Electronic

Commerce
(ITU 07402)
Neema Bhalalusesa
(MSc Computer Science)
 References
• Whiteley, David (2001); e-Commerce: Strategy,
Technologies and Applications; Tata McGraw-Hill
Companies, Inc., New York.
• Joseph, P.T. (2003); e-Commerce: A Managerial
Perspective; Prentice-Hall of India Private Limited, New
Delhi.
• Murthy, Murthy C.S.V. (2002); e-Commerce: Concepts,
Models and Strategies; Himalaya Publishing House, India
• Rayport, Jeffrey F. and Bernard J. Jaworski (2002), e-
Commerce, Tata McGraw-Hill Publishing Company
Limited, New Delhi.
• Diwan, Parag and Sunil Sharma (2000), Electronic
Commerce: A Manager’s Guide to E-Business, Vanity
Books International, New Delhi.
• https://www.tutorialspoint.com/e_commerce
 Assessment
• Continuous Assessment – 40%
o Test 1
o Test 2
o Group Assignment (s)
o Individual Assignment (s)
o Quiz (s)

• Semester Examination – 60%

 Introduction
• Definition
• About E-Commerce
• General Advantages
• Disadvantages
• Models
 What is Electronic
Commerce
• Also termed as E-Commerce
• Refers to business conducted over an
electronic network
• Involves buying and selling of goods and
services
• Primarily over the internet
• Lack of physical interactions
 Characteristics of E-
Commerce
• Uses non-cash/cheque methods for
payment
• Constant availability of services
• It has a lot of advertising and reaches many
people
• Information sharing is made easy via
electronic communication channels making
little dependency on person to person
information exchange.
 Characteristics …
• Electronics system automatically
handles when to pass communication
to required person or do the
transactions.
• E-Commerce website provides user a
platform where all information is
available at one place.
 Applications of E-
Commerce
• Sales
• Marketing
• Funds Transfer
• Business Information Dissemination
• Online shopping
• Bill payment
 Advantages of E-
Commerce (Business)
• Access to the global market means the business will
be better known
• A business using e-commerce can get ahead of its
rivals
• Increased sales, leading to increased profit
• Savings on expensive showrooms
• Reduced advertising costs
• Increased sales leads to ‘economies of scale’
 Advantages of E-
Commerce (Business)
• Business is open 24/7
• E-commerce helps organizations to reduce the cost
to create process, distribute, retrieve and manage
the paper based information by digitizing the
information.
• An organization can easily locate best suppliers,
and suitable business partners across the globe.
• E-commerce reduces the paper work.
 Advantages of E-
Commerce (Customers)
• Customers have a huge range of goods to choose from
• They can ‘shop around’ the ‘web’ for the best bargain
• Internet prices are often lower than in shops. E-
Commerce increases the competition among
organizations
• Customers can shop from the comfort of their own home
’24/7’
• It provides 24x7 support
• E-commerce provides options of virtual auctions
 Disadvantages (Business)
• Being part of the global market means the business
is in competition with lots of others
• Designing and keeping the website up-to-date is
expensive and requires specialists
• Market research needs to be very detailed to meet
the needs of customers in such a wide market
• Packing and distribution of products can be very
costly and involve long distances
Disadvantages (Business)
• Not all the businesses target customers have
access to the internet.
• The software development industry is still
evolving and keeps changing rapidly.
• Sometimes, it becomes difficult to integrate
an e-commerce software or website with
existing applications or databases or
operating systems.
 Disadvantages
(Customers)
• Customers need to own or have access to a
computer and be online and know how to use the
Internet.
• It is not easy to assess the quality and suitability of
many products on the screen.
• Inconvenience of returning unwanted goods.
• Customers usually have to have a credit card to
make Internet purchases
• Security risks of buying online
 Disadvantages
(Customers)
• Users may not trust the site being an unknown
faceless seller. Such mistrust makes it difficult to
convince traditional users to switch from physical
stores to online/virtual stores
• It is difficult to ensure the security or privacy on
online transactions.
 E-Commerce Models
• Business to Business (B2B)
• Business to Consumer (B2C)
• Consumer to Consumer (C2C)
• Consumer to Business (C2B)
• Business to Government (B2G)
• Government to Business
• Government to Citizen
• Mobile Commerce
• Peer to Peer
 B2B
• Transactions involve businesses, i.e. both seller and
buyer are businesses
• Deals with interactions of companies and
wholesalers or wholesales with retailers or producers
with retailers or just companies with companies
• A website following the B2B business model sells its
products to an intermediate buyer who then sells
the product to the final customer.
 B2B Cont’d
• As an example, a wholesaler places an order from
a company's website 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.
 B2C
• Direct interaction with the customers is the main
difference with other business models
• The basic concept of this model is to sell the
product online to the consumers.
• individual customers buying from a company/shop
online
• The internet users can use the shopping cart for
everything they need. Payment is mostly done
through credit cards or by payment gateways
B2C
 C2B
• In this case, individuals make their items or
services and sell them to companies
• Some examples are proposals for company
site or logo, royalty free photographs, design
elements and so on
• A.K.A. reverse auction or demand collection
model
• for example, a Blog owner sells
advertisement space to Target on their Blog.
 C2C
• A.K.A citizen-to-citizen electronic commerce
• A common example is the online auction, in
which a consumer posts an item for sale and
other consumers bid to purchase it
• Sales are usually made through a third party
C2C