FACILITATE E COMMERCE

RENZ MARC : Buying and selling is known as commerce (e-commerce) or electronic commerce, which is a
subset of e business. and the electronic exchange of products and services using computer networks (like the
Internet), wherein sales agreements or transactions are completed electronically. Despite what many people think, e-
commerce is not limited to the internet. Before the Internet, in reality, e-commerce was thriving in business-to-
business transactions conducted through Value-Added Networks (VANs) and Electronic Data Interchange (EDI) in
the 1970s.

In this approach, the usage of commerce drives and draws upon advancements in online transaction processing,
supply chain management, Internet marketing, and electronic funds transfers. automated data gathering systems,
inventory management systems, and electronic data interchange (EDI). Modern electronic commerce might involve
a larger range of technologies, including e-mail, although it usually involves the World Wide Web at least once
during the transaction's lifecycle.

E-commerce gives vendors the opportunity to increase their market reach and save expenses. They don't have to
produce and distribute mail order catalogs or construct, staff, or keep up a real store. Automated order monitoring
and invoicing systems eliminate the need for extra labor, and e-commerce companies don't incur distribution
expenses if their goods or services can be downloaded. Due to the products' ability to be sold over the world wide
web, sellers are not restricted by a store's physical location and can potentially offer their goods or services
worldwide.

With the consent of the consumer, internet technologies also enable retailers to monitor the interests and preferences
of their clients. This data is then utilized to develop a continuing relationship with the client by tailoring goods and
services to the client's requirements.

The History of E-Commerce

 The emergence of e-commerce as a revolution began in 1997 as people began to realize the potential of e-
business.
 IBM coined the phrase "e-business" and developed a campaign centered around it in 1997.
 Corporate houses began using electronic data exchange, or EDI, prior to the emergence of e-commerce.
 This technology, which is roughly 25 years old, has not proven to be effective. The e-commerce system has
developed in order to address the issues and constraints associated with EDI.

Aspects of Online Shopping

1. E-commerce, often known as virtual stores and virtual malls

- The Web is a multi-billion-dollar source of income for businesses throughout the world as a platform for
direct retail buying. It offers 24-hour availability, a global reach, the opportunity to engage and provide
unique information and ordering, and multimedia opportunities.
- In mid-1997, Dell Computers announced that it was receiving orders worth a million dollars every day
- Estimated e-commerce sales for businesses by early 1999 were in the billions of dollars, and the stocks of
the companies thought to be the best at e-commerce were rising to unprecedented heights. Internet retailing
is still expanding.

2. Market Analysis

- It was well known in early 1999 that businesses could obtain hitherto unheard-of volumes of information
on potential clients and consumers via online site registration, surveys, and order processing thanks to the
interactive nature of the Internet.
- It had been questioned if market participants were informed and gave their consent for the data to be
collected.
 3. Interchange of Electronic Data (EDI)

- EDI is the interchange of business data in a format that is widely understood.

- It was existing before the Internet. In EDI, parties who are well acquainted with one another exchange data
and arrange for a dial-up, one-to-one or point-to-point connection.
- EDI may be substituted with one or more common XML formats, like ebXML.

4. Instant messaging, social networking, and email

- Email, instant messaging, and social networking sites like \term Facebook
- Opt-In email is a feature that allows users of the website to freely sign up to get emails about product
categories or other topics they are interested in. This helps to avoid the impression that the emails are spam.

5. Business-to-Business Sales and Purchases

- Thousands of businesses that sell goods to other businesses have found that the Internet offers them not just
a round-the-clock display for their goods, but also an efficient means of getting in touch with the
appropriate individuals within an organization to request further details.

6. The Safety of Commercial Exchanges

- Authenticating business transactions, restricting access to resources like Web pages for registered or chosen
users, encrypting communications, and generally guaranteeing the confidentiality and efficiency of
transactions are all included in security.
- The Secure Sockets Layer (SSL), which is integrated into Web browsers, is one of the most extensively
utilized security technologies.

E-Commerce Essential Elements

Positioning

- This element is essential to every online retailer. It emphasizes how accessible and extremely visible the company
should be.

