UNIT 1

OVERVIEW OF ELECTRONIC COMMERCE

Overview:
This unit provides an overview of e-commerce, including its concept, types, growth, recent trends, and
advantages and disadvantages. It introduces the concept of e-commerce, which refers to the buying and
selling of goods and services over the internet. It explains the difference between e-commerce and
traditional commerce and provides examples of e-commerce platforms and business models. The unit
describes the various types of e-commerce, including business-to-consumer (B2C), business-to-business
(B2B), consumer-to-consumer (C2C), and mobile commerce (m-commerce). It explains the characteristics
and examples of each type and how they differ from each other. Growth of E-Commerce, discusses the rapid
growth of e-commerce over the past few decades and its impact on traditional commerce. It provides
statistics and trends that illustrate the growth of e-commerce globally and regionally, and explains the
factors that have contributed to its growth and recent Trends in E-Commerce. It explains the benefits and
challenges of these trends and how they are transforming the e-commerce industry. At the end, unit
discusses the advantages and disadvantages of e-commerce for businesses and consumers. It covers benefits
such as convenience, cost savings, and global reach, as well as drawbacks such as security risks, lack of
personal touch, and potential job losses. It also provides recommendations for businesses and consumers to
mitigate the risks and maximize the benefits of e-commerce. Overall, this chapter aims to provide a
comprehensive understanding of e-commerce and its implications for businesses and consumers in today's
digital economy.

Course Outcome:

ODM- 2007.1 Understand the basic concepts of e-commerce

Topics to be covered:

1.1 E-commerce concept

1.2 Types of E-commerce

1.3 Growth of E-commerce

1.4 Recent trends in E-commerce

1.5 Advantages and Disadvantages of E-commerce

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

E-commerce has become increasingly popular in recent years due to its convenience and accessibility,
allowing consumers to purchase products from anywhere at any time. E-commerce platforms range from
small online stores run by individuals to large multinational corporations, and they offer a wide range of
products, including physical goods, digital products, and services. The rise of e-commerce has fundamentally
changed the way businesses operate, and it continues to evolve as technology advances and consumer
behaviour changes.

1.1 E-commerce Concept

E-commerce as an acronym for electronic commerce. Traditional commerce deals with selling a product/
service in exchange of money. In modern contact when this exchange is enabled by electronic medium i.e.
internet in any manner we can consider it under e-commerce. Internet, website , apps, payment gateways,
servers, e-wallets all these are examples of e-commerce. The exchange of products and services through the
internet is referred to as e-commerce (or electronic commerce). It includes a broad variety of operations,
such as online bidding, electronic financial transfers, and others. Both business-to-business (B2B) and
business-to-consumer (B2C) transactions are possible with it.

E-commerce is a rapidly growing sector of the economy, and it's having a big impact on how businesses
operate. Companies are able to reach more customers and markets, and are able to provide a more efficient
and cost-effective way of doing business. With the help of e-commerce, businesses are able to provide
services such as online ordering, payment processing, inventory management, and customer service.
Additionally, e-commerce allows businesses to expand their reach to customers and markets around the
world, while also providing a platform for customers to shop locally. With the growing popularity of e-
commerce, businesses are now able to reach more customers than ever before, offering them more
convenience and choice.

E-Commerce has revolutionized the way businesses operate and has become an integral part of the modern
business world. It has enabled businesses to expand their reach and access markets that would have
otherwise been inaccessible. It has also allowed businesses to streamline their operations, reduce costs, and
increase profits.

Additionally, it has enabled businesses to provide better customer service and increase customer satisfaction
by offering more efficient and convenient shopping experiences. E-Commerce has also enabled businesses to
better understand customer behaviour, preferences, and interests, which can be used to create more
targeted and personalized marketing campaigns.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

E-Commerce has also enabled businesses to create stronger relationships with their customers by providing
more personalized and tailored experiences.

1.1.1 Definition, Meaning and Importance

“Electronic Commerce is where business transactions take place via telecommunications networks,
especially the Internet.” -E. Turban, J. Lee, D. King and H.M. Chung

“Electronic commerce is about doing business electronically.” –

-P. Timmers

 E-commerce (electronic commerce) is the online purchase and sale of products and services.
 It comprises a vast array of activities, such as online shopping, online auctions, and electronic money
transfer, among others.
 It may be used for both business-to-business and business-to-consumer transactions.
 E-commerce is a fast expanding economic sector that has a significant influence on how firms
function.
 Businesses may contact more clients and markets and give a more efficient and cost-effective
method of doing business.
 E-commerce enables firms to provide online ordering, payment processing, inventory management,
and customer care.
 Furthermore, e-commerce enables firms to extend their reach to global clients and marketplaces,
while simultaneously offering a platform for people to purchase locally.
 With the rise of e-commerce, firms can now reach more consumers than ever before and provide
them with more convenience and variety.

