5-basic-principles-of-web-design.html
• https://99designs.com/blog/tips/web-design-basics-guide/
Lifecycle Approach for Building a Website

Other Reference Links:

https://www.volpc.com/website-design/8-steps-to-website-
development-life-cycle/

https://www.macronimous.com/resources/web-development-
life-cycle.asp

Different ways of building a website:

http://how2buildawebsite.com/how-to-build-a-website/types-
of-a-website/
Payment, Security, Privacy & Legal Issues In
Ecommerce
Privacy & Security Issues In E-business
1. Access Security
2. Transaction Security
3. Contract Information
4. Hacking
5. Tampering
6. Privacy &Confidentiality
7. Cyber Crimes
Electronic Payment Systems
Electronic Payment is a financial exchange that takes place online between buyers
and sellers. The content of this exchange is usually some form of digital financial
instrument (such as encrypted credit card numbers, electronic cheques or digital
cash) that is backed by a bank or an intermediary, or by a legal tender.

The various factors that have lead the financial institutions to make use of
electronic payments are:
Decreasing technology cost
Reduced operational and processing cost
Increasing online commerce
Features of Electronic Payment
1. Freely Accessible
2. Time Saving
3. User Friendly
4. Immediate/Instant
5. Transaction Amount Neutral
6. Transparent
7. Anonymity
8. Privacy
9. Requires Internet
Advantages Disadvantages
• Convenience • Restrictions
• Expenses Control • Risk of Being Hacked
• Reduced Risk • Transfer of money between
• Increased Compliance different payment systems
• Enhanced Security • Lack of Anonymity
• Improved Workflow Efficiencies • Necessity of Internet Access
• Greater visibility into financial
supply chain
• User Friendly
• Dispute Management
Types of EPS
1. Debit Card - http://www.investopedia.com/terms/d/debitcard.asp
2. Credit Card - http://www.investopedia.com/terms/c/creditcard.asp
3. Smart Card
4. E-Cash
5. Electronic Cheques
6. E-wallet
7. Electronic Fund Transfer
Debit Card

Advantages Limitations
• Easy to obtain • No grace period
• Convenient • Check book balancing
• Secured • Instant money means instant
• Readily Accepted risk
• Limit • Fees
• Cannot be used everywhere
Credit Card

Advantages Limitations
• Flexibility • Over Spend
• Accuracy • Interest and Extra charges
• Convenience • Risk of Loss/Theft
• Cheaper • Tracking of Limit
• Add On Benefits • Cases of Fraud
• Withold Payments
Smart Card
• Like credit with integrated circuit
• First produced by Motorola – 1977
• Way more information is stored than credit card or debit card – financial facts, private keys, account
information, health information etc
• Three Classifications:
• Integrated Circuit Microprocessor Cards (Add remove data)
• IC Memory Cards (Can only store data no dynamic changes)
• Optical Memory (Same like IC cards but have large memory)

• Two Types:
• Contact Cards
• Contactless Cards (NFC)
Smart Card

Features Features
• Storage – around 10MB • Can only be accessed via PIN
• Convenience
• Info can’t be removed by tampering –
• Works like mini computer
chip is tamper resistant
• Store & Process information
• Allows to make purchases • Freedom from remembering multiple
• Can encrypt data for secrecy
usernames and passwords
• Secure
• Info can be exchanged without PC or
Internet
• Flexible – Multiple info can be stored
E-cash
• It is token based payment
• Identity of customer is preserved using – Public Key Cryptography, Digital Signatures and
Blind Signatures
• Methods:
• Online form
• Trusted Third Party
• Offline
• Properties:
• Needs monetary value – cash or bank credit
• Suitable for small transactions
• Does not replace paper completely
• Interoperability – Can be used against payment for other digital cash, paper cash and goods & services
• Ability to retrieve information anywhere
• Must be protected from tampering
E-cash

Advantages Features
• Quick • Security
• Convenience • Tax Evasion
• Privacy • Needs internet
• Inexpensive • Tech dependent
• Lesser operational costs
• Simple – No authorisation
required
Electronic Cheques/E-Checks

Advantages Features
• Inexpensive • Instant Withdrawal
• Easy & Simple • Delay in Payment
• Secure • Require Professional Services
• Lesser Costs
E-Wallets
Can have following stored:
• Money
• Personal Info
• Credit/Debit Card Info
• Bank Account Info
Electronic Fund Transfer
• Banking & Financial Payments
• Large scale or wholesale payments (eg bank to bank transfer)
• Small scale or retail payments (eg ATM)
• Home Banking (bill payment)
• Retail Payments
• Credit cards
• Private Label credit cards
• Charge cards
• Online ecommerce payments
• Token based payments
• Ecash
• Echecks
• Smart Cards
• Credit Card Based payments
• Encrypted cards
• Third Party authorization numbers
Payment Gateways
Types:
1. Hosted Payment Gateways – Directed outside
2. Shared Payment Gateways – Payment gateway opens within the site
3. Paypal Inc
4. World Pay – Founded in UK int the year 2000 backed by RBS
5. 2Checkout – American based
6. Money Bookers – Also, known as skrill
7. Cyber Cash – Like a wallet on secure financial network
8. Net Bill – Maintains account for both consumer and merchant
Payment Gateways

Advantages Limitations
• Security • Risk of sensitive info
• Encryption • Technical Problems
• Back up redundancy
• Customer uneasiness because
• Updated Tech of frauds
• Cost Effective
• Feature Rich
• Simple to use
• Rapid Development
Ecommerce Laws – Self Study
Digital Marketing
Definition
Digital marketing (also known as data-driven marketing) is the marketing of products or
services using digital technologies, mainly on the Internet, but also including mobile phones,
display advertising, and any other digital medium.

