Project Work

On
E-Commerce

Submitted by: Lalhriatpuia

Roll.No. 2003BCOM047
Subject: Essentials of E-Commerce
Course no.: BC/6/CC/24E
Bachelor of Commerce
6th Semester

Department of Commerce
Govt.Hrangbana College
Chanmari, Aizawl
 INTRODUCTION

E-commerce as anything that involves an online transaction. E-commerce provides multiple benefits to
the consumers in form of availability of goods at lower cost wider choice and saves time. The general
category of e-commerce can be broken down into two parts: E-merchandise: E-finance. E commerce
involves conducting business using modern communication instruments: telephone, fax, e-payment,
money transfer systems, e-data interchange and the Internet. Online businesses like financial services,
travel, entertainment, and groceries are all likely to grow. Forces influencing the distribution of global e-
commerce and its forms include economic factors, political factors, cultural factors and supranational
institutions. It has an impact over the economy of many countries among which India is on the top of that
list. It has named as new gold rush in e-commerce. E-commerce has many reasons that why it is very
crucial in developing the country. For the study we have taken several parts of the world such as North
America, Latin America, Europe, Middle-East, Africa and South Asia ,and Australia. E-commerce has an
intent to bring some transformation in the society and that is the reason why it is essential for the B2B and
B2C commerce.

CHARACTERISTICS

Exchange and Share Data Across the World

Text messages, documents, graphics, photographs, music, video, and much more, can be converted into
data and sent as email attachments or presented on a web site. There are no postage, printing and
packaging costs with eCommerce communications. So, use this new communications method to work
quicker, and in new ways, with customers and suppliers outside of your locality or country.

Send Messages Faster and Cheaper

When you send a message, you only pay for the INTERNET access. As soon as the message arrives at
your ISP, it is sent for zero cost to all the people to whom it has been addressed. Moreover, the message
is likely to arrive at its destination, in a matter of seconds or minutes, depending on the size of the email
and its attachments. Think of the possibilities for saving time and money with email.

Approve and Proof Work Quickly

A quotation, purchase order, letter, design drawings, brochure, or advert colour proof, etc. can be emailed
to you as an attachment for your approval. Using email in this way can dramatically speed-up the turn-
around of work between you and your business contacts.
Introduce Collaborative Working

With fast, reliable and cheap eCommerce communications, it is possible for colleagues, customers,
suppliers and partners, to use collaborative
working practices to manage, share, and enhance the project work, regardless of locationwhere they are
at a particular instance.

Update Employees Instantly With New Policies or Procedures

Email and messengers etc. works well when communicating with colleagues/pals who are off-site, out of
the country, or teleworking.

Hold Web Meetings (Data Conferencing)

A great way to have a virtual meeting is to upload a document (spreadsheets, project plans, etc) on to a
web site and enable it to be viewed and edited in real-time through the Internet. Holding virtual meetings
can save significantly on travel expenses and time.

Take Advantage of Time Differences

As eCommerce communications are so fast and low cost, new business relationship have been established
where work is exchanged between time zones at the end of one day, which, on the other side of the world,
is the beginning of either the same or next day.

Send Out email Automatically

Event-triggered emails can be used to acknowledge orders made on websites, and to update customers
on order progress. Alert-emails or SMS messages can also be used to notify technical support of critical
issues or
maintenance problems. There, and many other similar applications, are effortless, cheap, andefficient
ways of enhancing customer service and the brand experience.

Use the Internet to Improve Business Administration

With a mobile phone connected to a portable computer, employees working off-site can access and update
internal information, such as customer records, price lists, time sheets, schedules, and job reports.
Providing remote Internet access for staff makes it possible for the latest information to be at hand, for
administrative tasks such as invoicing, employee whereabouts, and expense claims etc.

Train on the Web

The multi-media capabilities of web sites make them ideal for creating a virtual learning environment for
employees and customers. When training material is updated, the latest version is immediately available.
On-line learning facilities enable trainees living all over the world to access courseware when it is
convenient to them, and without having to travel to a training centre, which in turn, saves time and
expenses.
Replace the Fax Machine and Save Money

If a multi-page document has to be faxed to many people, it can work out expensive on telephone bills,
especially if a national or international call has to be made. The cost savings can be huge if email is used
instead, and the message can also be sent to multiple people for no extra cost.

