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MEANING OF ECOMMERCE Ecommerce comprises of 2 things E + Commerce “Electroniccommerce describes the buying and selling of products, services and information via computer networks including the Internet.”
Products could be trading of any physical/digital products such as food, book, games, cars etc. Services could be distant education, online medical consultation with an hospital outside the country or arranging the trips etc.
DEFINITION “A way of doing real time business transactions via telecommunication networks, when the customer and merchant are in different geographical places” Dr. Heikki Mattila
Buying, Selling, Marketin g & Servicing over Computer Electronic of Networks Commerce Products, Services & Information
GOALS OF ECOMMERCE Reduced cost Lower product cycle time Faster customer response Improved Service Quality
DIMENSIONS OF ECOMMERCE Traditional Commerce – Product or goods are physical Process of transactions are physical Physical Agent Pure E Commerce- Product or services are digital Process of transactions are digital Delivery Agent is digital Partial E commerce Where any of two dimensions are physical Example ( Amazon.com)
COMPARISON OF ECOMMERCE WITH TRADITIONAL COMMERCE Startup-Needs capital & Very little financing Market – region, nation Local to global Knowledge-static competency Dynamic competency TC requires interstate highway EC requires I highway network Nature of goods determines what Information and multimedia type of vehicle is needed content determines what type of vehicle is needed
COMPARISON OF ECOMMERCE WITH TRADITIONAL COMMERCE To move the vehicle some fuel Messaging software like such as diesel, petrol or gas is email, EDI or point-to-point required file transfer is used as fuel is used to move the vehicle. Goods are stored in E-documents are stored in Warehouses multimedia servers
E-COMMERCE FROM DIFFERENTPERSPECTIVE1. Communications Perspective EC is the delivery of information, products/services, or payments over the telephone lines, computer networks or any other electronic means.2. Business Process Perspective EC is the application of technology toward the automation of business transactions and work flow.
3. Service Perspective EC is a tool that addresses the desire of firms, consumers, and management to cut service costs while improving the quality of goods and increasing the speed of service delivery.4. Online Perspective EC provides the capability of buying and selling products and information on the internet and other online services.
Electronic Commerce Framework Common business services infrastructure (security/authentification, electronic payment, directories / catalogs) The messaging and information distribution infrastructure Multimedia content and network publishing infrastructure Internet Super Highway( Network Infrastructure) Public Technical standards for electronicpolicy, legal and documents, multimedia and privacy issues network protocols
1.NETWORK INFRASTRUCTURE I-way has many different types of transport systems like Land based telephones, air based wireless, Satellite Based Network It also includes hardware, software and networking devices such as routers, hubs, digital switches that provide an interface with various networks
2. MULTIMEDIA CONTENT AND NETWORKPUBLISHING INFRASTRUCTURE The Most prevalent architecture that enables network publishing is WWW. Contents are developed in form of HTML and are published on WEB SERVER.
3. MESSAGING AND INFORMATIONDISTRIBUTION INFRASTRUCTURE Information contents consists of text, numbers, pictures, audio and video. Everything is in digital form. To distribute the information Messaging vehicle i.e. Middleware software is used. Messaging vehicle provides way to communicate unstructured as well as structured data
4. COMMON BUSINESS SERVICESINFRASTRUCTURE This layer addresses shortcomings such as inadequate online payment instruments and inadequate information security To handle these shortcomings it requires various security mechanisms such as Authentication Confidentiality Integrity Non-Repudiation
TWO MAJOR PILLARS Public policy issues deals with: Cost of accessing information Regulation to protect customer from fraud To protect their right to privacy Technical standards Access of information on different devices Interoperability of information (ex. Video standards for video conferencing)
BENEFITS OF E-COMMERCE To organizations To consumers To society
BENEFITS OF ECOMMERCE TOORGANIZATIONS International Marketplace Operation Cost Savings Reduced inventory level Lower Tele Communication cost: Internet is much cheaper than VANs No more 24 hour constraint Less expensive to expand business
BENEFITS TO CONSUMER 24/7 Access More Choices Price Comparisons Quick delivery (Digitized products) Disintermediation (no mediators) More discount due to more competition Interaction with other customers through e- communities
BENEFITS TO SOCIETY Enables more flexible working practices Less travelling for shopping resulting in less traffic and pollution Increase standard of living Can buy products and services that otherwise are not available to them Facilitates delivery of public services such as health care, education and distribution of government social services
LIMITATIONS Technical limitations Lack of System Security, Reliability, Standards. Insufficient telecommunication bandwidth Software development tools are still evolving and changing Incompatibility of Ecommerce Software Vendors may need special web servers & other infrastructure
Non Technical Limitations Inability to touch and feel the products Online stores don’t exist for very long Lack of trust and user resistance Not 100% safe Small Businesses may find it difficult to conform EDI standards Reduces socialism Accessibility to internet is still expensive / inconvenient for potential customers Not suitable for some perishable products
APPLICATIONS/SCOPE OF ECOMMERCE Internet banking Stock trading Online shopping E-auction Education sector E-governance E-publishing for marketing, advertising, sales & customer support Supply chain management Retail industry Marketing Inventory and logistics Other online services e.g. tour & travel, health care, legal & professional services
E-BUSINESS E-commerce is a subset of e-business. Business involves a whole set of transactions that must be completed before actually reaching the point where goods or services change hands. E-business is the conduct of business on the Internet, not only buying and selling but also servicing customers and collaborating with business partners.