Some examples of e-commerce are as under:

Ordering food on Swiggy, Zomato etc.
Booking a cab ride with Uber, Ola app
E-wallets like Paytm, Mobikwik etc
Net Banking
Payment of utility bills
Even Buying from a physical store in your neighbourhood and paying with your debit /credit card

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

1.1.2 Characteristics of E-commerce

1. Online Payment: E-commerce websites provide customers with an easy and secure way to make online
payments using various payment gateways.

2. Product Listings: Product listings on e-commerce websites make it easy for customers to browse and
purchase products from the comfort of their own home.

3. Shopping Cart: Shopping carts are an essential feature of e-commerce websites that allow customers to
select items and add them to their cart for checkout.

4. User Accounts: User accounts allow customers to easily manage their orders and keep track of their
purchase history.

5. Search Engine Optimization: To help prospective buyers find e-commerce websites, websites need to be
optimised for search engines.

6. Mobile Support: Many e-commerce websites now include mobile support to provide customers with an
optimized shopping experience on the go.

7. Customer Support: E-commerce websites should provide customers with effective customer support to
ensure their queries and concerns are addressed in a timely manner.

8. Social Media Integration: Social media integration allows e-commerce websites to leverage the power of
social media marketing to reach out to potential customers.

1.1.3 Difference between e-commerce and e-business

Online purchases and sales of products and services are known as e-commerce, although a company's use of
the internet for business operations covers a wider range of activities. Marketing, customer service, product
development, and operations are all part of e-business. Both are closely related concepts that refer to
conducting business transactions online. However, there are some key differences between these two terms
as under:

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

  Scope: E-commerce is a subset of e-business. E-commerce refers specifically to buying and selling
products or services online, while e-business encompasses a wider range of online business
activities, such as marketing, customer service, and supply chain management.

 Nature of Transactions: E-commerce transactions are typically limited to buying and selling goods or
services. In contrast, e-business transactions can include any type of business activity, such as
advertising, collaboration, and information sharing.

 Participants: E-commerce usually involves transactions between a buyer and a seller, while e-
business can involve multiple participants, such as suppliers, distributors, and customers.

 Technology Requirements: E-commerce often requires more advanced technology than e-business.
For example, e-commerce transactions may require secure payment processing, online shopping
carts, and order tracking systems, while e-business activities such as email marketing or social media
engagement may require less complex technology.

1.1.4 Characteristics of e-commerce

Below are some characteristics of E-commerce:

1. Using a variety of payment gateways, e-commerce websites give clients with a simple and safe method for
making online purchases.

2. Product Listings: Product listings on e-commerce websites make it easier for people to shop from the
comfort of their own homes.

3. Shopping carts are an integral component of e-commerce websites, allowing users to choose goods and
add them to their basket for checkout.

4. Accounts for Users: Accounts for users enable consumers to conveniently manage their orders and trace
their purchasing history.1.

5. E-commerce websites may be accessed from anywhere in the world using search engines giving it a
universal reach. SEO helps in discovery by prospective clients.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

6. Mobile Support: Several e-commerce websites now provide mobile assistance to maximize the mobile
buying experience for clients.

7. E-commerce websites provide clients with good customer service to guarantee that their
questions and complaints are promptly answered.

8. Social media integration allows e-commerce websites to use the effectiveness of social media
marketing to reach prospective clients.

1.2 Types of E-commerce

E-commerce can be broadly classified as:

 Business-to-Business (B2B)

 Business-to-Consumer (B2C)

 Consumer-to-Consumer (C2C)

 Consumer-to-Business (C2B)

 M-commerce

Let’s discuss them one by one.

1. Business-to-Business (B2B) e-commerce:

Business-to-business (B2B) e-commerce refers to the buying and selling of goods and services between
businesses over the internet. This kind of e-commerce entails business dealings with other company.
Wholesalers selling to retailers, producers selling to distributors, or even businesses purchasing and selling
components or raw materials are examples of this form of e-commerce. As B2B e-commerce platforms
facilitate transactions between businesses, often it eliminates the need for intermediaries such as
wholesalers or distributors in case two businesses want to deal directly.

B2B e-commerce has become increasingly important in recent years, as businesses seek to streamline their
procurement processes and reduce costs. B2B e-commerce platforms offer a range of benefits, including:

 Increased efficiency: B2B e-commerce platforms enable businesses to streamline their procurement
processes, reducing the time and effort required to source and purchase products.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

  Cost savings: B2B e-commerce platforms often offer lower prices than traditional channels, as they
eliminate the need for intermediaries and reduce transaction costs.

