®

eCommerce
Guide

eCommerce
eCommerce
eCommerce
Index
Chapters Page

1 eCommerce – Anytime, Anywhere, 1

Anything Marketplace
2 eCommerce- Benefit from it 3
3 Reach of eCommerce in India 6
4 Real People in the e-World 8
5 Guidelines for Online Transactions 11
6 Technology and Trends 14
7 Resources and Guides 16
8 Glossary of eCommerce Terms 19

Copyright © 2006 eBay India Private Limited

Copyrights and all rights of reproduction and translations are owned and reserved by eBay
India Private Limited. No part of this book may be reproduced or copied in any form or by
any means [graphic, electronic or mechanical, including photocopying, recording, taping,
or information retrieval system] or reproduced on any disc, tape perforated media or other
information storage device, etc., without the written permission of eBay India Private Limited.
Due care and diligence has been taken to avoid errors or omissions in this book. The copyright
holder of this book holds no responsibility for any mistakes, errors or omissions that may have
inadvertently crept in. All disputes subject to Mumbai jurisdictions only.
 Chapter 1 1

eCommerce: Anytime, Anywhere,

Anything Marketplace
They say a year in the Internet business is like a dog year... equivalent to seven
years in a regular person’s life. In other words, it’s evolving faster and faster.
-Vinton Cerf, Father of the Internet
Unlike the brick and mortar marketplace, eCommerce is a twenty-four
hour shopping mall where, any one can shop any time, buy almost
anything, from anywhere. Electronic Commerce or eCommerce is
conducting business using the Internet. People can exchange goods
and services without the barriers of time and distance. eCommerce
makes the world a global and unified marketplace!
To be an online buyer or a seller, all you need is access to
an Internet-enabled computer!

Amazing Potential! 25 million Indians use the Internet.

Online shoppers spent Rs. 4.30 billion on eCommerce. India will have over 100
million Internet users by 2007 - (Source IAMAI Power Shopper report 2005)

Fun Facts
First Online Transaction Aug. 11, 1994
The college graduates who founded NetMarket in Nashua, N.H.,
conducted the very first secure retail transaction on the Web.
They purchased the CD “Ten Summoner’s Tales” by Sting.
(Source: Digital Research Initiative)
2

Sheer speed of eCommerce

Did you know?

A piece of jewellery sells every 6 minutes in an online

marketplace like eBay?

A mobile handset sells every 7 minutes.

A piece of apparel sells every 13 minutes.

A MP3 player sells every 17 minutes.

A watch sells every 18 minutes.

A book sells every 28 minutes.

A coin or note sells every 32 minutes.

A digital camera sells every 40 minutes.

A toy sells every 66 minutes.

 Chapter 2 2
3

eCommerce: Benefit from It

“If eBay were a nation, we would be the fifth most populous nation in the world”
- Meg Whitman, eBay President and CEO
eCommerce ensures that anyone can run a highly profitable business by
spending only a few hours online each day. Some transactions that are
possible through the Internet include
• Trading in goods and services
• Delivering digital content online
• Transferring funds electronically, and
• Conducting online sourcing or public procurement

Unlike a traditional marketplace, the online shopping store is open

24X7 ensuring people across the globe can visit your store at anytime
and shop for products as per their convenience. Your physical presence
at all times is not essential. You only need to update information as
and when required!

5
Five Key Benefits of eCommerce

24 X 7 operational

1
No geographical/
language barriers

2
All transactions
just a click 4
3
away Speed and Better variety and
convenience of value enhancement
shopping from through auctions
home
4

eCommerce Categories – Top 5

Current categories Future Categories
Electronic gadgets 40% Electronic gadgets 53%
Computers & Peripherals 33% Airline Tickets 46%
Airline Tickets 29% Computers & Peripherals 42%
Hotel Bookings 20% Hotel Bookings 31%
Home tools and Products 16% Home Appliances 32%

(Source – IAMAI Power Shopper report 2005)

eCommerce: Business Models
While eCommerce is just over a decade old, there are various models in
the online eCommerce space.

