ROLE OF

E-COMMERCE
TOPIC 6
 DEFINITION

◦eCommerce, also known as electronic

commerce or internet commerce, refers to the
buying and selling of goods or services using
the internet, and the transfer of money and
data to execute these transactions
 SIGNIFICATNCE OF eCOMMERCE
◦ eCommerce or Electronic commerce is the buzzword of the modern day.
◦ In simple terms, it is just buying and selling of product and services through the internet.
◦ But in a much broader sense, it includes the entire online process of developing, marketing,
selling, delivering, servicing and paying for products and services. With the widespread usage
of internet, the sphere of eCommerce has widened dramatically
◦ Today eCommerce is an integral part of business because of various reasons like:
Ease of use
Accessibility across the globe
Great variety & easy compassion of products from different vendors
Trusted payment channels
Shopping can be done sitting in the convenience of your own home; hence it is less time
consuming.
 SCOPE OF eCOMMERCE
◦Ecommerce creates new opportunities for entrepreneurial start-
ups.
◦Ease of internet access,
◦Safe and secure payment modes coupled with aggressive
marketing by ECommerce giants has revolutionised this segment.
◦Rapid development in mobile technology has given way to
Mobile Commerce with many E-Commerce companies shifting to App
only model.
 eCommerce Advantages
Can be broadly classified in three major categories
1. Advantages to Organisations
2. Advantages to Consumers
3. Advantages to Society
 1. Advantages to Organizations
◦ Using e-commerce, organizations can expand their market to national and
international markets with minimum capital investment.
◦ An organization can easily locate more customers, best suppliers, and suitable
business partners across the globe.
◦ E-commerce helps organisations to reduce the cost to create process,
distribute, retrieve and manage the paper-based information by digitizing the
information.
◦ E-commerce improves the brand image of the company.
◦ E-commerce helps organization to provide better customer services.
◦ E-commerce helps to simplify the business processes and makes them faster
and efficient.
◦ E-commerce reduces the paper work.
◦ E-commerce increases the productivity of organisations.
 2. Advantages to Customers
◦ It provides 24x7 support. Customers can enquire about a product or service and place
orders anytime, anywhere from any location.
◦ E-commerce application provides users with more options and quicker delivery of
products.
◦ E-commerce application provides users with more options to compare and select the
cheaper and better options.
◦ A customer can put review comments about a product and can see what others are
buying, or see the review comments of other customers before making a final purchase.
◦ E-commerce provides options of virtual auctions.
◦ It provides readily available information. A customer can see the relevant detailed
information within seconds, rather than waiting for days or weeks.
◦ E-Commerce increases the competition among organizations and as a result,
organizations provides substantial discounts to customers.
 3. Advantages to Society
◦Customers need not travel to shop a product, thus less traffic and
low pollution.
◦E-commerce helps in reducing the cost of products, so less
affluent people can also afford the products.
◦E-commerce has enabled rural areas to access services and
products, which are otherwise not available to them.
◦E-commerce helps the government to deliver public services
such as healthcare, education, social services at a reduced cost and in
an improved manner
 The disadvantages of e-commerce
Can be broadly classified into two major categories
1.Technical disadvantages
2.Non-Technical disadvantages
 1. Technical disadvantages
◦ There can be lack of system security, reliability or standards owing to poor
implementation of e-commerce.
◦ The software development industry is still evolving and keeps changing rapidly.
◦ In many countries, network bandwidth might cause an issue.
◦ Special types of web servers or other software might be required by the vendor, setting the e-
commerce environment apart from network servers.
◦ Sometimes, it becomes difficult to integrate an e-commerce software or website with
existing applications or databases.
◦ There could be software/hardware compatibility issues, as some e-commerce software
may be incompatible with some operating system or any other component.
 2. Non-Technical disadvantages

◦ Initial cost − The cost of creating/building an e-commerce application in-house

may be very high. There could be delays in launching an e-Commerce application
due to mistakes, and lack of experience.
◦ User resistance − Users may not trust the site being an unknown faceless
seller. Such mistrust makes it difficult to convince traditional users to switch from
physical stores to online/virtual stores.
◦ Security/ Privacy − It is difficult to ensure the security or privacy on online
transactions.
◦ Lack of touch or feel of products during online shopping is a drawback.
◦ E-commerce applications are still evolving and changing rapidly.
◦ Internet access is still not cheaper and is inconvenient to use for many potential
customers, for example, those living in remote villages.
 TYPES of eCOMMERCE

1.Business-to-Business (B2B)
2.Business-to-Consumer (B2C)
3.Consumer-to-Consumer (C2C)
4.Consumer-to-Business (C2B).
5.Business-to-Administration (B2A)
6.Consumer-to-Administration (C2A)
 TYPES of eCOMMERCE

1.Business-to-Business (B2B)
This e-commerce type encompasses all electronic transactions of goods or services,
conducted between companies, i.e. companies sell their goods online to other companies.
They are not engaged in sales to the consumer public.
2. Business-to-Consumer (B2C)
In a Business-to-Consumer e-commerce environment, companies sell their online goods
to consumers who are the end-users of their products or services. Usually, B2C
Ecommerce web shops have an open access for any visitor and user.
There are already many virtual stores and malls on the Internet, which sell all kinds of
consumer goods, such as; computers, software, books, shoes, cars, food, financial
products, digital publications, etc.
 eCOMMERCE TYPES
3. Consumer-to-Consumer (C2C)
Consumer-to-Consumer (C2C) type e-commerce encompasses all electronic
transactions of goods or services conducted between consumers. Generally, these
transactions are conducted through a third party, which provides the online platform
where the transactions are actually carried out. eBay.com is a very good example. It is
the most popular platform that enables consumers to sell to other consumers.
4. Consumer-to-Business (C2B)
In C2B, there is a complete reversal of the traditional sense of exchanging goods. Here,
consumers offer their products or services online and companies post their bids. Then
consumers review the bids and choose companies that meet their price expectations. A
platform that is very common in this type of commerce is the markets that sell royalty
free photographs, images, and media and design elements, such as; Stock photo.
 eCOMMERCE TYPES

5 .Business-to-Administration (B2A)
This part of e-commerce encompasses all transactions conducted online
between companies and public administration. This is an area that
involves a large amount and a variety of services, particularly in areas
such as fiscal, social security, employment, legal documents, and
registers, etc. These types of services have increased considerably in
recent years with investments made in e-government.
6. Consumer-to-Administration (C2A)
The Consumer-to-Administration model encompasses all electronic transactions
conducted between individuals and public administration e.g. Tax
 So, what makes e-commerce sites
successful?
◦75 % of online shoppers surveyed said that good customer
service would make them shop at the site again
◦freeform layout most useful for finding shopping list
products within the store, and also by far the most
entertaining to use.
◦grid layout much easier to use than the other layouts
 So, what makes e-commerce sites
successful?
4 factors were predictive of customer judgments about quality and
satisfaction, customer loyalty and attitudes towards a website

1) Website design-This covers all elements of the customer’s experience at the website including
navigation, information search, order processing, appropriate personalization and product selection.
2) Fulfilment/reliability-This involves, firstly, the accurate display and description of a product so
that what customers receive is what they thought they ordered; and secondly, the delivery of the
right product within the time frame promised.
3) Privacy/security-This involves the security surrounding credit card payments and the privacy
of shared information.
4) Customer service-This needs to be responsive, helpful and willing service with a quick
response time to customer enquiries.