Merchandise and number of attendees

This part is concerned with making sure that product lines are maintained in stock and that deliveries are made on
schedule. The e-business marketplace caters to a global audience. It is critical to develop capacities that support
international trade.
Presentation

This focuses on two key context dimensions: function and aesthetics. Businesses can employ presentation that is
predominantly focused on one or the other in its presentation. At times, the two contexts are combined

Payment

• The marketplace capability integrates with other applications for financial and payment processing. Applications
include the ability to purchase using a credit card and require integration to provide supplier invoice information to
the buyer and to indicate invoice payment status

Security

This component must be given particular attention by e-businesses as it is an ongoing concern for consumers. E-
businesses must instill trust in its users by ensuring the security of all transactions and this can be achieved through
many methods such as encryption and authentication
Fulfillment

Once the online purchase order has been generated, the marketplace can allow buyers and sellers to manage the
fulfillment process. The fulfillment process must be enabled to ensure delivery.

JEZREL BAYLAN:

Types of E-Commerce

B2B (Business-to-Business)

 Internet-based business-to-business (B2B) e-commerce is conducted through industry-sponsored

marketplaces and through private exchanges set up by large companies for their suppliers and customers.
 Of course, companies also sell to business customers through their own web sites.
 B2B commerce is done through negotiated contracts that allow the seller to anticipate and plan for how
much the buyer will purchase.
 In some cases, B2B is not so much a matter of generating revenue as it is a matter of making connections
with business partners.

Examples

 Online companies that specialize in marketing strategies, advertising. Email companies, internet
consultants, website development etc.
 Also, as an offshoot of these companies, there are various internet resources such as online magazines,
including the E-Commerce Times and BtoBOnline.com.

Websites using B2B

 http://www.ec21.com/?gclid=CKv48NTdrKMCFdFR6woddm8J5Q
 http://www.b2btrademy.com/
 http://www.intoweb.co.za/et-online-shopping.html
 http://www.gxs.com/

B2C (Business-to-Consumer)

 Business-to-consumer (B2C, sometimes also called Business-to-Customer) describes activities of

businesses serving end consumers with products and/or services.
 In B2C transactions, online transactions are made between businesses and individual consumers.
Businesses sell products and services through electronic channels directly to the consumer
 An example of a B2C transaction would be a person buying a pair of shoes from a retailer.
 The transactions that led to the shoes being available for purchase, that is the purchase of the leather, laces,
rubber, etc. as well as the sale of the shoe from the shoemaker to the retailer would be considered (B2B)
transactions
 B2C E-Commerce involves what is known as electronic retailing or e- tailing.
-E-tailing involves online retail sales. E-tailing makes it easier for a manufacturer to sell directly to
a customer, cutting out the need for an intermediary (retailer).
 With B2C transactions there is no need for retailers and therefore, no need for a physical store from which
to distribute products.

Examples

 Amazon.com is an excellent example of a B2C company.

 Dell selling me a laptop
  Mc Donald’s selling me a Big Mac
 DrugStore.com
 eBay.com

C2B (Consumer-to-Business)

 Consumer-to-business (C2B) is an electronic commerce business model in which consumers (individuals)

offer products and services to companies and the companies pay them.
 This business model is a complete reversal of traditional business model where companies offer goods and
services to consumers (business-to- consumer = B2C).
 A consumer posts his project with a set budget online and within hours companies review the consumer's
requirements and bid on the project.
 The consumer reviews the bids and selects the company that will complete the project. Examples of this
include

-CTB

-SpeakOut.com

 These sites provide consumers with market strategies and businesses also use them to gain insight into
consumer wants.
 These groups may be economically motivated, as with demand aggregators, or socially orientated

C2C (Consumer-to-Consumer)

 Consumer-to-Consumer or Peer-to-Peer is defined as exchanges between/among consumers.

 These exchanges can involve a third-party involvement, which can facilitate and provide the infrastructure,
place and governance for the transactions/exchanges.
 There are many sites offering free classifieds, auctions, and forums where individuals can buy and sell
thanks to online payment systems like PayPal where people can send and receive money online with ease.
 EBay's auction service is a great example of where person-to-person transactions take place every day since
1995.

