NARESH SUKHANI

WHAT IS E-COMMERCE?

• E-commerce consists of the

buying and selling of
products or services over
electronic systems such as
the Internet and other
computer networks.

• Electronic commerce
commonly known as e-
commerce or Ecommerce
WHAT IS E-COMMERCE?
 FEW FACTS
•Michael Aldrich (22 August 1941 – 19 May 2014)
was an English inventor, innovator and entrepreneur.
In 1979 he invented online shopping to enable online
transaction processing between consumers and
businesses, or between one business and another, a
technique known later as e-commerce.
•1982 – Boston Computer Exchange launches. When
Boston Computer Exchange launched in 1982, it was
the world's first ecommerce company. Its primary
function was to serve as an online market for people
interested in selling their used computers.
 FEW FACTS
•Amazon - 1994 - Jeff Bezos
• one of the first American ecommerce companies to sell products over the Internet.

•K.Vaitheeswaran India's first e-commerce website

Fabmart.com 1999
•Mukesh Bansal - Myntra, (February 2007)

•Sachin Bansal & Binny Bansal - flipkart (2007 )

•Snap deal - The company was started by Kunal

Bahl and Rohit Bansal in February 2010
 FEW FACTS
•eBay -3 September 1995, San Jose, California,
United States.
•OLX was founded in 2006 by Fabrice Grinda
(“Grinda”), Alec Oxenford (“Oxenford”), and Jordi
Castello (“Castello”). The founders sought to
establish an online platform through which general
consumers are able to sell unwanted items at no cost
to themselves.
•Zomato is an Indian restaurant aggregator and food
delivery start up founded by Deepinder Goyal in
2008
 FEW FACTS
•Founded in 2014, Swiggy is based out of Bengaluru,
India, by Nandan Reddy; Sriharsha Majety; Rahul
Jaimini.

•Ola - Bhavish Aggarwal, 3 December 2010,

Bangalore

•Uber - Garrett Camp, March 2009, San Francisco,

California, United States
 History of E-Commerce
• The growth and acceptance of credit cards,
automated teller machines (ATM) and
telephone banking in the 1980s were also
forms of electronic commerce.
• Another form of E-Commerce was the airline
reservation system.
• By the end of 2000, many European and American business companies
offered their services through the World Wide Web.
• Since then people began to associate a word “E-Commerce" with the
ability of purchasing various goods through the Internet using secure
protocols and electronic payment services
Types of ecommerce

 Business to business (B2B)

 Business to consumer (B2C)
 Business to government (B2G)
 Consumer to business (C2B)
 Consumer to consumer (C2C)
 Consumer to government (C2G)
 Government to business (G2B)
 Government to consumer (G2C)
 government to government (G2G)
•Transactions conducted between businesses on
the Web, often called business-to-business (or
B2B) example Alibaba, Grainger.com etc.
•Consumer shopping on the Web, often called
business-to-consumer (or B2C) example
Walmart.com, Amazon etc.
•Business houses providing services to
Government comes under B2G category
example online Tender submission for
Government Projects by the Companies
•In C2B model customers gives valuable
suggestions, feedback, views to the companies
which help them in launching a product or in
making improvements in existing Products and
Services.
•B2B model is helpful in supporting internal
working of the organisation example – Intranet
or Extranet.
•Transactions conducted between Customers on
the Web often called C2C example e-Bay, OLX
• Electronic commerce was identified as the facilitation of commercial
transactions electronically, using technology such as Electronic Data
Interchange (EDI) and Electronic Funds Transfer (EFT).

• What is EDI?

• What is EFT?
 Electronic Data Interchange:
Electronic Funds Transfer:
• EDI is the structured transmission of data
between organizations by electronic means.
It is used to transfer electronic documents or
business data from one computer system to
another computer system.

• EFT is the electronic exchange or transfer of

money from one account to another.
Meaning
• Electronic Data Interchange (EDI) refers to the structured
transmission of data between organizations by electronic
means.
• A way to exchange transcripts (and other important data)
without paper.
• The National Institute of Standards and Technology in a 1996
publication defines Electronic Data Interchange as "the
computer-to-computer interchange of strictly formatted
messages that represent documents other than monetary
instruments.
• EDI can be transmitted using any methodology agreed to by
the sender and recipient. This includes a variety of
technologies, including modem (asynchronous, and
bisynchronous), FTP, Email, HTTP, AS1, AS2, etc
Working of EDI

1. Exchange of data with several trading partners

directly in a standard format.

