E-Commerce

What is E-Commerce?
Commonly known as Electronic Marketing. It consist of buying and selling goods and services over an electronic systems Such as the internet and other computer networks. E-commerce is the purchasing, selling and exchanging goods and services over computer networks (internet) through which transaction or terms of sale are performed Electronically.

Defining E-Commerce from Different Perspectives

Communications
From a communication perspective, e-commerce is the delivery of goods, services, information, or payments over computer networks or by any other electronic means.

Commercial (trading)
From a commercial perspective, e-commerce provides the capability of buying and selling products, services and information on the Internet and via other online services.

Business Process
From a business process perspective, e-commerce is doing business electronically by completing business processes over electronic networks.

Service
From a service perspective, e-commerce is a tool that addresses the desire of governments, firms, consumers, and management to cut service costs while improving the quality of customer service and increasing the speed of service delivery.

Learning
From a learning perspective, e-commerce is an enabler of online training and education in schools, universities, and other organizations.

Community
From a community perspective, e-commerce provides a gathering place for community members to learn transact and collaborate.

Brief History Of E-Commerce

1970s: Electronic Funds Transfer (EFT) Used by the banking industry to exchange account information over secured networks

Late 1970s and early 1980s: Electronic Data Interchange (EDI) for e-commerce within companies Used by businesses to transmit data from one business to another

1990s: the World Wide Web on the Internet provides easy-to-use technology for information publishing and dissemination Cheaper to do business (economies of scale) Enable diverse business activities (economies of scope)

Why Use E-Commerce?

Here are some of the most common Reasons

Low Entry Cost

A company can establish itself on the Internet, and open for business, with a relatively small investment. Thousands of companies operate simple, inexpensive sites that are successful in their markets.

Reduces Transaction Costs

Dealing with customers over the Web, whether to process orders or to attend to customer support, is cheaper than traditional marketing methods. For example, Dell Computer Corporation estimates that it saves eight dollars each time a customer checks the status of an order at the Dell Web site, instead of calling the company.

Access to the global market

With a traditional business, the target market may be the local community or, with a higher advertising budget, it may extend to neighboring communities. The Web extends the reach of even the smallest businesses by allowing them to market products globally.

Online distribution
The Web enables businesses to distribute data and software online

Secure market share

Getting a business online protects its current offline market share from being eroded by an online entrepreneur. If a business enters the e-commerce market too late, competitors who have already established a Web presence may make a successful market entry more difficult.

The Process Of E-Commerce

A consumer uses Web browser to connect to the home page of a merchant's Web site on the Internet. The consumer browses the catalog of products featured on the site and selects items to purchase. The selected items are placed in the electronic equivalent of a shopping cart. When the consumer is ready to complete the purchase of selected items, she provides a bill-to and ship-to address for purchase and delivery When the merchant's Web server receives this information, it computes the total cost of the order--including tax, shipping, and handling charges--and then displays the total to the customer. The customer can now provide payment information, such as a credit card number, and then submit the order. When the credit card number is validated and the order is completed at the Commerce Server site, the merchant's site displays a receipt confirming the customer's purchase. The Commerce Server site then forwards the order to a Processing Network for payment processing and fulfillment.

Types Of E-Commerce

Business-to-business (B2B)
Business-to-business is a term commonly used to describe electronic commerce transactions between businesses.

Business-to-consumer (B2C):
Business-to-consumer describes activities of E-businesses serving end consumers with products and/or services

Business-to-Government (B2G)
Business to Government is a derivative of B2B marketing and referred to as a market definition of "Public Sector Marketing" which encompasses marketing products and services to the U.S. Government through Integrated Marketing Communications techniques

Business-to-Employee (B2E)
Business-to-employee (B2E) electronic commerce uses an intrabusiness network which allows companies to provide products and/or services to their employees. Typically, companies use B2E networks to automate employee-related corporate processes.

Consumer-to-consumer (C2C)
It involves the electronically-facilitated transactions between consumers through some third party. A common example is the online auction, in which a consumer posts an item for sale and other consumers bid to purchase it; the third party generally charges a flat fee or commission. The sites are only intermediaries, just there to match consumers. They do not have to check quality of the products being offered.

CONCLUSION
The Internet has lead to the birth and evolution of electronic commerce or E-commerce. Ecommerce has now become a key component of many organizations in the daily running of their business. E-commerce challenges traditional organizational practices, and it opens up a vast array of issues that the organizations must address. By focusing on the varying levels of an organization, it soon becomes apparent what effect E-commerce can have. An understanding of the implication E-commerce has on such organizational divisions can help businesses gain understanding hence plan for its inevitable continuing evolution.