-Here consumers can bid for and sell items of any description, for any price

 An example of P2P exchanges are file swapping sites/programs, such as Kazaa and eDonkey
 An intra business network which allows companies to provide products and/ or services to their employees.
 Companies generally use B2E networks to automate employee-related corporate processes.
 B2E portal is a customized home page or desktop for everyone within an organization One URL. for
everyone in the organization • A mixture of organization-specific and employee-defined components
 The potential to be customized and altered to suit the needs of a particular employee

Examples of B2E applications include:

-Online insurance policy management

-Corporate announcement dissemination

-Online supply requests

-Special employee offers

-Employee benefits reporting

 -401(k) Management

Business Applications

Some common applications related to electronic commerce are the following:

Email

 Electronic mail, commonly called email or e-mail, is a method of exchanging digital messages across the
Internet or other computer networks.
 Email systems are based on a store-and-forward model in which email server computer systems accept,
forward, deliver and store messages on behalf of users, who only need to connect to the email
infrastructure, typically an e-mail server, with a network-enabled device for the duration of message
submission or retrieval.
 Originally, email was transmitted directly from one user's device to another user's computer, which
required both computers to be online at the same time.

Enterprise content management

 Enterprise Content Management (ECM) refers to the technologies, strategies, methods and tools used to
capture, manage, store, preserve, and deliver content and documents related to an organization "Enterprise
content management as integrative middleware
 ECM is used to overcome the restrictions of former vertical applications and island architectures.
 The user is basically unaware of using an ECM solution. ECM offers the requisite infrastructure for the
new world of web-based IT, which is establishing itself as a kind of third platform alongside conventional
host and client/server systems.

Enterprise content management components as independent services

 ECM is used to manage information without regard to the source or the required use.\
 The functionality is provided as a service that can be used from all kinds of applications.
 The advantage of a service concept is that for any given functionality only one general service is available,
thus avoiding redundant, expensive and difficult to maintain parallel functions.

Enterprise content management as a uniform repository for all types of information

 ECM is used as a content warehouse (both data warehouse. and document warehouse) that combines
company information in a repository with a uniform structure.
 Expensive redundancies and associated problems with information consistency are eliminated.
 All applications deliver their content to a single repository, which in turn provides needed information to all
applications. Therefore, content integration and II.M (Information Lifecycle Management) will play an
important role in the implementation and use of ECM.

Instant messaging

 Instant messaging (IM) is a form of real-time direct text-based communication between two or more people
using personal computers or other devices, along with shared software clients.
 The user's text is conveyed over a network, such as the Internet. More advanced instant messaging software
clients also allow enhanced modes of communication, such as live voice or video calling.
 Instant messaging (IM) is a collection of technologies used for real- time text-based communication
between two or more participants over the Internet, or other types of networks.
 IM allows effective and efficient communication, allowing immediate receipt of acknowledgment or reply.
 In many cases instant messaging includes additional features which can make it even more popular.
 For example, users can see each other by using webcams, or talk directly for free over the Internet using a
microphone and headphones or loudspeakers. Many client programs allow file transfers as well, although
they are typically limited in the permissible file-size.
  It is typically possible to save a text conversation for later reference. Instant messages are often logged in a
local message history, making it similar to the persistent nature of e-mails

Newsgroups

 A Usenet newsgroup is a repository usually within the Usenet system, for messages posted from many
users in different locations. The term may be confusing to some, because it is usually a discussion group.
 Newsgroups are technically distinct from, but functionally similar to, discussion forums on the World Wide
Web.
 Newsreader software is used to read newsgroups.
 Newsgroups generally come in either of two types, binary or text.
 There is no technical difference between the two, but the naming differentiation allows users and servers
with limited facilities to minimize network bandwidth usage.
 Generally, Usenet conventions and rules are enacted with the primary intention of minimizing the overall
amount of network traffic and resource usage. Newsgroups are much like the public message boards on old
bulletin board systems.

