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Unit - 5

5.1. Introduction to E Commerce
Carry ‘the globe’ in your shopping bag!! It’s not exaggerating the fact if I say: the
world is now coalesced to a click on our computers. Since long ago, all alluring
materials around have taken an exodus to the world of internet. No often do we now
think of taking a stroll through the market before buying a mobile handset, but a
healthy online research which in some cases is consequently followed by an online
purchase. The scenario is not limited to mobiles alone. It covers a wide range of
products like home appliances, consumer electronic goods, books, apparels,
travelling packages etc and even the electronic content itself.

What is E Commerce?
E Commerce stands for electronic commerce and caters to trading in goods and
services through the electronic medium such as internet, mobile or any other
computer network. It involves the use of Information and Communication Technology
(ICT) and Electronic Funds Transfer (EFT) in making commerce between consumers
and organizations, organization and organization or consumer and consumer. With
the growing use of internet worldwide, Electronic Data Interchange (EDI) has also
increased in humungous amounts and so has flourished e-commerce with the prolific
virtual internet bazaar inside the digital world which is righty termed as e-malls.
We now have access to almost every knick-knack of our daily lives at competitive
prices on the internet. No matter one is educated or illiterate, an urbane or a
countryman, in India or in U.K; all you need is an internet connection and a green
bank account. With e-commerce then, you can buy almost anything you wish for

without actually touching the product physically and inquiring the salesman n number
of times before placing the final order. Here is a beautiful picture depicting how has
human life evolved to adapt to the digital world and hence trading over the internet.
As seen, from pizza and potted plant to pair of shoes, we have everything on sale on
the internet available in tempting offers..!! Snapdeal.com, Amazon, eBay, Naaptol,
Myntra, etc are some of the most popular e-commerce websites.

The Breakthrough Beginners
Tracing some steps back, it’s been recorded that some institutes of the western
world started exchanging information and data electronically by the late 1970s. But
the concept of online trading of goods was first witnessed much later with the dawn
of 1990. In 1994, Jeff Bezos; an American businessman started his e-commerce
website Cadabra.com, now popularly known as Amazon.com. Amazon was the first
online firm to execute secured online transactions. At the onset, Amazon was known
as an online bookstore, but with the whelming customer-response it expanded to
trading in books, music, apparels, CDs/DVDs, electronics, MP3s, videogames and
many more. Running successfully, round-the-clock since 1994, surprisingly Amazon
recorded its first profit in the year 2003 only. Although, Amazon proved to be a
successful business model by late 2003, it’s no less than a fact stating its

tremendous popularity. The ‘enriched library’, online review system and a user
friendly website are still the starred assets of this e-commerce company.
Dell Inc emerged as the first company ever to record sales in millions of dollars in
1997. It was also the first company to sell large number of assembled computers
online. It is popularly known for its successful business model and in the year 2007,
it was listed as the 34th largest company in the Fortune500 list.

5.2. E-Commerce in India: Scope, Challenges &
Future
Scope

Electronic Commerce is more than just buying and selling
products online. It also includes the entire online process of
developing, marketing, selling, delivering, servicing and paying
for products and services. India has shown tremendous growth in
the E-commerce segment. With an internet user base of over
300 million, India has third largest internet population after US &
China (see info-graphic below).

India has witnessed a major breakthrough E-commerce success
stories particularly in e-retail in Consumer Electronics &
Fashion Apparel & Home Furnishing segments. E-commerce
creates new opportunities forentrepreneurial start-ups. Ease of
Internet access, Safe and secure payment modes coupled with
aggressive marketing by E-Commerce Giants has revolutionized
this segment. Rapid development in mobile technology has given
way to Mobile Commerce with many E-Commerce companies
shifting to App only model.

in-spite of the opportunities it presents also has poses certain challenges which are sometimes too much to handle for start-ups: .Challenges E-Commerce.

let alone early stage ones. This cost is significant and can be brought down to cost per customer. if the volumes permit to do so. in India internet penetration is so far dismally low at 0.1 per cent of population. the customer is pampered by offering huge .5 per cent of the population. Unfortunately. ecommerce remains far away from the common man. Experts say that the average figure for this metric in the current e-Commerce ecosystem is between INR 500 – 1000 customer. E-Infrastructural Issues: Internet is the backbone of ecommerce. penetration of personal computer (PC) as low as 3. which isn’t sustainable for even medium sized companies.  Branding & Marketing: To get people to come on an eCommerce site and make a purchase involves heavy cost due to branding and marketing.  Declining Margins: With the introduction of a large number of players in the already competitive e-commerce market.5 per thousand of population and penetration of telephone only 2.

Twitter. tax rate is uniform for all sectors whereas tax structure of India varies from sector to sector. In those countries. jewelry have to face challenges to sell their products as thebuyers want to see and touch before they buy these stuffs. Companies dealing with products like apparel. This factor creates accounting problems for the Indian online business companies. the advertising & promotions on these social sites has increased the chances of success of generating transactions to many folds. Future E-Commerce is here to stay !!  Social Media: Majority of online buying decisions are made on Social Media.  Touch and Feel: Indian customers are more comfortable in buying products physically. Further. the clients can stay updated via the posts published on this media. Pinterest etc have become a medium for easy log-in and purchase.discounts. resulting in razorthin margins. Getting this right is a challenge. handicrafts.  Logistics & Supply Chain: Logistics failure in any area can mean detrimental damage to a startup’s future and can hurt the brand overall. LinkedIn. Social network like Facebook. Add to this the need for a guaranteed return policy. Google+. offers. . Moreover. taking returns etc.  Tax related issues: Tax rate system of Indian market is another factor for lesser growth rate of eCommerce in India in comparison to other developed countries like USA and UK.