B2B Model
B2B (Business to Business) is the exchange of products or services on
the Internet between businesses rather than between businesses and
consumers. B2B is companies buying from and selling to each other
online. For example: Company A in China makes computer peripherals
and sells them online to its trading partner Company B in USA that
makes computers.
Visit eBay India B2B motors site - [Link]

B2C Model
B2C (Business to Consumer) is the online selling of products or services
by a company to a consumer for its own use. It refers to the selling or
buying of products and services through the Internet from web retailers
to web customers. Online booksellers such as [Link], branded
goods manufacturers, online banking, travel services ([Link]),
real estate sites, are examples of B2C operations.

C2C Model
C2C (Consumer to Consumer) is the online transaction between two
individuals selling products and services to one-another. A good example
of C2C model is eBay ([Link]), where consumers from across the
globe sell their goods and services to other consumers.

G2B Model
G2B (Government to Business) is the online transaction between the
government and a company or an organization. An example of G2B
operation is the online sale of surplus government products to public
sector companies. G2B operations can also include online procurement
of products and services from public sector companies by the
 5

government. The Indian government has an online tendering website,

[Link].

G2C Model
G2C (Government to Citizen) is an e-government initiative designed to
increase the interaction of citizens with the government. Examples of
G2C initiatives are renewing licenses online, paying taxes online, and
applying for passports, visas, and other government benefits online.
G2C initiatives increase citizen participation in the government by
overcoming barriers of time and geographies. For example, the Mumbai
police website [Link] accepts complaints, suggestions,
shares information on the new initiatives and can be contacted for
latest updates on license renewal etc.

Fun Facts
Can you imagine a town getting sold online? Well, the town of
Bridgeville, California was sold on eBay for more than US$1.75
million.

India’s Internet Usage and eCommerce in 2007

India’s Internet Growth in

population by eCommerce industry
2007: 100 million (2006-2007): 95%

(Source IAMAI Power Shopper report 2005)

Rest of the world Rest of the world

(12.5%) Asia Pacific (13.9%)
(21.6%)
Japan Asia Pacific
Japan
(7.8%) (30.6%)
(10.3%)

United States United States

(27.3%) (22.1%)
Western Europe Western Europe
2002 Total=602M
(28.3%)
2007 Total=1077M (25.6%)

(Source: Worldwide Internet Usage and Commerce 2004.

2007 Forecast: Internet Commerce Market Model Version 9.1)
6 Chapter 3

Reach of eCommerce in India

When I took office, only high energy physicists had ever heard of what is called the
Worldwide Web.... Now even my cat has its own page.
- Bill Clinton, former President USA
Business to commerce (B2C) transactions in India will see a 95% growth
in 2006-2007. According to the IAMAI Power Shopper 2005, the B2C
transaction in India is predicted to touch Rs. 23 million in 2006-2007.
Mumbai and Delhi account for almost 50% of the total eCommerce volume.

29% 19% 7% 6%
MUMBAI DELHI CHENNAI BANGALORE

5% 4% 2% 2% 26%
KOLKATA HYDERABAD LUCKNOW AHMEDABAD OTHERS
(Source IAMAI Power Shopper report 2005)

eCommerce India: Key Players

eBay India

Rediff

Indiatimes

Others
Yahoo Fabmall Sify
Google MSN
42% 23% 18% 3% 3% 3% 1% 1% 5%
(Source: JuxtConsult survey, April 2005)
 7

Sellers across India reach millions of buyers across the globe!

Mahendra Tated, a seller from Vishakhapatanam, has hit the jackpot
with eBay. Tated knew that if he started listing his items on eBay India,
his products would be viewed by a much larger audience than he could
imagine.

Mahendra Tated, 34, seller on eBay India since 2001

“I started listing all kinds of stationery items… apparel, CDs, floppies,

sunglasses, antique gramophones... I have recently located a dealer
from whom I can source these items at a good price. I am getting a
great response.”
Business men or college kids, buyers of all age group are happy
shopping online…
Ashok Nadkarni’s job requires him to be on the Internet for close to 18
hours a day. There hasn’t been a single day when he hasn’t logged on
to eBay India. His first deal was in October 2002 when he bought 50
business planners for only Rs.2000. Since then, he has been an ardent
buyer on eBay India.