 Improved access to information: B2B e-commerce platforms provide businesses with access to a
wide range of information about products and suppliers, enabling them to make more informed
purchasing decisions.

 Greater convenience: B2B e-commerce platforms enable businesses to purchase products from
anywhere at any time, reducing the need for face-to-face meetings and physical transactions.

B2B e-commerce platforms come in a variety of forms, including:

 E-procurement platforms: These platforms enable businesses to automate their procurement

processes, from requisition to payment.

 E-marketplaces: These platforms bring together buyers and sellers in a single marketplace, enabling
businesses to source products from a range of suppliers.

 Industry-specific platforms: These platforms are tailored to specific industries, such as construction
or healthcare, and offer features and functionality tailored to the needs of those industries.

Here are a few examples of B2B e-commerce:

 Alibaba: Alibaba is one of the largest B2B e-commerce platforms in the world. It connects businesses
from around the world, enabling them to buy and sell products in bulk. Alibaba offers a range of
services, including payment processing, logistics, and trade assurance.

 Amazon Business: Amazon Business is a B2B e-commerce platform that offers a range of products
and services for businesses. It provides access to millions of products from thousands of sellers,
along with tools for managing purchasing and tracking spending.

 SAP Ariba: SAP Ariba is a B2B e-commerce platform that offers procurement and supply chain
management solutions for businesses. It enables businesses to automate their procurement
processes, from sourcing to payment, and provides access to a global network of suppliers.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

  Grainger: Grainger is a B2B e-commerce platform that specializes in industrial and commercial
products. It offers a wide range of products, including tools, safety equipment, and office supplies,
and provides services such as inventory management and order tracking.

 Cisco: Cisco is a B2B e-commerce platform that provides networking and communications solutions
for businesses. It offers a range of products and services, including routers, switches, and
collaboration tools, and provides support and training for businesses that use its products.

Thus, B2B e-commerce platforms enable businesses to connect and trade with other businesses around the
world, streamlining procurement processes, reducing costs, and improving access to products and services.

Figure. 1.1 Alibaba B2B (Source: https://www.alibaba.com/Commercial-Service-Equipment)

The examples above illustrate the diverse range of B2B e-commerce platforms available, serving a wide
range of industries and offering a variety of products and services.

2. Business-to-Consumer (B2C) e-commerce:

B2C ecommerce, also known as business-to-consumer ecommerce, is the buying and selling of products or
services between a business and individual consumers over the internet. B2C ecommerce involves a business
selling directly to consumers, usually through an online store, website, or mobile app.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

B2C ecommerce has become increasingly popular in recent years due to its convenience and accessibility.
Consumers can shop for products or services from the comfort of their own homes, at any time of day, and
can compare prices and products easily.

B2C ecommerce involves a range of activities, including marketing, sales, and order fulfillment. Businesses
need to create a user-friendly online store or website that allows customers to browse products, add items
to their cart, and complete transactions securely.

Figure 1.2 Amazon.in (Source: http://www.amazon.in)

Here are a few examples of B2C e-commerce:

 Amazon India - Amazon India is the Indian version of the global e-commerce giant Amazon. It
offers a wide range of products, including electronics, fashion, home appliances, groceries, and
more.

 Flipkart - Flipkart is a homegrown e-commerce platform in India. It was started as an online

bookstore and has now expanded to offer a range of products across various categories.

 Myntra - Myntra is an online fashion and lifestyle store that offers a wide range of clothing,
footwear, and accessories for men, women, and kids.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

  Bigbasket - Bigbasket is an online grocery store that offers a range of products, including fresh fruits
and vegetables, groceries, and household items.

 Grofers - Grofers is another online grocery store that offers a range of products, including fresh
fruits and vegetables, groceries, and household items.

 Firstcry - Firstcry is an online store that offers a wide range of products for babies and kids, including
clothing, toys, diapers, and more.

 Uber: Uber is a B2C e-commerce platform that provides transportation services to consumers. It
enables consumers to book rides directly from drivers through its mobile app, and has become a
popular alternative to traditional taxi services.

3. Consumer-to-Consumer (C2C) e-commerce

C2C e-commerce, also known as consumer-to-consumer e-commerce, is a type of online commerce that
involves individuals buying and selling products or services directly with each other, without the involvement
of a business or intermediary.