. Experts say more than 580 million people in India will use the Internet by 2018. The answer to these problems is Delivery by Drones.  App only Approach: Statistics suggest the future of internet lies in mobiles. This will cause all major players to switch to app only model. Drone Delivery: Companies have been working their way around to innovate the delivery process to shorten human effort as well as time. If everything goes as per the plan. DGCA is now fast tracking the process of issuing guidelines for the use of drones for civil purposes in India. About two-thirds of its online traffic of Flipkart comes from users in small cities and towns. then India might become the first country in the world to allow the use of drones for civil purposes. and 70-80% of them will access the Web on mobile phones.

such as color and size. The button will be displayed near sponsored search results beneath a “Shop on Google” heading at the top of the page. and then select a shipping route. Google would then pass on order information. including the customer’s name and shipping address.Flipkart’s app-only approach assumes larger significance in these places where most people don’t own desktop computers and have limited access to broadband. to the retailer.  Google's Buy Now Button: Google is reportedly working on its own “Buy Now” style button that would allow e-shoppers search for products on Google and purchase them with a single click. Jet Airways is experimenting with one such solution . right through Google’s own search results page. When users click on the Google’s “Buy Now” button.  Artificial Intelligence: As the ecommerce space gets saturated. they will be re-directed to another Google page that will allow them to choose specific item details. investors looking for innovative use of technology are zeroing in on companies developing artificial intelligence (AI) solutions.

From horses and handcarts to ships. and wait for the goods to show up on your doorstep. though. click your mouse a few times. You just sit in your armchair. In a real-world store. you simply take your new jeans to the . and how flexible would the customer be to change travel location or date. the airline knows whether to package hotel deals.3. It sifts through the individual’s public content on the internet. and airplanes. it's all change: many of us are now buying and selling with a new form of commerce that involves neither money nor transportation—at least not in the traditional sense. Originally just a bookstore. Based on this information.com: the world's most successful e-shop. enter your credit card number. It even allows third-party vendors to sell products alongside its own offerings with something called Amazon Marketplace. making life more convenient for consumers and opening up all kinds of new opportunities for businesses. Today. now it sells almost anything you can imagine. Amazon has consistently set the standard for online retailers with pioneering features like one-click shopping. The basic components of an e-commerce system Whether you're buying in a store or buying online. as well as the customer’s previous searches and creates an instant profile. E-commerce. everything you do is geared around a transaction: the basic exchange of money for goods or services. We do know that metal coins have been used to buy and sell things for at least 4000 years. 5. or simply stick with airfare discounts. the need to trade goods has spurred on innovations in transportation for just as long. The system also allows them to predict how likely is it for the customer to upgrade. Let's take a closer look at what it is and how it works! Photo: Amazon. has grown enormously in the last decade. as this is known. trucks. Essential E-commerce Processes No one knows exactly when people first started trading with one another— or how.devised by Vizury.

it also introduces two extra problems for the retailer (or e-tailer. Many people successfully run small-scale online stores without either complicated databases or dispatch systems: they simply have a website to publicize their business and take orders and then they manage the stock control and dispatch in more traditional ways. It works in a similar way if you're buying online. Not all e-commerce systems work in exactly this way: . Small traders who sell items on the auction website eBay often work in this way. their "dispatch system" is simply a walk to the local post office. for example. but there's one important difference: you never actually get to handle (or even see) the goods until they arrive at your home sometime later. hand over some cash. Only the first of these three systems is strictly necessary for e-commerce. and a dispatch system linked to a warehouse where the goods can be instantly located and sent to the buyer as quickly as possible. then. a database system that can keep a check of the items the store has in stock (constantly updating as people make orders and ideally making new orders with suppliers when stocks run low). In short. and a means of dispatching and delivering the goods to your address. Apart from having some means of processing transactions online. and leave the store with your purchase in a bag—that's a transaction. How e-commerce works Here's one example of how a sophisticated. it means they also need a way of checking that the goods you've ordered are actually in stock. Their "databases" are in their head. If this makes buying online slightly problematic for the purchaser.checkout. as online retailers are sometimes known). fully computerized e-commerce system might work. e-commerce is about combining three different systems: a Web server that can manage an online storefront and process transactions (making appropriate links to bank computers to check out people's credit card details).

The stock database confirms whether the item is in stock or suggests an estimated delivery date when supplies will be received from the manufacturer. in "real time"). This is a central computer that sees orders through every stage of processing from submission to dispatch. The Web server sends her order to the order manager. The order manager queries a database to find out whether what the customer wants is actually in stock. Her Web browser communicates back-and-forth over the Internet with a Web server that manages the store's website. Next it communicates with a merchant system (run by a . a customer tries to order a book online. 3. 6. Assuming the item is in stock. the stock database system can order new supplies from the wholesalers or manufacturers. 2. This might involve communicating with order systems at the manufacturer's HQ to find out estimated supply times while the customer is still sitting at her computer (in other words. 5. If the item is not in stock.1. Sitting at her computer. 4. the order manager continues to process it.

9. 11. the warehouse computer e-mails the customer to confirm that her goods are on their way. 12. 8. The order manager confirms that the transaction has been successfully processed and notifies the Web server. The merchant system authorizes the transaction to go ahead. seven . 7. reliable (customers expect sites to be online 24 hours a day. Once the goods have been dispatched. A truck from a dispatch firm collects the goods from the warehouse and delivers them. 14. 15. The goods are delivered to the customer All of these things are invisible—"virtual"—to the customer except the computer she sits at and the dispatch truck that arrives at her door. 13. How do you design an e-commerce website? The design of virtual stores is often the most important factor in the success or failure of online businesses. The merchant system might make extra checks with the customer's own bank computer. The bank computer confirms whether the customer has enough funds. The Web server shows the customer a Web page confirming that her order has been processed and the transaction is complete. though funds will not be completely transferred until several days later. That doesn't simply mean that ecommerce web sites have to look attractive (though they do): they have to be usable (quick and easy to navigate around without irritating or confusing people). 10. The order manager sends a request to the warehouse to dispatch the goods to the customer.credit-card processing firm or linked to a bank) to take payment using the customer's credit or debit card number.