2. Interaction with multiple companies through a

central information clearing house. Here each
companies add EDI program to its computer to
translate the company data into standard formats for
transmission, and for reverse translation in the data.
Working of EDI cont…
Supplier
One to Many

Manufacture Supplier

Supplier

One to Many

Manufacture Supplier

Manufacture Third Party Supplier

Vendor

Manufacture Supplier
 EDI Business Cycle
Vendors

Company XYZ
Customers

Branch
Notes, Documents, Office
Images, Letters, Purchase
Orders, Invoice, Queries, EDI Service
Order Entry, Shipment
Distributors
Details, Payment Orders,
Network
Bankers Advice,
Miscellaneous claims. Stores

Banks
Computer
with EDI
software Transporters
 Processing of EDI message

External User External User

Interface Interface

Application Application

Translation Translation
Services Services

EDI Service EDI Service

Network Network
EDI Service
Access Access
Control Network Control
Benefits of EDI

• Generation of a paper document on a form by software application.

• Delivery of a few copies of document to the internal dept to be filed
and others to the trade partners via postal service.
• Retyping the document received by the trading partner on the form
into their computers which may offer introduce errors.
• Generation of a paper acknowledgement and sending it to the
originating company.
• Generation of a file containing the processed document by the
application program.
Benefits of EDI cont…

• Conversion of the document into agreed standard format.

• Electronic transmission of the file containing the document over the
network , which may link the originating company and its trading
partner. (SMTP - 25, FTP - 20, 21)
• Automatic generation of the receipt and its delivery over the network
to the originating company.
Features of EDI

• Exchange of structured business information in standard formats

between computers.
• It has reduced data entry link, eliminates the need for a paper bases
system and improved business cycle.
• EDI transfer structured business documents internally among groups
of departments or externally with its suppliers, customers and
subsidiaries.
• In EDI, information transferred over a network will not have to read,
retyped or printed but must have predefine structure agreed between
the two company's which send and receive data.
• The two companies or groups which exchanged information through
EDI are called the Trading Partners.
Unique Transaction Reference number

As per the RBI norms, UTR numbers

are of 16 digit codes. It consists of
only the numeric code or alphabetic
and numeric code. It depends upon
the bank itself. There is no fixed
format of the UTR.

The arrangement is:

XXXXAYYDDD999999
Here, XXXX is the Bank code.

For example, SBI’s bank code is

SBIN.
YY: Two-digit year, i.e., 12 for 2012.
DDD: Julian date, i.e., 032 for Feb 1.
999999: 6 digit succession numbers.
 Components of EDI
There are 3 types of component

1. Application service
2. Translation service
3. Communication service
 Components of EDI cont…

Business
Trading Partner
Application

Application Transmission Communication

Service Service Service
 File Types
Edi creates following files as a document passes through the system:

1. Internal format file (IFF):-

It contains single document for single trading partner.

2. External format file(EFF):-

It contains same data as the internal format file translated into the appropriate
standard document format.

3. Transmission file:-
it contains one or more document for the same trading partner. Documents of same
format are packed into an functional groups. The functional groups going to one
trading partner are packaged into an interchanged set. An interchanged set. An
interchanged set contains one or more functional groups of documents with the
same sender and receiver.
 EDI software
1.Translators:-
Every EDI sender and receiver should have EDI translator. It varies based
on the computer on which it is going to reside. The computer may be a
micro computer or a midrange or a mainframe. Translator reads the fixed
length file and generates valid Edi standard and maintains control
information.

2.Application link software:-

There are 2 components of software, which is generally used to link the
existing business application to the EDI data. One is the translator and
the other is application link software . Application link software is used to
collect information from the business application and then it formats into
fixed length computer file and passes it onto translators.
EDI services

1. Application Services :-
It provides the link between application and EDI. It allows
you to send documents from an EDI system. The set of
callable routine is used to transfer document from the
business application into EDI document destination can be
either intra-company or to the external companies .
EDI services cont…

File Server

Internal Format File

Document
Business
Application Document Internal Format File

Callable Routines

Management - Interface

Application Service
EDI services

2. Translation service:-
Converts the out going documents from an internal format
file to an agreed external format.
Translates internal document from external format to EDI
internal format file.
 EDI Services cont…
Translation Service

