1)E-Commerce:-E-Commerce or Electronics Commerce is a methodology of modern business
which addresses the need of business organizations, vendors and customers to reduce cost and
improve the quality of goods and services while increasing the speed of delivery.
Features of E-Commerce:-E-Commerce provides following features
i) Non-Cash Payment:- E-Commerce enables use of credit cards, debit cards, smart cards,
electronic fund transfer via bank's website and other modes of electronics payment.
ii) 24x7 Service e availability:- E-commerce automates business of enterprises and services
provided by them to customers are available anytime, anywhere. Here 24x7 refers to 24 hours of
each seven days of a week.
iii) Advertising / Marketing:- E-commerce increases the reach of advertising of products and
services of businesses. It helps in better marketing management of products / services.
IV) Improved Sales:- Using E-Commerce, orders for the products can be generated anytime,
anywhere without any human intervention. By this way, dependencies to buy a product reduce at
large and sales increases.
v) Support: - E-Commerce provides various ways to provide pre sales and post sales assistance
to provide better services to customers.
2)Advantages of E-Commerce:- E-Commerce advantag es can be broadly classified in three
major categories:
i)Advantages to Organizations:-
a)E-Commerce helps organization to reduce the cost to create process, distribute, retrieve and
manage the paper based information by digitizing the information.
b)E-commerce improves the brand imag e of the company.
c)E-commerce helps org anization to provide better customer services.
ii)Advantages to Consumers:-
a)E-Commerce application provides user more options and quicker delivery of products.
b)E-Commerce application provides user more options to compare and select the cheaper and
better option.
c)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 buy.
iii)Advantages to Society:-
a)Customers need not to travel to shop a product thus less traffic on road and low air pollution.
b)E-Commerce helps reducing cost of products so less affluent people can also afford the
products.
c)E-Commerce has enabled access to services and products to rural areas as well which are
otherwise not available to them.
3)Disadvantages of E-Commerce:-E-Commerce disadvantages can be broadly classified in two
major categories:
i)Technical disadvantages:-
a)T here can be lack of system security, reliability or standards owing to poor implementation of
e-Commerce.
b)Software development industry is still evolving and keeps changing rapidly.
c)In many countries, network bandwidth might cause an issue as there is insufficient
telecommunication bandwidth available.
ii)Non-Technical disadvantages:-
a)Initial cost:- The cost of creating / building E-Commerce application in-house may be very
high. T here could be delay in launching the E-Commerce application due to mistakes, lack of
experience.
b)User resistance:- User may not trust the site being unknown faceless seller. Such mistrust
makes it difficult to make user switch from physical stores to online/virtual stores.
c)Security/ Privacy:- Difficult to ensure security or privacy on online transactions.
4)History of e-commerce:-
1969: Compuserve – first online service provider – is launched.
1979: Michael Aldrich invents electronic shopping and makes the first electronic transaction.
1982: World’s first eCommerce company, Boston Computer Exchange, is started.
1991: The world wide web is invented.
1992: First eCommerce website – an online bookstore – Book Stacks Unlimited is launched.
1994: Netscape Navigator – an online web browser – is launched.
1995: eBay and Amazon are launched.
1998: Paypal is launched, and it revolutionises online payment processes.
1999: Alibaba – a frontier in eCommerce brands – is launched.
2000: Google Adwords – the first online search advertising tool – helps retailers advertise their
products/services
5) Differences between Traditional Commerce and E-Commerce:-
Traditional Commerce E-Commerce
Traditional commerce refers to the commercial E-commerce refers to the commercial
transactions or exchange of information, buying transactions or exchange of information,
or selling product/services from person to buying or selling product/services
person without use of internet. electronically with the help of internet.
In traditional commerce it is difficult to In e-commerce it is easy to establish and
establish and maintain standard practices. maintain standard practices.
In traditional commerce direct interaction In e-commerce indirect interaction through
through seller and buyer is present. seller and buyer occurs using electronic
medium and internet.
Traditional commerce is carried out by face to E-commerce is carried out by internet or
face, telephone lines or mail systems. other network communication technology.
In traditional commerce processing of In e-commerce processing of transaction is
transaction is manual. automatic.
Its accessibility is for limited time in a day. Its accessibility is 24×7×365 means round
the clock.
Traditional commerce is done where digital E-commerce is used to save valuable time
network is not reachable. and money.
