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E-COMMERCE
Abstract
E-commerce is a boom in the modern business. E-commerce means electronic commerce.
Ecommerce (Electronic commerce) involves buying and selling of goods and services, or the
transmitting of funds or data, over an electronic network, predominantly the Internet.

E-commerce (Electronic commerce) is a paradigm shift influencing both marketers and the
customers. Rather e-commerce is more than just another way to boost the existing business
practices. It is leading a complete change in traditional way of doing business. This significant
change in business model is witnessing a tremendous growth around the globe and Pakistan is not
an exception. A massive internet penetration has added to growth of E-commerce and more
particularly start-ups have been increasingly using this option as a differentiating business model.

E-commerce is empowered with benefits to both retailers and consumers that has fuelled most of
the business direction. Despite of e-commerce development in developed countries, some
challenges still hinder the full realization of growth and performance in developing countries, this
brings our research gap. Research method used qualitative analysis, using interpretative
phenomenological analysis technique and critical realistic approach in literature review.

Moreover E-Commerce has significant influences on the environment. Although the model is
highly used in current business scenario but the option has not been explored at its fullest.

The current research has been undertaken to describe the scenario of E-Commerce, analyze the
trends of E-Commerce. The study further examines the key variables imperative for the success of
E-commerce business models.

Objective:

The objectives of present study are:

1. To understand the present status and trends of E-Commerce; and

2. To reveal the key variables influencing the increased usage of E-Commerce.

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INTRODUCTION
Today, electronic commerce (E-commerce) is growing very fast. Business through the internet is
an essential component and will be the heart of global economic trade in the 21st century which
has an enormous and undoubted impact on almost all organizations and markets.

E-commerce means electronic commerce. It means dealing in goods and services through the
electronic media and internet. E-commerce involves carrying on a business with the help of the
internet and by using the information technology like Electronic Data Interchange (EDI). E-
Commerce relates to a website of the vendor on the Internet, who trades products or services
directly to the customer from the portal. The portal uses a digital shopping cart or digital shopping
basket system and allows payment through credit card, debit card or EFT (Electronic fund transfer)
payments.

E-commerce is the use of electronic communications and digital information processing

technology in business transactions to create, transform, and redefine relationships for value
creation between or among organizations, and between organizations and individual.

Definition of e-commerce:
Although there are many definitions and explanations of e-commerce, the following definition
provides a clear distinction.

1. Electronic commerce, or e-commerce, is defined to be the process of businesses trading with

other businesses and the formulation of internal processes using electronic links.
2. Electronic business, or e-business, is a term often used interchangeably with e-commerce, but
is more concerned with the transformation of key business processes through the use of
internet technologies.

Categories of e-commerce:

• Business-To-Business e-commerce:

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The largest category of e-commerce is business-to-business (B2B) commerce. This involves
companies conducting e-procurement, supply chain management, network alliances, and
negotiating purchase transactions over the internet. Businesses use e-commerce to lower
transaction costs of conducting business and to make savings in terms of time and effort when
conducting business.

• Business-To-Consumer e-commerce:
Business-to-consumer (B2C) e-commerce involves businesses introducing products and services
to consumers via internet technologies. This includes companies selling software and hardware
through the internet, taking orders for products that are subsequently delivered to the consumer,
and providing digital services such as online magazines and search engines.

• Business processes:
Business process refers to the use of e-commerce to tailor the internal activities of a business in
order to maximize their efficiency and effectiveness. Through the use of e-commerce, businesses
can fine-tune supply chains, provide advanced consumer relations management systems, and
reduce transaction costs.

• Consumer-To-Consumer e-commerce:
Consumer-to-consumer (C2C) e-commerce is concerned with the use of e-commerce by
individuals to trade and exchange information with other individuals. There has been a huge
growth in consumer-to consumer auctions sites such as e-Bay and sites enabling consumers to
offer goods and services to other consumers on an individual basis.

