1 introduction to e commerce

E-COMMERCE
Department Of Computer Science & IT
University of Malakand
Presented by
Sajid Ullah Khan DilResh
6th Semester 2017
Lecture 1

COMMERCE
Commerce is a division of trade or
production which deals with the
exchange of goods and services from
producer to final consumer.

E-COMMERCE
 It is commonly known as electronic marketing.
 It consist of buying and selling goods and services over
an electronic system such as the internet.
 E-commerce is the purchasing , selling & exchanging
goods and services over computer network or internet
through which transactions or terms of sale are
performed electronically.

The process of E-commerce
 A consumer uses Web browser to connect to the home page
of a merchant's Web site on the Internet.
 The consumer browses the catalog of products featured on
the site and selects items to purchase. The selected items
are placed in the electronic equivalent of a shopping cart.
 When the consumer is ready to complete the purchase of
selected items, he provides a bill-to and ship-to address for
purchase and delivery

The process of E-commerce
 When the credit card number is validated and the
order is completed at the Commerce Server site, the
merchant's site displays a receipt confirming the
customer's purchase.
 The Commerce Server site then forwards the order to a
Processing Network for payment processing and
fulfilment.

Features of E-Commerce
 E-Commerce provides following features
 Non-Cash Payment: E-Commerce enables use of credit cards, debit
cards, smart cards, electronic fund transfer via bank's website and other
modes of electronics payment.
 24x7 Service availability: E-commerce automates business of
enterprises and services provided by them to customers are available
anytime, anywhere. Here 24x7 refers to 24 hours of each seven days of
a week.
 Advertising : E-commerce increases the reach of advertising of
products and services of businesses.
 Marketing :It helps in better marketing management of products /
services.

Features of E-Commerce
 Improved Sales: Using E-Commerce, orders for the products can be
generated any time, any where without any human intervention. By this
way, dependencies to buy a product reduce at large and sales increases.
 Support: E-Commerce provides various ways to provide pre sales and
post sales assistance to provide better services to customers.
 Inventory Management: Using E-Commerce, inventory management
of products becomes automated. Reports get generated instantly when
required. Product inventory management becomes very efficient and
easy to maintain.
 Communication improvement: E-Commerce provides ways for faster,
efficient, reliable communication with customers and partners.

Sr.
No. Traditional Commerce E-Commerce
1 Heavy dependency on information
exchange from person to person.
Information sharing is made easy via
electronic communication channels making
little dependency on person to person
information exchange.
2
Communication/ transaction are done
in synchronous way. Manual
intervention is required for each
communication or transaction.
Communication or transaction can be done
in asynchronous way. Electronics system
automatically handles when to pass
communication to required person or do
the transactions.
3
It is difficult to establish and maintain
standard practices in traditional
commerce.
A uniform strategy can be easily
established and maintain in e-commerce.
Traditional Commerce v/s E-Commerce

Sr.
No. Traditional Commerce E-Commerce
4 Communications of business depends
upon individual skills.
In e-Commerce or Electronic Market,
there is no human intervention.
5
Unavailability of a uniform platform as
traditional commerce depends heavily
on personal communication.
E-Commerce website provides user a
platform where al l information is
available at one place.
6
No uniform platform for information
sharing as it depends heavily on
personal communication.
E-Commerce provides a universal
platform to support commercial /
business activities across the globe.
Traditional Commerce v/s E-Commerce

Different types of e-commerce
I. Business-to-business (B2B)
II. Business-to-Consumer (B2C)
III. Business-to-government (B2G)
IV. Consumer-to-consumer (C2C)
V. Government to consumer (G2C)
VI. Government-to-business (G2B)

What is B2B e-commerce?
 B2B e-commerce is simply defined as ecommerce
between companies. About 80% of e-commerce is
of this type.
 Examples:
 Intel selling microprocessor to Dell
 Heinz selling ketchup to Mc Donalds

What is B2C ecommerce?
 Business-to-consumer e-commerce, or commerce
between companies and consumers, involves
customers gathering information; purchasing
physical goods or receiving products over an
electronic network.
 Example:
 Dell selling me a laptop

What is B2G ecommerce?
 Business-to-government e-commerce or B2G is
generally defined as commerce between
companies and the public sector. It refers to the
use of the Internet for public procurement,
licensing procedures, and other government-
related operations
 Example:
 Business pay taxes, file reports, or sell goods and services
to Govt. agencies.