In C2C e-commerce, individuals can sell goods and services to other individuals through online marketplaces,
auction sites, social media platforms, or personal websites. C2C e-commerce can include both new and used
items, and can range from small, one-off transactions to ongoing sales by individuals who have established a
business selling products or services to consumers.

Examples of C2C e-commerce platforms include:

 OLX: OLX is a popular C2C e-commerce platform in India that enables individuals to buy and sell used
items, such as electronics, vehicles, and furniture. OLX provides a user-friendly platform where
individuals can post advertisements for their products and services, and interested buyers can
contact them directly to negotiate the sale.

 Quikr: Quikr is another popular C2C e-commerce platform in India that specializes in buying and
selling used items, such as electronics, furniture, and vehicles. Quikr provides a range of services,
including chat and phone support, to help individuals buy and sell products securely.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

 Figure 1.3 Olx.in-C2C E-commerce (Source:http://www.olx.in)

 99acres: 99acres is a C2C e-commerce platform that specializes in buying and selling real estate
properties in India. 99acres provides a platform where individuals can post advertisements for their
properties, and interested buyers can contact them directly to negotiate the sale.

 eBay: eBay is one of the largest C2C e-commerce platforms in the world, providing an online
marketplace for individuals to buy and sell goods and services.

 Craigslist: Craigslist is a popular C2C e-commerce platform that enables individuals to buy and sell
items locally, such as furniture, electronics, and vehicles.

 Etsy: Etsy is a C2C e-commerce platform that specializes in handmade and vintage goods, providing a
marketplace for artists and artisans to sell their products directly to consumers.

4. Consumer-to-Business (C2B) e-commerce

In C2B e-commerce, customers sell goods and services to merchants. Most often, freelancers and
consultants offering their services to companies constitute this sort of e-commerce.
C2B e-commerce, or consumer-to-business e-commerce, is a type of online commerce that involves
individuals selling products or services to businesses. This is the opposite of the more traditional B2C

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

(business-to-consumer) e-commerce model, where businesses sell products or services directly to
consumers.

C2B e-commerce can take various forms, such as:

 Freelancing: Individuals can sell their skills and services to businesses, such as web development,
graphic design, writing, or marketing.

 Crowdfunding: Individuals can pitch their ideas or projects to businesses or investors, who can
choose to fund them if they see potential.

 Reverse auction: Individuals can bid for work or projects posted by businesses, and the lowest bid
wins the job.

 Affiliate marketing: Individuals can promote a business's products or services on their own platforms
(such as a blog or social media), and earn a commission for every sale generated through their
referral link.

Figure 1.4 Cashify - C2B E-commerce (Source: http://cashify.in)

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

Here are some examples of C2B e-commerce platforms:

 Cashify: Cashify is a C2B e-commerce platform that allows individuals to sell their used or old
electronic gadgets, such as smartphones, laptops, tablets, or gaming consoles, directly to businesses
that specialize in refurbishing and reselling them.

 Upwork: Upwork is a popular C2B e-commerce platform where businesses can post job listings, and
individuals can bid for the jobs and sell their services to the businesses.

 Freelancer: Freelancer is another C2B e-commerce platform that connects businesses with skilled
individuals who can work on their projects.

 Kickstarter: Kickstarter is a crowdfunding platform where individuals can pitch their creative projects
(such as films, games, or inventions) to potential backers, who can choose to fund them in exchange
for rewards.

 Amazon Mechanical Turk: Amazon Mechanical Turk is a platform where businesses can outsource
small tasks to individuals (such as data entry, surveys, or transcription), who can earn money by
completing them.

 Skimlinks: Skimlinks is an affiliate marketing platform that connects individuals with businesses,
allowing them to promote the businesses' products or services and earn commissions on sales.

C2B e-commerce has become increasingly popular in recent years, as more individuals seek to monetize their
skills or ideas and businesses look for flexible and cost-effective ways to outsource work. C2B e-commerce
platforms offer a convenient and accessible way for individuals to sell their products or services to
businesses, while also providing businesses with access to a diverse range of services and products from
individual sellers.

5. Mobile Commerce (M-commerce)

M-commerce is the practise of conducting online transactions using mobile devices like smartphones and
tablets. Mobile applications are the most typical form of this kind of e-commerce.
M-commerce, or mobile commerce, refers to the buying and selling of goods and services through mobile
devices, such as smartphones and tablets. M-commerce has become increasingly popular in recent years,

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

thanks to the widespread adoption of mobile devices and the convenience they offer for making purchases
on-the-go.

Here's an example of how m-commerce works:

Uber is a prime example of a mobile commerce or m-commerce company. It is a ride-hailing service that
enables customers to book a ride through a mobile app on their smartphone.