you also had to develop your own merchant system that could securely process credit card details and ship transactions to and from bank computers. and for pages to load without delay). there doesn't necessarily have to be an obvious connection between the name of a website and things it actually does or sells: all that matters is that. These days.days a week. As successful Web businesses such as eBay and Amazon have proved. Using e-commerce to sell information There's lots of money to be made online. offering a gateway to all kinds of other premium services. is probably the best-known example of a website like this.com boom and bust. over time. but not all of this involves selling goods in the traditional way. and trust the brand and visit the site instinctively when they want to buy something. Some websites (notably Amazon) allow you to incorporate mini versions of their store inside your own website—so you make a small commission selling their products within your own site. since they have built-in credit card processing features. It used to be said that the right domain name was an essential requirement for a successful online business but some of the most memorably named web sites (includingpets. Not only did you have to build a dedicated website from scratch. For example. Yahoo! (which originally stood for Yet Another Hierarchical Officious Oracle). it mutated into a search engine and then a portal. Created as a comprehensive directory of other websites. love.com and garden. Setting up an online store used to be quite an undertaking. Many people set up virtual storefronts on the auction site eBay and then use PayPal (now a part of eBay too) to process their transactions. you can get free e-mail through . etoys.com) were early casualties of the dot.com. handling transactions couldn't be simpler. Websites like PayPal make it possible to build a store very quickly and. anyone can set up an online store in minutes. and secure (because no one is prepared to type their credit card details into a website that isn't safe). Many online businesses try to make money by offering a mixture of free and premium services. people will come to know.

Advantages and disadvantages of e-commerce Although early reactions to online shopping websites were often mixed ("It takes too long to find what you want". you can store your photographs for free on Yahoo's Flickr site. waiting lines are longer. Not many can compete with huge businesses like Amazon or eBay. When people flock to online shopping sites for the Christmas rush. Newspapers. "I'm not sure they're secure". but anyone can open an online store and start trading within a matter of minutes. and book publishers also try to make money through a mixture of free and premium services. and the doors open only during normal business hours. Buying an article involves a transaction similar to the ones you'd make on Amazon or eBay. E-commerce has also threatened many traditional ways of doing business. Small local stores. so this kind of online publishing is also clearly a variety of e-commerce. unappealing name that online businesses give to the words and pictures they publish) for free. but you can pay an extra sum to have them printed out or processed in various ways.Yahoo!. using advertising to make money. e-commerce has opened up all kinds of new opportunities. some also offer a proportion of their articles for a one-off fixed fee or subscription). but you can also pay extra for a more sophisticated e-mail system. long threatened by the growth of giant retailers like Wal-Mart and Tesco. Savvy existing businesses such as Wal-Mart have tried to offset the threat by seizing the opportunity: "bricks and clicks" (having real world stores and a seamlessly integrated website) . For businesses too. have found a new lease of life by trading online and selling their products mail order. "You can't see what you're buying"). While most of them offer their basic content (the horrible. they naturally spend less in real-world stores.) Many people now swear by online shopping and wouldn't dream of setting foot in a real-world store where prices are often higher. (For example. things have improved greatly over the last decade and online businesses have found ways round most of the drawbacks. "The things I want are never in stock". magazines. some online clothing stores sensibly offer free returns if you don't like the clothes you've bought or if they turn out not to fit.

or using websites to locate local branches of stores where they can inspect and purchase exactly the goods they want. The steady growth of e-commerce: This chart shows the percentage of total retail sales that e-commerce has represented since 2006. By courtesy of US Census Bureau. . And always will be.2 percent of total retail sales.S.is now generally seen as the way to go. While some traders (notably car dealers. and realtors) have tried to resist the threat from online shopping. is always right. as shown in the chart below)—but that fraction has been growing very steadily. The customer. and will keep doing so. it shows "Estimated Quarterly U. Shoppers have become equally savvy and are adept at inspecting products in real-world stores before buying online. Retail E-commerce Sales as a Percent of Total Quarterly Retail Sales: 1st quarter 2006 to 1st Quarter 2015". It's all too easy now for customers to take their money and their spending power somewhere else—even to retailers in another country. opticians. and their mouse. It's important to bear in mind that e-commerce still represents only a fraction of all the trade that we do (for 2015. As ever. customers call the shots and will continue to do so. the US Department of Commerce reported ecommerce reaching about 7. protectionist tactics are bound to fail in the long term. More formally.

Once we hunched over desktop PCs clicking mice. and Facebook all see mobile computing as a decisive battleground in the next few years. However. you've only to look at the giants of the online world and see how seriously they're taking it. If you've any doubt about whether m-commerce is the future. and other handheld devices. But just as you've got used to the rules of the online game. Google has repeatedly highlighted the importance of running a mobile-friendly site. along comes something new that shifts the goalposts: mobile commerce. 74 percent of users said they were more likely to return to mobile-friendly sites and 67 percent said they were more likely to buy from mobile-friendly sites. chances are you now have a website gathering orders from your customers and processing them through e-commerce. in one recent Google survey. a massive 96 percent reported that they'd encountered incompatible websites while going online with their mobile. Amazon. now we're increasingly likely to poke at touchscreen tablets while we slouch on the sofa and simultaneously watch TV. What can you do to go mobile? . You can't help but notice that more and more people are going online through cellphones. Google.The mobile future of e-commerce If you're running a long-established retail business. iPads. also known as m-commerce.

There are emulators and testers you can use that simulate mobile devices on a PC.The first step is to check out how your existing site works on a mobile device. the text may be too small to read. You can tell when a site is responsive by browsing it on a desktop. because they present essentially the same pages for all users (just formatted differently). perhaps using a desktop or mobile stylesheet that reformats your common HTML code accordingly. but it can be complex to implement. . using a common stylesheet that has conditional rules in it that apply to devices of different screen width. but it's much better to get yourself a modern cellphone with a browser or a tablet computer and see how your website works for real. links may be too small to click.) Dynamic serving is search-engine friendly (providing you signal that the content of your pages varies according to user-agent) and gives a good user experience (because you can optimize pages for desktop and mobile much more than with responsive design). There are essentially four options if you want to "go mobile": 1. If you've never seen it working on a tiny screen. Responsive design: Redesign your existing site so that the same HTML code works equally well on both desktop and mobile. you'll probably find it looks terrible: columns probably wrap and overlap. Responsive sites are easy to maintain and searchengine friendly. and so on. Typically. (Or you could use a responsive stylesheet as well. you can start to do something about it. the site will suddenly reformat from the desktop to the mobile version. you might be amazed by how it looks. if you narrow the width of your browser. Don't worry! once you've assessed the scale of the problem. If your site has been designed to work for a typical widescreen laptop. you would use PHP or ASP to test for a mobile device and then build a desktop or mobile optimized page. Dynamic serving: Build your pages slightly differently for desktop and mobile devices without changing their URLs (either with a common stylesheet or by "including" an appropriate stylesheet for each device). but they don't always give the best experience for users. 2.