• Business-To-Government e-commerce:
Business-to-government (B2G) e-commerce is concerned with the need for business to sell goods
or services to governments or government agencies. Such activities include supplying the army,
police force, hospitals and schools with products and services. Furthermore, businesses will often
compete in an online environment for contracts to provide services to the public on behalf of the
government. Such services may include the collection of taxes, and the supply of public services.

The nature of e-commerce:

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Three core concepts underpin the nature of e-commerce:

• The management of transactions and transaction costs through the use of online technologies and
computerized networks.

• The re-engineering of business processes into logical, related and sequential activities that ensure
businesses engage in transactions in the most efficient and effective manner through the use of
online technologies and computerized networks.

• The use of information technologies and computerized networks to facilitate employees’

telecommuting or telle-working. Such activities enable flexible working, distributed workforces
and efficient productivity paths.

Advantages of electronic commerce:

All the advantages of electronic commerce for businesses can be summarized in one statement:

Electronic commerce can increase sales and decrease costs. Advertising done well on the web
can get even a small firm’s promotional message out to potential consumers in every country in
the world. A firm can use electronic commerce to reach narrow market segments that are
geographically scattered. The web is particularly useful in creating virtual communities that
become ideal target markets for specific types of products or services. A virtual community is a
gathering of people who share a common interest, but instead of this gathering occurring in the
physical world, it takes place on the internet.

The table below lists some key advantages of e-commerce:

• A business can reduce the costs of handling sales inquiries,

Advantages providing price quotes, and determining product availability by
using electronic commerce in its sales support and order-taking

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process.
• Electronic commerce provides buyers with a wider range of
choices than traditional commerce.
• Electronic commerce provides buyers with an easy way to
customize the level of detail in the information they obtain about
a prospective purchase.
• Electronic payments of tax refunds, public retirement, and
welfare support cost less to issue and arrive securely and quickly
Advantages when transmitted over the internet.
• Electronic payments can be easier to audit and monitor than
payments made by cheque, providing protection against fraud
and theft losses.
• Electronic commerce can also make products and services
available in remote areas.

Disadvantages of electronic commerce:

Some businesses are less suitable for electronic commerce. Such businesses may be involved in
the selling of items which are perishable or high-cost, or which require inspection before
purchasing. Most of the disadvantages of electronic commerce today, however, stem from the
newness and rapidly developing pace of the underlying technologies. These disadvantages will
disappear as electronic commerce matures and becomes more available to and accepted by the
general population

The table below lists some of the key disadvantages of e-commerce:

• Return-on-investment is difficult to calculate.

• Many firms have had trouble recruiting and retaining employees
Disadvantages with the technological, design, and business process skills
needed to create an effective electronic commerce presence.

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• Difficulty of integrating existing databases and transaction-

processing software designed for traditional commerce into the
Disadvantages software that enables electronic commerce.
• Many businesses face cultural and legal obstacles to conducting
electronic commerce.

LITERATURE REVIEW
The definition of e commerce:
E-commerce also known as electronic commerce; internet or online shopping, is the activity of
buying and selling of goods and services via the internet and its network system. In another words
it involves business transactions of buying and selling of goods and services or exchange of
information between business to business or business to consumers without both the buyer and
seller meeting physically but rather over the internet (Mehra, 2015; Rahman,2018). In the last 3
decades, the revolution of internet from 1960s, to date is fascinating. There is much development
and penetration of internet. E-commerce has resulted to globalization of products and services. E-
commerce has brought with it a lot of benefits to the consumers as well as companies over the
traditional retail. Consumer benefits range from comparison of prices before purchase, shopping
while at your comfort zone, wide range of products choice, cheaper in shopping since no travelling
costs, and time wastage, information is easily available on a click of a button. For the companies
can enjoy the following benefits: large market, new customers, decrease in inventories, monitoring
customer preference changes, efficient and competence, scalability, reduce costs and boost brand
awareness. According to Alavinasab & Taleghani (2016), mention the significance of ecommerce
on business performance and growth.

