E-Commerce

and
Business Model
Concepts
 Content
• 1.1- Introduction to E-Commerce
• Role of E-Commerce in Business Economy.
• Growth of E-Commerce in India
• 1.2 - Factors responsible for the growth of E-Commerce in India
• Opportunities and Challenges for E-Commerce in India
• 1.3- E-Commerce Business Models – Introduction, Types, how
• to choose e-commerce business models.
• 1.4- Modern Procurement in E-Commerce -
• E-Procurement – Introduction,
• E-Commerce and Technological tools
 Content
• 1.5- E-Distribution – Introduction, Features, Scope and Advantages.
• Architectural Models in B2B
• 1.6- E-Commerce and Infrastructure – Electronic Data
Interchange, Internet, Intranet, Extranet, Backend Informatics, System
Integration etc
E-COMMERCE (Meaning & Definition)
• The term e-commerce refers to all types of business operations and
transactions that are executed through internet and other electronic
technologies.
• E - commerce is a virtual business environment in which information moves
electronically via internet related to buying , selling, transportation of goods
and services.
Definition:
According to P. T Joseph E commerce comprises core business processes of
buying and selling, good, services and information over the internet
 Introduction to E-Commerce
• E business: May be defined as conduct of industry, trade and commerce using the
computer networks.

1. Managing suppliers
2. Managing production
3. Managing Inventory
4. Accounting and finance
5. HRM
6. Selling products
7. Servicing customers
8. Processing payments
 UBIQUITY

FEATURES GLOBAL REACH

UNIVERSAL STANDARDS
OF E- INTERACTIVITY

COMMERCE INFORMATION DENSITY AND

RICHNESS
PERSONALISATION
FRAMEWO
RK OF E-
COMMERC
E
 Network Infrastructure: It decides the
hardware such as computers, servers,
Routers Cable TV, Wireless Internet.

Multimedia content & Network

Framework Publishing Infrastructure: It is

responsible to show the product or services.
In this basically HTML is used Electronic
books, WWW

of E- Messaging & Information Distribution

Infrastructure: It is responsible to prepare

commerce
and send the formatted and un- formatted
messages such as purchase order, Invoice,
packing list and other personal messages,
e-mails etc. EDI. E-Mail, HTTP, SMTP, FTP.

Common business service

infrastructure : facilitating buying and
selling process, security, authentication,
electronic payment, catalog.
 Types of E commerce
• B2C (Business-to-Consumer): This is the most common form, where
businesses sell directly to individual consumers. Think of your favorite online
clothing store or the platform where you buy gadgets.
• B2B (Business-to-Business): In this model, transactions occur between
businesses. For example, a company that sells software to another business
would be engaged in B2B e-commerce.
• C2C (Consumer-to-Consumer): This involves transactions between
individual consumers. Online marketplaces where people can buy and sell
used items, like eBay or Craigslist, fall into this category.
• C2B (Consumer-to-Business): This is a bit more unconventional, where
individual consumers sell products or services to businesses. Think of
freelance platforms where individuals offer their skills or products to
companies.
• B2G (Business-to-Government): In this model, businesses sell products or
services to government entities. It could be anything from office supplies to
Types of E commerce

1. B2C (Business-to-Consumer)
2. B2B (Business-to-Business)
3. C2C (Consumer-to-Consumer)
4. C2B (Consumer-to-Business)
5. B2G (Business-to-Government)
 More customers

Cost effective

Role of E- Easy & Quick communication

Commerce
in Business
Elimination of middlemen

Economy. Easy distribution process

Introduction to new product

 Internet Access: More people are using the
internet, even in smaller towns.

Growth of Affordable Smartphones: Cheaper phones

make it easier for everyone to shop online.
E-
Commerce Easy Payments: Apps like UPI, Paytm, and
PhonePe make online payments quick and
in India safe.

Fast Delivery: Companies now deliver

products quickly, sometimes on the same
day.
 Factors responsible for the growth of E-
Commerce in India
1. Increasing Internet Users
• More Internet Access: Affordable data plans and widespread internet connectivity have made it
easy for millions of Indians to go online.
• Digital India Initiative: Government programs are promoting internet use, even in rural areas.