What is C2C ecommerce?
 Consumer-to-consumer e-commerce or C2C is
simply commerce between private individuals or
consumers.
 Example:
 Mary buying an iPod from Tom on eBay.
 Me selling a car to my neighbor.

G2C E-commerce
 This Model is also a part of e-governance.
 The objective of this model is to provide good and
effective services to each citizen.
 The Government provides the following facilities to
the citizens through website.
 Information of all government departments,
 Different welfare schemes,
 Different application forms to be used by the citizens.

G2B E-commerce
 Government-to-business (G2B) is a business model
that refers to government providing services or
information to business organisation.
Government uses B2G model website to approach
business organizations. Such websites support
auctions, tenders and application submission
functionalities.

Applications of E-Commerce:
1) Online Shopping
2) Online Banking
3) Electronic Bill Payment
4) Electronic ticketing

Online Shopping:
Online shopping is the process consumers go through
to purchase products or services over the Internet.
Online shopping is a type of electronic commerce used
for business-to-business (B2B) and business-to-
consumer (B2C) transactions.

Online Banking:
Online banking (or Internet banking) allows
customers to conduct financial transactions on a
secure website operated by their bank.
The common features provided by online-banking fall
broadly into several categories:
Transactional
Non-transactional

Electronic Bill Payment:
Electronic bill presentment and payment (EBPP) is a
fairly new technique that allows consumers to view
and pay bills electronically.
EBPP systems send bills from service providers to
individual consumers via the internet.

Electronic ticketing:
An electronic ticket or e-ticket is used to represent the
purchase of a seat on a passenger airline, usually
through a website or by telephone.
This form of airline ticket has rapidly replaced the old
multi-layered paper tickets.

E-Commerce Advantages
 E-Commerce advantages can be broadly classified in three
major categories:
 Advantages to Organizations
 Advantages to Consumers
 Advantages to Society

E-Commerce Advantages
A. Advantages to Organizations
 Using E-Commerce, organization can expand their
market to national and international markets with
minimum capital investment. An organization can
easily locate more customers, best suppliers and suitable
business partners across the globe.
 E-Commerce helps organization to reduce the cost to
create process, distribute, retrieve and manage the paper
based information by digitizing the information.

 E-commerce improves the brand image of the company.
 E-commerce helps organization to provide better customer
services.
 E-Commerce helps to simplify the business processes and
make them faster and efficient.
 E-Commerce reduces paper work a lot.
 E-Commerce increased the productivity of the organization.
It supports "pull" type supply management. In "pull" type
supply management, a business process starts when a request
comes from a customer and it uses just-in-time
manufacturing way.

Advantages to Customers
• 24x7 support. Customer can do transactions for the product or
enquiry about any product/services provided by a company any
time, any where from any location. Here 24x7 refers to 24 hours of
each seven days of a week.
 E-Commerce application provides user more options and quicker
delivery of products.
 E-Commerce application provides user more options to compare
and select the cheaper and better option.

Advantages to Customers
 A customer can put review comments about a product and can see
what others are buying or see the review comments of other
customers before making a final buy.
 E-Commerce provides option of virtual auctions.
 Readily available information. A customer can see the relevant
detailed information within seconds rather than waiting for days
or weeks.
 E-Commerce increases competition among the organizations and
as result organizations provides substantial discounts to
customers.

Advantages to consumers (OR)
1) More products and services: EC provides with more choices;
they can select from many vendors and from more products.
2) Cheaper products: EC frequently provides consumers with less
expensive products and services by allowing them to shop in many
places and conduct quick comparisons.
3) Ubiquity: EC provides consumers to shop or perform other
transactions year round, 24 hours a day, from almost any location.

Advantages to Society
 Customers need not to travel to shop a product thus
less traffic on road and low air pollution.
 E-Commerce helps reducing cost of products so less
affluent people can also afford the products.
 E-Commerce has enabled access to services and
products to rural areas as well which are otherwise not
available to them.
 E-Commerce helps government to deliver public
services like health care, education, social services at
reduced cost and in improved way.