In other words. In North America almost 90% of online retail transactions were made with this payment type. 4. duplicate version of your site—and the risk of different versions of your pages getting out of step. It's a good idea to give mobile users the option to view your desktop site. goes on to explain that it would be difficult for an online retailer to operate without supporting credit and debit cards due to their widespread use. There's an upfront expense in having apps developed.3.[2] Also online merchants have to . and going off to competitor sites. but they generally give a much better user experience than mobile websites. This means you can optimize your site for mobile users without compromising usability for people on the desktop. clicking other links. if they prefer. Separate mobile app: Develop a free app for mobile devices that effectively bypasses your website altogether. Separate mobile site: Detect whether users are on a desktop PC or a handheld device and then redirect to a completely separate mobile version of your site. Electronic payment process An e-commerce payment system facilitates the acceptance of electronic payment for online transactions. but they prevent users getting distracted. you can set a cookie to remember which version of the site to serve as users hop from page to page. credit cards have become one of the most common forms of payment for ecommerce transactions. Separate-URL sites tend to be search-engine unfriendly. so use techniques like canonical URLs to help them understand where to find the definitive version of each page.4. but the drawback is having to maintain a second. 5. Increased security measures include use of the card verification number (CVN) which detects fraud by comparing the verification number printed on the signature strip on the back of the card with the information on file with the cardholder's issuing bank. If you want.[1] Turban et al. mobile apps are a great way to "capture" mobile users and keep them. Also known as a sample of Electronic Data Interchange (EDI). Not only that. Over the years. e-commerce payment systems have become increasingly popular due to the widespread use of the internetbased shopping and banking. but they can give a really good user experience (because the mobile site can be highly optimized for mobile users). Remember that search engines such as Google dislike duplicate content.

This can also include having a certificate from an authorized certification authority (CA) who provides PKI(Public-Key infrastructure) for securing credit and debit card transactions. that does not involve any sort of physical card. Many of the mediaries permit consumers to establish an account quickly. Bitcoin payment processors are a cheaper alternative for accepting payments online which also offer better protection from fraud. It is used by customers who have accounts enabled with Internet banking. It is typically seen as being safer than using credit cards. other forms of payment have emerged and sometimes even claimed market leadership. A popular smartcard initiative is the VISA Smartcard. Typically there will also be some form of two-factor authentication. although such credit card transactions are usually assessed a fee (either to the recipient or the sender) to recoup the transaction fees charged to the mediary. In the meantime. Despite widespread use in North America. such as PayPal. in this system the payment gateway allows one to specify which bank they wish to pay from. A Smartcard is similar to a credit card.comply with stringent rules stipulated by the credit and debit card issuers (Visa and MasterCard) [3] this means that merchants must have security protocol and procedures in place to ensure transactions are more secure. Methods of Online Payment[edit] Credit cards constitute a popular method of online payment but can be expensive for the merchant to accept because of transaction fees primarily. and you can then use your card at various retailers and on the internet. The speed and simplicity with which cyber-mediary accounts can be established and used have contributed to their widespread use. there are still a large number of countries such as China. . India and Pakistan that have some problems to overcome in regard to credit card security. and to transfer funds into their on-line accounts from a traditional bank account (typically via ACH transactions). Wallets like PayPal and Alipay are playing major roles in the ecosystem. after verification of the consumer's identity and authority to access such bank accounts. with the result that nearly all merchant accounts in India offer it as an option. Using the VISA Smartcard you can transfer electronic cash to your card from your bank account. There are companies that enable financial transactions to transpire over the internet. Also. where one can authenticate oneself and then approve the payment. Then the user is redirected to the bank's website. however it contains an embedded 8-bit microprocessor and uses electronic cash which transfers from the consumers’ card to the sellers’ device. the larger mediaries further allow transactions to and from credit card accounts. theft and other problems—with disgruntled users frequently accusing the mediaries themselves of wrongful behavior—is associated with them. and vice versa. well known in India. Debit cards constitute an excellent alternative with similar security but usually much cheaper charges. the use of smartcards has become extremely popular. Besides card-based payments. although the risk of abuse. Instead of entering card details on the purchaser's site. Net banking[edit] This is a system.

2002. United States at eBay's North First Street satellite office campus. 5. It also features a security that has not been cracked to date [when?]. Online money transfers serve as electronic alternatives to paying with traditional paper methods. In addition. Scottsdale. California. It is subject to the US economic sanction list and other rules and interventions required by US laws or government. This can be used for online transaction and eCommerce purchases. and the ability to send payments as attachments via email. have started offering mobile money wallets which allows adding funds easily through their existing mobile subscription number. by visiting physical recharge points close to their homes and offices and converting their cash into mobile wallet currency. in such geographies. PayPal became a wholly owned subsidiary of eBay. the country of the sender. is popular in the Netherlands. E-Commerce . The company also has significant operations in Omaha. proportional to the amount received. Telecom operators. From July 2007. PayPal is an acquirer. [4] Mobile Money Wallets[edit] In undeveloped countries the banked population is very less. auction sites. Berlin in Germany. The fees depend on the currency used. Dublin in Ireland. and Tel Aviv in Israel. PayPal has operated across the European Union as a Luxembourg-based bank Google Wallet[edit] Google Wallet was launched in 2011. On October 3.Business Models . such as cheque's and money orders. PayPal[edit] PayPal is a global e-commerce business allowing payments and money transfers to be made through the Internet. the country of the recipient. known as iDEAL. It may also charge a fee for receiving money. there are more mobile phone users than there are people with active bank accounts. Charlotte and Austin in the United States. Taking the example of India.A very similar system. for which it charges a fee. Bitcoin[edit] Bitcoin is a decentralized virtual currency. the payment option used. the amount sent and the recipient's account type. Chennai in India. eBay purchases made by credit card through PayPal may incur extra fees if the buyer and seller use different currencies. and other commercial users. a performing payment processing for online vendors. Many payment options such as Airtel Money and M-Pesa are being accepted as alternate payment options on various eCommerce websites. Its corporate headquarters are in San Jose. serving a similar function as PayPal to facilitate payments and transfer money online. especially in tier II and tier III cities.5.

to .to .Business (G2B)  Government . .Business (C2B)  Business .to .to .Business (B2B)  Business .to .Consumer (C2C)  Consumer .Consumer (B2C)  Consumer .Business (B2B) Website following B2B business model sells its product to an intermediate buyer who then sells the product to the final customer. sells the end product to final customer who comes to buy the product at wholesaler's retail outlet.to . a wholesaler places an order from a company's website and after receiving the consignment.Government (B2G)  Government . As an example.Citizen (G2C) Business .  Business .E-Commerce or Electronics Commerce business models can generally categorized in following categories.to .to .