2. Affordable Smartphones
• Budget-friendly smartphones allow people from all economic backgrounds to shop online.
• Over 700 million smartphone users in India are potential e-commerce customers.
 Factors responsible for the growth of E-
Commerce in India
3.Easy and Secure Payments
• UPI (Unified Payments Interface): Apps like PhonePe, Paytm, and Google Pay make
payments fast and safe.
• Cash on Delivery (COD): E-commerce platforms offer COD for customers who prefer
paying in cash.
4. Convenience and Variety
• People can shop anytime, anywhere, without going to a store.
• E-commerce platforms offer a wide range of products, often more than physical stores.
 Factors responsible for the growth of E-
Commerce in India
5. Rising Middle Class and Disposable Income
• More people have extra money to spend on shopping.

• The growing middle class prefers branded and quality products, which are easily available online.

6. Logistics and Fast Delivery

• Companies like Amazon and Flipkart have improved delivery networks to reach even small towns and villages.

• Services like same-day delivery and quick commerce (10-20 minutes delivery) are attracting more
customers.

7. COVID-19 Pandemic
8. Discounts and Promotions
9. Advanced technology
Opportunities for E-Commerce in India
Market Expansion:
• Large untapped market with potential for significant growth.
Rising Middle Class:
• Growing middle-class population with increased purchasing power.
Mobile Internet Usage:
• Proliferation of mobile internet usage, providing access to a wide consumer base.
Digital India Initiatives:
• Government initiatives promoting a digital ecosystem.
Global Market Access:
• Opportunities for Indian businesses to access global markets.
 Challenges for E-Commerce
in India

Infrastructure Payment Regulatory Consumer Last-Mile Competition

Challenges: Security Compliance: Trust: Delivery: and Pricing:
Inadequate logistics Concerns:
Concerns over the Complex regulatory Building and Efficient last-mile Intense competition
and transportation security of digital landscape affecting maintaining trust in delivery logistics in affecting pricing
infrastructure. payment systems. e-commerce online transactions. both urban and rural strategies and profit
operations. areas. margins.
 E COMMERCE
BUSINESS MODEL
IN PHYSICAL MARKET YOU CAN DO DIFFERENT TYPES OF BUSINESS TO EARN MONEY LIKE:

OPEN A RETAIL SHOP – OPEN A WHOLESALE CONSTRUCT A MARKET PROVIDES SERVICES LIKE SELL TOUR PACKAGES
GROCERY, ELECTRONICS, SHOP OR MALL TICKET BOOKING
MEDICINE, BOOKS ETC
• E COMMERCE BUSINESS MODEL
SIMILARLY IN E COMMERCE, THERE ARE DIFFERENT BUSINESS MODELS THROUGH WHICH ONE
CAN EARN MONEY

TRANSACTION MARKET CONTENT

E- TAILER
BROKER CREATOR CREATER

COMMUNITY SERVICE
PORTAL
PROVIDER PROVIDER
E TAILER
• SELLS PHYSICAL
PRODUCTS DIRECTLY
TO CONSUMERS OR
TO INDIVIDUAL
BUSINESSES
• EG. - AMAZON,
FLIPKART, AJIO
TRANSACTIO
N BROKER
• SAVES USERS MONEY AND
TIME BY PROCESSING
ONLINE SALES
TRANSACTIONS AND
GENERATING A FEE EACH
TIME A TRANSACTION
OCCURS
EG. POLICY BAZAAR, MAKE MY
TRIP, AGODA, OLA, UBER
 PROVIDES A DIGITAL
ENVIRONMENT WHERE BUYERS
AND SELLERS CAN MEET, SEARCH
FOR PRODUCTS, DISPLAY
PRODUCTS, AND ESTABLISH
PRICES FOR THOSE PRODUCTS.
GENERATING REVENUE FROM
MARKET TRANSACTION FEES

CREATOR
EG. - OLX
 CREATES REVENUE BY
PROVIDING DIGITAL CONTENT,
SUCH AS NEWS, MUSIC, PHOTO
OR VIDEO OVER THE WEB
CONTENT
PROVIDER THE CUSTOMER MAY PAY TO
ACCESS THE CONTENT OR
REVENUE MAY BE GENERATED
BY SELLING ADVERTISING
SPACE.
 PROVIDES AN ONLINE MEETING
PLACE WHERE PEOPLE WITH
SIMILAR INTERESTS CAN
COMMUNICATE AND FIND USEFUL
COMMUNIT INFORMATION.

Y
PROVIDER
EG. - FACEBOOK, INSTAGRAM,
TWITTER.
 PROVIDES OTHER SERVICES
SUCH AS ONLINE DATA
STORAGE AND BACKUP, PDF
CONVERTER, PHOTO
SHARING, VIDEO SHARING
SERVICE ETC.