History of E-commerce
Concerning Technology

E-commerce began before personal computers were prevalent and has grown into a multi-billion dollar
industry. The meaning of the term "electronic commerce" has changed over the last 30 years. Originally,
"electronic commerce" meant the facilitation of commercial transactions electronically, usually using
technology like Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT), where both were
introduced in the late 1970s, for example, to send commercial documents like purchase orders or invoices
electronically. The 'electronic' or 'e' in e-commerce refers to the technology/systems; the 'commerce'
refers to be traditional business models. E-commerce is the complete set of processes that support
commercial business activities on a network. In the1970s and 1980s, this would also have involved
information analysis. The growth and acceptance of credit cards, automated teller machines (ATM) and
telephone banking in the 1980s were also forms of e-commerce. However, from the 1990sonwards, this
would include enterprise resource planning systems (ERP), datamining and data warehousing.

In the dot com era, it came to include activities more precisely termed"Web commerce" - the purchase
of goods and services over the World Wide Web, usually with secure connections (HTTPS, a special server
protocol that encrypts confidential ordering data for customer protection) with e-shopping carts and with
electronic payment services, like credit card payment authorizations. Today, it encompasses a very wide
range of business activities and processes, from e-banking to offshore manufacturing to e-
logistics. The evergrowing dependence of modern industries on electronically enabled
business processes gave impetus to the growth and development of supporting systems, including
backend systems, applications and middleware. Examples are broadband and fibre-optic networks, supply-
chain management software, customer relationship management software, inventory control systems and
financial accounting software.

Concerning Decisions/Foot steps

When the Web first became well-known among the general public in1994, many journalists and pundits
forecast that e-commerce would soon become a major economic sector. However, it took about four years
for security protocols (like HTTPS) to become sufficiently developed and widely deployed. Subsequently,
between 1998 and 2000, a substantial number of businesses in the United States and Western Europe
developed rudimentary web sites. Although a large number of "pure e-commerce" companies
disappeared during the dot-com collapse in 2000 and 2001, many "brick-and-mortar" retailers recognized
that such companies had identified valuable niche markets and began to add e-commerce capabilities to
their Web sites. For example, after the collapse of online grocer Web van, two traditional supermarket
chains, Albertsons and Safeway, both started e-commerce subsidiaries through which consumers could
order groceries online. The emergence of e-commerce also significantly lowered barriers to entry in the
selling of many types of goods; accordingly many small home-based proprietors are able to use
the internet to sell goods. Often, small sellers use online auction sites such as EBay, or sell via large
corporate websites like Amazon.com, in order to take advantage of the exposure and setup convenience
of such sites.

Concerning Transformation of IT

EDI

Some authors will track back the history of ecommerce to the invention ofthe telephone at the end of
last century. EDI (Electronic Data Interchange) is widely viewed as the beginning of ecommerce if we
consider ecommerce as the networking of business communities and digitalization of business
information. Large organizations have been investing in development of EDI since sixties. It has not gained
reasonable acceptance until eighties. EDI has never reached the level of popularity of the web-based
ecommerce for several reasons:

High cost of EDI prohibited small businesses and medium-sized companies from participating in the
electronic commerce.

Slow development of standards hindered the growth of EDI.

The complexity of developing EDI applications limited its adaptation to a narrow user base.

The Internet and the Web

The Internet was conceived in 1969, when the Advanced Research Projects Agency (a Department of
Defense organization)funded research of computer networking. The Internet could end up like EDI without
the emergence of the World Wide Web in 1990s. The Web became
a popular mainstream medium (perceived as the fourth mainstream medium inaddition to print, radio
and TV) in a speed which had never been seen before. The Web users and content were almost doubled
every a couple of months in 1995 and1996. The web and telecommunication technology had fueled the
stock bubble in the roaring 90s and eventually pushed NASDAQ over 5,000 in 2000 before it crashed down
to 1,200 in 2002.

XML and Web Services

Besides the availability of technical infrastructures, the popularity of the Web is largely attributed to the
low cost of access and simplicity of HTML authoring, which are the obstacles of EDI development. The
Internet and the Web have overcome the technical difficulty of EDI, but it has not solved the problem of
slow development of ecommerce standards.XML, as a meta markup language, provides a development
tool for defining format of data interchange in a wide variety of business communities. Web Services offers
a flexible and effective architecture for the implementation. There is no doubt that XML and the Web
Services will shape the course of ecommerce in years to come.
 • Global trends in E-commerce
• Government programs are a significant vehicle for c-commerce implementations
• Retail, grocery and logistics industries are the most active in encouraging trading partners to
implement EDI
• Small and medium sized companies demand flexible integration solutions
• European companies focus on core competencies and outsource technology to consulting groups
• High percentage of first time implementers seek to achieve full integration
• Organizations are seeking a scalable, reliable system that is easy to deploy and manage

