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E Commerce

E-commerce has grown into a huge industry with US online retail generating $175B in revenues in 2007. Research by ComScore shows sales declining by 1% for the first 49 days of the holiday season.

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Benudhar Pradhan
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0% found this document useful (0 votes)
94 views6 pages

E Commerce

E-commerce has grown into a huge industry with US online retail generating $175B in revenues in 2007. Research by ComScore shows sales declining by 1% for the first 49 days of the holiday season.

Uploaded by

Benudhar Pradhan
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Assignment On

E-COMMERCE

Submitted To: Sanjeev Tripathy (Course Facilitator) CSREM, Paralakhemundi

Submitted By: Benudhar Pradhan

DATE: 1 DECEMBER 2011 Centurion School of Rural Enterprise Management Parlakhemundi, Odisha
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E-COMMERCE INTRODUCTION: The Internet has created a new economic ecosystem, the e-commerce marketplace, and it has become the virtual main street of the world. Providing a quick and convenient way of exchanging goods and services both regionally and globally, e-commerce has boomed. Today, e-commerce has grown into a huge industry with US online retail generating $175B in revenues in 2007, with consumer-driven (B2C) online transactions impacting industries from travel services to consumer electronics, from books and media distribution to sports & fitness. With more than 70% of Americans using the Internet on a daily basis for private and/or business use and the rest of the world also beginning to catch on, e-commerce's global growth curve is not likely to taper off anytime soon. However, the US recession has taken its toll on online sales. Although early 2008 estimates by Forrester Research were very strong with 2008 revenues upwards of $204B (a 17% growth rate), 2008 holiday sales showed the first decrease in the last 7 years. Research by ComScore shows sales declining by 1% for the first 49 days of the holiday season. WHAT IS E-COMMERCE? Electronic commerce or e-commerce refers to a wide range of online business activities for products and services. It also pertains to any form of business transaction in which the parties interact electronically rather than by physical exchanges or direct physical contact. E-commerce is usually associated with buying and selling over the Internet, or conducting any transaction involving the transfer of ownership or rights to use goods or services through a computer-mediated network.3 Though popular, this definition is not comprehensive enough to capture recent developments in this new and revolutionary business phenomenon. A more complete definition is: E-commerce is the use of electronic communications and digital information processing technology in business transactions to create, transform, and redefine relationships for value creation between or among organizations, and between organizations and individuals.4 With the advent of the Internet, the term e-commerce began to include: Electronic trading of physical goods and of intangibles such as information. All the steps involved in trade, such as on-line marketing, ordering payment and support for delivery. The electronic provision of services such as after sales support or on-line legal advice. Electronic support for collaboration between companies such as collaborative on-line design and engineering or virtual business consultancy teams. WHAT IS THE IMPACT OF ELECTRONIC COMMERCE? E-commerce and e-business are not solely the Internet, websites or dot com companies. It is about a new business concept that incorporates all previous business management and economic concepts. As such, e-business and e-commerce impact on many areas of business and disciplines of business management studies. For example: Marketing issues of on-line advertising, marketing strategies and consumer behavior and cultures. One of the areas in which it impacts particularly is direct marketing. In the past this was mainly door-to -door, home parties (like the Tupperware parties) and mail order using catalogues or leaflets. This moved to telemarketing and TV selling with the advances in telephone and television technology and finally developed into e-marketing spawning eCRM (customer
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relationship management) data mining and the like by creating new channels for direct sales and promotion. Computer sciences development of different network and computing technologies and languages to support e-commerce and e-business, for example linking front and back office legacy systems with the web based technology. Finance and accounting on-line banking; issues of transaction costs; accounting and auditing implications where intangible assets and human capital must be tangibly valued in an increasingly knowledge based economy. Economics the impact of e-commerce on local and global economies; understanding the concepts of a digital and knowledge-based economy and how this fits into economic theory. Production and operations management the impact of on-line processing has led to reduced cycle times. It takes seconds to deliver digitized products and services electronically; similarly the time for processing orders can be reduced by more than 90 per cent from days to minutes. Production systems are integrated with finance marketing and other functional systems as well as with business partners and customers. Production and operations management (manufacturing) moving from mass production to demand-driven, mass customisation customer pull rather than the manufacturer push of the past. Web-based Enterprise Resource Planning systems (ERP) can also be used to forward orders directly to designers and/or production floor within seconds, thus cutting production cycle times by up to 50 per cent, especially when manufacturing plants, engineers and designers are located in different countries. In sub-assembler companies, where a product is assembled from a number of different components sourced from a number of manufacturers, communication, collaboration and coordination are critical so electronic bidding can yield cheaper components and having flexible and adaptable procurement systems allows fast changes at a minimum cost so inventories can be minimized and money saved. Management information systems analysis, design and implementation of ebusiness systems within an organization; issues of integration of front-end and backend systems. Human resource management issues of on-line recruiting, home working and intrapreneurs working on a project by project basis replacing permanent employees. Business law and ethics the different legal and ethical issues that have arisen as a result of a global virtual market. Issues such as copyright laws, privacy of customer information, legality of electronic contracts, etc. What are the different types of e-commerce? The major different types of e-commerce are: business-to-business (B2B); businessto-consumer (B2C); business-to-government (B2G); consumer-to-consumer (C2C). What is B2B e-commerce? B2B e-commerce is simply defined as e-commerce between companies. This is the type of ecommerce that deals with relationships between and among businesses. About 80% of ecommerce is of this type, and most experts predict that B2B ecommerce will continue to grow faster than the B2C segment. The B2B market has two primary components: efrastructure and e-markets. E-frastructure is the architecture of B2B, primarily consisting of the following: logistics - transportation, warehousing and distribution (e.g., Procter and Gamble);
