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E-Commerce Chapter 1

The document provides an introduction to e-commerce, defining it as the buying and selling of goods and services over electronic systems like the internet. It distinguishes between e-commerce and e-business, explaining that e-business encompasses a broader range of online business activities beyond transactions. Additionally, it outlines the types of e-commerce, their advantages and disadvantages, and the historical context of e-commerce development.

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52 views25 pages

E-Commerce Chapter 1

The document provides an introduction to e-commerce, defining it as the buying and selling of goods and services over electronic systems like the internet. It distinguishes between e-commerce and e-business, explaining that e-business encompasses a broader range of online business activities beyond transactions. Additionally, it outlines the types of e-commerce, their advantages and disadvantages, and the historical context of e-commerce development.

Uploaded by

fikadu.meu.edu
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Electronic

Commerce
Mettu University, Department of Information Technology
3rd Year
Chapter 1 – introduction to E-Commerce
Prepared By: Alemayehu N
•
What is Commerce
According to Dictionary.com
• Commerce is a division of trade or
production which deals with the exchange of
goods and services from producer to final
consumer
• It comprises the trading of something of
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.
TRADITIONAL
BUSINESS
MANF. UNIT DISTRIBUTOR WHOLESALER RETAILER CUSTOMER
20% 10% 10% 10% 100%

ADVERTISEMENT
50%

DIRECT SELLING
COMPANY CUSTOMER
E-Commerce vs. E-Business
Definition of E-Commerce

• e-commerce is an abbreviation used for


electronic commerce. It is the process through
which the buying, selling, dealing, ordering and
paying for the goods and services are done over
the internet is known as e-commerce. In this
type of online commercial transaction, the seller
can communicate with the buyer without having
a face to face interaction.
• Some examples of real world application of e-
commerce are online banking, online shopping,
online ticket booking, social networking, etc.
Definition of E-Business

• Electronic Business, shortly known as e-business, is the online


presence of business. It can also be defined as the business which is
done with the help of internet or electronic data interchange i.e. is
known as E-business. E-commerce is one of the important
components of e-business, but it is not an essential part.
• e-business is not confined to buying and selling of goods only, but it
includes other activities that also form part of business like
providing services to the customers, communicating with employees,
client or business partners can contact the company in case if they
want to have a word with the company, or they have any issue
regarding the services, etc. All the basic business operations are done
using electronic media. There are two types of e-business, which are:
• Pure-Play: The business which is having an electronic existence only.
• Brick and Click: The business model, in which the business exists both in
online i.e. electronic and offline i.e. physical mode.
Key Differences Between e-
commerce and e-business

1. Buying and Selling of goods and services through the internet is known as
e-commerce. Unlike e-business, which is an electronic presence of business,
by which all the business activities are conducted through the internet.
2. e-commerce is a major component of e-business.
3. e-commerce includes transactions which are related to money, but e-
business includes monetary as well as allied activities.
4. e-commerce has an extroverted approach that covers customers, suppliers,
distributors, etc. On the other hand, e-business has an ambivert
approach that covers internal as well as external processes.
5. e-commerce requires a website that can represent the business. Conversely,
e-business requires a website, Customer Relationship Management
and Enterprise Resource Planning for running the business over the
internet.
6. e-commerce uses the internet to connect with the rest of the world. In
contrast to e-business, the internet, intranet and extranet are used for
connecting with the parties .
Why Use E-Commerce …….?
• LOW ENTRY COST
• REDUCES TRANSACTION COSTS
• ACCESS TO THE GLOBAL MARKET
• SECURE MARKET SHARE
Brief History Of
E-Commerce
• 1970s: Electronic Funds Transfer (EFT)
• Used by the banking industry to exchange account
information over secured networks
• Late 1970s and early 1980s: Electronic Data
Interchange (EDI) for e-commerce within
companies
• Used by businesses to transmit data from one business
to another
• 1990s: the World Wide Web on the Internet
provides easy-to-use technology for information
publishing and dissemination
• Cheaper to do business (economies of scale)
• Enable diverse business activities (economies of scope
The Process of E-Commerce
• A consumer uses Web browser to connect to the
home page of a merchant's Web site on the
Internet.

• The consumer browses the catalog of products


featured on the site and selects items to
purchase. The selected items are placed in the
electronic equivalent of a shopping cart.

• When the consumer is ready to complete the


purchase of selected items, she provides a bill-to
and ship-to address for purchase and delivery
• When the merchant's Web server receives this
information, it computes the total cost of the
order--including tax, shipping, and handling
charges--and then displays the total to the
customer.

• The customer can now provide payment


information, such as a credit card number, and
then submit the order.
• When the credit card number is validated and the
order is completed at the Commerce Server site,
the merchant's site displays a receipt confirming
the customer's purchase.

• The Commerce Server site then forwards the


order to a Processing Network for payment
processing and fulfillment.
Types of E-Commerce
Business-to-business
(B2B)
• B2B stands for Business to Business. It consists of
largest form of Ecommerce. This model defines that
Buyer and seller are two different entities. It is
similar to manufacturer issuing goods to the
retailer or wholesaler.
E.g.:-Dell deals computers and other associated
accessories online but it is does not make up all
those products. So, in govern to deal those products,
first step is to purchases them from unlike businesses
i.e. the producers of those products.
Business-to-consumer
(B2C):
• It is the model taking businesses and consumers
interaction. The basic concept of this model is
to sell the product online to the consumers.
• B2c is the direct trade between the company
and consumers. It provides direct selling
through online. For example: if you want to sell
goods and services to customer so that anybody
can purchase any products directly from
supplier’s website.
Business-to-Employee
• (B2E)
Business-to-employee (B2E) electronic
commerce uses an intrabusiness network which
allows companies to provide products and/or
services to their employees. Typically,
companies use B2E networks to automate
employee-related corporate processes.
Consumer-to-
• consumer (C2C)
There are many sites offering free classifieds,
auctions, and forums where individuals can buy
and sell. The 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 everyday since 1995.
PROS AND CONS OF
E-COMMERCE
PROS

• No checkout queues

• Reduce prices

• You can shop anywhere in the world

• Easy access 24 hours a day

• Wide selection to cater for all consumers


CONS

• Unable to examine products personally

• Not everyone is connected to the Internet

• There is the possibility of credit card number


theft

• On average only 1/9th of stock is available on


the net
Thank You

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