In traditional commerce customers can inspect In e-commerce customers can not inspect
products physically before purchase. products physically before purchase.
6)Impact of E-Commerce:-The impact of e-commerce platforms extends beyond the business
realm:
1. Employment Landscape: E-commerce platforms have created new job opportunities,
such as e-commerce managers, digital marketers, and logistics specialists, while also
reshaping traditional retail employment.
2. Disruption and Transformation: Traditional retailers have faced disruptions as
consumers shift towards online shopping, leading to the transformation of retail business
models.
3. Environmental Considerations: While e-commerce reduces the need for physical
stores, it also raises concerns about packaging waste, carbon emissions from shipping,
and the overall sustainability of the supply chain.
4. Data Privacy: E-commerce platforms handle vast amounts of consumer data, raising
questions about data privacy and security in the digital age.
5. Cultural and Social Changes: The rise of e-commerce has altered shopping behaviors,
affecting the way individuals interact with products and altering the cultural significance
of traditional shopping experiences.
7)Challenges of E-Commerce:-
1. Cyber & Data Security:-When it comes to eCommerce, one of the biggest challenges faced is
security breaches. There is a lot of information/data that is involved while dealing with
eCommerce and a technical issue with data can cause severe damage to the retailer’s daily
operations as well as brand image.
2. Online Identity Verification:-When a shopper visits an eCommerce site, how would the
retailer know if the person is who they say they are? Is the shopper entering accurate
information? Is the shopper genuinely interested in the eCommerce products?
3. Attracting the Perfect Customer:-Shoppers have a myriad of options to choose from these
days. If they are looking to buy a handbag, they do some thorough research before finalizing on
one. If shoppers have several options, how do you make sure they pick you? How do you go
about finding that perfect customer that wants your product, at your rate and to the places you
can ship?
4. Customer Experience:-Customer experience or user experience is key to a successful
eCommerce website. Shoppers expect a similar if not same experience as one they would get in a
brick and mortar store. The flow of the website, the segmentation of the website and the retail
personalization of products based on the shopper’s preferences are imperative.
5. Converting Shoppers into Paying Customers:-One of the biggest ecommerce challenges is to
convert visitors into paying customers. An eCommerce website might have a lot of traffic, a lot
of clicks and impressions but they aren’t making the sales they anticipated. What can they do to
get more sales?
8)Limitations of ecommerce:
1. Security: the security risk in ecommerce can be
• client / server risk
• data transfer and transaction risk
• virus risk
2. High start up cost:The various components of cost involved with ecommerce are:-
• connection:- connection cost to the internet.
• hardware / software:- this includes cost of sophisticated computer, moduer, routers, etc.
• maintenance:- this include cost invole in traning of employees and maintenance of web-pages.
3. Legal issues:- these issues arises when the customer data is fall in the hands of strangers.
4. Lack of skilled personnel:- there is difficulty in finding skilled www developers and
knowledgeable professionals to manage and a maintain customer on line.
5. Loss of contact with customers:- Sometimes customers feels that they doesnot have
received sufficient personal attention.
6. Some business process may never be available to ecommerce:- Some items such as foods,
high cost items such as jwellery may be impossible to be available on the internet.
9)Electronic Data Interchange (EDI):- EDI is the computer-to-computer exchange of
business documents in a standard electronic format between business partners.
Importance of EDI:-
1. Cost Efficiency:- Properly executed EDI integration streamlines operations, leading
to reduced overhead and administrative expenses for companies of all sizes.
By implementing EDI, you can cut costs associated with paper, printing, storage, filing,
postage, and document handling.
2. Accelerated Commerce: Integrated EDI optimizes your supply chain, increasing
efficiency and productivity by seamlessly linking order data with accounting or ERP
systems. This eliminates the need for laborious manual tasks, like manually calculating
invoices, which can introduce errors affecting various aspects of your company.
3. Enhanced Accuracy: API-driven connectivity fosters seamless communication among
disparate technologies, transforming them into a cohesive application network. This
integration minimizes errors and enhances the vendor fulfillment process, ultimately
improving accuracy.
4. Data Enrichment: EDI integration contributes to data enrichment within your CRM.
Real-time data enrichment and tracking enable your customer success team to identify
customers requiring assistance or follow-up, repeat orders, or product suggestions based
on order data.
5. Heightened Productivity: Team members will no longer need to generate stock receipts,
hunt down invoices, or monitor supplier performance, freeing up time for more valuable
tasks.