Chapter

1
E-COMMERCE CONCEPTS
1.1 E-COMMERCE – ANYTIME COMMERCE
E-Commerce stands for ‘Electronic Commerce’. It refers to buying and selling of goods,
products, or services over the internet.
E-commerce as anytime commerce is the ability to buy and sell goods and services
online at any time of day or night, from anywhere in the world. This is made possible by the
fact that e-commerce websites are hosted on the internet, which is accessible 24/7.
E-commerce is a powerful tool that can be used to improve the customer experience and
increase sales. It allows customers to shop whenever they want, regardless of their time
zone or work schedule. This can be especially convenient for people who work long hours
or who have busy lifestyles.
Here are some examples of anytime commerce:
 You can shop on Amazon at any time of day or night, from anywhere in the world.
 You can order a pizza from Domino's online and have it delivered to your door in
minutes.
 You can book a flight on Kayak at any time of day, even if it's in the middle of the
night.
The term ‘e-Commerce’ also comprises other activities including- online auctions,
internet banking, payment gateways, and online ticketing.
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Some popular e-Commerce platforms are: Amazon, Flipkart, Myntra, IndiaMART, and
Snapdeal.
Note: E-Commerce is also known as ‘Internet Commerce’.

1.1.1 FEATURES OF E-COMMERCE

Some of the features of E-Commerce are as follows:
 Cashless Payment: E-Commerce allows the use of electronic payment. It allows the
transaction from credit cards, debit cards, electronic fund transfer via bank's website,
and other electronic payment methods.
 24x7 Availability: E-Commerce provides 24x7 service availability. It is available
anywhere, anytime.
 Improved Sales: Using e-commerce, orders for the products can be generated
anytime, anywhere without any human intervention. It gives a big boost to existing
sales volumes.
 Advertising and Marketing: E-Commerce helps in good marketing management of
products and services. It helps to increase the reach of advertising of products and
services of businesses.
 Support: E-commerce provides various ways to provide pre-sales and post-sales
assistance to provide better services to customers.
 Improvement in Communication: E-commerce gives faster, efficient and reliable
communication with customers and partners.
 Global Reach: It enables a business to easily reach across geographic boundaries.

1.1.2 ADVANTAGES OF E-COMMERCE

E-commerce is beneficial for organizations, society, and customers. So, e-Commerce
advantages can be broadly classified in three major categories:
(i) Advantages to Organizations
(ii) Advantages to Customers
(iii) Advantages to Society

1.1.2.1 ADVANTAGES OF E-COMMERCE TO ORGANIZATIONS

There are various benefits of e-Commerce to organizations that are listed as follows:
 Using e-commerce, organizations can expand their market to national and
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international levels with minimum investment. An organization can easily locate

more customers, best suppliers, and suitable business partners across the globe.
 E-commerce improves the brand image of the company.
 Using e-commerce, paperwork is reduced.
 E-commerce helps organization to provide better customer services.
 E-commerce helps to increase the productivity of organizations.
 E-commerce helps to simplify the business processes and makes them faster and
efficient.
 E-commerce provides organizations with the ability to quickly share information
with business partners and customers.

1.1.2.2 ADVANTAGES OF E-COMMERCE TO CUSTOMERS

There are various benefits of e-Commerce to customers that are listed as follows:
 E-commerce provides 24x7 supports to customers. Customers can enquire about a
product or service and place orders anytime, anywhere from any location.
 E-commerce application provides users with more options to compare and select the
cheaper and better options.
 E-commerce application provides a faster delivery of products to its customers.
 A customer can put review comments about a product and can see what others are
buying, or see the review comments of other customers before making a final
purchase.
 It provides the information in an easy way, i.e., the information is not hard to read. A
customer can see the detailed information of a product within some seconds instead
of waiting for days.
 E-Commerce increases the competition among organizations and as a result,
organizations provide big discounts to customers.
 There are many ways of making payments at e-Commerce sites through various
payment modes like- internet banking, credit card, debit card, cheques and even
cash on delivery. Hence, customer has option to choose the payment method of his
choice based on his convenience.

1.1.2.3 ADVANTAGES OF E-COMMERCE TO SOCIETY

There are various benefits of e-Commerce to society that are listed as follows:
 Customers need not travel to shop a product, thus less traffic on road and low air
pollution.
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 E-commerce has enabled rural areas to access services and products, which are
otherwise not available to them.
 E-commerce helps in reducing the cost of products, so less rich people can also
afford the products.
 E-commerce helps the government to deliver public services such as healthcare,
education, social services at a reduced cost and in an improved manner.

1.1.3 DISADVANTAGES OF E-COMMERCE

The limitations of using e-Commerce are mentioned as follows:
 E-commerce has no universal standard for quality and reliability.
 As there is a requirement of the internet to use e-commerce, it is possible that the
internet may be slow.
 Strong security is required in e-commerce as all transactions are through internet.
 Lack of touch or feel of products during online shopping is a drawback.
 Sometimes, there is a risk of purchasing unsatisfactory products via E-commerce.
 Customers also trap in banking fraud which is quite frequent.
 Hackers also try to get access of data or to destroy data in e-commerce.
 It is inconvenient to use the internet for those people who are living in remote
villages, and it is still not cheaper.
 The cost of the creation and building of an e-commerce application may be very high.

(TRADITIONAL COMMERCE V/S. E-COMMERCE)

Traditional Commerce E-Commerce

Traditional commerce refers to the commercial E-commerce refers to the commercial

transactions or exchange of information, buying transactions or exchange of information, buying
or selling product/services from person to or selling product/services electronically with
person without use of internet. the help of internet.

The start-up cost of traditional commerce is very The start-up cost of e-commerce is low.
high.