Especially, with the developed countries enjoy high volume of e-commerce sales compared to
developing countries. However, the developing countries are yet to realize the full potential growth
and performance of e-commerce. Although, according to emarket.com shows that by 2022,

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developing countries will be leading in e-commerce, especially Africa. Despite, developed
countries have realized full potential, still developing countries are faced with challenges that
hinder growth and performance of e-commerce.

. A huge amount of research works has been done on e-Commerce which is basically on online
shopping. A large group of researchers has found out and also pointed out the necessity and
possibilities of Online Shopping. On the other hand, limitation of ecommerce is found and at the
same time, they provided essential suggestion and came to a prediction to make Online Shopping
more useful for the consumers. But the contribution of traditional marketing is also inescapable
but compare to online

shopping it is less effective we

think. So on this basis, Mehrdad Salehi et.al [17]

found out distinguish between online marketing & traditional marketing. Though most of the
people of Bangladesh especially the rural people are not enough capable of operating internet to
run the online business. For that reason, they need to be dependent on traditional marketing.

METHODOLOGY

This research is actually based on secondary information from various journals, published book,
and newspapers along with internet. The study is qualitative and unique in nature.Data sources of
research data in the form of literary journals that are relevant to the research topic. Sources of
data in this study journal articles that are relevant to the research topic. Researchers analyse data
using interpretative phenomenological analysis. In this interpretation, the authors uses a critical-
realist approach, where the authors analyse data based on relativity over existing realities.

DISCUSSION

Empirical research shows that penetration and access of internet is one of the major factors that
lead consumers to buy online. 65% shows that consumers would like to shop online because of its

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convenience. 72% ability to search for information of products and services with easiness.
Consumers can call to the customer service support even after working hours since its available
24 hours, 7 days a week. Therefore, can get feedback on information on what they require online
shop as compared to offline shop that operate on specific hours of the day. Most of consumers,
prefer online shopping because they can save a lot of time. For example, looking for parking space
at the mall, long queues on cashier desk and salespeople with who impose you to buy things you
had not planned for. In a snapshot, online consumers are endowed with huge benefits at the click
of a button.

Even though, after analysing huge theoretical and literature review, it depicts that developing
countries are still experiencing hinderances on growth and performance of ecommerce. Hitherto,
challenges are, trust, privacy and security, culture aspects, lack of knowledge and skills. TV media
is a great tool that can be used to influence the growth and performance in the developing countries.

The development of world wide web has fuelled the growth and performance of online shopping.
It plays a crucial role in the modern-day society. Information technology and communication is
the backbone of economic, social, environmental, as it hence achieving of sustainable e-commerce
. Therefore, online retailers need to be aware of the challenges that make consumers to abandon
online shopping and offer solutions. This will create good experience, great satisfaction, and
loyalty to remain online shoppers for the rest of their lives.

Trust, privacy, and security- security is a great concern to online consumer. Even though, there are
several ways to make payments on online purchase. Credit card is the most convenient way.
Consequently, consumers would feel insecure and abandon the online shopping if they do not trust
retailers with their personal information on the website. However, if retailers are subscribed to
guarantee security seals like Verisign on their page this challenge can be minimised. Customers
tend to associate themselves with trusted brands. Trusted brands influence customers on online
purchase. Trust can determine either loose or gain customers as well as failure or success of online
retailers on e-commerce. Why is security and trust important to online consumers? Because by the
virtual customers using credit card online, retailers can access private information of the
consumers. Consumers worry a lot if they are not guaranteed their information would not be used

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otherwise, for different purpose. Privacy indicates infringing the rights of another person using
their information without their consent.

Culture aspect- traditionally, consumers are used to shop in traditional way. Brick and mortar,
visiting physical shops, to see, feel and tough the product before actual purchase. Online shopping,
the culture is different, there is intangibility of the products, and this may lead some products not
purchased online. Also, according to some cultures and religion, consumer may not be interested
of buying a product or service. Hence retailers should be aware of this fact and avoid offending
consumers by directing customised ads to the wrong consumer, otherwise, might have a negative
impact on the brand. Statistics shows that is the culture of male to do more online shopping than
female by 67 percent. Fashion is the leading, followed by travel, electronics, among others. It is
important for the online retailers to have in mind the culture of a certain countries, behaviour, and
beliefs. In this aspect can promote the development and performance of e-commerce in a diverse
way.