Ashok Nadkarni, 47, Businessman from Dadar, Mumbai

“I recommend it to both casual and serious buyers, to those who are

good and those not-so-good with their computer skills, as the site is
very user friendly. The payment gateway is safe and secure and one need
not have the usual fears associated with using credit or debit cards on
the Internet”.

Fun Facts
71% of the internet shoppers are in the age band of 18 to 35.
36% of the users have spent more than Rs.5000
36% of the users have spent between Rs.1000 to 5000
(Source IAMAI Power Shopper report 2005)

Fun Facts
The owner of [Link] sold advertising space comprising a
single pixel on its homepage for 21 days for $100.
(Source IAMAI Power Shopper report 2005)
8 Chapter 4

Real People in the E-World

“The Internet is becoming the town square for the global village of tomorrow.”
- Bill Gates, founder Microsoft
Some interesting facts about how people have adopted
eCommerce as their virtual homes.
The Site Visitor
55% of visitors to eCommerce sites have adopted the Internet as a
shopping medium. (Source: IAMAI eCommerce Report 2005)

‘Regular Online Shopper’

Out of those 55 online shoppers, 48 shoppers have shopped more than
once and are termed ‘regular shoppers’.
(Source IAMAI Power Shopper report 2005)

18% Percentage Age-Group

Regular shoppers 25 18-25
46%
25% Regular shoppers 46 26-35
Regular shoppers 18 36-45

85% of the Indian online shoppers are male. Even a 15%

female audience represents a 15 million strong market by
2007-2008.

Your next door neighbor could be a successful online shopper!

Check out some surprising statistics of buyers and sellers.

Profile Statistics in Gender and Percentage
by occupation
Bachelor or Post Graduate degree 83%
At executive level 54%
Professionals or self-employed 24%
by point of access
Access the Internet from their office 76%
Home 63%
Cyber cafes 24%
 9

eCommerce is Addictive!
62% of shoppers have shopped for more than a year!
37% of online shoppers have started shopping online in the last
12 months.
67% of online shoppers have shopped online as recently as 3 months
showcasing the growing acceptance of eCommerce.
53% of online shoppers have shopped online more than 5 times and
27% of online shoppers have shopped online more than 10 times.

VRS at 40, Start Business at 60, Keep Earning at 80!

At 80, Mr. P. Sharma fuels his 50 year old passion for stamp
collection and entrepreneurship through eBay.

Mr. Sharma served the Indian government for 41 years and retired as
an Assistant Civilian Staff Officer. He started selling on eBay India
three years ago under the ID, indiastamp. Today, he has found a means
to earn through his hobby. “I come from an age when money was
something very dear and not easily spent. I have a huge collection of
thousands of stamps…I thought it was a good option to earn something
by selling them on eBay India.”
Mr. Sharma sells mostly through the Auction format and offers all
convenient payment options to buyers. “eBay India is a great
platform... There are 3Ps that are essential to know – Product,
Presentation, and Platform. One must be completely honest to the
buyers in order to be successful. Online selling is a platform which
operates entirely on trust.”
Fun Facts
12,700 Indian sellers join the 1.3 million eBay community
members who earn their primary or secondary source of income
from eBay.
((Source: A C Nielsen)

Better Deals, Lower Cost, At-par Quality

Mr. Faizal Memon, 45, deals with the import and export of ‘Attar’, a
traditional Persian perfume. He buys mostly jewellery and electronics
on eBay. He prefers using the ATM drop-box for making payments.
“Till date, I have bought over 540 items ranging from jewellery, mobiles,
electronics, toys, garments, shoes, home appliances, watches, etc.
I prefer bidding for items as I end up buying them at a price that is
lesser than what is available offline, yet of the same quality.”
10

Chance to Live your Dreams

“I always wanted to start on my own. I realized there is a huge market
waiting for me to explore and I didn’t have to try any harder.”
Twenty-eight year old Chinmay Tripathi found his goal in life through
eBay. A post graduate in Computers from the University of Ahmedabad,
Chinmay has a family-run textile business. A banner by eBay on a chat
site changed his life.