ADVANTAGES OF E-COMMERCE
 Faster buying/selling procedure, as well as easy to find
products.
 Buying/selling 24/7.
 More reach to customers, there is no theoretical
geographic limitations.
 Low operational costs and better quality of services.
 No need of physical company set-ups.
 Easy to start and manage a business.
 Customers can easily select products from different
providers without moving around physically.

E-Commerce Disadvantages
E-Commerce disadvantages can be broadly classified in two
major categories:
 Technical disadvantages
 Non-Technical disadvantages
 Technical Disadvantages
 There can be lack of system security, reliability or standards owing
to poor implementation of e-Commerce.
 Software development industry is still evolving and keeps
changing rapidly.
 In many countries, network bandwidth might cause an issue as
there is insufficient telecommunication bandwidth available.
 Special types of web server or other software might be required by
the vendor setting the e-commerce environment apart from
network servers.

Non-Technical Disadvantages
 Initial cost: The cost of creating / building E-Commerce
application in-house may be very high. There could be delay in
launching the E-Commerce application due to mistakes, lack of
experience.
 User resistance: User may not trust the site being unknown
faceless seller. Such mistrust makes it difficult to make user
switch from physical stores to online/virtual stores.
 Security/ Privacy: Difficult to ensure security or privacy on
online transactions.
 Lack of touch or feel of products during online shopping.
 E-Commerce applications are still evolving and changing rapidly.
 Internet access is still not cheaper and is inconvenient to use for
many potential customers like one living in remote villages.

DISADVANTAGES OF E-COMMERCE
 Unable to examine products personally
 Not everyone is connected to the Internet
 There is the possibility of credit card number theft
 Mechanical failures can cause unpredictable effects on
the total processes.

Disadvantages:
1) Some customers like to feel and touch products. Also,
customers are resistant to the change from a real to a
virtual store.
2) People do not yet sufficiently trust paperless, faceless
transactions.
3) There is an increase amount of fraud on the Internet.

E-commerce vs. E-business
 We use the term e-business to refer primarily to the
digital enablement of transactions and processes
within a firm, involving information systems under the
control of the firm.
 E-commerce include commercial transactions
involving an exchange of value across organizational
boundaries

What is e-business
E-Business is about using Internet technologies to provide
 superior customer service
 streamline business processes,
 increase sales,
 and reduce costs.
 E-Business can be applied to any part of a company's
operations, including marketing and sales, purchasing,
production, design and engineering etc...,

E-Marketing
E-Marketing is a subset of E-
Business that utilises electronic medium to
perform marketing activities and achieve
desired marketing objectives for an
organisation.
E-Marketing is a broader term that
describes any marketing activity
performed via electronic medium.
WHAT IS E-MARKETING?

E-Marketing
 Reduction in costs through automation and use of
electronic media.
 Faster response to both marketers and the end user.
 Increased ability to measure and collect data.
 Opens the possibility to a market of one through
personalisation.
 Increased interactivity
 ADVANTAGES OF E-MARKETING:

E-Marketing
 Dependability on technology.
 Security, privacy issues.
 Maintenance costs due to a constantly evolving
environment.
 Higher transparency of pricing and increased price
competition.
 Worldwide competition through globalisation.
 DISADVANTAGES OF E-MARKETING:

Difference between
E-Business, E-Commerce and E-Marketing.
E-Business E-Commerce E-Marketing
E-Business is a very
broad entity dealing
with the entire complex
system that comprises a
business that uses
electronic medium to
perform or assist its
overall or specialised
business activities.
E-Commerce is best
described in a
transactional context. So
for example an
electronic transaction of
funds, information or
entertainment falls
under the category
handled by principles of
e-Commerce.
Technically e-Commerce
is a part of e-Business.
E-Marketing is also a
part of e-Business that
involves electronic
medium to achieve
marketing objectives.
e-Marketing is set on a
strategic level in
addition to traditional
marketing and business
strategy.

1 introduction to e commerce

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