These are the most widely distributed and carefully controlled newsgroup hierarchies

 Comp:- Computer-related topics

 Humanities: - Topics related to the.
 Misc:-Miscellaneous topics.
 News: - Matters related to the functioning of Usenet itself
 Rec:- Recreation and entertainment topics
 Sci-: Science related topic
 Soc:-Discussion related to society and social subcultures

Shopping cart software

 Shopping cart software is software used in e-commerce to assist people making purchases online,
analogous to the American English term 'shopping cart. In British English it is generally known as a
shopping basket, almost exclusively shortened on websites to 'basket'.
 Software allows online shopping customers to accumulate a list of items for purchase, described
metaphorically as "placing items in the shopping cart". Upon checkout, the software typically calculates a
total for the order, including shipping and handling (i.e. postage and packing) charges and the associated
taxes, as applicable.

Components

 Storefront:
- Area of the Web store that is accessed by visitors to the online shop. Category, product, and other pages
(e.g. search, best sellers, etc.) are dynamically generated by the software based on the information saved in
the store database.
- The look of the storefront can normally be changed by the store owner so that it merges with the rest of the
Web site
 Administration:
- The area of the Web store that is accessed by the merchant to manage the online shop.
- The amount of store management features changes depending on the sophistication of the shopping cart
software chosen by the merchant, but in general a store manager is able to add and edit products,
categories, discounts, shipping and payment settings, ctc.
- Order management features are also included in many shopping cart programs.
- The administration area can be:
1. based (accessed through a Web browser)
 2. Desktop-based (a desktop application that runs on the user's computer and then transfers changes to the
storefront component)

Teleconferencing

 A teleconference or teleseminar is the live exchange and mass articulation of information among several
persons and machines remote from one another but linked by a telecommunications system.
 Telecommunications system may support the teleconference by providing one or more of the following:
audio, video, and/or data services by one or more means, such as telephone, computer. telegraph, teletype,
radio, and television.

Electronic tickets

 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 although purchase through airline ticket offices or travel agencies can
also get you an e-ticket.
 This form of airline ticket has rapidly replaced the old multi-layered paper tickets (from close to zero to
100% in about 10 years) and became mandatory for IATA members as of June 1, 2008.
 During the last few years, where paper tickets were still available, airlines frequently charged extra for
issuing them.
 E-tickets are also available for certain entertainment venues.
 Once a reservation is made, an e-ticket exists only as a digital record in the airline computers.
 Customers usually print out a copy of their receipt which contains the record locator or reservation number
and the e-ticket number

ADRIAN NABOYA:

Impact of E-Commerce

E-commerce has made a profound impact on Business

 Improve Responsiveness:
- It helps by improving responsiveness to market conditions and customer preferences.
- Every business must know how important timing is to marketing and selling products.
- Timing is important to cater to the demands of customers.
- If distributors, dealers and sales force do not get the right information at the right times, there will be a
financial crisis as well as losing valuable customers.
- E-Commerce network enables a company to implement marketing programmers with greater precision
such as:
1. Pre-empt competitiveness with a change in marketing tactics before they can react.
2. Improve responsiveness by revising price change and marketing programmers as and
when required.
 Expedites and Streamlines reporting
 It has been an experience in conventional commercial practices with factors like delays and ineffectiveness
in reporting systems, crippling effectiveness. Responsive, timely information flows from sound
management systems.
 Electronic commerce improves delivery and distribution both within and outside organizations.
 The benefits are:
1. Stored lists of key recipients facilitate distribution
2. Electronic delivery time.

Coordinates sales efforts

 Some studies reveal that most sales people spend nearly 75 percent of their time on the roads, relying
heavily on telephone calls for contact with their head officers and customers.
  Telephone tag makes an endless frustrating gamma out of tracking down leads and following up to
authenticates sales calls.
 In addition, misplaced or undelivered information results in low sales records. Other benefits of electronic
business are:
1. Fliminating telephone tag.
2. Sending and receiving message al convenience.
3. Linking sales team numbers to gather, including international representatives.
4. Choosing sales without delays

Effectiveness and efficiency

 Electronic commerce can increase the efficiency and effectiveness of public relation programmes,
broadcast press release, financial updates and other corporate communication.
 Copy reviews and approvals are expedited by circulating instant messages to key internal and external
contacts

Close contact with clients

 In any business, where maintaining close contact with customers is a priority consideration, electronic
business can increase responsiveness of the company and ensure customer satisfaction
 Appointment confirmations, requests for information, follow-up reports and electronic data interchange can
be affected with greater efficiency using instant messages.

