E-Commerce

BASICS OF ECOMMERCE

What is E-commerce?

Services of E-commerce

Difference between Manual Business &

Ecommerce

Advantages of Ecommerce

Disadvantages of Ecommerce

Applications of E-commerce

Types of E-Commerce

Learning objectives

• E-Commerce is buying and selling of products, services and information via computer networks including the internet.

• Electronic commerce is - Sharing business information, Maintaining business relationships Conducting business transactions (financial)

• Electronic commerce is about doing business electronically

What is E-commerce?

E-commerce perspectives:

COMMUNICATION BUSINESS

SERVICE Online

Communication Perspective: E-commerce is the delivery of information, product/services or payments over tele-communication channels, computer networks or any other electronic mode of communication.

Business Process Perspective: E-commerce is the application of technology towards the automation of business transactions and work flow.

Service Perspective: E-commerce is improving the quality of goods/services and increasing the speed of service delivery.

Online Perspective: E-commerce provides the capability of buying and selling products and information on the internet and other online services.

1) Computers

2) Internet

3) Shared software

To send and receive product specifications and drawings;

bids, purchase orders and invoices; and any other type of

data that needs to be communicated to customers,

suppliers, employees or the public.

E-commerce is electronic business

1. Electronic Data Interchange (EDI)

2. Technical Data Interchange (TDI)

3. Hypertext Mark- up Language (HTML)

4. Extensible Mark-up Language (XML)

5. Standard for Exchange of Product (STEP)

6. Internet

7. World Wide Web

8. Value-Added Networks.

E-commerce Standards & Technologies

I N T E R N E T

E-business

E-Sales

E-Payment

E-Banking

E–Procurement

Conclusion:

E-commerce includes purchases of goods, services and other financial transactions.

E-commerce transaction model can be in terms of:

1) Business to Business (B2B),

2) Business to Customer (B2C)

3) Customer to Customer (C2C).

Features of E-commerce

• Fast transactions

• Wide market coverage

• Convenient- 24x7

• Cost effective

• Time saving

• High profit margins

• Instant customer relations/response

• No loss of customers

• Better decisions –sales price, sale forecast

• Greater control

Basis Manual business E-business Meaning It involves the physical exchange of

goods and servicesIt involves buying and selling of goods and services of internet

Middlemen It requires the involvement of wholesalers and retailers

No requirement of wholesalers or retailers. There is direct contact between buyers and sellers.

Anywhere anytime service

It is restricted to the working hours only It is not restricted means anytime, anywhere services. It provides 24 hours service online.

Quick service

It required lot of time while selecting, purchasing and payment of goods

It provides quick service through which customers can get information in seconds while sitting in home or office.

Cost It requires retail shop and advertising. Lot of paper work required

It is cost effective as there is no need of retail shops. It saves time, advertising cost and paper work

Growth of business

It has lesser market growth It has more market growth

Choice of product

It provides less choice of product It provides, that is customer can find products from all over the world, they can select and place order

Variety of services

It provides lesser services It provides more services such as financial services, legal services, medical advice etc.

Advantages of Ecommerce :

1. It helps the business to reach our products or services worldwide.

(Anyone can buy or sell of products from any corner of the world)

2. It helps to find the customers easily to communicate.

3. It reduced cost in terms of paper work; all documents are exchanged

electronically on the net.

4. It provides services such as financial, legal, medical, advice, and

suggestion etc.

5. It helps the efficient and effective communication between the suppliers

and customers.

6. Companies can setup a new office or retail department store using e-

commerce website (telecommunication)

7. File transfer and fund transfer is faster using e-commerce.

Disadvantages of Ecommerce :

1. Online business problem (knowledge of computer and

internet is required)

2. Security problem

3. Payment made by credit card

4. Website is needed

5. Physical verification not possible

6. Communication is between over the Internet only by

passing information through email or file transfer.

7. Products & services must be updated in time.

1.Business to business e-commerce (B2B)

2. Business to consumers e-commerce (B2C) 3. Consumers to consumers e-commerce (C2C)

Models or Types of E-commerce

• Business is conducted between two businesses.

• Businesses with customers and suppliers.

• A wholesaler may sell products to the retailer.

• Transaction between organization and partners.

• Includes linkages with enterprises, dealer, warehouse or manufacturer

• One for the vast competitive business over the computer network.

• B2B is selling between companies, wholesalers & retailers.

• It provides the information of suppliers, distributors, dealers, vendors etc.

• B2B is faster and more convenient.

Example: ERP, SCM

Innovative methods of enhancing B2B:

• CD-ROM catalogues - browse offline and order online.

• Shopping malls to introduce users to the easy online ordering options.

• Extranets to link businesses together that conduct regular B2B

Business to Business (B2B)

Advantages of B2B:

• It allows buying selling information and services

• It allows relationship between suppliers and customers

• It increases the business goodwill and competition

• It reduces manpower

• It is faster and more convenient.

Disadvantages of B2B:

• It is expensive in terms of installation of business

• It is mainly used in corporate sector

• Personal attention is required due to 24 hours system working

• It uses EDI and EFT

• E-mail service is used for purchasing goods and services.

• Involves selling of goods/services to consumers or end users

• It allows them to browse the product catalogue, select products or

services and complete the order online.

• It involves an individual and a shop selling goods.

• It refers to selling to an individual person rather than to a company

customer can communicate with enterprise software system.

• B2C does not require large investment by retailers.

Example: amazon.com, rediff

These websites are meant for selling goods directly to consumers

through the internet

Business to Consumers (B2C)

Advantages of B2C:

• Shopping can be faster and more convenient and cheaper.

• It offering new prices and discounts

• Credit card system is used for payment

• Call centers persons integrated with websites

Disadvantages of B2C:

• It is not suitable for small business

• It is difficult to enter into market

• It is price sensitive

• Credit card system used for payment.

• Security guarantee is not maintained

• No quality control.

• Commerce is conducted between two consumers. • It is the transaction between consumers through some 3rd party

customers.

For example: e-Buy Bid or Buy.com, Baazi.com which are auction sites, one can virtually sell and buy any goods (either used or new ones).

Online auction - in which a consumer posts an item for sale and other consumers bid to purchase it. The 3rd party generally charges a flat fee (commission) the business sites are only intermediaries just to match consumers. They do not have to match to check quality products and services.

Example of C2C websites: www.ebay.com

Consumer to Consumers (C2C)

Advantages of C2C:

• Business between only the consumers and 3rd party

• It provides services about the business transactions

• It receives commission

Disadvantages of C2C:

• No quality product or services

• No payment guarantee

• Prices of the products may increase at its actual cost.

Thank you