File Server

Internal Format File Transmission File

C External Format File TFB

Internal Format File Transmission File

T External Format File TFS

Management - Interface

C Converter , T Translator
TFB Transmission file Builder , TFS Transmission file Splitter
EDI Services cont…

• 3. Communication service:-
The communication service sends and receives transmission files to
and from the trading partners either directly or by using party service
called a valued added network(VAN).
 EDI Services cont…

Communication Service

File Server

Transmission File CC Transmission File

Transmission File Transmission File

Gateway 1

Gateway 1

Management - Interface

CC = Communication Controller
EDI Standards

1. Transaction set standards:-

These defines the procedural format and content requirement for
specified business transactions. Eg: Purchase orders.
2. Data Dictionary And Segment Dictionary:-
These defines the precise content for data content and data
segment used in building transaction sets.
3. Transaction control standard:-
These define the format s for the information required to control
the data interchange
 DIFFERENCE BETWEEN ELECTRONIC
COMMERCE AND TRADITIONAL
COMMERCE
COST: E – Commerce is cost effective when compared to
Traditional Commerce.
TIME: E – Commerce saves time when compared to
Traditional Commerce.
CONVENIENCE: E – Commerce platform is more
convenient to operate for both Supplier and Customer in
comparison to Traditional Commerce.
GEOGRAPHICAL ACCESSIBILITY: In E – Commerce
its quite easy to attract customers from global markets at a
marginal cost than Traditional Commerce.
 DIFFERENCE BETWEEN ELECTRONIC
COMMERCE AND TRADITIONAL
COMMERCE
INTRODUCTION OF NEW PRODUCTS AND
FEEDBACK: In E – Commerce it is easy to introduce a
Product on the website and get Immediate feedback.

PROFIT: E – Commerce helps in cutting down various

direct and indirect cost in comparison to Traditional
Commerce which results in Higher Profits.
PHYSICAL INSPECTION: E – Commerce does not allow
physical examination of the product which is possible in
Traditional Commerce.
 DIFFERENCE BETWEEN ELECTRONIC
COMMERCE AND TRADITIONAL
COMMERCE
TIME ACCESSIBILITY: E-Commerce provide
round the clock services than Traditional Commerce.
PRODUCT SUITABILITY: E–Commerce and
Traditional Commerce are suitable for all types of
Product Category.
HUMAN RESOURCE: E-Commerce works in
electronic environment which requires highly
technically qualified staff.
 DIFFERENCE BETWEEN ELECTRONIC
COMMERCE AND TRADITIONAL
COMMERCE
CUSTOMER INTERACTION: In E-Commerce
the interaction between customer and Business is
screen to face whereas in Traditional Commerce it is
Face to Face.
PROCESS: E-Commerce works through On line
Platform and Traditional Commerce through Brick
and Mortal Buildings.
Fraud: In E-Commerce chances of Fraud are more
comparatively to Traditional Commerce.
 M commerce:

• Mobile banking

• Booking tickets

• Location based services

• Mobile money transfer.

• Mobile marketing and advertising:
-Mobile web banner (on the top of the page)
-mobile web poster(on the bottom of page)
-sms advertising
-mms advertising
-audio advertising.

• Information services:
News
Stock market updates
Sports scores
Traffic reporting
 Benefits of ecommerce to consumers:

• Ubiquity:
Ecommerce provides customers to shop or
perform any other transactions year
round,24hours a day , from almost any
location.

• Discounts:
Customers get high discount while shopping
online.

• More products and services:

Ecommerce provides more choices in
product selection.
• Delivery of products.
In case of digital products, ecommerce provides
quick delivery service.

• Provide access to compare.

Consumers can compare the product before their
purchase.

• Information availability:
Easy to find what you need, with details and
demos , etc.
 Benefits to organizations:
• Global reach:
Ecommerce expand the market place to
national and international markets.

• Cost reduction:
Ecommerce decrease the cost of creating ,
processing , distributing , storing , etc.

• Extended time:
Business is always open on net with no
overtime and other extra cost.
 Limitations in ecommerce:
• Lack of personal touch.

• Need of internet for access.

• Anyone can setup the ecommerce website.

• Frauds.

• Delivery issue.
Limitations in ecommerce:

• Delay in replacements.

• No guarantee of product quality.

• Mechanical failure can cause unpredictable effect on the whole process.