Hottest selling products: Ramayana, Mahabharata

Buyers from: Baroda, Haridwar, Gangotri
“I sell electronics as well as religious books on eBay India. Two most
popular books are the Ramayana and the Mahabharata at Rs. 75 and
Rs. 40. I have sold over 1000 religious books on eBay India. All the
books are procured from dealers hence they are heavily discounted.”

eCommerce Transaction Process

Online transaction is as simple as a real place transaction. Sellers need
to present details of their product or service on the eCommerce website
that the buyers can view.

“Raju” Seller
Raju registers Raju fills phone Raju realizes that
Raju sees an on eBay by details for the the auction has
eBay ad online  accepting all  auction. The listing closed successfully
and decides to terms on the goes live in 30 as a buyer bids on
sell. site. seconds. the mobile.

Then buyers bid for the product or service.

“Shalini” Buyer
Shalini a regular Shalini sees the Shalini wins the auction
buyer on eBay, auction put up by and gets in touch with
is looking for a  Raju and places a  Raju for payment and
mobile phone. bid on the auction. delivery.

After the auction is closed, the buyer who wins the auction pays for the product. The
seller pays a commission to the eCommerce website for its services.

Payment
Shalini pays Raju for Raju pays a commission
eBay generates
the mobile phone and to eBay for its services
 an invoice once 
Raju delivers the phone within 30 days of
every 30 days.
to Shalini. receiving the invoice.
 Chapter 5 11

Guidelines for Online Transactions

The Internet has been the most fundamental change during my lifetime and for
hundreds of years. Someone the other day said, “It’s the biggest thing since
Gutenberg,” and then someone else said “No, it’s the biggest thing since the
invention of writing.”
- Rupert Murdoch
When shopping offline in a real marketplace, we always ensure that:
• We have verified the seller’s reputation before purchasing.
• We have scrutinized the product.
• We have checked delivery date, time, and details.
• We have received a receipt of the transaction.
• Our wallets are safe from pickpocketers.
• Our PIN is concealed while paying through debit cards.
Similar checks and validations are also critical while shopping online.
Some guidelines to keep in mind for online transactions
Guideline 1: Learn as much as possible about the product
and the seller.
Knowing your merchant helps you feel more secure about the
transaction. You can gain information about the retailer through:
• The retailer’s reputation in the market
• Previous purchases made by shoppers
• Referrals through friends
• Reviews and comments by other online shoppers on forums

Tracking User Feedback

eBay India encourages users to ‘rate’ each other. Ratings are dependent
on the actual experiences of users while buying and selling.
Buyers rate sellers based on their service and product quality. Sellers
rate buyers depending on the ease of transaction and time taken to
receive payments.
Ratings are of three kinds
1. Positive
2. Negative
3. Neutral
12

This feedback score acts like an eBay user’s online reputation. Buyers
usually choose to deal with sellers with high positive feedback scores.

Guideline 2: Understand retailers’ refund policies.

As a customer, you should be aware of the refund policies. You must seek
answers to the following questions:
• What is the required time frame to contact the retailer to
return the purchased items?
• Will a full refund be offered or will a merchandise credit be
provided?
• Can you return an open or used item?
If your retailer does not have refund policies, access buyer protection
programs from either the shopping site or through the payment method.
For example, many credit cards have chargeback facilities.

Guideline 3: Use a secure password to protect account information

Do not use predictable passwords like your birth date or name. A secure
password should be a combination of upper and lower case letters,
numbers, and symbols that no one can predict.
(For example: $BLue Ice$, Ab**19#72) Another example is to look at
your CD rack for a great password.. the first initials of the title of your
favorite song can be an excellent password !

Use different passwords for different accounts. Also, change

your password periodically to keep it safe.
Guideline 4: Use a secure checkout and payment process.
There are safe and easy-to-use payment services that allow shoppers to
enter account information only once into a highly secure and reputable
site. This ensures protection of this financial information from mis-use.
 13

Use this account for all future purchases to avoid giving credit card or
banking information separately to other websites. Many websites use
a technology called Secure Sockets Layer (SSL) to code personal and
financial information sent over the Internet. A browser displays the icon
of a locked padlock at the bottom of the screen.
Look for third-party seals (VeriSign or TrustE logos) that guarantee sites
with safe handling policies and procedures. Restrict your purchases to
such trusted sites only.