Planning and execution of meeting

 The mechanism of electronic operations in business facilitates planning and execution of meetings.
 Execution, management of meetings, seminars, workshops, symposia and conventions take a great deal of
time and efforts to manage.
 Arrangements must be coordinated among a variety of diverse groups in different locations e.g., hotels,
speakers, exhibitors, attendees, the media etc.
 Reports and surveys need to be distributed before and after the event. And there are always the headaches
of late breaking events and last-minute announcement.
 In an electronic business environment, video conferences, document conference, computer-based
conference, which offer companies the flexibility of both electronic and paper distribution, can make these
jobs easier and more effective.

E-commerce has made a profound impact on society

 People can now shop online in the privacy of their own homes without ever having to leave.
 This can force larger brick and mortar retailers to open an online division.
 In some cases, it can also force smaller businesses to shut their doors, or change to being completely online.
 It also changes the way people look at making purchases and spending money.
 Electronic Commerce has changed the face of retail, services, and other things that make our economy
work.
 Undoubtedly, it will continue to influence how companies sell and market their products, as well as how
people choose to make purchases for many years to come.

`Advantages of E-Commerce

1. Increased Sales: -Secure real time processing increase sales on the web site by providing a means for
immediate payment that provides closure for sales. E-commerce solutions have been delivering down to
earth selling strategies to enterprises who wish to profit from this emerging explosive new technology.
 2. Impulse Buying: -Another reason you need to go for internet business is that it has potential for impulse
buying, thereby making it easy for customers to buy from merchants online when impulse strikes.
3. Round the Clock Business: -Internet commerce is made easy because you can make money conveniently.
With this mechanism of commerce enabled website, the merchant can sell round the clock, every day of the
week, 24 hours a day and 365 days a year. There is no need to hire a clerk to run the store. This makes
potential business for the merchants and organizations.
4. Level Playing Field: -Can a business of small size get on to the internet? It is a frequently asked question.
Yes. Well, that is the best part of doing online business. It does not matter whether yours is a small,
medium or large business. E-commerce is open to one and all regardless of size potential and shape. On the
internet, no one knows that yours is small business. As long as you have a product to sell or buy, you are on
the net. You will be online. You can compete with the big guys in business.
5. Customer Convenience - Economy and convenience are the important reasons for investing and going on
net transactions. Trading online makes it easy for people to buy from merchants online. Internet processing,
credit card processing software, point of sales terminal equipment etc., made it more convenient for the
consumer to buy online. From the customer's point of view online business means greater convenience and
better fund management.

E-Commerce Procedure (Steps)

1) Filling Form Online: -

a. This is selling online and customers place their order by e-mail. When a customer visits a e-commerce site, he has
to fill out an online form to enquire about products or services. The supplier or merchant has to read the data of
enquiry about products and services including names, address, credit card number, instruction and so on. They
should get them encrypted, compressed, encoded and sent to by e-mail.

2) Selecting Product Service: -

a. The first step to be followed in the e-commerce process is the product service. The customer browses the
merchant's web sites, decides and selects. products/service item. In this connection, the shopping cart software
package is to be used. The shopping cart helps to add, delete and accumulate the total with regard to the
product/service.

3) Web Server: -

a. Online processor's web server is a key factor in the e-commerce process. As soon as the customer has finished
shopping, item selection and viewing shopping cart, they are linked to a secure from on the merchant's web server.

4) Encryption: -

a. Cryptography provides a tool of e-commerce security. As there is no formal exchange of signed document or
legitimacy of trading partner, with the possibility of illicit modification, these are the various aspects to be examined
as security aspects. Cryptography provides effective security for e- commerce superstructures.

5) Forwarding: -

a. The encrypted data is then forwarded to the online processors, which provides payment services. Today, there are
many real time online payment systems services. They are authorized, net future cash, net bank etc. they keep the
details of customer's orders and intern forward only the relevant credit card information to the banking system.

6) Leased lines: -

a. The bank or other financial institutions have been receiving thousands of transactions every day. The online
processor maintains a dedicated or leased line connection to the banks or institution. The arrangement facilitates to
process any number of transactions received every day.