Top ecommerce website:
Growth of ecommerce:
 EVOLUTION AND HISTORY OF
E - COMMERCE
1. CONCEPTION STAGE (1960–1980):-
 EDI(Electronic Data Interchange) by Ed. Gilberth in
1960,
 Birth of Internet (1969 known as ARPANET),
 EFT(Electronic Fund Transfer)1970.
 Invention of Online Shopping(1979 by Michael
Aldrich),
 Introduction of Minitel(1982) videotext online service
before origin of world wide web services
 EVOLUTION AND HISTORY OF
E - COMMERCE
2. INTRODUCTORY STAGE (1990):–
World Wide Web(WWW)(1990) is created by Tim
Berners Lee in which documents are connected to
each other through Hyper Links and formatted in a
Mark up Language called HTML.
 Net Browser introduced in 1994 by Netscape
communication corporation a subsidiary of
American Online and after that dominant position
acquired by Internet Explorer of Microsoft
 EVOLUTION AND HISTORY OF
E - COMMERCE
 First Ever Online Order for Pizza Hut(1994)
Birth of C2C – e-Bay (1995) founded by Pierre
Omidyar and Jeff Skoll.
First Ever Sale by Amazon – (1995) Jeff Bezos
Introduction of PayPal – (1998)
 EVOLUTION AND HISTORY OF
E - COMMERCE
3. GROWTH STAGE (2000 ONWARDS)
E Bay Acquires Pay Pal(2002)
 Online Purchase through Mobile
Phones(2008, USA)
 ROADMAP OF E – COMMERCE
IN INDIA
1. PHASE I (1996-2005):-1995 Dial – Up
connection, 1996 B2B and online
matrimonial, 1997 Job Portals
2. PHASE II (2006 TILL DATE):- Online
Travel (2005-06), online Retail (2007),
group buying and daily offers (2010), social
networking.
 DRIVING FORCES OF
E - COMMERCE

1. Economic Forces.
2. Technological Forces.
3. Market Forces.
 FUTURE OF E-COMMERCE
 There is a great potential for E-Commerce in India.
Problems associated with technological infrastructure,
Cyber Laws, Security etc can act as a stumbling block in
preventing purchasers and users of online services.
Government of India is taking various steps to stop the
criminals to take advantage of the loopholes in the
Information Technology Act and trying to provide secured
electronic platform with strict cyber laws. A study by Technavio
(2016) estimated that the global e-commerce market will grow at a
compound annual growth rate (CAGR) of over 19% till 2020.
 MAIN ACTIVITIES OF
E – COMMERCE

1. Information Sharing
2. Registration
3. Order Placement and Processing
4. Processing of payment
5. Shipment
6. Delivery
 MAIN ACTIVITIES OF
E – COMMERCE

7. Service and Support

8. Feedback
9. Customer Reviews
10. Advertising and Sales Promotion
 FUNCTIONS OF E – COMMERCE

1. Registration
2. Information search
3. EDI
4. Negotiations
5. Orders
6. Payments
7. Logistics
8. After Sale Activities
 FUNCTIONS OF E – COMMERCE

1. Promotion of Products
2. Consumer Research
 SCOPE OF E COMMERCE

1. Electronic Markets
2. Electronic Data Interchange
3. Internet Commerce
 ADVANTAGES OF E – COMMERCE
To E – MARKETERS
1. Global Markets/ Wide geographically coverage.
2. Audience Sizing. (trace the number of visitors)
3. Lower Investment.
4. Lower Operating Costs.
5. Improvement in Productivity.
6. Quality Procurement.
7. Effective Customer Relationship and Services.
8. Benefits to the Government Agencies.
9. Increase in Revenue.
 ADVANTAGES OF E – COMMERCE
To E – CUSTOMER

1. Convenience in Shopping/Anytime Shopping

2. Lower Price
3. Loyalty Incentive
4. Simple to operate.
5. Enhances Sales
6. Effective Customer Service.
7. Adequate Information.
 ADVANTAGES OF E – COMMERCE
To E – CUSTOMER

8. Wide Range of Products and Services.

10. Virtual communities help in solving various
issues and provides information.
11. Saves Time.
 ADVANTAGES OF E – COMMERCE
To SOCIETY
1. Provides Job Opportunity.
2. Promotes cordial Relationship.
3. Provides a wealth of Information.
4. Provides Entertainment.
5. Less Pollution. (reduces traffic and air pollution
resulting lesser global warming)
6. Online Education.
7. Health Care facilities.
 ADVANTAGES OF E – COMMERCE
To NATION

