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Electronic Commerce is exactly analogous to a marketplace on the Internet. Electronic Commerce (also referred to as EC, e-commerce eCommerce or ecommerce) consists primarily of the distributing, buying, selling, marketing and servicing of products or services over electronic systems such as the Internet and other computer networks. The information technology industry might see it as an electronic business application aimed at commercial transactions; in this context, it can involve electronic funds transfer, supply chain management, e-marketing, online marketing, online transaction processing, electronic data interchange (EDI), automated inventory management systems, and automated data collection systems. Electronic commerce typically uses electronic communications technology of the World Wide Web, at some point in the transactions lifecycle, although of course electronic commerce frequently depends on computer technologies other than the World Wide Web, such as databases, and e-mail, and on other non-computer technologies, such as transportation for physical goods sold via e-commerce.
E-Commerce according to Person Halls book E-Commerce started in 1994 with the first banner ad being placed on a website.
According to the October 2006 Forrester Research report entitled, “US eCommerce: Five-Year Forecast And Data Overview, “Nontravel online retail revenues will top the quarter-trillion-dollar mark by 2011. The driver of this growth? A segment of the most active Web shopping households that is approximately 8 million strong. This group of consumers is extremely comfortable with technology and values convenience above all else in the online retail experience. As retailers begin to wade through their copious data warehouses and understand the who, what, when, where, why, and how of this segment, they will benefit from targeting these customers.”[1]
Historical development
The meaning of the term “electronic commerce” has changed over the last 30 years. Originally, “electronic commerce” meant the facilitation of commercial transactions electronically, usually using technology like Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT), where both were introduced in the late 1970s, for example, to send commercial documents like purchase orders or invoices electronically.
The electronic or e in e-commerce refers to the technology/systems; the commerce refers to be traditional business models. E-commerce is the complete set of processes that support commercial business activities on a network. In the 1970s and 1980s, this would also have involved information analysis. The growth and acceptance of credit cards, automated teller machines (ATM) and telephone banking in the 1980s were also forms of e-commerce. However, from the 1990s onwards, this would include enterprise resource planning systems (ERP), data mining and data warehousing.
In the dot com era, it came to include activities more precisely termed “Web commerce” — the purchase of goods and services over the World Wide Web, usually with secure connections (HTTPS, a special server protocol that encrypts confidential ordering data for customer protection) with e-shopping carts and with electronic payment services, like credit card payment authorizations.
Today, it encompasses a very wide range of business activities and processes, from e-banking to offshore manufacturing to e-logistics. The ever growing dependence of modern industries on electronically enabled business processes gave impetus to the growth and development of supporting systems, including backend systems, applications and middleware. Examples are broadband and fibre-optic networks, supply-chain management software, customer relationship management software, inventory control systems and financial accounting software.
When the Web first became well-known among the general public in 1994, many journalists and pundits forecast that e-commerce would soon become a major economic sector. However, it took about four years for security protocols (like HTTPS) to become sufficiently developed and widely deployed. Subsequently, between 1998 and 2000, a substantial number of businesses in the United States and Western Europe developed rudimentary web sites.
Although a large number of “pure e-commerce” companies disappeared during the dot-com collapse in 2000 and 2001, many “brick-and-mortar” retailers recognized that such companies had identified valuable niche markets and began to add e-commerce capabilities to their Web sites. For example, after the collapse of online grocer Webvan, two traditional supermarket chains, Albertsons and Safeway, both started e-commerce subsidiaries through which consumers could order groceries online.
The emergence of e-commerce also significantly lowered barriers to entry in the selling of many types of goods; accordingly many small home-based proprietors are able to use the internet to sell goods. Often, small sellers use online auction sites such as EBay, or sell via large corporate websites like Amazon.com, in order to take advantage of the exposure and setup convenience of such sites.
[edit] Success factors in e-commerce
In many cases, an e-commerce company will survive not only based on its product, but by having a competent management team, good post-sales services, well-organized business structure, network infrastructure and a secured, well-designed website. A company that wants to succeed will have to perform 2 things: Technical and organizational aspects and customer-oriented. Following factors will make business of companies succeed in e-commerce: haiii===Technical and organizational aspects===
Sufficient work done in market research and analysis. E-commerce is not exempt from good business planning and the fundamental laws of supply and demand. Business failure is as much a reality in e-commerce as in any other form of business.
A good management team armed with information technology strategy. A companys IT strategy should be a part of the business re-design process.
Providing an easy and secured way for customers to effect transactions. Credit cards are the most popular means of sending payments on the internet, accounting for 90% of online purchases. In the past, card numbers were transferred securely between the customer and merchant through independent payment gateways. Such independent payment gateways are still used by most small and home businesses. Most merchants today process credit card transactions on site through arrangements made with commercial