Television has a significant role in society in various countries, especially in developing countries.
In many developing countries, television has received the attention of the government, so that the
mass media is often explicitly regulated. Almost all developing countries throughout the world
have and manage TV stations in the form of public TV, for example, Kenya, Nigeria, Iraq, Jordan,
Mongolia, Afghanistan, Pakistan, Indonesia, Malaysia, the Philippines, Vietnam, Thailand, and
others. Many countries also have rules that can force private TV stations to broadcast government
programs situations.

Messages that contain e-commerce can take many forms, ranging from news, features, news
magazines, documentaries, advertisements, talk shows, reality shows, even quizzes and soap
operas. The program can be direct and interactive. All TV programs will have a stronger impact if
designed in an integrated manner with various other activities and programs. Research shows that
integrated campaigns can have a substantial impact on consumers.

CONCLUSION

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It is of no doubt for e-commerce to thrive in developing countries the following challenges needs
to be addressed urgently. Online shopping has come of age, it is no longer an option but a vital
business model that contribute to economic aspect for both retailers and consumers. Online
retailers need to pay close attention to factor that can turn a way online customer. Similarly,
provide a solution aiming to get larger market and turn potential customers to actual online buyers.
Understanding of the obstacles by online retailers or sellers will close the gap. Create websites that
guarantee online consumers safety of the personal information. Enshrine policies on retailers’
website page that gives assurance of the protection every private information collected can only
be used with customer’s consent.

Trust, privacy, and security- online retailers to institute trust among its customers, by subscribing
to features that display trust. For example, VeriSign, etrust signs, SSL certificate can be ascribed
to from genuine vendors. When consumer visit online retailer’s page with these signs gain more
trust to these brands. Encrypted websites that would not leave the credit card users vulnerable to
hackers, would go in hand. Trust critical factor considered by consumers, at pre-purchase, during
purchase and post-purchase. For instance, when consumers buy online products and find them with
default. Contact information should be available for the seller’s web and customer can have an
easy way to return the product for exchange or get a refund without hitches. This makes consumers
build more trust with the brands. Also, transactions should be secured by ensuring protection of
the data of the consumers when they use credit cards. Retailers should keep customers’ information
encrypted and all employees made to sign binding contract that forbid them from using consumer
private data for their personal gain. This clause can be included on the sellers’ website on privacy
protection. All above measures is to create trust in the mind of the consumers and online sellers
are holding themselves accountable hence makes e-commerce more viable and sustainable. In
summary, e-commerce has changed the way businesses are conducted around the world. E-
commerce has brought a lot of efficiency, time saving and cost reduction for the online shopping
malls. Likewise, online consumers are can shop online 24 hours a day, avoid traffic jams, enjoy
convenience, great customer satisfaction coupled with amazing shopping experience. However,
web shops must pay keen attention to the things that will make online consumers avoid online
shopping. For example, ensure user friendly website, ease to use, adequate availability of
information upon search. Secure websites that guarantee safety and privacy of consumer private

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data. Create trustworthiness among consumers by subscribing to features that provide confidence
with the consumers. On their website give the policies that protect consumers. Online sellers to
ensure that they are aware of the consumers and respect their cultures, beliefs, norms, and customs.

In near future E-Commerce will be the leader with popularity and prosperity in e-trade sector.
From above discussion we can come to a view that eCommerce has changed the business strategy
and making life easier for the people of Pakistan as well as other countries. Developing countries
like Pakistan, we faced some problem in this sector but we think we can overcome very
strategically in future. Results of this study shows that the mention barriers if well considered by
the online sellers then would give the right environment for e-commerce to thrive in the developing
countries.

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