1. Balanced Regional Development

2. Reduces Unemployment
3. Economic Development.
4. Availability of Goods.
 LIMITATION OF E – COMMERCE

1. Security. (not accessed by unauthorised person)

2. Lack of Privacy. (protection against illegal
attempt)
3. Tax Issues. (sales tax)
4. Fear.
5. Product Suitability. (electronic image etc.)
6. CulturalObstacles.(https://www.webinterpret.c
om/uk/blog/culture-global-ecommerce-buying-
experience/)
 LIMITATION OF E – COMMERCE

1. High Labour Cost.

2. Legal Issues. (cyber laws)
3. Technical Limitation/Site Crash
4. Technological Cost
 CHALLENGES OF E – COMMERCE
1. Declining Profit Margins (competition)
2. Laws in India (still evolving)
3. Low Entry Barriers
4. Problem for rural Customers
5. Shortage of Manpower (Lack of specialised courses)
6. Challenges of Customer Loyalty(switching options are
more)
7. Challenges of Return of Goods (cross border e-
commerce)
8. Challenges of Cash on Delivery
 CHALLENGES OF E – COMMERCE
9. Problem of Payment Gateways (options)
10. Problem of touch and feel
11. Problem of Delivery
12. Problem of Confidence
13. Unsuitable for certain products (depends on
product requirement)
14. Problem of Negotiation (price categories are
there)
15. Problem of Language
16. Low Internet Penetration
17. Privacy Issue
 E – COMMERCE BUSINESS
STRATEGIES
1. Niche Markets (categories)
2. Sell internet – Only Merchandise
3. Personalize
4. Third Party Logistics (PL’s)
5. Invest in Mobile Platform (Apps)
6. Consider Subscription Commerce
7. Consistency across Channels (retail and online
platforms)
 E – COMMERCE BUSINESS
STRATEGIES
8. Implement a Loyalty Program (repeat purchase)
9. Make use of Native Language (translation feature)
10. Donate products to others for Review (Journalist,
writers, editors etc.)
11. Excellent Customer Service(repeat purchase and
brand evangelist)
12. Understand the Customers (regular customers)
13. Attractive Website
 BUSINESS MODEL OF E – COMMERCE

1. Business to Consumer – Flipkart , Amazon etc

2. Business to Business – Tata steel etc
3. Consumer to Business feedbacks, suggestions,
Job Portals etc.
4. Consumer to Consumer – eBay etc.
5. Government to Business – inviting tenders,
auctions etc.
6. Business to Government – all websites
 BUSINESS MODEL OF E – COMMERCE

7. Government to Consumer – National Service

Government Portal, UPSC, UGC etc.
8. Government to Citizenship – Municipality
website, electricity department website etc.
9. Peer to Peer – whats app, face book chat etc.
10. Business to employee and interested parties –
Intranet and Extranet.
 CHARACTERISTICS OF
B2B E – COMMERCE
1. High Volume
2. Longer Lead Time (delivery time)
3. Credit Sale
4. Various Models includes
(a) Net Market Place
(b) Private Industrial Network includes single firm
and industry wide industrial network
 CHARACTERISTICS OF
B2B E – COMMERCE
5. Price Negotiations
6. Specialised Promotions (specific to customers)
7. Customised Orders
8. Value Addition
9. Activities involved in Purchasing
10. Higher Risks
11. High Degree of Personal Selling
 NEED AND IMPORTANCE OF
B2B E – COMMERCE
1. Reduces Distribution Costs
2. Reduces Inventory Levels
3. Increase in Productivity
4. Focused Brand Promotion
5. Customer Loyalty
6. Wider Geographical Spread
 NEED AND IMPORTANCE OF
B2B E – COMMERCE
7. Scalability
8. Reciprocal Buying
9. Benefits of Negotiation
10. Lower Rejection Rates
 CHARACTERISTICS OF
B2C E – COMMERCE
1. Large Number of Customers
2. Lower Entry Barriers
3. Lower Volume Per Transaction
4. Possibilities of Return of Goods
5. Global Reach
6. Anytime Shopping
7. B2C Process
8. Lower Operating Costs
 CHARACTERISTICS OF
B2C E – COMMERCE
9. Lower Investment
10. Stiff Competition
11. Lower Prices to Customers
 PROCESS/ ACTIVITIES OF
B2C E – COMMERCE

1. Pre Purchase – Information Search, Pre

Purchase Decision, Registration.

