Ist lecture

Electronic Commerce (E-Commerce)

Commerce refers to all the activities the purchase and sales of goods or services. Marketing, sales, payment, fulfillment, customer

service

Electronic commerce is doing commerce with the use of computers, networks and commerce-enabled software (more than just online shopping)

Introduction to E-Commerce

Definition Business activities conducted using

electronic data transmission over the world wide web.

Electronic commerce is the sale and procurement of supplies and services using information system technology.

Introduction to E-Commerce

Definition (Business Prospective) Electronic commerce is the application

of the technology towards the automation of business transaction.

Introduction to E-Commerce

Definition (Service Prospective ) Electronic commerce is a tool that

addresses the desire of firms, consumers, and management to improve the quality of goods and to increase the speed of delivery.

Introduction to E-Commerce

Definition (Communication Prospective ) Electronic commerce is the delivery of

information, products/services, or payments via computer network.

Introduction to E-Commerce

Definition (Web Prospective) Electronic commerce provides the

capability of buying and selling products and information by connecting with the World Wide Web.

E-Business vs E-Commerce

Electronic business transactions involving money are "eCommerce" activities. However, there is much more to e-Business than selling products: what about marketing, procurement and customer education? Even to sell on-line successfully, much more is required than merely having a website that accepts credit cards.

E-Commerce is the subset of E-Business Those activities which essentially involve

monetary transactions are termed as "e-commerce". However, e-business is a much broader term.

There are many other things besides selling including but not limited to marketing, procurement of raw materials or goods, customer education, looking for suppliers etc.

To sell online is e-commerce but to bring and retain customers and educate them online about the product or service is e-business.

When Dell sell computers, laptops, monitors, printers, accessories etc online then it is not engaged in e-commerce but e-business. Let me tell you how. When a visitor comes on the website, the first thing he see is website design and navigation as well as those things which are going to help him find what he is looking for and if he directly lands on the page he was looking for, he looks for the information related to it. The information provided should be appealing and clear maximum doubts of the visitor so as to convert him in a client. Till now no money has been exchanged nor been talked about. So, was this e-commerce? No, it is e-business which guides the visitor.

E-commerce has also been defined as a process covering outward processes that touch customers, suppliers and external partners while e-business covers internal processes such as production, inventory management, product development, risk management, finance etc.

In all, e-commerce can be described as the use of the Internet and the web to transact business.

More formally, digitally enabled commercial transactions between and among organizations and individuals. On the other hand, e-business can be described as

the digital enablement of transactions and process within a firm, involving information systems under the control of the firm. Moreover, e-business applications turn into e-commerce precisely when an exchange of value occurs.

Advantages of Electronic Commerce

Increased sales Reach narrow market segments in

geographically dispersed locations Create virtual communities

Decreased costs Handling of sales inquiries Providing price quotes Determining product availability

Benefits to Organization

Expand the markets Economy of scale Economy of scope

Decreases the cost advertisement Specialized business Reduce the time – outlay of capital and the receipt of products and services Improved

Image Customer service New business partners

Offer product comparison Use customer database Have an eye on competitors Competitive edge of using technology

customers

24/7 More choice to the customers Purchase directly Quick delivery Relevant and detail information's Virtual auctions Interact with other customers Services and feedback

society

Work at home and less to travel Delivery of public services

Health Education Governmental services

Increases social intractability – virtual communities Saving of non-renewal resources Jobs for IT literates Cross cultural interactions

Disadvantages of Electronic Commerce

Loss of ability to inspect products from remote locations

Rapid developing pace of underlying technologies

Difficult to calculate return on investment Cultural and legal impediments

Disadvantages of Electronic Commerce

Some products are unsuitable for electronic commerce.

Return-on-investment is difficult to apply to electronic commerce.

Businesses face cultural and legal obstacles to conducting electronic commerce.

International Electronic Commerce

About 60 percent of all electronic commerce sites are in English, therefore many language barriers need to be overcome.

The political structures of the world present some challenges.

Legal, tax, and privacy are concerns of international electronic commerce.

Standards – security system Payment system Insufficient bandwidth Rapid changes in s/w development Integration of EC and internet software Cost and justification Lack of trust of users Ethics Not enough support services Could result in a human breakdown expensive

Pure versus Partial EC

EC can take several forms depending on the degree of digitization

1. the product (service) sold 2. the process (e.g., ordering, payment,

fulfillment) 3. the delivery method