. Website will send a notification to the business organization via email and organization will dispatch the product/goods to the customer. A customer can view products shown on the website of business organization.Consumer(B2C) Website following B2C business model sells its product directly to a customer.to . The customer can choose a product and order the same.Business .

Consumer (C2C) Website following C2C business model helps consumer to sell their assets like residential property. Another consumer may opt to buy the product of the first customer by viewing the post/advertisement on the website. comparison of interest rates of personal loan/ car loan provided by various banks via website. or rent a room by publishing their information on the website. a consumer approaches website showing multiple business organizations for a particular service. cars.to . Consumer places an estimate of amount he/she wants to spend for a particular service.Consumer . Consumer . Business organization who fulfills the consumer's requirement within specified budget approaches the customer and provides its services.to . . motorcycles etc. Website may or may not charge the consumer for its services.Business (C2B) In this model. For example.

Government . Such websites support auctions of vehicles.to . machinery or any other .to . Such websites are used by government to trade and exchange information with various business organizations. Government .Business .Business (G2B) Government uses B2G model website to approach business organizations. tenders and application submission functionalities.Citizen (G2C) Government uses G2C model website to approach citizen in general.to . Such websites support auctions.Government (B2G) B2G model is a variant of B2B model. Such websites are accredited by the government and provide a medium to businesses to submit application forms to the government.

often use subscriptions as a revenue source. or someone else&amp. such as Google AdSense. Entrepreneurs who possess a high level of expertise in a field.material.s. Purveyors of products such as . Auction websites such as eBay. you can start a website and engage in the selling of your products or services. One way for an entrepreneur to make money by using a computer is to start an ecommerce business. With ecommerce. such as investing or how to make money through a particular business venture. give businesses the opportunity sell products to other businesses online.in Vanity Vanity websites allow you to promote an individual interest or indulge in a hobby. Products may be manufactured by the seller or sold through methods such as drop shipping. marriage or death certificates. An example of a vanity site is a writer who starts a blog as a form of self-expression. Storefront A storefront is used to sell products via a website. in which a site owner sells the products of a third party. to place advertisements on your site that produce revenue when visitors click on them. A vanity site typically is not a means to earn a large income. via the Internet.#039.com are another common form of storefront site from which entrepreneurs can sell merchandise through a bidding process. Website for eCommerce Build a website for eCommerce now! Get free payment gateway & hosting www. Main objectives of G2C website are to reduce average time for fulfilling people requests for various government services. They may disseminate information in the form of a newsletter sent periodically by email.shopnix. Subscription Subscription websites allow readers to gain access to information in a method similar to subscribing to a newspaper or magazine. Several common ecommerce business models can be applied to your online business. However. Such website also provides services like registration for birth. some income may be generated by using an ad serving application. also known as B2B. Business-to-Business Business-to-business ecommerce sites.

checks or any form of paperbased legal tender) to electronic alternatives (such as e-payment systems). When a customer clicks on the link and purchases the book. e-tailing and online publishing/online retailing. a) Benefits of e-Commerce  Expanded Geographical Reach  Expanded Customer Base  Increase Visibility through Search Engine Marketing  Provide Customers valuable information about your business  Available 24/7/365 .Never Close  Build Customer Loyalty  Reduction of Marketing and Advertising Costs  Collection of Customer Data . including e-banking. such as when they receive discounts for buying through a website. He then registers with the affiliate program of a business that sells a book about how to make money investing in stocks and places a link to the book on his site. the site owner receives a commission. thereby closing the e-commerce loop. An example of an affiliate marketing model is when an individual creates a website providing information about stock market investing. cash.computer systems and office supplies allow small business owners to make purchases without having to visit a physical location. A more developed and mature e-banking environment plays an important role in e-commerce by encouraging a shift from traditional modes of payment (i. Affiliate Marketing Affiliate marketing is when one business sells the products of another in return for a commission. This can save them time and perhaps even money.e. E-Commerce Applications: Issues and Prospects[edit] Various applications of e-commerce are continually affecting trends and prospects for business over the Internet..

and e-banking. Delivery is likewise done the conventional way. include credit and debit cards. After ordering goods online. stored value cards.  Bank payments. Traditional Payment Methods  Cash on delivery.b) Basic Benefits of e-Business e-Commerce  Increase sales . B.this is the first thing that people consider when dealing with e-commerce  Decreasing costs  Increase profits  Understanding that profits is not the same as sales  Expands the size of the market from regional to national or national to international  Contract the market  Reach a narrow market  Target market segmentation allows you to focus on a more   Select group of customers And therefore have a competitive advantages in satisfying them What are the existing practices in developing countries with respect to buying and paying online?[edit] In most developing countries. Many online transactions only involve submitting purchase orders online. the payment schemes available for online transactions are the following: A. Electronic Payment Methods  Innovations affecting consumers. . Payment is by cash upon the delivery of the physical goods. automated teller machines (ATMs). payment is made by depositing cash into the bank account of the company from which the goods were ordered.