Digital marketing is a subcategory of marketing that uses digital technology to place and sell
products. Product promotion is done, not only on the internet, but also via Short Message
Service (SMS), Simple Notification Service (SNS), search engine optimization (SEO), electronic
or interactive billboards and other online ads (such as banner ads).

History - The term digital marketing was first used in the 1990s,[8] but digital marketing has
roots in the mid-1980s, when the SoftAd Group, now ChannelNet, developed advertising
campaigns for automobile companies: People sent in reader reply cards found in magazines
and received in return floppy disks that contained multimedia content promoting various cars
and free test drives
Advantages

• http://technians.com/blog/benefits-digital-marketing-over-traditional-
marketing/

• https://www.businesszone.co.uk/community-voice/blogs/robbo75/10-benefits-
of-digital-marketing-v-traditional-marketing
Limitations

• http://www.digitalskillport.com/advantages-and-limitations-of-digital-
marketing.html

• https://www.quora.com/What-are-the-advantages-and-disadvantages-of-Digital-
marketing
Activities in Digital Marketing
1. SEO
2. SEM
3. Content Marketing
4. Influencer Marketing
5. Campaign Marketing
6. Email Marketing
7. Display Advertising
8. Blogs
9. Viral Marketing
10. Podcast
11. Vodcast
Digital Marketing on Social Media Platforms
Definition - What does Social Media Marketing (SMM) mean? Social media marketing (SMM)
refers to techniques that target social networks and applications to spread brand awareness
or promote particular products.

Social media marketing campaigns usually center around:

Establishing a social media presence on major platforms
Creating shareable content and advertorials
Cultivating customer feedback throughout the campaign through surveys and contests

Social media marketing is perceived as a more targeted type of advertising and is therefore
believed to be very effective in creating brand awareness.
Examples of Social Media Platforms
Websites and applications that enable users to create and share content or to participate in social networking.

• FB
• Twitter
• Google+
• Wiki
• Linkedin
• Reddit
• Pinterest
• Instagram
• Snapchat
• Youtube
Advantages of Social Media Marketing

• https://blog.hootsuite.com/social-media-for-business/

• https://www.forbes.com/sites/jaysondemers/2014/08/11/the-top-10-
benefits-of-social-media-marketing/#47ac220e1f80

• https://www.bluefountainmedia.com/blog/advantages-of-social-media-
marketing/
Limitations of Social Media

• http://digitalmarketingphilippines.com/the-pros-and-cons-
of-social-media-marketing-for-business/
Online Advertising
• Online advertising, also called online marketing or Internet advertising or
web advertising, is a form of marketing and advertising which uses the
Internet to deliver promotional marketing messages to consumers.

• It includes email marketing, search engine marketing (SEM), social media

marketing, many types of display advertising (including web banner
advertising), and mobile advertising.
Online Advertising

Advantges Limitations
• Low Cost • Security Concerns
• Measurability • Banners Blindness
• Multiple Formats • Heterogeneous Clients
• Targeting • Ad blocking
• Coverage • Anti targeting tech
• Speed – Goes live fastest • Privacy – Cookies
• Spam
Online Market Research
• Types:
• Online Survey
• Online Observation
• Online Focus Group
• Online Panel - Requanta
Advantages Limitations
• Precision • Internet Access
• International • Low Cooperation due to
• Affordable bombardment of same or over
information
• Reliable
• No Interviewer
• Automation – Real Time
• Audience Representation
• Convenient
• Versatile – Audio, Video, Images
etc makes questionnaire
information rich
Online Market Research Tools
• Keyword
• Competitior Links
• Read Blogs/Industry Reports
• Conduct Surveys
• Study Social Media Presence
• Social Media Listening – Sentiment Analysis
• Use of free tools/Softwares – Unmetric, Comscore, Alexa, Similarweb etc
Online PR - http://www.ironpaper.com/webintel/articles/what-is-online-pr/

Advantages Limitations
• Increased Website Traffic • Accessible – Tech Support
• Contribution to SEO • Very Risky at times
• Increase Brand Awareness • Misinterpretation of
• Helps establish positioning of information
the brand online
• Negative Publicity
• Create thought leadership
• Difficult job overall due to
• Improved Customer nature of massive online reach
Relationship
• Web Analytics
• Web Traffic
• Developments &Strategies of Digital Marketing –
• https://www.avaus.fi/blog/8-hottest-digital-marketing-trends-for-2017/
• https://www.forbes.com/sites/kateharrison/2017/01/09/top-10-trends-that-will-
transform-digital-marketing-in-2017/#6666923e3bf5
• https://www.brandwatch.com/blog/digital-marketing-trends-2017/