PROVIDER EG. - smallpdf.com,

zamzar.com, ilovepdf.com
PORTAL
PROVIDES INITIAL POINT OF ENTRY TO THE WEB ALONG WITH
SPECIALIZED CONTENT AND OTHER SERVICES.

WEB PORTALS ARE INTERNET OR CLOUD PLATFORMS THAT GIVE SPECIFIC

AUDIENCES ACCESS TO DIFFERENT INFORMATION FROM AN
ORGANISATION.

Eg. -- GOOGLE, BING, YAHOO

Modern Procurement
in E-Commerce/E-
Procurement
E PROCUREMENT – ELECTRONIC
PROCUREMENT
• E- ELECTRONICS
• PROCUREMENT : THE PROCESS OF OBTAINING SUPPLIES FOR AN ORGANISATION.

• E PROCUREMENT : THE BUSINESS-TO-BUSINESS PURCHASE AND SALE OF SUPPLIES

AND SERVICES OVER THE INTERNET.
• ALSO KNOWN AS SUPPLIER EXCHANGE
• DEFINITION: E PROCUREMENT IS THE BUSINESS TO BUSINESS PURCHASE AND SALE OF
SUPPLIES OVER THE INTERNET.
E PROCUREMENT –
ELECTRONIC PROCUREMENT
• E- INFORMATION
• E- TENDERING
• E- AUCTION
• VENDOR MANAGEMENT
• E- INVOICING
• E- PAYMENT
 INFORM
NEED GET APPROVAL
PURCHASE DEPT

TRADITIONAL CREATE PO
REQUEST
FOR QUOTATION
GET APPROVAL

PROCUREME
NT
RECEIVE IN ONE
WEEK
 E PROCUMENT
SEARCH
APPROVED
NEED APPROVE ONLINE
ELECTRONIC
CATALOG

RECEIVE IN 2
DAYS
 BENEFITS OF E PROCUREMENT
• SAVES TIME
• COST EFFECTIVE
• EASY TO HANDLE
• FAST
• MAKE ALL PROCESS EASIER
E-Commerce and Technological
tools
• M commerce
• Electronic Funds Transfer (EFT)
• Supply Chain management
• Internet Marketing
• Online Transactions Processing
• Electronic Data Interchange (EDI)
M-commerce (Mobile Commerce):

• Definition: Buying and selling goods or services using mobile

devices like smartphones or tablets.
• Example: Ordering and paying for a pizza through a mobile app
on your smartphone.
Electronic Funds Transfer (EFT):

• Definition: The electronic exchange of money from one bank

account to another, often used for transactions like salary
deposits or bill payments.
• Example: Transferring money from your checking account to a
friend's account using online banking.
Supply Chain Management:

• Definition: The coordination of processes involved in the

production and distribution of goods, ensuring efficiency from raw
material to the final product.
• Example: Using technology to track inventory levels and
manage the flow of products from manufacturer to retailer.
Internet Marketing:

• Definition: Promoting products or services using online

channels, such as social media, websites, and email.
• Example: Running targeted ads on Facebook to reach a specific
audience interested in a particular product.
Online Transactions Processing:

• Definition: The real-time processing of online transactions,

ensuring quick and secure completion of purchases.
• Example: Completing an online purchase and receiving an
instant confirmation of the transaction.
Electronic Data Interchange (EDI):

• Definition: The electronic exchange of business

documents between companies, allowing for seamless
and standardized communication.
• Example: Sending and receiving electronic invoices
between a supplier and a retailer to streamline the
billing process.
 • E- DISTRIBUTION : Introduction
• It refers to the process of delivering products or services purchased online to customers.
When you buy something online, e- distribution involves getting that item from the seller to
your doorstep.
• When you shop online, the seller needs to send the products you bought to your home.
• It involves packing the items securely and arranging for system, while other times they may
work with shipping companies like FedEx or UPS to handle the delivery.
• E distribution is an imp part of e commerce because it ensure that the products you order
are delivered safely and efficiently to your location.
• It involves logistics, such as inventory management, packaging and coordinating with
shipping services to make sure your purchase reaches you in good condition and on time
• Process of getting the products you buy online delivered to your doorstep, making online
shopping convenient and accessible.
E- DISTRIBUTION : SCOPE
As technology continues to advance, the scope of e-distribution is likely to expand further.
• E-commerce: E-commerce is perhaps the most well-known application of e-distribution.
Online retail platforms allow businesses to sell products directly to consumers over the
internet. This includes a wide range of goods, from electronics and clothing to digital
products and services.
• Digital Products and Services: E-distribution plays a crucial role in delivering digital
products and services such as software, e-books, music, streaming services, and online
courses. These products can be easily distributed and accessed through digital channels.
• Financial Services: Banking and financial institutions use e-distribution for online
banking services, electronic fund transfers, and distribution of financial products such
as insurance and investment instruments.
E- DISTRIBUTION : SCOPE
• Education: E-distribution is transforming the education sector through online learning
platforms, e-books, and digital educational resources. This enables the distribution of
educational content to students worldwide.