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application service providers - deployment, hosting and management of packaged software from a central facility (e.g., Oracle and Linkshare); outsourcing of functions in the process of e-commerce, such as Web-hosting, security and customer care solutions (e.g., outsourcing providers such as eShare, NetSales, iXL Enterprises and Universal Access); auction solutions software for the operation and maintenance of real-time auctions in the Internet (e.g., Moai Technologies and OpenSite Technologies); content management software for the facilitation of Web site content management and delivery (e.g., Interwoven and ProcureNet); and Web-based commerce enablers (e.g., Commerce One, a browser-based, XML enabled purchasing automation software). E-markets are simply defined as Web sites where buyers and sellers interact with each other and conduct transactions. The more common B2B examples and best practice models are IBM, Hewlett Packard (HP), Cisco and Dell. Cisco, for instance, receives over 90% of its product orders over the Internet. Most B2B applications are in the areas of supplier management (especially purchase order processing), inventory management (i.e., managing order-ship-bill cycles), distribution management (especially in the transmission of shipping documents), channel management (i.e., information dissemination on changes in operational conditions), and payment management (e.g., electronic payment systems or EPS). eMarketer projects an increase in the share of B2B e-commerce in total global commerce from 79.2% in 2000 to 87% in 2004 and a consequent decrease in the share of B2C ecommerce from 20.8% in 2000 to only 13% in 2004 . Likewise B2B growth is way ahead of B2C growth in the Asia-Pacific region. According to a 2001 eMarketer estimate, B2B revenues in the region are expected to exceed $300 billion by 2004. WHAT IS B2C E-COMMERCE? Business-to-consumer e-commerce, or commerce between companies and consumers, involves customers gathering information; purchasing physical goods (i.e., tangibles such as books or consumer products) or information goods (or goods of electronic material or digitized content, such as software, or e-books); and, for information goods, receiving products over an electronic network. It is the second largest and the earliest form of e-commerce. Its origins can be traced to online retailing (or e-tailing).13 Thus, the more common B2C business models are the online retailing companies such as Amazon.com, Drugstore.com, Beyond.com, Barnes and Noble and ToysRus. Other B2C examples involving information goods are E-Trade and Travelocity. The more common applications of this type of e-commerce are in the areas of purchasing products and information, and personal finance management, which pertains to the management of personal investments and finances with the use of online banking tools (e.g., Quicken). eMarketer estimates that worldwide B2C e-commerce revenues will increase from US$59.7 billion in 2000 to US$428.1 billion by 2004. Online retailing transactions make up a significant share of this market. eMarketer also estimates that in the Asia- Pacific region, B2C revenues, while registering a modest figure compared to B2B, nonetheless went up to $8.2 billion by the end of 2001, with that figure doubling at the end of 2002-at total worldwide B2C sales below 10%.
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B2C e-commerce reduces transactions costs (particularly search costs) by increasing consumer access to information and allowing consumers to find the most competitive price for a product or service. B2C e-commerce also reduces market entry barriers since the cost of putting up and maintaining a Web site is much cheaper than installing a brick-and-mortar structure for a firm. In the case of information goods, B2C ecommerce is even more attractive because it saves firms from factoring in the additional cost of a physical distribution network. Moreover, for countries with a growing and robust Internet population, delivering information goods becomes increasingly feasible. WHAT IS B2G E-COMMERCE? Business-to-government e-commerce or B2G is generally defined as commerce between companies and the public sector. It refers to the use of the Internet for public procurement, licensing procedures, and other government-related operations. This kind of ecommerce has two features: first, the public sector assumes a pilot/leading role in establishing e-commerce; and second, it is assumed that the public sector has the greatest need for making its procurement system more effective. Web-based purchasing policies increase the transparency of the procurement process (and reduces the risk of irregularities). To date, however, the size of the B2G ecommerce market as a component of total e-commerce is insignificant, as government eprocurement systems remain undeveloped. WHAT IS C2C E-COMMERCE? Consumer-to-consumer e-commerce or C2C is simply commerce between private individuals or consumers. This type of e-commerce is characterized by the growth of electronic marketplaces and online auctions, particularly in vertical industries where firms/businesses can bid for what they want from among multiple suppliers.16 It perhaps has the greatest potential for developing new markets. This type of e-commerce comes in at least three forms: auctions facilitated at a portal, such as eBay, which allows online real-time bidding on items being sold in the Web; peer-to-peer systems, such as the Napster model (a protocol for sharing files between users used by chat forums similar to IRC) and other file exchange and later money exchange models. classified ads at portal sites such as Excite Classifieds and eWanted (an interactive, online marketplace where buyers and sellers can negotiate and which features Buyer Leads & Want Ads). Consumer-to-business (C2B) transactions involve reverse auctions, which empower the consumer to drive transactions. A concrete example of this when competing airlines gives a traveler best travel and ticket offers in response to the travelers post that she wants to fly from New York to San Francisco. There is little information on the relative size of global C2C e-commerce. However, C2C figures of popular C2C sites such as eBay and Napster indicate that this market is quite large. These sites produce millions of dollars in sales every day. HOW IS E-COMMERCE USEFUL TO DEVELOPING COUNTRY ENTREPRENEURS? There are at least five ways by which the Internet and e-commerce are useful for developing country entrepreneurs: 1. It facilitates the access of artisans47 and SMEs to world markets. 2. It facilitates the promotion and development of tourism of developing countries in a global scale.
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3. It facilitates the marketing of agricultural and tropical products in the global market. 4. It provides avenues for firms in poorer countries to enter into B2B and B2G supply chains. 5. It assists service-providing enterprises in developing countries by allowing them to operate more efficiently and directly provide specific services to customers globally.

Source: http//www.google.co.in

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