Software needs to be capable of handing different business processes and must integrate with existing IT
investments. As social media, app stores and global availability become standard, many companies are
looking to enhance the online customer experience. And while retail and other transactions via Internet
are customary, more than ever companies are simplifying the ways in which customers interact with their
website and ultimately make online purchases. Here are eight trends happening right now in global e-
commerce that seek to enhance the user experience:

Micro-payments

Among the most revolutionary changes in the coming months not years

is the use of micro-payment systems from a variety of financial firms, e.g., Paypal, Visa, Western Union,
among others, including banks. This trend is facilitated by the W3C working group that approved these
protocols and technical standards for the interworking. These systems will change not only how we carry
money but how we value money and think about purchases. (Consider how a purchase of $4.99 feels in a
mobile app store vs. at Dunkin' Donuts.) Payment systems that make it easier to buy online, coupled with
mobile technologies will accelerate the usage of global e-commerce applications.

Mobile technologies

More people access the Internet on their mobile devices than on any other device. We are rapidly
approaching the time (if we are not already there) where designs must be created for the mobile Webfirst,
and for the desktop second. Mobile technologies facilitate comparison shopping; with the advent of
barcode reader apps and price-comparison databases, a consumer could snap a bar code in Walmart and
quickly reference product reviews and prices on walmart.com (or compare prices with Walmart
competitors). Mobile technologies also facilitate impulse buys especially with the advent of micro-
payments tied to the mobile

device. Just recently, Starbucks customers can not only place an order with their Smartphone, but also
make a purchase.

Social media

As Facebook has become the most visited site on the Web, the role of social media, including Facebook
and its local clones such as Twitter, is increasingly important. Social media sites increasingly act as points
of entry to e-commerce sites, and vice versa, as e-commerce sites build rating, loyalty and referral systems
tied to social media. Group buying (e.g., Groupon) is also gaining mainstream ground, with many "deal of
the day" sites competing for an increasingly savvy consumer base, but improvements lie ahead as the
social aspects and user experience are refined.

Fulfillment options

I believe that users will want to have multiple fulfillments and return options when interacting with a
vendor: ship to address, courier, pick-up in store, return to store, etc. Having many fulfillment options is
how customers view their overall customer experience. Some companies have made a business
proposition online by being exceptional in service to the online channel (e.g., Zappos).

Global availability

Increasingly, consumers want the availability to buy products from foreign sites and have them delivered
locally. Thus, currency and customs will be of growing concern to many online retailers. Along with this,
there will be concerns with local privacy laws and restrictions on related data collection and storage.

Localization

• While the trend is to globalize, what‘s often more important is to localize.

• User Centric‘s research clearly shows that sites that feel local.
• Customizability
• Consumers want control, and want to be able to design the details of the items they
purchase.
• Time-based availability

Some of the hottest and most successful sites are those that have a time-critical response component.
Sites like Groupon, Gilt and others capitalize on the perception of limited-time availability. Creating a
sense of urgency drives traffic and purchase behavior.

In the world where old-fashioned retail meets high-technology and innovative management, the winners
could well be those who understand dimensions. What the consolidation?

• High operational costs affect profit margins.

• Most e-commerce sites compete on deep discounts, which hit their margins.
• Some firms feel the time is right to cash in on brand, customer base.

Private equity (PE) and venture capitalists (VC) are eyeing safe exit while e-commerce ventures are still
profitable. What makes a Long-Term Player?

• Loyal customer base, fundamentally strong business models, clear product/service

differentiation.
• Deep pockets to tide over initial gestation period. Challenges for E-Commerce Sites
• Low customer loyalty
• High returns rates on cash-on-delivery
• High cost of customer retention
• State of Play

The companies that are selling have real valuations, real transactions and real customers, and are not
based on eyeballs. E-commerce companies in India offers the most tangible and finest e-commerce
solutions, provide high end e-commerce solution taking utmost care of the privacy and security of the e-
commerce website. E-Commerce service includes shopping carts, database programmers, graphic design
services, graphics, e-business, Flash designs etc.