• Manufacturing and B2B Commerce: E-distribution is used in B2B (business-to-business)

transactions and supply chain processes, facilitating the exchange of goods and services
between businesses. Online platforms enable manufacturers to connect with distributors
and retailers globally.

• Government Services: Governments use e-distribution to deliver services to citizens,

including online tax filing, government information portals, and e-government platforms
that streamline the distribution of official documents and information.
E- DISTRIBUTION : Advantages
• Global Reach : it allows businesses to reach customers
worldwide, breaking geographical barriers.
• Cost efficiency: no rent , utilities and maintenance.
• 24/7 availability
• Wide range products
• Efficient inventory management: inventory tracking,
management of inventory efficiency, ensures smoother customer
experience.
E-Commerce and Infrastructure – Electronic Data
Interchange, Internet, Intranet, Extranet
 Electronic Data Interchange (EDI)

Electronic data Interchange (EDI) is the computer-to- computer exchange of

business documents in a standard electronic format between business
partners.
Companies use EDI systems to exchange business information automatically by
computer as paperless transactions.
EDI is a process for transferring information between systems using
standardized electronic formats to enable computers to process the
information while minimizing or completely eliminating the need for human
intervention.
Many business documents can be exchanged using EDI like – PO, Invoices,
advance ship notice, customer documents, inventory documents, payment
documets etc.
Internet:
It is a global network of computers, to
exchange information.

It is a network of networks that includes

millions of private and public, academic,
business, and govt networks linked by
copper wires, wireless connections and
other technologies.
Applications of Internet:
 Download programs and files
 E mail
 Voice and video confercing
 E – commerce
 File sharing
 Information browsing
 Search the web addresses for access search engine
 Chatting and many more
What is intranet
•Internal company network that uses internet
standards (HTML, HTTP & TCP/IP protocols) &
software.

•Accessed only by authorized person,

especially members or employees of the
organization.
FIREWALL:

• SECURITY DEVICE LOCATED BETWEEN FIRMS INTERNAL

NETWORK (INTRANET AND EXTENAL NETWORK(INTERNET)

• REGULATES ACCESS INTO & OUT OF COMPANY'S NETWORK

BASED ON A SET OF RULES

• NEEDS TO BE UPGRADED FROM TIME TO TIME TO CHECK LATEST

POTENTIAL SECURITY PROBLES.
APPLICATIONS OF INTRANET
• SHARING OF COMPANY POLICIES/RULES & REGULATIONS
• ACCESS EMPLOYEE DATABASE
• DISTRIBUTION OF CIRCULARS/OFFICE ORDERS
• ACCESS PRODUCT & CUSTOMER DATA
• SHARING OF INFORMATION OF COMMON INTEREST
• LAUNCHING OF PERSONAL/DEPARTMENTAL HOME PAGES
• SUBMISSION OF REPORTS
• CORPORATE TELEPHONE DISTRIBUTION
What is Extranet
•Extranet is an intranet for outside authorized
users using same internet technology.
•Inter-organizational information system.
•Enable outsides to work together with
company's employees.
•Open to selected suppliers, customers &
other business partners.
Examples of Extranet
Dealers/distributors have access to product
files such as : production specification,
pictures, images to answer the queries of
the customer.
ASSIGNMENT – I
• WHAT IS E –COMMERCE . EXPLAIN THE FEATURES OF ELECTRONIC COMMERCE.
• DISCUSS THE FRAMEWORK OF E-COMMERCE AND WRITE THE ADVANTAGES &
DISADVANTAGES OF E- COMMERCE.
• Discussion Topic: "The Impact of Social
Media on E-Commerce"
• Objective: To analyze and discuss how social
media platforms influence and shape the
landscape of e-commerce, including
opportunities, challenges, and best practices.