Here's how Uber's mobile app works:

Suppose you're in a new city and need to get to your hotel. You download the Uber app on your
smartphone, sign up, and enter your destination. The app shows you the nearest available Uber driver, the
estimated time of arrival, and the fare.

You can select the type of ride you want, such as UberGo, UberX, or UberXL, and see the fare for each
option. You can also view the driver's details, such as name, photo, and rating, before confirming the ride.

Once you confirm the ride, you can track the driver's location and estimated time of arrival on the app. You
can also message or call the driver for any queries or directions. When you reach your destination, the app
shows you the fare, which is automatically charged to your credit or debit card.

In this example, Uber's entire business model is based on mobile commerce. Customers use their
smartphones to request rides, track the driver's location, and pay for the service. Uber's mobile app offers
several benefits over traditional taxi services, such as:

 Convenience: Customers can book a ride anytime, anywhere, without having to call or hail a taxi.

 Cost-effective: Uber's fares are usually lower than traditional taxis, making it a more affordable
option for customers.

 Safety: Uber's app allows customers to view the driver's details, such as name, photo, and rating,
and share their trip details with friends or family.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

  Accessibility: Uber's app can reach a wider audience, including those who don't have access to
traditional taxis or public transport.

Overall, Uber's mobile app is a great example of how m-commerce is changing the transportation industry,
making it more convenient, cost-effective, and accessible for customers.

Figure 1.5 Uber-M-commerce (Source: Uber Technologies Inc. :App on Google Play Store )

1.2.1 Unique features of E-commerce

Following are some features which make e-commerce unique:

1. Reduced costs: E-commerce reduces costs related to purchasing, as there is no need to maintain a physical
store or hire additional staff to process orders. E-commerce minimizes the expenses associated with buying
since it eliminates the need to operate a physical shop or engage extra people to fulfill orders.

2. Convenience: E-commerce allows customers to purchase products and services anytime, anywhere and
they can do it from the comfort of their own homes.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

 Figure 1.6 Unique features of E-commerce

3. Increased reach: E-commerce gives businesses the opportunity to reach customers around the world and
increase their customer base.

4. Product personalization: E-commerce businesses can offer personalized products by allowing customers to
customize their order based on their preferences.

5. Automation: Routine processes like order processing, inventory management, and customer support may
be automated by e-commerce companies, which can improve productivity and save costs.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

6. Analytical capabilities: E-commerce businesses can use data gathered from customers’ purchases and
interactions with their site to gain insights into customer behaviour and make better decisions for their
business.

1.3 Growth of E-commerce

From the internet's start in the 1960s, it has expanded rapidly. Almost 3.4 billion individuals are now online,
and more people are anticipated to join them in the future.

Over the past two decades, the internet has grown from a few thousand users to billions of users worldwide.
This growth is due to technological advances and the availability of faster internet connections. The internet
has enabled people to stay connected and access information from anywhere, and it has revolutionized the
way people communicate, shop, and do business.

The future of the internet looks bright, and it is likely to continue to expand and become an even more
integral part of everyday life.

1.3.1 Web and mobile platforms for business

Web and mobile platforms have become essential for businesses of all sizes. With the right web and mobile
platforms, businesses can create a strong online presence, increase their visibility, reach new customers, and
offer an enhanced customer experience.

Web platforms are the foundation of any digital business. They provide a convenient way for customers to
find your business, learn more about your services, and make purchases. With the right web platform,
businesses can make sure their website is secure, easy to use, and optimized for search engines. Mobile
platforms are also essential for businesses.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

Mobile platforms allow businesses to reach customers wherever they are, giving them the ability to stay
connected and engaged with their customers. Mobile platforms make it easy for businesses to offer
personalized experiences, create loyalty programs, and offer targeted promotions.

By combining web and mobile platforms, businesses can create a unified digital experience that helps build
trust and loyalty with their customers. With the right web and mobile platform, businesses can reach new
customers, increase their revenue, and create a loyal customer base.

1.4 Recent trends in E-commerce

The Internet has been a revolutionary force on the way that businesses market their products and services.
Recent years have seen a surge in options for organisations to more successfully contact their target
audiences thanks to the introduction of new digital technologies. Businesses today have a lot more ways to
interact with their consumers, from social media usage to the creation of mobile applications.

The emergence of social media as a medium for marketing is one of the most significant trends to be aware
of. Social media platforms like Facebook and Twitter have given companies whole new ways to interact with
their consumers. Businesses may utilise these platforms to communicate with their clients and get insightful
feedback on their offers in addition to posting updates about their goods and services.