. or by legal tender. including inter-bank transfers through automated clearing houses allowing payment by direct deposit. Innovations enabling online commerce are e-cash. smart cards. transaction privacy and safety. the underdeveloped electronic payments system is a serious impediment to the growth of e-commerce.S. electronic checks. In sum. Only a small segment of the population can buy goods and services over the Internet due to the small credit card market base. What is the confidence level of consumers in the use of an EPS? Many developing countries are still cash-based economies. They are employed by a few large companies in specific secured channels on a transaction basis. security concerns have a lot to do with a lack of a legal framework for adjudicating fraud and the uncertainty of the legal limit on the liability associated with a lost or stolen credit card. These payment methods are not too popular in developing countries. an intermediary. a signature) by a card owner before a transaction is considered valid-a requirement that does not exist in the U.e.  Innovations affecting companies pertain to payment mechanisms that banks provide their clients. The absence or inadequacy of legal infrastructures governing the operation of e-payments is also a concern. EPS plays an important role in e-commerce because it closes the e-commerce loop. e-checks. The primary issue is transaction security. In these countries. and encrypted credit cards. In developing countries. and in other developed countries. Hence. which is useful for tax evasion purposes or keeping secret what one’s money is being spent on. There is also the problem of the requirement of “explicit consent” (i. entrepreneurs are not able to accept credit card payments over the Internet due to legal and business concerns. banks with e-banking operations employ service agreements between themselves and their clients. The relatively undeveloped credit card industry in many developing countries is also a barrier to e-commerce. or digital cash) backed by a bank. What is an electronic payment system? Why is it important? [edit] An electronic payment system (EPS) is a system of financial exchange between buyers and sellers in the online environment that is facilitated by a digital financial instrument (such as encrypted credit card numbers. Cash is the preferred mode of payment not only on account of security but also because of anonymity. competitive payment services to ensure equal access to all consumers. and the right to choice of . For other countries. among the relevant issues that need to be resolved with respect to EPS are: consumer protection from fraud through efficiency in record-keeping.

Research by NetValue (an Internet measurement company) shows that while the number of people engaging in online banking in Singapore has increased. BPI launched its BPI Express Online in January 2000. Most banking in developing countries is still done the conventional way. indicating a promising future for online banking in these countries. Philippine National Bank.institutions and payment methods. while banks issue credit cards and while many use debit cards to draw directly from their respective bank accounts.. Interbank networks in the country like Megalink. and other large banks pioneered e-banking in the early 1980s. online payment is gaining popularity because of the emergence of Chinapay and Cyber Beijing. more than 28% of Internet users visited e-banking sites in May 2001. smart cards/smart money) and Internet-based stored value products. credit cards. Bank of the Philippine Islands (BPI). Legal frameworks in developing countries should also begin to recognize electronic transactions and payment schemes. The Singapore Experience In Singapore. Cash-on-delivery is still the most popular mode of e-commerce payment. What is the status of e-banking in developing countries? E-banking in developing countries is in the early stages of development. The Philippine Experience In the Philippines. credit cards. fund transfers. which . Citibank. What is e-banking? E-banking includes familiar and relatively mature electronically-based products in developing markets. It also includes electronic bill payments and products mostly in the developing stage. such as telephone banking. Bancnet. applications for new accounts. ATMs. there is an increasing growth of online banking. housing and auto loans. and direct deposit. Nonetheless. the average time spent at sites decreased by approximately four minutes from March 2001 to May 2001. and remittances. The most common online financial services include deposits. Payment Methods and Security Concerns: The Case of China In China. This decline can be attributed to the fact that more visitors spend time completing transactions. which offer a city-wide online payment system. Stop Payment on issued checks. including stored-value cards (e. Box 7. very few people use their credit cards for online payment. Below is a broad picture of e-banking in three ASEAN countries. and BPI Expressnet were among the earliest and biggest starters of ATM (Automated Teller Machines) technology. However.g.

On June 1. the Malaysian Bank formally allowed local commercial banks to offer Internet banking services. This was followed by tele-banking in the early 1990s where telecommunications devices were connected to an automated system through the use of Automated Voice Response (AVR) technology.  Integrated B2B e-commerce product. bill payments. share investing. HSBC Bank.maybank2U. launched the country’s first Internet banking services. The bank employs 128-bit encryption technology to secure its transactions. electronic shopping. Phileo Allied Bank and United Overseas Bank. insurance. purchase order. travel. Maybank (www. fund transfers. invoice generation and payment. Banks that offer WAP or Mobile banking are OCBC Bank. one of the largest banks in Malaysia.  Securities trading. obstacles. problems and issues are affecting the growth of e-banking in developing countries? . credit card payments. Among the products offered are:  Fund transfer and payment systems.  Securities placement and underwriting and capital market activities. According to the survey. Phileo Allied Bank and RHB Bank. 2000. Hong Leong Bank. which was more popular among corporate customers than retail customers. All major banks in Singapore have an Internet presence. Other local banks in Malaysia offering e-banking services are Southern Bank. Multi-Purpose Bank. Then came PC banking or desktop banking using proprietary software.37 What market factors.take less time than browsing different sites. involving product selection. 2000. The most common e-banking services include banking inquiry functions. and other basic banking services. The Malaysian Experience E-banking in Malaysia emerged in 1981 with the introduction of ATMs.com). two out of three visitors make a transaction. These banks have shifted from an initial focus on retail-banking to SME and corporate banking products and services. They offer a wide range of products directly to consumers through proprietary Internet sites. and  Retail banking. On June 15.

38 . Internet banking accounted for less than 0. Less than 13% of the lead users and followers indicated some interest in conducting complex activities over the Internet. These lead users undertake one-third more transactions a month than do other users. Indonesia. respectively. and many of the services are very basic. it ranged from 5% to 6%. This is the main reason for not opening online banking or investment accounts. Apparently. In general. only 2. there is also a preference for personal contact with banks. Followers: An additional 20% showed an inclination to eventually open an online account. In India. The Internet is more commonly used for opening new accounts but the numbers are negligible as less than 0. This slow uptake cannot be attributed to limited access to the Internet since 42% of respondents said they had access to computers and 7% said they had access to the Internet. Lead users: 38% of respondents indicated their intention to open an online account in the near future.3% of respondents used it for that purpose.and high-income people in Asia questioned in a McKinsey survey. What are the trends and prospects for e-banking in these countries? There is a potential for increased uptake of e-banking in Asia. 3. Only a small number of banks employ Internet banking. credit cards.1% of these customers’ banking transactions. if their primary institution were to offer it and if there would be no additional bank charges. It is important to note that these respondents also preferred consolidation and simplicity. and Thailand. and loans. Most Asian banks are in the early stages of Internet banking services. i. Access to high-quality products is also a concern. 2.. as it did in 1999.6% reported banking over the Internet in 2000. such as trading securities or applying for insurance. and they tend to employ all banking channels more often. Among the middle.7 and 1. The chief obstacle in Asia and throughout emerging markets is security. like ascertaining account balances and transferring money between accounts.Human tellers and automated teller machines continue to be the banking channels of choice in developing countries. over the Internet. except in China and the Philippines where the figures climbed to 0. About a third of lead users and followers showed an inclination to undertake only the basic banking functions. owning fewer banking products and dealing with fewer financial institutions. Respondents of the McKinsey survey gave the following indications: 1. Rejecters: 42% (compared to the aggregate figure of 58% for lead users and followers) indicated no interest in or an aversion to Internet banking.0%. the figure was as low as 1%.e. in Singapore and South Korea.