Traditional commerce is usually carried out by E-commerce is carried out by screen to face.
face to face.

In traditional commerce, processing of In e-commerce, processing of transaction is

transaction is manual. automatic.
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In traditional commerce, delivery of products is In e-commerce, delivery of products takes time.

instant.

Its accessibility is for limited time in a day. Its accessibility is 24x7. 24x7 means "24 hours a
day, 7 days a week".

Traditional commerce is done where digital E-commerce is used to save valuable time and
network is not reachable. money.

Traditional commerce is an older method of E-commerce is a newer concept of business style

business style which comes under traditional which comes under e-business.
business.

In traditional commerce, customers can inspect In e-commerce, customers can not inspect
products physically before purchase. products physically before purchase.

Communications of business depends upon In e-Commerce, there is no human intervention.

individual skills.

1.2 DIMENSIONS OF E-COMMERCE

The dimensions of e-commerce refer to the different aspects of e-commerce that
businesses need to consider in order to be successful. These dimensions include:
 Products and services: The products and services that are available for purchase
online. This includes everything from physical goods to digital content.
 Customers: The people who buy products and services online. This includes both
individuals and businesses.
 Businesses: The companies that sell products and services online. This includes both
large retailers and small businesses.
 Technology: The technology used to create and maintain an e-commerce website or
platform. This includes the hardware, software, and telecommunications
infrastructure.
 Content: The content that is used to attract and engage customers. This includes
product descriptions, images, videos, and blog posts.
 Marketing: The strategies used to promote an e-commerce website or platform. This
includes search engine optimization (SEO), pay-per-click (PPC) advertising, and
social media marketing.
 Shipping: The methods used to deliver products to customers. This includes
shipping carriers, shipping rates, and shipping tracking.
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 Payment processing: The methods used to process payments from customers. This
includes credit cards, debit cards, PayPal, and other payment methods.
 Customer service: The support provided to customers before, during, and after a
purchase. This includes live chat, email support, and phone support.
 Security: The measures taken to protect customer data and prevent fraud. This
includes encryption, firewalls, and fraud detection software.
Each of these dimensions is important in its own way, and businesses need to consider
all of them in order to create a successful e-commerce website or platform.
Here are some of the key trends that are shaping the dimensions of e-commerce:
 The growth of mobile commerce: More and more people are shopping online using
their mobile devices. This is driving the growth of mobile commerce, which is the
buying and selling of goods and services through mobile devices.
 The rise of social commerce: Social media is becoming an increasingly important
platform for e-commerce. Businesses are using social media to promote their
products and services, connect with customers, and drive sales.
 The increasing importance of data analytics: Businesses are using data analytics to
better understand their customers and their needs. This data can be used to improve
the customer experience, target marketing campaigns, and make better business
decisions.
 The growth of cross-border commerce: More and more people are shopping online
from other countries. This is driving the growth of cross-border commerce, which is
the buying and selling of goods and services across borders.

1.3 E-COMMERCE BUSINESS MODELS / TYPES OF

E-COMMERCE
Nowadays e-commerce has become very popular among the people who want to buy
and sell different things online.
There are basically four main types of e-commerce models that can describe almost
every transaction between Consumers (C) and Businesses (B).
(1) Business to Consumer (B2C)
(2) Business to Business (B2B)
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(3) Consumer to Consumer (C2C)

(4) Consumer to Business (C2B)

(1) Business to Consumer (B2C)

In Business-to-Consumer (B2C) e-commerce, the company will sell their goods and/or
services directly to the consumer.
In this type of e-commerce, customers or consumers visit the company’s website and
look at products, pictures and read reviews there. Then they place their order and the
company ships the goods directly to them.

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Fig. 1.1 (B2C E-Com m e rce M ode l

)

Example: An example of B2C e-commerce would be someone buying a pair of shoes

online from Amazon or eBay.

(2) Business to Business (B2B)

In Business-to-Business (B2B) e-commerce, the companies are doing business with each
other. B2B takes place between two businesses where one business provides services to
other business.
In this type of e-commerce, the final consumer is not involved. The online transactions
only involve the manufacturers, wholesalers, retailers etc.
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Fig. 1.2 (B2B E-Com m e rce M ode l

)

Example: A wholesaler places an order from a company's website (manufacturer) and

after receiving the consignment, sells the end product to the final customer who comes to
buy the product at one of its retail outlets.

(3) Consumer to Consumer (C2C)

Fig. 1.3 (C2C E-Com m e rce M ode l

)
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In Consumer -to- Consumer (C2C) e-commerce, the consumers are in direct contact
with each other. No company is involved. It helps people sell their personal goods and
assets directly to an interested party. C2C e-commerce takes place between two consumers
where one consumer sells an item through an online auction while the other consumer
purchases the item by offering the highest bid.
Example: CUSTOMER 1 wants to sell a car, so he/she can place his/her car on a website
like- OLX or eBay, while the CUSTOMER 2 wants to buy that car. So, the CUSTOMER 2
can contact CUSTOMER 1 and buys the car from him/her.
(4) Consumer to Business (C2B)
This is the reverse of B2C; it is a Consumer to Business.
In Consumer -to- Business (C2B) e-commerce, the consumer provides a good or some
service to the company. In this business model, the consumer creates value, and the
business consumes that value.

Fig. 1.4 (C2B E-Com m e rce M ode l

)

Example: A customer places some of their services or products on the website. If the
services or products create value for the business organization, then they order these services
or products, but in most cases, services. When the deal is done, they receive services or
products, and the customer receives money.
Note: Freelancing websites like- Fiverr, Freelancer work on C2B business model.

1.4 M-COMMERCE – CONCEPT

M-commerce, also known as mobile commerce, is defined as the process of conducting
business transactions using portable mobile devices connected over wireless networks. The