E-Commerce
1. Introduction
E-commerce can be conducted in many different types. One of the most popular designs is a shopping cart, which people can use on their own websites. Today, many people have an internet presence through a website, using an e-commerce tool and a shopping cart. This permits an alternative connection to customers, instead of doing business with them behind a storefront. Having a connection that is only available in the presence of the actual store. This method is efficient for companies that do not have a physical store and only have an internet store to do business. Another alternative is that of a marketplace, where one can sell their products on other sites that have been created for this purpose.
E-commerce, or electronic commerce, is the means of buying and selling goods and services via the internet or other electronic systems. These transactions have increased by more than 13.4 percent over the past few years, reaching 1,954 billion dollars. This proves that people are accepting e-commerce as a means to buy their goods, with some of the all-time big department and grocery stores opening their own electronic stores for their customers. This type of commerce is not only increasing worldwide, but it is also being used worldwide as well. E-commerce can be a powerful channel in B2C (business to consumer) and B2B (business to business) transactions. Today, there are billions of dollars being exchanged on a regular basis for goods that are marketed or exchanged over the internet and other electronic systems.
2. Benefits of E-Commerce
23. Building customer loyalty – With a well-constructed website that is aimed at the target audience, the customer base will grow. A well-built website can bring the image of success, a larger company than it really is. When a smaller company gets the image of being a large firm, this will, in most cases, increase the confidence in the customer and build credibility for the company. A website is a way to inform customers of what is being offered, the benefits, and most importantly, why one product is better than another. This will create more informed customers, and informed customers tend to be more loyal and buy more.
22. Reduced costs – E-commerce will enable the automation of a large number of business tasks and processes, thus reducing the cost of doing business. There are many costs that are reduced when using e-commerce, such as the need for paper-based information, faxes, telephones, and the time to wait for these, as well as the cost of mistakes (through reprinting of forms, etc).
21. Increased sales – The first and the most important benefit of e-commerce is that it enables a merchant to have low-cost access to the global marketplace. When a merchant has an online business, the doors to their store are open 24 hours a day, 7 days a week. This means that they can potentially make money while they are sleeping! E-commerce automates the sales process, which in turn reduces staff time required to complete the sales. There may also be a reduced cost in marketing and advertising. This is because the internet is one of the best ways to get your business known to the world.
3. Types of E-Commerce
Business to business, often referred to as B2B, is when a business sells its products or services to another business. An example of this would be the hardware store. The local hardware store sells tools to the home building business. This is still B2C, except they are a business in the building industry that is purchasing tools. Now, a hardware store that has an online store is a different scenario. If the online hardware store sells the same tools to the home building business, it is B2B. The hardware store is still a business to consumer retailer, but now it has a B2B transaction between the online store and the building business. This is because the online store is an arm of the overall business, thus it is an inter-business dealing. A B2B transaction can occur between a consumer wholesaler or one that involves the manufacturer and a wholesale business. E-commerce has allowed manufacturers to become much more efficient, and it is not uncommon for them to deal with wholesalers on a consumer level. Step B2B is often conducted simply to cut or reduce company costs. A manufacturer of bicycle helmets may strike a deal with a multinational bike shop franchise to supply them with helmets to every shop at a reduced cost. This would increase sales for the manufacturer and reduce costs for the bike shop, making it a win-win situation.
A consumer can visit the website of the business, choose an item, and purchase it. In most cases, there will be only one consumer and one seller involved in the transaction. B2C has grown in the last 10 years because the widespread use of the internet has made it easier for consumers to shop online. Online stores typically do not have a completely automated B2C transaction. They may have an automated system for the consumer to purchase an item, but it is not uncommon that they will also have a telephone number where consumers can order the item. An example of a B2C transaction would be someone buying a shirt from an online retailer.
E-commerce can be classified into different categories according to the transaction parties or the main function. Business to consumer, which is known as B2C, is the simplest and most common form of e-commerce. Using a B2C business model, a business sells its product or service directly to a consumer (i.e. the business sells to the consumer). A B2C transaction can occur between a business and a consumer wholesaler (i.e. a business to consumer transaction), but typically the term B2C refers to the business dealing with an individual consumer.
4. Key Components of E-Commerce
2. Products/Services
These are the main selling points of any e-commerce website and can be physical goods like books or computers, or information like stock analyses or consultancy. Services might include web design or remote hosting of data. The internet is a perfect way to sell information and it has the added advantage of global distribution at minimal cost. Information can be automatically delivered in digital form via downloading. Offering digital content over the internet has two major advantages for sellers. The first is the automation of the delivery process, hence eliminating staff and distribution costs. The second is reaching the global market at minimal cost. This is very common today with the use of web banners, and it is worth having a small website developed which will be an advertisement for the product.
1. People
Those who are the key players in an e-commerce business. These people might be customers, business partners, or employees in a company. At a higher level, the internet and web technology have drastically changed the way people interact and behave. As a result, it has changed society and the economy. E-commerce provides new ways of doing business using information technologies and also creates economic efficiencies. It allows customers to compare prices and product quality. People are the most critical link in e-commerce. It becomes very difficult to build a website that will attract customers and provide them with good service. Customers do not always have trust in an unknown internet company because there can be a risk in transactions and there might be a chance where the customer is not satisfied with the service provided by the company. The customer might also feel insecure regarding the transaction being done using a credit card.
The primary goal of this section is to understand e-commerce and its components. E-commerce brings the sellers and the buyers on a single platform, which is the internet. It increases efficiency, effectiveness, and competition. The main components of e-commerce are as follows:
5. Future Trends in E-Commerce
In the future, consumers will be able to interactively design and order a vast range of products, including clothing, electronics, and large appliances. This will be done using virtual reality technology, which will let the customer view a computerized simulation of the product. This technology also has potential for use with intelligent software agents. Agents will assist the customer in product design by offering advice and evaluating different configurations of a product based on an understanding of the customer’s needs and the agent’s knowledge of what is being designed.
First, we will address the consumer’s ability to customize products and services. This is already possible today, to some extent, using so-called “build-to-order” products such as those offered by Dell Computers. Consumers are able to specify what they want included with their computer and are then presented with a range of prices for different packages. Expanding this idea into new areas, Ford Motor Company is exploring the idea of complete car customization. Ford’s Mondeo model can now be built and purchased online with various options for finishes and interior styles. These cars are then built to the precise customer specification and are delivered to the customer’s door.
Enhanced product and service customization and growth in consumer-to-consumer selling are just two of the implications for e-commerce as it moves from convenience to necessity.
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