Profitability will vary sharply between Web-based. they do not rely on online selling alone. and CommerceNet/Nielsen Media recorded that 10 million people had made purchases on the Web.What is e-tailing?[edit] E-tailing (or electronic retailing) is the selling of retail goods on the Internet. E-Tailing: Pioneering Trends in E-Commerce The year 1997 is considered the first big year for e-tailing. Figure 7 shows the top 10 e-tailers by revenues generated online for the year 2001. the success of Amazon. Security concerns over taking purchase orders over the Internet gradually receded. There was also a marked reduction in customer acquisition costs for all online retailers from an average of $38 in 1999 to $29 in 2000. reaching $65 billion. Also.com (which opened its virtual doors in 1996) encouraged Barnes & Noble to open an e-tail site. Top 10 E-Retailers 41 . In the same year. catalog-based and store-based retailers. Auto-by-Tel sold its millionth car over the Web. An e-retail study conducted by Retail Forward showed that eight of its top 10 e-retailers 40 were multi-channel-that is. It is the most common form of business-to-consumer (B2C) transaction. This was when Dell Computer recorded multimillion dollar orders taken at its Web site. Box 8. Another estimate is that the online market will grow 45% in 2001. Figure 7. What are the trends and prospects for e-tailing? Jupiter projects that e-tailing will grow to $37 billion by 2002.

This image is available under the terms of GNU Free Documentation License and Creative Commons Attribution License 2.S. books.org revealed that the multi-channel retail market in the U.5 In addition. with the Internet as a medium for publication. What are the benefits and advantages of online publishing to business? Among the benefits of using online media are low-cost universal access. What are the problems and issues in online publishing? . These are the reasons why the Internet is regarded as an effective marketing outreach medium and is often used to enhance information service.8% for the total online market for the years 19992002. and the like. What is online publishing? What are its most common applications? [edit] Online publishing is the process of using computer and specific types of software to combine text and graphics to produce Web-based documents such as newsletters. expanded by 72% from 1999 to 2002. a study by the Boston Consulting Group and Shop. the independence of time and place. online magazines and databases. and ease of distribution. vis-àvis a compounded annual growth rate of 67. brochures and other promotional materials.

Many publishers are prevented from publishing online because of inadequate copyright protection.42 5.” Junk e-mail is not just annoying. which pertains to the effectiveness of a Web site and the fairness of charges to advertisers.The problems in online publishing can be grouped into two categories: management challenges and public policy issues. and The measurement issue. In online marketing. Sending bulk junk e-mail is a lot cheaper compared to receiving the same. Junk e-mail consumes bandwidth (which an ISP purchases). The most common public policy issues have to do with copyright protection and censorship. E-commerce Trends . There are two major management issues: The profit question. Aside from displacing normal and useful e-mail.6. it is also costly. The more common technological solutions include encryption for paid subscribers. there is the problem of unsolicited commercial e-mail or “spam mail. making Internet access clients slower and thereby increasing the cost of Internet use. and information usage meters on add-in circuit boards and sophisticated document headers that monitor the frequency and manner by which text is viewed and used. which seeks to address how an online presence can be turned into a profitable one and what kind of business model would result in the most revenue. the major reason why spam mail is a big issue in online marketing is that significant costs are shifted from the sender of such mail to the recipient. An important question to be addressed is: How can existing copyright protections in the print environment be mapped onto the online environment? Most of the solutions are technological rather than legal.

both Pinterest and Twitter have announced buttons that companies can use to post and sell their items directly through the social networks. and it would even send people to your product or blog pages when linked. The same goes for Facebook. Etsy or ThemeForest. Multi-Channel Shopping May Make or Break Your Business As a consumer. some platforms like Shopify and Bigcommerce have Facebook selling built-in. but the need is ever growing. The cool part is that they only need to make a single payment at the end. since it strays from the regular sales website and offers products through a multimerchant system. In fact. Now the social ecommerce landscape is changing. almost every time you find a cool product online. chances are you can also go to Amazon and find it on there. The reason so many consumer go to these multi-vendor websites is because they can find a wide selection of unique items from varying sellers. This is what many consider multi-channel selling. Many ecommerce sellers know the benefits of selling through multiple channels. considering so many of the social networks have opened up their systems for selling. For example. Connecting with Customers Through Social Media is Not Enough In the past. 2. Companies are starting to experience problems if they don’t list products on places like Amazon. social media was primarily to connect with customers and get them to like or comment on your content. .1. This stirred up buzz whenever you launched a new product.

First of all.3. the new popups are generally only to give away something for free in exchange for email addresses. there are quite a few differences from the pesky popup ads we used to see. Physical stores can implement physical beacons in the shops. The Popup Makes an Effective Comeback Remember when the internet popup was in full force? Consumers hated the popup. Well. 4. The new popups generally never come back. companies are beginning to offer mobile deals and greetings when someone walks into the store. their phone accepts the signal and provides something like a promotion. The technology works when your phone or tablet keeps searching for a beacon. when the customer has signed up for the email list. it’s making a huge comeback. deceptive popup ads use to have. so once someone walks in. and if you’ve been on the internet at all in the past six to twelve months. These popups work wonders for email marketing and they don’t have the stink that the old. or come back rarely. However. . An Integration of Online and Offline with Beacon Technology Offline and online technologies are coming together more than ever. and with the advent of something called beacon technology. you’ve noticed.

