1. ECOMMERCE AND INTERNET MARKETING
DEFINITION
• Buying and selling of products through
• Electronic systems viz INTERNET and
• Other Computer Networks.
• Generally known as sales aspect of E-business
• Consisting of exchange data for financing and
• Making payments through Business Transactions.
• It includes Business to Business (B2B), Business
• to Consumer (B2C) and also Value Chains.
• Examples:
• Credit Card payments for online buying,
• Advertisement Revenue online, Trading Stocks
• Online, Pay per downloads thro Websites.
ADVANTAGES/DISADVANTAGES
While it offers many advantages to Cos and Customers, Ecommerce causes some problems
Too.
ADVANTAGES
Easy to find any product online, Buying and selling Faster, Timely reach to Customers
No Geographic limitations. Better product with lesser Costs. Easy to start any Business,
Branches need not be opened, No Physical constraints, You may select any product
From various suppliers.

2. Disadvantages:
Can start any Business easily. But beware of Cheaters who snatches
Customers Money.
No guarantee for qualitative product.
There is always Hackers threat. Hence Ecommerce and payment
gateways are prone to many attacks.
Unexpected technical problems causes some process hurdles.
Minimum chance of Direct Customers, hence no interaction with
them.
BRIEF HISTORY OF E-COMMERCE
Way Back to 1970s, internal business networks designed to streamline certain business processes, such
as filling customer orders and sending invoices. Once electronic transactions were possible, it was only a
matter of time before home computer users would be offered the opportunity to purchase items
through the internet.
In 1980, CompuServe introduced Electronic Mail which allowed individuals to purchase products online
from 110 different businesses. With a few more developments in internet technology in the early 1990s,
including better encryption companies processing credit cards online, the world was truly on its way to
buying and selling on the internet.
Globally, ecommerce is expanding rapidly. It took approximately four years for developing security
Protocols like HTTP and DSL which allowed fast access and connection to Internet. So the
Explosion began and continued.
Scope of ECOMMERCE
When you think of Electronic or Internet Economy, you may find three
Components as given under:
(1) Electronic Commerce (e-Commerce)
Any transaction completed over a computer-mediated network that transfers ownership of, or
rights to use, goods or services. The value of goods and services sold on-line. The term "on-line"
includes the use of the Internet, Intranet, and Extranet, as well as proprietary information that
runs over systems such as Electronic Data Interchanges (EDI) networks.
(2) Electronic business supporting infrastructure
The economic infrastructure that is used to support electronic business processes and conduct

3. electronic commerce transactions. It includes hardware, software, telecommunication networks,
support services, and human capital used in electronic business and commerce.
(3) Electronic business processes
Processes that a business organization conducts over a computer-mediated network. Business
organizations include any for-profit, governmental, or nonprofit entity. Examples of on-line e-
business processes include the following:
* Purchasing
* Selling
* Vendor-managed inventory
* Production management
* Logistics
* Communication and Support Services such as on-line training and recruiting
Business strategy in Electronic Commerce ;
Dynamic process of developing e-commerce business strategy starts with the same process of
planning and preparation as any other business activity. Whether this is a new venture, or you want
to get your existing business ready to trade online, you need to consider the following:
Do you want to trade conventionally as well as online, or are you going to concentrate on e-
commerce?
What are your strengths, weaknesses, opportunities and strengths? This is called a SWOT analysis.
How suitable are your products and services for online selling, and do you need to make any
changes?
How competitive are your prices, and are there any specific market opportunities that an online store
will open up?
Does your competition use e-commerce, and if so can you see what makes them successful (or not)?
What can you do to differentiate your brand and your offering in the market?
Setting your goals
The answers to the questions above will enable you to develop objectives or goals for your e-
commerce business. A good test is to ensure that these are SMART – they should be:
Specific: the goals should be clear and straightforward, and give a precise indication of what you
want to achieve – not just ‘develop an online store’ but ‘develop an online store by the start of my new
financial year’.
Measurable: this is how you will judge whether you have been successful, so your goals should be
something you can measure or judge, such as the number of people who register with your customer

4. loyalty scheme, or the value of online sales. Remember that if you can’t measure it, you can’t manage
it.
Achievable: your goals should be within your reach, otherwise you are likely to be frustrated – but
that doesn’t mean they should be easy. Your e-commerce goals should stretch you, you may need to
develop additional skills, and you will almost certainly need to change the way you run your business.
Relevant: your goals should mean something to your business, and those for your e-commerce
strategy should be in line with your overall business objectives.
Time-related: you need to set a target date for achieving your e-commerce goals. This will ensure
you to focus on getting the job done, and stop it drifting.
Your e-commerce business strategy will always be in line with these SMART goals, so test each
element of the strategy as it develops against your objectives. If it doesn’t meet your objectives,
change the strategy.
VALUE CHAIN
Is a tool developed by Dr. Michael Porter of Harvard Business School.
In order to assess the overall performance of a Company, source of
Competitive advantage could be assessed to know :
1. Whether the present activities are yielding good results
2. Or shall we have to lower costs than that of competitors.
The firm activities include Production, Sale and transfer of products
Logistics - Receipt, Storing, Distribution of Inputs including Inventory
Cointrol.
Outbound logistics - Processing of orders, Warehousing finished Goods
and delivery’s.
Marketing and Sales – How the buyers will be convinced to purchase
the product. Example : Advertising, promotion and Sales

5. Support Activities:
Task of purchasing inputs like Raw Material,
Equipment and Labour.
Technology Development: is intended to improve
The product and process.
Human Resource Management
Involved in Recruiting, Training, Development
And Compensation.
Firm Infrastructure : General Management, Planning,
Finance, and Accounting are categorized. This
Tool is useful for assessing discreet activities and how
They inter act with one another and affect each others
Cost and performance.
Value activities are distinct both physically and
Technologically. Some activities are more vital than
others depending upon industry. Marketing activities
Are vital in a very competitive consumer Goods Industry.

6. Some activities are directly involved in creating value for
The Buyer. Some activities are primarily involved
In Quality Assurance. (Monitoring , Inspecting and
Testing)
Some activities should be combined if they are of
No importance to the best advantage of the firm
If the economics of both are similar.
Analysing the Chain is intended to be sure of including
Sub-contracted or outsourced portions.
Vertical linkages can be provide opportunities to the firm
To enhance its competitive advantages.
Value Chain of a firm is a part of Value system
Which is the larger stream of activities from suppliers to
Buyers.
Value is created when a firm creates competitive
Advantage for its Buyers.
The Business Unit is the correct level to construct

7. A Value chain and application to entire Industry
Is not recommended.
Value Chain analysis on an industry level has been
Performed in numerous industry studies all over.
DEFINE BUSINESS TO BUSINESS?
Any Commercial transaction arises between businesses such as
Manufacturer and wholesaler, or between Wholesaler or Retailer is called
B2B Business to Business. B2B Business to Business Branding is a term used
In Marketing. Similar terms are B2C Business to Consumer, B2G Business to
Goverrnment.
1.Companies Buying from and selling to each other online
2. B 2B evolved supply chain management as many companies outsource
Parts of their supply chain to other trading partners.
3.Buyer and seller must negotiate product specification, price, and delivery.
4. A company’s system should be able to communicate without human inter action.