Guideline 5: Trust your instinct.

If an offer sounds highly suspicious or too good to be true, think twice!
You should be wary of unreasonably low prices or unusually attractive
offers. Read the fine print (or click the links that describe the purchase
agreement) before purchasing.
Guideline 6: Protect your computer.
Your computer must have up-to-date anti-virus, anti-spam, and firewall
software protection. Contact your computer technician today to update
the same.
Guideline 7: Understand safe trading guidelines.
Always follow safe trading guidelines provided by the site when
shopping online.
Guideline 8: Retain copies of correspondence.
Retain copies of all correspondence and communication until you receive
your product. This may be useful to solve disputes between you and the
seller.
If this fails, contact the service or financial institution used to make the
payment to see if it can be reversed.
14 Chapter 6

Technology and Trends in eCommerce

They say a marketer’s and consumer’s dream is the World Wide Web. It’s the best
of mass advertising and the best of target marketing.
- David King of DDB Needham
Technology Making eCommerce a Safe Marketplace
Technology in eCommerce is moving towards getting buyers and sellers
closer than never before.
VOIP in eCommerce
Offline businesses not only provide help and sales
advice but also a touch and feel to the product. Voice-
over Internet Protocol (VoIP) addresses the interaction
gap in eCommerce by providing customers a direct
access to the seller so as to discuss information related
to products and services.
VoIP enables shoppers to talk at the click of a button.
Customers can chat free of cost or even talk to the
seller, who can walk the customers through the
technicalities of the product and close the sale. VoIP
also helps vendors convert their call centers to IP-
based communication center. This helps them reduce
their operational costs while adding new services and
features.

Fun Facts
By shopping and paying bills online, consumers review their
account information and check the accuracy of transactions more
carefully!
Online transactions like electronic payments and automated payroll
eliminate the physical trail of documents.
Blogging in eCommerce
Blogging has grown in the past two years as a popular and compelling
business tool. Today eCommerce retailers and vendors start their
company blogs to provide information that they could not accommodate
on their company websites.
Business blogs have come up as a novel way to deliver products,
services, and information besides being an excellent advertising and
marketing tool. Blogs can be used as a focused marketing tool as it is
the place where like minded people share news and views on products
and services.
 15

Blogs enable readers to post feedback and queries that the company can
respond to. This makes blogs an interactive medium for both vendors
and sellers.
eBay Blog ([Link])

Fraud Prevention Technologies

Most eCommerce companies use fraud prevention technologies to
ensure a safe and secure business experience to online buyers and
sellers. Most of these technologies are designed to prevent credit card
frauds, identity thefts, cheque frauds, and phishing. There are various
technologies geared toward the creation of anti-phishing software to
identify phishing contents on websites. These technologies act as a
toolbar to display the real domain name of the visited website and
detect phishing attempts over email.
16 Chapter 7

Resources and Guides

We have technology, finally, that for the first time in human history allows people
to really maintain rich connections with much larger numbers of people.
- Pierre Omidyar, Founder, Chairman of the board, eBay
Securing Online Transactions
Most eCommerce websites have resources to address security and
customer concerns.
eCommerce Security Information Websites
Websites
Yahoo Virus updates and customer [Link]
support
Indiatimes Secure transaction information, [Link].
privacy protection com/planetm/feedback/
[Link]?CID=20
Rediff Customer support [Link]/
eBay Report a problem/ file a [Link]/securitycentre
complaint, marketplace
rules and policies, dispute
resolution, Spoof tutorials and
free spoof detector tool bar,
safety tips etc.