Another important trend is the growing use of mobile apps. Mobile apps have become a powerful tool for
businesses as they allow customers to access their services and products from anywhere. Businesses can use
mobile apps to better engage with their customers, provide personalized experiences, and promote their
offerings.

Businesses are increasingly turning to data-driven approaches to marketing. By leveraging data analytics,
businesses can better understand their customers and tailor their strategies to meet their needs. This
enables them to create more effective campaigns and reach their target audiences more efficiently.

Overall, the emergence of new digital technologies has had a huge impact on the way businesses market
their products and services. From the use of social media to the development of mobile apps, businesses
have many more options available to them. By leveraging these tools and taking a data-driven approach to
marketing, businesses can more effectively reach their target audiences and gain valuable insights into their
customers.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

Below are the noteworthy trends in E-commerce:

Increase in internet penetration: The increase in internet penetration has had a significant impact on the
Indian e-commerce market. According to a report by the Internet and Mobile Association of India (IAMAI),
India had over 743 million internet users in 2021. This increase in internet penetration has led to a larger
customer base for e-commerce companies to target. E-commerce companies are now able to reach
customers in even the remotest areas of the country, which was not possible before. As a result, the e-
commerce market in India has grown exponentially in recent years.

No. of ISP's (Internet Service Providers): The increasing number of ISP's in India has also contributed to the
growth of the e-commerce market. With more ISP's providing internet access to customers, the competition
has increased, and the prices of internet services have gone down. This has made it easier for customers to
access the internet and make online purchases. Additionally, e-commerce companies have been able to
leverage the competition among ISP's to get better deals on internet services, which has reduced their
operational costs.

Low-cost computing solutions: The availability of low-cost computing solutions has made it easier for e-
commerce companies to set up and operate their businesses. With the advent of cloud computing, e-
commerce companies no longer need to invest heavily in expensive IT infrastructure. They can now use
cloud-based solutions to store their data and run their applications, which has significantly reduced their
operating costs. Additionally, the availability of low-cost computing solutions has also made it easier for e-
commerce companies to scale up their operations quickly.

Focus on better customer service: E-commerce companies in India have realized the importance of
providing better customer service to their customers. With the increase in competition, companies that
provide better customer service are more likely to retain their customers and attract new ones. As a result,
e-commerce companies have been investing in improving their customer service processes, such as faster
delivery times, better return policies, and more personalized customer service. This has led to increased
customer satisfaction and loyalty, which has translated into higher sales and revenue for these companies.

E-commerce in Governance: Governments around the world have recognized the potential of digital
technologies to improve the delivery of public services, increase efficiency, and reduce costs. In order to

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

build transparent, fast and fool-proof governance models governments also are implementing E-governance
initiatives as:
G2C (Government-to-Citizen) e-commerce: G2C e-commerce involves the provision of online services by
the government to its citizens. This model of e-commerce is used by government agencies to provide various
services to citizens, such as paying taxes, renewing licenses, applying for permits, and accessing government
information. G2C e-commerce has become increasingly popular in recent years as governments around the
world look to digitize their services and provide citizens with easier and more convenient ways to access
government services.

C2G (Citizen-to-Government) e-commerce: C2G e-commerce is the opposite of G2C e-commerce and
involves citizens providing services to the government. This model of e-commerce is used by citizens to pay
fees and taxes to the government, submit applications, and provide feedback on government policies and
services. Examples of C2G e-commerce include online tax filing, applying for government jobs, and providing
feedback on government policies.

G2G (Government-to-Government) e-commerce: G2G e-commerce involves transactions between

different government agencies at the local, state, or national level. This model of e-commerce is used by
government agencies to share information, conduct procurement, and collaborate on projects. Examples of
G2G e-commerce include electronic tendering systems, e-procurement systems, and government
information portals.

1.5 Advantages and disadvantages of ecommerce

Advantages of e-commerce: Advantages of e-commerce are numerous and have revolutionized the way
businesses operate and interact with customers. Some are as under:

1. Fast: E-commerce transactions are fast and efficient as they can be completed in a matter of minutes
or hours. This is especially useful for businesses that need to operate in a fast-paced environment.
2. Reduces cost: E-commerce eliminates the need for physical stores, reducing the cost of rent, utilities,
and other overhead expenses associated with operating a traditional brick-and-mortar store.
3. Flexibility: E-commerce platforms are flexible and can be easily customized to meet the unique
needs of a business. This allows businesses to tailor their e-commerce presence to suit their specific
requirements.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

