Lecture 7 e-Commerce

“A good website gives you a competitive

advantage. It is a powerful marketing tool. A
good web site can dramatically increase sales
while a poorly executed site can cast your
business in a negative light”.
~Frank Farris
 Sequence
• Commerce and E-commerce
▪ Value and advantage
▪ Key elements and growth drivers
▪ E-commerce environment
▪ E-commerce business models
▪ Challenges and solution
▪ Myths about e-commerce
▪ E-commerce website design
 Commerce
• Commerce is a division of trade or production
dealing with exchange of goods/services from
producer to consumer.
– It comprises of trading a commodity having
economic value such as goods, services,
information or money between two or more
entities
 What Is E-commerce?
• Commonly known as Electronic Marketing
– “It consist of buying and selling goods and services over an
electronic systems such as the internet and other computer
networks”
– “E-commerce is the purchasing, selling and exchanging
goods and services over computer networks (internet)
through which transaction or terms of sale are performed
electronically”
• The most popular example of eCommerce is online shopping,
which is defined as buying and selling of goods via the internet on
any device
• e-Commerce can also entail other types of activities, such as
online auctions, payment gateways, online ticketing, and internet
banking
 The Business Value of Ecommerce
• The explosive growth in ecommerce makes it an increasingly
valuable and essential tool that enables businesses to:
– Differentiate from their competitors
– Reach more customers in more regions of the world
– Reduce costs by selling directly to customers and maintaining
fewer brick-and-mortar stores
– Enable customers to purchase anytime and anywhere, using
their preferred devices—a capability that is essential for
millennials and other digital natives
– Gain valuable customer data
– Test-market new products, services, brands, and businesses
with minimal upfront investment
– Provide self-service options to customers, allowing a smaller
sales staff to sell to more customers
 How Ecommerce Is Changing the
Shopping Experience
• To keep pace with customers’ increasing demands for more choice,
easier access, and faster delivery, businesses are integrating their
in-store and ecommerce offerings to create seamless multichannel
shopping experiences where customers can
• Research and explore products and services online before making
a purchase either online or in-store
• Use any device—a computer, smartphone, smartwatch, digital
assistant, and more—to shop when and where they want
• Receive personalized recommendations, coupons, and other
online offers based on information collected online or in-store
• Have items shipped wherever they want (to their homes or to their
local store), often within just a day or two
• Order items online from within a brick-and-mortar store, when
that physical store lacks the preferred inventory (style, size, color,
and so on)
 The Future of Ecommerce
E-commerce is growing quickly, as customer demands keep growing and
technological innovations in AI, machine learning, the Internet of Things (IoT),
and more enable businesses to meet those demands in new ways.
Expansion to more Ecommerce is growing around the world and businesses will be competing to win
markets millions of new customers in emerging as well as existing markets.
Greater Customers want personalized ecommerce experiences, such as discounts and
personalization upsell suggestions based on their purchase history. Ecommerce platforms that
leverage AI for more accurate predictions and recommendations will gain and
retain more customers.
Faster deliveries Same-day and even same-hour deliveries via drones and other means will
become increasingly common, forcing all businesses to streamline their supply
chains and speed deliveries to stay competitive.
Subscription-based Subscription sales of lifestyle products and other goods are likely to increase,
purchasing providing curated products to discerning customers.
More touchpoints Customers will be shopping more with their phones, digital assistants, and other
digital devices, forcing ecommerce retailers to provide seamless service across
more touchpoints.
Better chatbots Digital assistants and other chatbots will become progressively more
sophisticated, enabling customers to interact by voice, and using AI to provide
more conversational assistance.
Experiential stores Brick-and-mortar retailers will shift toward more experiential and immersive
offerings, engaging customers with digital kiosks, touchscreen-enhanced mirrors,
in-store classes, virtual reality features, in-store cafés, and other interactive
displays and experiences.
Enhanced visualization Ecommerce retailers will leverage virtual reality, 3D imaging, augmented reality,
and other technologies to mimic hands-on experiences that were once available
only in physical stores.
 Key Elements of E-commerce Platforms
Flexible The platform should support both B2B and B2C selling in one platform that can be deployed using
a hybrid cloud environment or other models.
Affordable Software-as-a-service (SaaS) subscription models are typically more affordable than on-premises
platforms, which usually require high and continuing infrastructure investments.
User-friendly Ecommerce needs to be easy for customers to navigate on the front end and easy for businesses to
manage on the back end. User interfaces need to be clear and simple so that nontechnical workers
can add pages and features without difficulty.
Easy to It should be easy for businesses to integrate their legacy technologies into the platform to keep
integrate costs down and take advantage of existing investments.
Customizable Businesses should be able to customize the front-end customer experience as necessary to support
their brand.
Fast Businesses need ecommerce platforms that are easy to implement, with self-service architecture
and standards-based frameworks that simplify deployment and make it easy to add applications
and features as needed.
Simple
Ecommerce platforms should be easy to maintain and monitor, with automatic updates, instant
access to the latest features, and real-time visibility into businesswide performance metrics.