Today, even though there are less than 10 million internet users who are actually engaging in e-
commerce activities, there are about 150 million internet users in India or around 75 million households
that are ready for e-commerce. The growing reach in terms of internet connectivity to the interiors of
India coupled with the positive experiences of end consumers when buying online beyond the metros
and big cities are key drivers of the e-commerce boon in India. Businesses in even the smallest towns
and villages are becoming increasingly aware of e-commerce and are excited by the growth potential.
The growing penetration of e-commerce along with positive consumer experiences is reflected in a trend
towards higher value online purchases. Today, consumers across urban India are confident enough to
make purchases that exceed Rs 20,000-25,000. Earlier, the same shoppers stayed in the Rs 2,000-5,000
ranges. According to one study almost 57% of business for e-commerce product sites came from tier I,
tier II and tier III cities while the eight metros accounted for the remainder 43%. The same pattern was
visible in the service sites too, with tier I, tier II and tier III cities contributing 54% of revenue versus 46 %
by the eight metros.

According to a report by the IAMAI, the current e-commerce market in India is around US$ 10 billion. But
with different levels of adoption, the market has the potential to grow anywhere between US$ 70 billion-
US$ 150 billion under one scenario and at another level it can grow between US$ 125 billion – US$ 260
billion by 2024-25.

E-commerce: The world over Globally, the scenario is much the same. Brazil, one of fastest growing
economies in Latin America, is seeing considerable growth. According to a recent report, it estimates
business-to-consumer (B2C) ecommerce including both retail e-commerce and online travel sales, will
total to$18.7 billion in 2012, a growth of21.9% over the previous year. Brazil will account for more than
half of the total B2C e-commerce sales in Latin America through 2013, thanks in large to its huge populace
and growing number of online buyers. Retail e-commerce itself in the U.S.is predicted to grow at 17% and
it will likely account for $200 billion in sales in 2012 , according to a presentation at a popular forum. Retail
e-commerce totalled $48.2 billion during the third quarter of 2011; an increase of 13.7% compared with
the third quarter of 2010, according to estimates from the U.S. Census Bureau. 2011 also saw the European
online market boom despite the floundering euro. Germany‘s online trade increased 17% in 2011 to
€21.48billion compared to 2010, crossing the €20 billion mark for the first time, outstripping traditional
mail order sales by 10%. A similar growth rate of 10% to 15% is expected in 2012.In the global scenario,
China is fast emerging as the biggest player in e-commerce. According to an e-commerce report, by 2015,
it may well surpass the U.S. In an astonishing illustration of its online growth rate, China has added the
equivalent of the entire population of France in internet users in each of the last four years. It will add the
equivalent of the entire population of Canada as e-shoppers in each of the next four years. China is
projected to rise from 145 million e-shoppers today to329 million by 2015.
 KEY REASONS FOR THE SUCCESS OF E-COMMERCE

Shopping 24x7: E-commerce facilitates shopping anytime, anywhere and for almost anything desired. Busy
consumers prefer this to the restrictions of when a mall/shop is open and the need to physically travel to
a shop. Online business takes shopping a step further by taking itself to the customer creating
conveniences of shopping anywhere and at anytime.

Reduced operational cost: Since the entire business can be moved online, the need for physical stores has
become obsolete. Less infrastructural investment and associated labour costs drive sup the profit margin.
The seller can then transfer this benefit to the customer in the form of discounted pricing which boosts
the appeal of online shopping.

Easy to compare: It is far easier and quicker to compare prices of goods online, equipping the customer
with the information to decide the right price or terms for themselves. The comparison is not restricted to
items from a single seller, or a single region. One can explore products across global markets via e
commerce.

Safe & secure: Customers can trust the process of going online and purchasing only when transactions are
fast, convenient and secure. A high degree of integrity is possible only when the online electronic payment
provider is reputable and trustworthy. In India, all payment transaction providers are required to comply
with the security requirements laid out by the Reserve Bank of India making the system more robust and
reliable.

Increased reach for the merchant: Just as the customer finds them able to venture across geographic
markets, the merchant too is able to display his product to customers in new territories. Market
penetration also becomes far more achievable with e-commerce; it is possible for a merchant in Mumbai
to extend his reach to north-eastern cities or even rural villages that are now connected by the online
network.

CONCLUSION
Social media trend: In India, with the increasing propensity of social media, businesses have now begun
to engage their customers on social networking portals such as Facebook. Promotions, sales and new
products are increasingly showcased through such channels and mobile apps are now available that
suggest products to users based on their profiles. These are likely to be rapidly developing marketing
channels for the future. The e-commerce world is changing rapidly in the digitized world. These e-
commerce developments may have been accelerated by the global economic downturn which may be
driving consumers to find new ways of reducing their costs of living. The online channel offers a clear value
proposition for both merchants and consumers making it the most sought after and exciting business
model today.