7) E-mail Receipt: -
a. The facility of e-mail receipt is available for e-commerce over the internet. The optional e-mail receipt method
helps the merchant and the customer to notify by e-mail of the purchase approval and purchase details. It is only
optional. Irrespective of e-mail receipt, the order particulars are transferred to the merchant's sites for timely
processing of the order.

8) Merchant Account: -

a. A merchant account is necessary for accepting credit cards. The banks process merchant account transaction
besides contacting the customer credit card company. It may accept or decline the amount of the credit card
purchase. When the merchant has opened a merchant account, he specifies the name of the bank and account to
which funds are to be transferred. Once the bank has accepted the credit card transactions the funds are transferred
to the bank account specified by the merchant.

9) Credit Card Processing: - Payment processing system plays a critical role in e-business. The whole concept of
frauds related to credit card is a bigger risk to merchant than customers. The internet merchants have to take the
same precautions as in mail or phone orders. Generally, merchants are at risk of fraudulent orders. Credit cards are
the most popular way for paying for goods and services on the net.

10) Verification: -

a. The transaction information is sent via leased lines to the credit card networks, where the validity of the card is
checked and the availability of funds on that account is verified. An authorization code is written via leased lines to
secure server.

11) Merchant Getting Money: -

The banker of the merchant will collect money from the merchant account

12) Shipment of Goods: -

Dispatching the goods is the final step in process of online shopping. The goods are finally shipped which is done
outside the internet facility.

Disadvantages of E-Commerce

Electronic commerce is also characterized by some technological and inherent limitations which have restricted the
number of people using this revolutionary system.

One important disadvantage of e-commerce is that the Internet has still not touched the lives of a great number of
people, either due to the lack of knowledge or trust.

 A large number of people do not use the Internet for any kind of financial transaction. Some people simply
refuse to trust the authenticity of completely impersonal business transactions, as in the case of e-
commerce. Many people have reservations regarding the requirement to disclose personal and private
information for security concerns.
 Many times, the legitimacy and authenticity of different e-commerce sites have also been. questioned.

Another limitation of e-commerce is that it is not suitable for perishable commodities like food items.

 People prefer to shop in the conventional way than to use e-commerce for purchasing food products.
 So, e-commerce is not suitable for such business sectors. The time period required for delivering physical
products can also be quite significant in case of e-commerce
 A lot of phone calls and e-mails may be required till you get your desired products. However, returning the
product and getting a refund can be even more troublesome and time consuming than purchasing, in case if
you are not satisfied with a particular product.

The Future of E-Commerce

Experts predict a promising and glorious future of ecommerce in the 21st century. In the foreseeable future
ecommerce will further confirm itself a major tool of sale. Successful ecommerce will become a notion absolutely
inseparable from the web, because e-shopping is becoming more and more popular and natural. At the same time
severe rivalry in the sphere of ecommerce services will intensify their development. Thus, prevailing future trends of
ecommerce will be the growth of Internet sales and evolution.

Each year number of ecommerce deals grows enormously. Sales volumes of on-line stores are more than
comparable with those of "brick-and-mortar" ones. And the tendency will continue, because a lot of people are
"imprisoned" by work and household duties, while Internet saves a lot of time and gives opportunity to choose
goods at the best prices. Present-day Internet sales boom is the foundation for magnificent ecommerce future.

The "quantity to quality" tendency of ecommerce is also becoming more and more obvious, as the Internet has
excluded geographical factor from the sale. So it doesn't matter anymore whether your store is situated in New York
or London or in a small town. To survive, merchants will have to adapt rapidly to the new conditions. To attract
more customers e- store-owners will have not only to increase the number of available services, but to pay more
attention to such elements like attractive design, user-friendliness, appealing goods presentation, they will have to
opportunely employ modern technologies for their businesses to become parts of ecommerce future.

Of course, those, who acquire e-stores earlier, get better chance for future success and prosperity, though an
ecommerce site itself doesn't guarantee you anything. Only an appropriate ecommerce solution in combination with
thorough eMarketing and advertising can buy your business insurance.

Conclusion

Thus, on evaluating the various pros and cons of electronic commerce, we can say that the advantages of e-
commerce have the potential to outweigh the disadvantages. A proper strategy to address the technical issues and to
build up customers trust in the system, can change the present scenario and help e-commerce adapt to the changing
needs of the world.