many ecommerce designers started putting a focus on large images and videos. resulting in one or two paths for the customers to go. Huge Images and Videos Deliver Stunning Homepages As 2015 progressed. These designs have delivered beautiful introductions for companies. Huge media modules also help out the consumer. It’s all much simpler. or a stunning image. . since most of the clutter is pushed to secondary pages. since ecommerce businesses can quickly explain the purpose of the site in a few minute video.5. many of which would take up the entire screen.

you’re running out of time to remain competitive. Online Loyalty Programs Continue to Grow The online loyalty program hasn’t seen as much growth as other marketing techniques. and credit card companies begin to get involved (you may have noticed the Amazon Rewards credit card. 8. But Required for Survival The mobile buying numbers are gradually moving up every quarter. Instead of waiting for customers to buy. Niche Flash Sales See an Explosion Groupon is still hanging around. chat modules and other tools for sales people to convince customers to buy before they make a decision. This often resulted after the buy. Mobile is Not Recommended. The point is to run flash sales for .) the online loyalty program is sure to improve. 9. but the most success with flash sales has come from ecommerce sites that don’t generally have these sales. or to inquire about some specs before buying. but as the technology improves. online support teams mainly sat around to wait for a customer to send in a question.6. Virtual Sales Forces Become Highly Implemented In the past. 7. A huge shift is coming in the ecommerce industry. If you haven’t modified your ecommerce site to make it mobile friendly. since many companies are beginning to treat online employees like they would brick and mortar sales people. ecommerce sites are using popups.

possible. In Conclusion The world of ecommerce is always changing. 1. Improved mobile shopping experiences Mobile commerce is constantly growing. As 2016 comes closer. improving how you make decisions on the spot. After all. It just might save you some cash or push your online business to the next level. many challenges associated with getting people to buy through smartphones and tablets have arisen. The urgency is often too much to pass up. If. Real Time Analytics Become the Norm Analytics use to come in play towards the end of the month. but a lot of those kinks have been ironed out. you have a large chance of selling out of a product if you offer them a flash sale popup. In the past. so make sure you bookmark the most interesting ecommerce trends for 2016 and beyond. you're going to convert very few shoppers if they can't get what they want with the fewest number of taps -. for example. This creates an immediate point of connection with customers.or clicks -. so you can see how customers react while on the site. some retailers are already taking things to the next level by offering live chat support.000 people are browsing on your site. they are far more likely to become loyal customers . where higher ups in the company would sit down and try to figure out what aspects of the site were hurting business.your regular customers. Difficult and lengthy checkout processes. we’re starting to see more advanced real time analytics. say. What's more. 10. are finally getting whittled down to their core elements. Feel free to leave us a comment in the section below if you have any other suggestions about upcoming trends 1. If you can reliably and consistently offer them good advice via their devices.

regardless of their actual interest level. Personalization. Data-based. Context will become the new personalization. And though many shoppers appreciate customized product suggestions. is being replaced by contextual shopping. mobile shopping is an area ecommerce businesses will be looking to streamline and dominate in 2016 and beyond. Related: 9 Tips to Make Your Ecommerce Business Wildly Successful . And the same personalized experiences are now being offered even to those who aren't even registered or logged in. 2. your business can efficiently lead shoppers on to a buying decision. different sales copy could be displayed depending on the preferences of the customer accessing your site. then. In short. retargeting may be effective. This means less friction to the customer journey. This has massive implications for brick-and-mortar stores that also have an ecommerce component.over the long term. and customers will be seeing more relevant content coming their way than ever before. By presenting the right content at the right time. others are annoyed when a product they viewed just once on Amazon continues to follow them around for weeks or even months on sites like Facebook. The idea is that if you become a member of an ecommerce site. personalized shopping experiences are now the norm. and even incredibly relevant. it will remember your preferences. So. but it doesn't always take context into account. For example.

you'll be able to increase your conversion rate dramatically. Behind-the-scenes production videos. entertaining and informative product videos that tell an engaging story are really just the starting point. But when you can repair problems on the fly or interact with a customer before he or she abandons that shopping cart. Real-time analytics Data is an invaluable resource in helping you determine how your business is doing. 4. Traditional analytics also slowed things down because you couldn't provide immediate assistance to your customers before they left your site. Real-time tracking will allow online retailers to offer a more holistic shopping experience. demonstrations. This is where real-time analytics could be a game-changer. Many businesses are now taking things to the next level. perhaps for good. Unfortunately. . Video marketing We've known about the importance of optimized product descriptions and high-quality photography for ecommerce sites for years. Video builds a lot of trust with prospective customers. these are mere prerequisites. however. you'll be able to identify problems in your sales funnel. custom video content. 360-degree product rotations and even live streaming are now being looked to as viable strategies. As you monitor customer and shopper behavior. with branded. The problem could be an issue with checkout or a coupon code. spotting trends or problems was a time-intensive process. A lot of sales can be lost that way. leaving fewer opportunities on the table. Educating.3. If you want to remain competitive. with traditional analytics.

while others have even started using apps like Instagram and Vine to capture the attention of prospective customers. especially in the apparel and accessory e-commerce sector.Video can boost your site's SEO. Many ecommerce businesses have built large YouTube followings. Social collaboration Social collaboration is on the rise in the ecommerce world. Social collaboration isn't just about having a site where shoppers can drop their templates into existing designs. 5. make your content more shareable and help your shoppers consume more information in less time. increase conversions. There are more opportunities to create a presence where your customers are than ever before. It's one thing to have products your customers want. Expect to see more social co-creation in 2016. Prospective customers can actually alter the designs of existing products and come up with beautiful. It's quite another to allow for further customization by the users. . as businesses continue to innovate and get an edge on the competition. not just one that they want. professional-looking one-of-a-kind wares. The implementation of sophisticated tools for collaboration and social interaction allows for customers to feel that they are a part of the creation process. Final thoughts This is an exciting time to be in ecommerce. but this is exactly what's already happening on marketplaces like Etsy. which means that they can get a product that they really want.

New business processes don't necessarily require money. Many times. but they do require outside-the-box thinking. . You have to be able to see possibilities where others might see none. spending can actually get in the way of innovating. because creativity is what makes all the difference.Don't forget: Innovation isn't all about the capital you have to invest in new initiatives.