 4. Convenience: E-commerce platforms offer convenience to both businesses and customers as
transactions can be completed from the comfort of one's home or office.
5. Price comparisons: E-commerce platforms make it easy for customers to compare prices of different
products and services from multiple vendors. This makes it easier for customers to find the best
deals.
6. Better customer service/experience: E-commerce platforms offer better customer service and
experience by allowing customers to track their orders, access customer service support, and leave
feedback.
7. 2 way communication: E-commerce platforms allow for two-way communication between
businesses and customers, which can help to improve customer service, resolve issues, and build
brand loyalty.
8. Ease of use: E-commerce platforms are user-friendly and easy to navigate, making it easy for
customers to complete transactions.
9. Better customer insights: E-commerce platforms provide businesses with valuable customer insights
that can help them to improve their products and services, optimize their marketing strategies, and
increase customer retention.
10. Increased efficiency: E-commerce platforms are efficient and can handle large volumes of
transactions without any delays or disruptions.
11. Availability of online reviews/ratings: E-commerce platforms allow customers to leave online reviews
and ratings, which can help other customers to make informed purchasing decisions.
12. Borderless: E-commerce platforms allow businesses to reach customers anywhere in the world,
breaking down geographical barriers and expanding their customer base.

Disadvantages of e-commerce: While e-commerce has its advantages, it is important for businesses to be
aware of the potential disadvantages and take steps to mitigate them. These are as under:

1. Lack of human contact: E-commerce transactions lack the personal touch of face-to-face interactions
and human contact. This can lead to misunderstandings, miscommunications, and a lack of trust.
2. Intangibility: Products and services in e-commerce are intangible and cannot be physically inspected
by the customer before purchase. This can lead to dissatisfaction if the product or service is not as
expected.
3. Security threats: E-commerce transactions are vulnerable to security threats such as fraud, hacking,
and identity theft. This can result in financial losses for both businesses and customers.
4. Heavily dependent on internet/websites: E-commerce is heavily dependent on the internet and
websites, and any disruption or downtime can result in loss of business.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

 5. Data security: E-commerce transactions involve the exchange of sensitive data such as credit card
information and personal details, making them vulnerable to data breaches and cyber attacks.
6. Privacy: E-commerce transactions involve the collection and storage of personal information, raising
concerns about privacy and data protection.
7. Easy to enter/exit: E-commerce has low entry barriers, which can lead to a high level of competition
and a low barrier to exit, making it difficult for businesses to differentiate themselves from
competitors.
8. Heightened competition: E-commerce has a global reach, increasing competition from both
domestic and international players, making it difficult for small businesses to compete.
9. Logistics/packaging costs: E-commerce requires efficient logistics and packaging processes, which
can add to the cost of doing business.
10. Increased dependency: E-commerce businesses are highly dependent on third-party service
providers such as payment gateways and logistics providers, increasing the risk of disruption to
operations.
11. Cost of skilled manpower: E-commerce requires skilled manpower for website design, development,
and maintenance, increasing the cost of doing business.

Summary

E-commerce has rapidly transformed the way businesses operate and consumers shop. In this unit, we
explored the concept of e-commerce, which involves buying and selling goods and services over the internet,
and the different types of e-commerce, such as B2C, B2B, C2C, and m-commerce. We also examined the
growth of e-commerce and the factors that have contributed to its success, as well as the latest trends in the
industry, including social commerce, omnichannel retailing, AI, and VR/AR. Finally, we discussed the
advantages and disadvantages of e-commerce for businesses and consumers, such as convenience and cost
savings versus security risks and lack of personal touch. Overall, this chapter provides a comprehensive
overview of e-commerce and its impact on the digital economy.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

 Case Study 1.1

ABC Clothing is a popular clothing brand that specializes in selling its products through brick-and-mortar
stores across the country. Due to the COVID-19 pandemic, the company's sales have plummeted as many
customers are hesitant to visit physical stores.

To address this challenge, ABC Clothing decides to launch an e-commerce website to sell its products online.
The company hires a team of web developers and designers to create an attractive and user-friendly online
store. They also set up a secure payment gateway to ensure that customers can make online payments
without any concerns about fraud or theft.

Once the website is launched, ABC Clothing promotes it through social media and online advertising
campaigns. They also offer special discounts and promotions to attract new customers to their online store.

Within a few months of launching the e-commerce website, ABC Clothing's online sales begin to pick up. The
company is able to reach a wider audience and attract customers who prefer to shop online. They also
gather valuable data about their customers' preferences and behaviors, which they use to improve their
products and marketing strategies.

As a result of their successful e-commerce initiative, ABC Clothing is able to weather the storm of the
pandemic and maintain their market position. They continue to invest in their online store and explore new
ways to enhance the customer experience, ensuring that they remain competitive in an increasingly digital
world.

