E-Commerce

What is E-commerce
• Electronic Commerce (E-Commerce) refers to the
buying, selling, or exchanging of goods, services,
and information through electronic networks,
primarily the Internet.
• It involves online transactions where businesses,
consumers, and even governments interact using
digital platforms rather than traditional physical
marketplaces.
E-commerce = conducting business activities
online (marketing, ordering, payments, delivery
coordination, and customer service).
 Types of E-Commerce
E-commerce can be classified based on the
parties involved in the transactions:
1. Business-to-Consumer (B2C)
Transactions between businesses and individual
consumers.
Most common form—online retail stores.
Examples: Amazon, Jumia, eBay, Alibaba.com
(retail side).
Features: Wide reach, convenience, product
variety, personalized marketing.
2. Business-to-Business (B2B)
 Transactions between businesses.
 Companies sell products/services to other companies, often in
bulk.
 Examples: Alibaba (wholesale side), Salesforce, Microsoft
Azure.
 Features: Large volume transactions, negotiated pricing, long-
term relationships.

3. Consumer-to-Consumer (C2C)
 Transactions between consumers through a third-party
platform.
 Individuals sell products or services directly to other
individuals.
 Examples: eBay, Craigslist, Facebook Marketplace, Vinted.
 Features: Second-hand goods, peer-to-peer sales, low entry
cost.
4. Consumer-to-Business (C2B)
Individuals offer products or services to businesses.
Businesses pay consumers for their contributions.
Examples: Freelancers on Upwork, photographers
selling stock images, influencer marketing.
Features: Reverse of traditional business flow,
flexibility, gig economy-based.
5. Business-to-Government (B2G)
Businesses provide goods or services to government
agencies via digital platforms.
Examples: Online government procurement systems,
e-tendering platforms.
Features: Large-scale contracts, strict regulations,
transparency.
6. Government-to-Citizen (G2C) / Government-to-
Business (G2B)
E-commerce conducted by governments with citizens or
businesses.
Examples: Online tax filing, license renewals, paying utility
bills online.
Features: Improves efficiency, reduces bureaucracy,
enhances service delivery.
7. Mobile Commerce (M-Commerce)
Subset of e-commerce conducted via smartphones and
tablets.
Examples: Mobile money (M-Pesa, Airtel Money),
shopping apps (Amazon app).
Features: Accessibility, convenience, growth driven by
mobile internet.
 E-Commerce Infrastructure
E-commerce infrastructure refers to the
technological, organizational, and human
resources needed to support online transactions.
It includes:
a) Hardware Infrastructure
Servers & Hosting – powerful servers to host websites,
databases, and applications.
Data Centers – for storing and securing data.
Networking – reliable internet backbone, broadband,
and wireless connections.
Devices – desktops, laptops, tablets, and smartphones
used by customers and merchants.
b) Software Infrastructure
 E-Commerce Platforms – e.g., Shopify, WooCommerce,
Magento.
 Payment Gateways – PayPal, Stripe, Visa/MasterCard, mobile
money.
 Databases – for storing product catalogs, customer info,
transaction records.
 Security Tools – firewalls, SSL certificates, encryption software,
intrusion detection.
c) Telecommunication Infrastructure
 High-speed internet and mobile networks (4G/5G) to enable
smooth transactions.
d) Human and Organizational Infrastructure
 Skilled personnel – developers, marketers, cyber-security
experts.
 Logistics & Supply Chain – warehousing, packaging, and
delivery services.
 Customer Support – call centers, chatbots, after-sales service.
e) Legal & Regulatory Framework
Consumer protection laws.
Cyber laws (data protection, privacy,
fraud prevention).
International trade regulations.
 Current Issues in E-Commerce
a) Cyber-security & Privacy Concerns
Phishing, hacking, data breaches, identity theft.
Weak consumer trust due to online fraud.
b) Payment Issues
Lack of secure and universally accepted payment
gateways in some regions.
High transaction costs for cross-border payments.
c) Logistics & Delivery Challenges
Last-mile delivery problems in rural or remote areas.
High shipping costs and delays in cross-border trade.
d) Legal & Regulatory Challenges
Lack of harmonized international e-commerce laws.
Issues of taxation, customs duties, and intellectual
property rights.
e) Digital Divide
Unequal access to internet and digital devices in
developing countries.
Limits participation of many SMEs and consumers.
f) Competition and Market Saturation
Big players (Amazon, Alibaba) dominate, making it
hard for small businesses to thrive.
g) Trust and Consumer Protection
Fake products, poor return policies, hidden
costs.
Difficulty in resolving disputes across
borders.
h) Emerging Technologies
Adoption of AI, blockchain, IoT, AR/VR in e-
commerce is still uneven.
Small businesses struggle to keep up with
rapid innovation.