2. Purchase – Placement of Order, Processing of

Order, Processing of Payment, Operational
Management.

3. Post Purchase – Shipment, Delivery of Goods,

Feedback
 CHARACTERISTICS OF
B2G E – COMMERCE
1. Mainly involves Bidding
2. Transparency
3. Virtual Work Place
4. Improved Efficiency
5. High Value per Transaction (high cost as huge
projects)
6. Rules and Regulations
7. Absence of Promotional Tactics (project
specific)
8. International Coverage
 MODELS OF
B2B E – COMMERCE

1. Net Market Place Model

(a) Supplier Oriented Marketplace
(b) Buyer – Oriented Market Place
(c) Intermediary oriented Market Place

2. PRIVATE INDUSTRIAL NETWORKS

(a) Single Firm Industrial Network
(b) Industry Wide Industrial Network
 E – COMMERCE SALES LIFE CYCLE
(ESLC)
1. Seed(Development) Stage – thought of creating
attractive website.
(a) Challenge – market acceptance (niche market or
specific popular products)
(b) Focus – skills, resources etc
(c) Money Source – own or borrowed.
 E – COMMERCE SALES LIFE CYCLE
(ESLC)
2. Start Up(Introductory Stage) – getting first
customer.
(a) Challenge - cash flow crisis or BEP, struggle
for growth and survival
(b) Focus – increasing customer base
(c) Money Source – best use of investors money,
creditors by suppliers and sales amount.
 E – COMMERCE SALES LIFE CYCLE
(ESLC)

3. Growth Stage – more sales and profits

(a) Challenge – proper management require
(b) Focus – customer relation and promotional
activities.
(c) Money Source – reinvest earned money or
borrow from market.
 E – COMMERCE SALES LIFE CYCLE
(ESLC)

4. Established (Maturity) Stage – strong market

base.
(a) Challenge – competition, changing customer
preferences.
(b) Focus – improving efficiency and sound
collaborations with suppliers and logistics.
(c) Money Source –ploughing back of profits
 E – COMMERCE SALES LIFE CYCLE
(ESLC)

5. Expansion Stage – national and international level

(a) Challenge – planning and research
(b) Focus – existing and new customer base
(c) Money Source – own or borrowed funds
6. Decline stage – revitalize or sale
(a) Challenge – decline in sales, profits etc.
(b) Focus – new opportunities and business venture
(c) Money Source – own and borrowed.
 E – COMMERCE SALES LIFE CYCLE
(ESLC)

7. Exit Stage – come out of Business.

(a) Challenge – financial or psychological loss.
(b) Focus – proper valuation.
 E – MARKETING AND
ELECTRONIC PAYMENT
SYSTEM
•E – Marketing is also known as electronic
marketing, internet marketing, web marketing or
online marketing.
•It is a process of marketing a product and services
using the internet, it includes marketing on
internet, e- mails and wireless media.
• to start e marketing company should have online
access.
 SCOPE OF E – MARKETING
• Goods
•Services
•Ideas
•Promotes Personalities
•Places
•Properties
•Events
•Virtual Learning
•Political Parties
•Government
 TECHNIQUES OF E – MARKETING
•Social media marketing
•Blogs
•Mobile Advertisement
•Video Marketing
•RSS feed
•Email marketing
•Display ads
•Article marketing
•Forum marketing
•Search Engine marketing
 TECHNIQUES OF E – MARKETING

•Link exchange/purchase

•Ezine marketing

•Press Release

•Joint Ventures

•Affiliates Program
•Contest and Giveaway techniques
 WEB COUNTERS

It helps in knowing the number of visitors visited

the website and the pages they searched.