Secure Ecommerce platforms must provide the latest comprehensive security measures while also
ensuring compliance with the Payment Card Industry Data Security Standard (PCI DSS), the General
Data Protection Regulation (GDPR), and other regulations.
Scalable
Whether it’s Black Friday or launch day for a new brand, the platform should be able to scale
rapidly to deliver an exceptional experience to customers worldwide every day of the year.
E-commerce Environment
E-commerce Business Model
E-commerce Business Model
 What are the Different eCommerce
Business Models?
• eCommerce is typically classified into three different models
based on the type of participants involved in the transaction:
B2B, B2C, and C2C. Broadly speaking these business models
are:
• Business to Business (B2B)
– Business-to-business (B2B) is a transaction or business
conducted between one business and another, such as a
wholesaler and retailer
– B2B is when businesses sell to other businesses. This is typical of
stationery stores who sell office equipment in bulk to
businesses. Normally B2B companies provide a discounted rate
per unit if customers buy in bulk
 Cont………

• Business to Consumer (B2C)

– Direct-to-consumer or business-to-consumer is the business
model of selling products directly to customers and thereby
bypassing any third-party retailers, wholesalers, or any other
middlemen
– A familiar example of the B2C model would be supermarkets
where consumers buy their shopping weekly, but they wouldn’t
normally bulk buy anything
– For example, Walmart
 Cont………

• Consumer to Consumer (C2C)

– a business model in which third-party companies facilitate
transactions for products or services between private
consumers without a business participating on either end of the
sale
– C2C businesses are a type of business model that emerged with
e-commerce technology and the sharing economy
– Through marketplaces like eBay, Amazon Marketplace, this can
be easy and quite lucrative for selling items that you no longer
have a use for
 Strategies for E-Success
• Focus on a niche in the market
• Develop a community
• Attract visitors by giving away “Freebies”
• Make creative use of e-mail but avoid becoming a
spammer
• Make sure your web site says “credibility”
• Consider forming strategic alliances
• Make the most of the web’s Global reach
• Promote your web site online and offline
• Develop an effective search engine optimization (SEO)
Strategy
 What are The Benefits of
eCommerce?
• eCommerce has demonstrated such explosive growth,
with the internet becoming an essential requirement of
everyday life, businesses are learning to take advantage
of the benefits of eCommerce, which include:
– Global market
– Around-the-clock availability
– Reduced costs
– Inventory management
– Targeted marketing
– Serving niche markets
– Working from anywhere
 Designing a Web Site
• Understanding of your target customer
– Give customers what they want
– Assure customers that their online transactions are secure
– Keep your site updated
• Select an intuitive domain name
• Make your web site easy to navigate
– Give shoppers the ability to track their orders online
– Create fast, simple checkout process
– Post shipping and handling charges up front
– Confirm transactions
• Build loyalty by giving online customers a reason to return to
your web site
• Establish hyperlinks with other businesses, preferably those
selling products or services that complement yours
• Test your site often
25 Most Important
Features For E-
commerce Website