E-Commerce

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COMMERCE
the exchange or buying and selling of commodities; the exchange of merchandise, on a large scale, between different places or communities; extended trade or traffic.

ELECTRONIC COMMERCE
- Electronic commerce (e-commerce) or electronic business (e-business) is a general term for any type of business, or commercial transaction that involves the transfer of information across the Internet. This covers a range of different types of business from consumer-based retail sites, like Amazon.com, through auction and music sites lie eBay or MP3.com, to business exchange trading goods or services between corporations.

- Electronic commerce is the use of electronic communication to do busines. E-commerce is not about technology. It is not a new business. E-commerce is a method for companies to create and operate their business in new and efficient ways.

FROM TRADITIONAL TO E-COMMERCE

Opened avenues for trade between buyers and sellers. Ancient times (thousands of years ago) Sailing ships

Printing press

Steam engine

Telephone
Wire transfers – used by banks
Businesses transfer electronic data
- data not re-keyed
-high implementation cost, thus excluded small businesses
On-line shopping

Electronic Funds Transfer (EFTs)

Electronic Data Interchange (EDI)

Internet

BUSINESS PROCESSES WELL-SUITED TO PARTICULAR TYPE OF COMMERCE * E-commerce
- Sale/purchase of books & CDs, travel services,
- investents and insurance services
- onlie delivery of software
- online shipment tracking
* Taditional
- Sale/purchase of impulse items for immediate use, high fashion jewely and antiques (personal inspection required; prefer to touch, smell or examine closely)
- Small denomination purchases and sales (since there is not yet a standard for transferring small amounts of money)

BUSINESS PROCESS SUITABILITY TO TYPE OF E-COMMERCE

ADVANTAGES AND DISADVANTAGES OF E – COMMERCE

Similar to traditional businesses, e-commerce presents many advantages and disadvantages

ADVANTAGES
-Doing business around the globe 7 days a week, 24 hours a day. - Gaining additional knowledge about potential customers
-Improved customer involvement
-Improved customer service
-Improved relationships with suppliers
-Improved relationships with the financial community
-Increased flexibility and ease of shopping
-Increased number of customers
- Increased return on capital and investment, since no inventory is needed. - Personalized service
- Product and service customization

DISADVANTAGES
- Possible capacity and bandwidth problems
- Security issues
- Accessibility (not everybody is connected to the Web yet)
- Acceptance (not everybody accepts this technology)
- A lack of understanding of business strategy and goals.

DIFFERENT TYPES OF E-COMMERCE

The matrix in Figure shows the different types of e-commerce from the perspective of the buyer and seller relationship. This is often used to categorize e-commerce applications. According to this relationship, e-commerce applications can be divided into the following four categories.

Business-to-consumer (B2C)
- In this case, the seller is a business organization whereas the buyer is a consumer. This emulates the situation of physical retailing and so it is commonly called electronic retailing. Typically, electronic stores are set up on the internet to sell goods to the consumers.

- In B2C e-commerce, businesses sell directly to consumers.

Amazon.com:B2C e-commerce
- Established in 1995 by Jeff Bezos, Amazon.com (www.amazon.com) is one of the most well-known e-commerce site in general and internet bookseller in particular. It is a typical example of B2C e-commerce in which a business sells already manufactured products to the consumers directly on the internet.

Business-to-business (B2B)
- In this case, both the buyer and the seller are business organizations.
- B2B involves electronic transactions among and between...
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