It can be public(tracking information public) and

private( information private)

It includes hit counter(measures request sent by a

visitors), page counter (no. of pages visited) and
we counter(combination of hit and page counter)
 WEB ADVERTISEMENTS
1. Google based ads –(Google ad words, Google
search ads, Google display ads and Gmail ads)
2. Video ads.
3. Banner ads
4. News letter advertising (Ezine)
5. Affiliate advertising
6. Social media advertising
7. Mobile ad
8. In – game ad
9. Email ads
 ROLE OF SOCIAL MEDIA IN MARKETING
• It includes marketing of website and products
using social media platforms.
• It facilitates communication and information
sharing through social network.
• Important social media sites includes –
Facebook, You Tube, LinkedIn, Twitter etc.
 ROLE OF SOCIAL MEDIA IN MARKETING
• Increased brand recognition
• Improved brand loyalty
• More opportunities to convert
• Higher brand authority
• Increased inbound traffic
• Decreasing marketing cost
• Better search engine ranking
• Richer customer experience
• Improved customer insights
 ROLE OF SOCIAL MEDIA IN MARKETING
• Building customer relationship
• Targeting and retargeting
• Media coverage
• Resolving problems
• Increase sales
 E – COMMERCE STRATEGIES FOR
PURCHASING AND SUPPORT ACTIVITIES
 PLANNING FOR ELECTRONIC COMMERCE
INITIATIVE
1. Identify E- Commerce Objectives
2. Link objectives with business strategies
3. Managing costs
4. Measuring benefits
5. Follow up
 JUSTIFICATION FOR INTERNET BUSINESS
1. Growth of e – entrepreneurs
2. Employment generation
3. Economic growth
4. Environment protection
5. Reduction in bad debts
6. Reduction in business overhead
7. Convenience for shoppers
8. Optimum use of physical space
9. Instant product review
10.Global reach
 E – PAYMENT
It means making payment for goods and services
by using online or digital medium