Security Centre
It is a single source for direct information on shopping safely on the
online marketplace. Additional security also comes through the Purchase
Protection Program.
Feedback forums on online marketplaces help buyers and sellers share
their transaction experience. Online shoppers use this to check the
history of buyers or sellers.
 17

Reporting Online Disputes

Contact the website redressal systems to report online disputes. For
example, eBay has a dispute resolution centre wherein a user can file
a complaint or solve a dispute easily. Buyer problems such as item
not received, seller problems such as unpaid item etc. can be resolved
through the security and resolution centre. [Link]/securitycentre

You can also follow a simple process to report misuse of credit card or
any financial information.
Obtain a copy of your credit card statement to confirm someone
has misused your credit card or financial information
Contact the credit providers and inform them of the fraudulent
activity
Keep records of all correspondence related to your attempt to
report and correct the fraudulent activity
Your last option is to contact the Police and report the crime
18

Resources from eBay that ensure trading is fast, safe, fun, and easy.
For Query and response on eBay: contact us-
[Link]/help/contact_us/_base

For quick, safe access to eBay: eBay toolbar and Account Guard-
[Link]/toolbar

To ensure safety and security in the eBay marketplace: Security

and Resolution Centre- [Link]/security centre

To protect your account information on eBay: Spoof Tutorial

[Link]/education/spooftutorial

For a safe purchase on eBay: Buyer protection

[Link]/help/tp/

More information about eCommerce

IAMAI : Information, news, and research findings about
eCommerce [Link]
NASSCOM : Research in software industry, services, and advancements
in software technology [Link]
CII : Detailed insight into Indian industries, policies,
fairs and exhibitions [Link]
CERT : Internet security [Link]

CORE : Internet domain name registrations [Link]

IT ministry : Department of Information Technology [Link]

 Chapter 8 19

Glossary of eCommerce Terms

Affiliate Program: A popular website promotion tool where a
website contracts with other websites for driving visitor to its
site. The revenue is calculated according to the traffic brought
by a particular website.
Browser: Software Application program required to access and
read the websites on the Internet.
Business to Business: A business model for business on
Internet. Popularly called as B2B, it includes eCommerce
transaction between two business organizations.
Business to Consumer: A business model for business on
Internet. Popularly called as B2C, it includes eCommerce
transactions between a business organization and an individual.
Domain Name: The unique name given to every website.
It is used to physically locate a website over the Internet.
A domain name consists of three different parts with each
separated by a dot. These are host server name, the unique
name of the website and the third defining the purpose/type
of the website.
eCommerce: A methodology used for executing business
either wholly or partially - over the Internet or a network.
Encryption: A procedure that renders the contents of a message
or file unintelligible to anyone not authorized to read it.
FTP: File Transfer Protocol (FTP). A globally accepted set of
rules used while transferring files from one computer to
another computer of a network or Internet.
Gateway: A hardware or software that acts as a mediator
between two distinct protocols and helps in the transfer of
information between diverse systems.
Hosting: A term used to store and maintain files, email or
domains on a server connected to the Internet.
Merchant Account: An online bank account required by a store
to receive payments through electronic mediums like credit
cards. It can be considered as a virtual bank account that
receives electronic money.
20

Order Tracking: The process of tracing the status of particular

orders placed by a customer in a web store.
Payment Gateway: A computer system that acts as a mediator
between a merchant account and online storefront. Payment
gateway is used in authentication of credit card information
and real-time charging from a credit card.
Shipping Provider: An organization that provides the services
of physically transporting the goods ordered on the Internet,
to the address specified by a buyer.
Shopping Cart: Software required for building an online store
and accepting orders online.
SSL: Secure Socket Layer: A protocol designed for secure
transfer of Information over the Internet. It helps to maintain
security, reliability and privacy of the information and ensures
that the information is not tampered with while the transfer
is taking place.
Website: A collection of files organized in a structure that
can be read through a browser. The domain name given to a
website is the unique identification of a website in the World
Wide Web.
Website Traffic: The number of times a website is viewed by
a unique visitor within a stipulated time.

(Source: [Link]/legalresources/[Link],
[Link]/[Link])
Design layout: Courtesy – Kern Communications Pvt. Ltd. Printed at: Mumbai, India
This book has been issued in public interest by eBay India.
eBay and the eBay logo are trademarks and copyrights of eBay Inc.
[Link]