From above case please answer following:

a. Discuss how e-commerce facilitated ABC clotings business

b. How they won customer trust?
c. What we
d. Zre the online tools they used?

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

 Case Study 1.2

Amazon is one of the world’s largest e-commerce companies and was founded in 1994 by Jeff Bezos. The
company started as an online bookstore but has now evolved into a one-stop-shop for various products,
including electronics, apparel, groceries, and more. Amazon is a B2C e-commerce company that connects
buyers and sellers through its online marketplace platform. Amazon operates on a B2C e-commerce business
model, where it connects buyers and sellers through its online platform. The company acts as an
intermediary between the two parties and earns a commission on each transaction. Amazon's business
model is unique because it offers a wide range of products, including its private label brand. The company's
primary revenue streams are product sales, commissions, and advertising.

Strategy Amazon's strategy is customer-centric, and the company's primary goal is to offer the best shopping
experience to its customers. Amazon has achieved this by investing heavily in technology and innovation.
The company has developed proprietary algorithms that personalize the shopping experience for its
customers. The algorithms use data on customers' past purchases, browsing history, and other metrics to
provide tailored product recommendations.

Another aspect of Amazon's strategy is to offer a wide range of products at competitive prices. The company
achieves this by partnering with numerous sellers and offering its private label brands. The private label
brands allow Amazon to offer products at lower prices than its competitors. Success Factors Amazon's
success can be attributed to several factors, including its business model, customer-centric strategy, and
investment in technology. The company's large customer base and extensive product offerings give it a
significant advantage over its competitors. Amazon has also invested heavily in technology, which has
enabled it to offer a personalized shopping experience to its customers. Additionally, the company's logistics
and supply chain capabilities have enabled it to offer fast and reliable shipping, which has contributed to its
success.

Discuss

a. Factors responsible for success of Amazon.

b. How Amazon is using e-commerce for it’s success?

c. What is Amazon’s business model?

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

 E-governance in action

Direct Benefit Transfer (DBT) is a scheme launched by the Government of India to transfer government
subsidies and other benefits directly to the bank accounts of beneficiaries. The objective of DBT is to ensure
that government subsidies and benefits reach the intended beneficiaries in a more efficient and transparent
manner, without any intermediaries or leakage.

Under the DBT scheme, the government transfers subsidies and benefits directly to the bank accounts of
beneficiaries using Aadhaar-based authentication. Aadhaar is a unique identification number issued by the
government of India to its citizens. The government also provides a mobile application called 'Umang' that
allows beneficiaries to check their payment status and view payment history.

DBT has several benefits over the earlier system of subsidy and benefit delivery, which relied on
intermediaries like dealers and agents. The use of Aadhaar-based authentication has reduced the scope for
fraud and misuse of subsidies and benefits. It has also eliminated the need for middlemen and reduced the
cost of delivery, thus increasing the efficiency of the system.

DBT has been implemented across several government schemes, including LPG subsidy, scholarships,
pension schemes, and the National Rural Employment Guarantee Act (NREGA). The scheme has been
successful in reducing leakages and improving the delivery of subsidies and benefits to the intended
beneficiaries.

In conclusion, DBT is an important initiative by the Government of India to improve the efficiency and
transparency of the subsidy and benefit delivery system. The scheme has had a positive impact on the lives
of millions of beneficiaries and has helped the government to achieve its objective of reducing leakages and
ensuring that subsidies and benefits reach the intended beneficiaries.

E-governance case

E-Governance case study Rajasthan-Bhamashah Yojna

https://nceg.gov.in/nceg_header/files/BhamashahYojna_CaseStudy.pdf

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India

Summary:
The unit "Overview of E-commerce" provides a comprehensive understanding of the concept of e-
commerce, exploring its various types, growth, recent trends, and advantages and disadvantages. It defines
e-commerce as the buying and selling of goods and services over the internet, highlighting its transformative
impact on business models and consumer behavior. The unit covers different types of e-commerce, including
B2B, B2C, C2C, and C2B, illustrating how each involves transactions between different entities. It emphasizes
the exponential growth of e-commerce, facilitated by advancements in technology and increased internet
penetration. The unit also discusses recent trends in e-commerce, such as mobile commerce (m-commerce),
social commerce, and the rise of online marketplaces. Lastly, it examines the advantages and disadvantages
of e-commerce, showcasing how it offers convenience, global reach, and cost savings for businesses, while
also posing challenges related to security, trust, and customer experience. Overall, this unit provides a
comprehensive overview of e-commerce, laying the foundation for further exploration into its intricacies.

Self-Learning Material (ODM-2007) CDOE-Department of Business Studies, NCU, India