E – PAYMENT SYSTEM
It govern the rules, regulation, procedure etc
related with making payment online.
 CHARACTERISTICS OF E PAYMENT
SYSTEM
1. Confidential
2. Security
3. Quick and efficient
4. Non Repudiability
5. Authenticity
6. Reliability
7. Encryption
8. Scalability
9. Acceptability
 CHARACTERISTICS OF E PAYMENT
SYSTEM
10. Convertibility
11. Applicability.
12. Transparency
 SET PROTOCOL FOR CREDIT CARD
PAYMENT
Secure Electronic Transactions (SET) – was a
communication protocol standard for securing
credit card transactions over insecure
networks, specifically the internet. It was
developed by the SET consortium, which was
established in 1996 by VISA and Mastercard in
cooperation with GTE, IBM, Microsoft,
Netscape, SAIC, Terisa system, RSA and
Verisign. It has became a standard payment
method on the Internet between the merchants,
the buyers and the credit card companies.
MAIN FEATURES
• Confidentially of information
• Integrity of data
• Cardholders account authentication
• Merchant authentication
PARTICIPANTS
• Cardholder
• Merchant
• Issuer
• Acquirer
• Payment gateways
• Certification authority
SET PROTOCOL PROCEDURE
• Cardholder and merchant should register with
certification authority.
• Customer browses website and makes a
purchase decision
• Customer sends order and payment
information, which includes two parts –
purchase order and card information
• Merchant forwards card information to his
bank
• Merchants bank checks with issuer for
payment authorization.
SET PROTOCOL PROCEDURE
• Issuer of credit card sends authorization to
merchant’s bank
• Merchants bank send authorization to
merchant
• Merchant completes the order and sends
confirmation to the customer
• Merchant captures the payment transaction
details from the bank
• Issuers prints credit card bill to customer.
PREPAID E –PAYMENT SERVICE – Prepaid
payment instruments are methods that facilitate
purchase of goods and services against the
values stored on such instruments.
CATEGORIES OF PREPAID PAYMENT
INSTRUMENTS
1. Closed system payment instruments example
brand specific gift card (tanishq, ola money)
2. Semi closed system payment instruments.
Example e wallets like oxigen and mobikwik.
CATEGORIES OF PREPAID PAYMENT
INSTRUMENTS
3. Open system payment instruments example All
RuPay, Visa, Master card.
4. Semi open system payment instruments
example is Vodafone mPesa
5. Mobile prepaid instruments
ISSUERS OF PREPAID PAYMENT
INSTRUMENTS
• Banks and Non – Banking Financial
Companies
• Banks permitted to provide mobile banking
transactions
• Mobile service providers
• Other entities
POST PAID E PAYMENT SYSYTEM
In this payment is done after the usage of the
services, after certain period. Example
electricity and water bill payment etc. it
requires two essential events one is credit
history/contractual commitment and second
service tenure
STEPS IN POST PAID PAYMENTS
• Agreements
• Use of services
• Billing
• Payment of bills
• Confirmation of payments
ADANTAGES OF POST PAYMENT SERVICES
• Availability of credit
• No recharge required
• Discounts
• Customer loyalty
DISADANTAGES OF POST PAYMENT
SERVICES
• Monthly service charges
• Possibility of higher bill amount
• Bad debts
• Excessive usage
TYPES OF E PAYMENTS SYSTEMS
• Credit card :
• Processing of Credit card Payment
• Advantages of credit card – convenience in transaction, offers as reward
points, surety of payment to merchant.
• Risk in Credit Card – can be stolen, fraudulent use of the card, hackers
can misuse the card.
TYPES OF E PAYMENTS SYSTEMS
• Debit card
• Advantages of debit card – convenience, no
interest and service charge, issuer bank
relieved of default by cardholder.
• Disadvantages of debit card – problem in rural
areas, hacking problems, hidden cost.
TYPES OF E PAYMENTS SYSTEMS
• Smart card
• Features of smart card - plastic card, contains
information in encrypted form, information
storage capacity more than debit and credit
card, for longer duration.
TYPES OF E PAYMENTS SYSTEMS
• E cash
• EFT (Electronic Fund Transfer) –
• Procedure of EFT.
• Digital Wallet
• Mobile Payments
• Models of Mobile Payments includes – mobile wallets, credit card
based payment, carrier billing, contact less payments, direct transfers
between NFC, direct transfer between payer and payee bank accounts in
near real time.
TYPES OF E PAYMENTS SYSTEMS
• Internet Banking
• Reward Points.
• Prepaid Cards.
RISK OF E-PAYMENT SYSTEM
• Operational risk
• Credit risk
• Legal risk
 OPERATIONAL RISK
Operational risk arises due to deficiency in the
information systems or internal controls.
• Human and technical errors
• Frauds
• Operational Risk controls
• System measures
• Procedural measures
• Unauthorized use of card
 CREDIT RISK
It involves the risk of failure of settlement of amount by
the cardholder on due date.
• Faulty settlement procedures
• Deferred payment settlement
• Payers financial institution to verify availability of
funds
• Cheque return
• Charge backs
• Credit and liquidity risks
• Settlement lags
• Daylight overdrafts
 LEGAL RISK
It is also known as compliance risk arising
because of the unexpected application of law
or regulation because of which contract cannot
be enforced.
• Failure to comply legal laws
• Participants declared insolvent
• Legal disputes
• Financial institution failure
• Non compliance
 RISK MANAGEMENT OPTIONS FOR E –
PAYMENT SYSTEMS
• Pricing (adverse selection)
• Insurance (Moral hazards)
• Containment (monitoring)
 RBI MEASURES FOR SECURITY AND RISK
MITIGATION FOR E PAYMENT
TRANSACTION
1. Securing card payment transactions
2. Securing electronic payment transactions
 PRINCIPLES/STANDARDS FOR E
PAYMENTS
1. CORE PRINCIPLES
• The system should have a well founded legal
basis under all relevant jurisdictions
• The systems rules and procedure should enable
participants to have a clear understanding of
the systems impact on each of the financial
risks they incur through participation in it.
 PRINCIPLES/STANDARDS FOR E
PAYMENTS
• The system should have clearly defined
procedures for the management of credit risks
and liquidity risks, which specify the
respective responsibilities of the system
operator and the participants and which
provide appropriate incentives to manage and
contain those risks
• The system should provide prompt final
settlement in the day of value, preferable
during the day and at a minimum at the end of
the day.
 PRINCIPLES/STANDARDS FOR E
PAYMENTS
• A system in which multilateral netting takes
place should, at a minimum, be capable of
ensuring the timely completion of daily
settlements in the event of an inability to settle
by the participant with the largest single
settlement obligation
• Assets used for settlement should preferably be
a claim on the central bank, where other assets
are used, they should carry little or no credit
risk
 PRINCIPLES/STANDARDS FOR E
PAYMENTS
• The system should ensure a high degree of
security and operational reliability and should
have contingency arrangements for timely
completion of daily processing.
• The system should provide a means of making
payments which is practical for its users and
efficient for the economy.
• The system should have objective and publicly
disclosed criteria for participation which
permit fair and open access.
 PRINCIPLES/STANDARDS FOR E
PAYMENTS
• The systems governance arrangements should
be effective, accountable and transparent.
KEY FACTORS FOR SUCCESS OF
E-COMMERCE
• Government Support
• On Line Payment System
• Internet Penetration and smart phone users