INTRODUCTION E-COMMERCE

Table of Contents E-Commerce overview 1.1 Definition of e-commerce 1.2 Brief history of e-commerce E-Commerce categories 2.1 Two major categories 2.2 Other categories Benefits of e-commerce 3.1 Benefits to organizations 3.2 Benefits to consumers Business applications Online shopping Interesting facts and figures Summary and Conclusion References

E-Commerce Overview Definition of E-Commerce Brief History of E-Commerce 1

Definition of E-Commerce E-Commerce or Electronic commerce is a process of buying, selling, transferring, or exchanging products, services, and/or information via electronic networks and computers

Definition of E-Commerce ‘Formulating commercial transactions at a site remote from the trading partner and then using electronic communications to execute that transaction.’ The definition includes business to business and business to consumer transactions.

Brief History of E-Commerce E- commerce meant the facilitation of commercial transactions electronically, using technology such as Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT), allowing businesses to send commercial documents like purchase orders or invoices electronically.

Brief History of E-Commerce (cont).. The growth and acceptance of credit cards Automated teller machines (ATM) Telephone banking Airline reservation system 2

Brief History of E-Commerce (cont).. The Internet commercialized and users flocked to participate in the form of dot-coms, or Internet start-ups Innovative applications ranging from online direct sales to e-learning experiences

Brief History of E-Commerce (cont).. Many European and American business companies offered their services through the World Wide Web. Since then, People began to associate a word “e-commerce”

E-Commerce Categories Two major categories Other categories 3

Two Major Categories Business-to-consumer (B2C) : Online transactions are made between businesses and individual consumers. E.g. Amazon.com, eBay.com. Business-to-business (B2B): Businesses make online transactions with other businesses.

Other Categories Consumer-to-consumer (C2C) Mobile commerce (m-commerce) E-learning E-government 4

Benefits of E-Commerce Benefits to organizations Benefits to consumers 5

Benefits to organizations Global reach Cost reduction Supply chain improvements Extended hours: 24/7/365 Customization Improved customer relations

Benefits to consumers More products and services Cheaper products and services Instant delivery Information availability Participation in auctions

Business applications Email Instant messaging Online shopping and order tracking Online banking Shopping cart software Teleconferencing Electronic tickets

Online Shopping Online shopping is the process of buying goods and services from merchants who sell on the Internet Online consumers are evenly split between men and women and tend to be better educated, younger, and more affluent than the general population

Online Shopping (cont).. Advantages: 24-hour access Ability to comparison shop The in-home privacy Variety 6

Online Shopping (cont).. Favourite websites for shopping include those featuring: Event tickets Online periodicals subscription Flowers and gifts Consumer electronics Travel

Online Shopping (cont).. 7 How do you buy something

Interesting Facts and Statistics 8 Every 1.2 seconds, a Canadian makes a purchase with their PayPal account Almost 20 per cent of Canadians make three or more online purchases per month (comScore 2009).

Interesting Facts and Statistics (cont..) Ninety per cent of Canadians do their online shopping exclusively from home and only one per cent of Canadians shop online exclusively from work (comScore 2009). Experts predict that online sales will reach US$328 billion by 2010

E-Commerce technologies The three e-Commerce technologies are: Electronic Markets Electronic Data Interchange Internet Commerce

Electronic markets The use of information and communications technology to present a range of offerings available in a market segment and hence enable: the purchaser to compare the prices (and other attributes); make a purchase decision. The usual example of an electronic market is an airline booking system.

Electronic markets There is the potential for new electronic markets to be created using Internet technologies.

Electronic Data Interchange (EDI) EDI provides a standardised system for coding trade transactions so that they can be communicated directly from one computer system to another. EDI removes the need for printed orders and invoices and avoids the delays and errors implicit in paper handling.

Electronic Data Interchange (EDI) EDI is used by organisations that make a large number of regular transactions. Examples are the large supermarket chains and the vehicle assemblers which use EDI for transactions with their suppliers.

Internet commerce Information and communications technologies can also be used to advertise and make once-off sales of a wide range of goods and services. This type of e-Commerce is typified by the commercial use of the Internet. The Internet can, for example, be used for the purchase of books that are then delivered by post or the booking of tickets that can be picked up by the clients when they arrive at the event.

Internet commerce It is to be noted that the Internet is not the only technology used for this type of service and this is not the only use of the Internet in e-Commerce.

The trade cycle Conducting a commercial transaction involves the following steps: Pre-Sale: Search - finding a supplier Negotiate – agreeing the terms of trade Execution: Order Delivery Settlement: Invoice Payment After-sales, e.g. warrantee and service