ADVANTAGES AND DISADVANTAGES OF ECOMMERCE
The invention of faster internet connectivity and powerful online tools has resulted in a new commerce arena – Ecommerce.
ADVANTAGES OF ECOMMERCE
Faster buying/selling procedure, as well as easy to find products.Buying/selling 24/7.More reach to customers, there is no theoretical geographic limitations.Low operational costs and better quality of services.No need of physical company set-ups.Easy to start and manage a business.Customers can easily select products from different providers without moving around physically.
DISADVANTAGES OF ECOMMERCE
Any one, good or bad, can easily start a business. And there are many bad sites which eat up customers’ money.There is no guarantee of product quality.Mechanical failures can cause unpredictable effects on the total processes.As there is minimum chance of direct customer to company interactions, customer loyalty is always on a check.There are many hackers who look for opportunities, and thus an ecommerce site, service, payment gateways, all are always prone to attack.
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What Is E-Business?
introduction :
Simply defined, an e-business is an electronic business activity.
At first, e-business generally referred to businesses that interfaced with their consumers almost exclusively over the Internet.
For example, one of the earliest e-businesses that aimed to serve a broad market was Amazon.com. The Amazon.com of 1994 was very different than the Amazon.com of today.
in 1994, Amazon.com was a specialty bookstore.
Today, while it still sells books, it also sells every other product like: clothes, electronics, toys, household goods, music, movies, and even food!
Amazon Dash is a service available in many large U.S. cities where you can order fresh vegetables, fruit, and other food on Amazon, and it is delivered the same day.
Amazon.com also includes the Amazon Marketplace, which is where third-party vendors can sell on Amazon—much like eBay, but Amazon Marketplace doesn't use bidding.
Amazon is a great example of a direct-to-consumer e-business. Their marketing, distribution system, and website is all aimed at the end user—
we are using their website and buying, These are often called B2C (business-to-consumer companies).
Definition of e-business
Electronic Business, shortly known as e-business, is the online presence of business. It can also be defined as the business which is done with the help of internet or electronic data interchange i.e. is known as E-business. E-commerce is one of the important components of e-business, but it is not an essential part.
e-business is not confined to buying and selling of goods only, but it includes other activities that also form part of business like providing services to the customers, communicating with employees, client or business partners can contact the company in case if they want to have a word with the company, or they have any issue regarding the services, etc. All the basic business operations are done using electronic media. There are two types of e-business, which are:
Pure-Play: The business which is having an electronic existence only.Brick and Click: The business model, in which the business exists both in online i.e. electronic and offline i.e. physical mode.
Definition of e-commerce
e-commerce is an abbreviation used for electronic commerce. It is the process through which the buying, selling, dealing, ordering and paying for the goods and services are done over the internet is known as e-commerce. In this type of online commercial transaction, the seller can communicate with the buyer without having a face to face interaction.
Some examples of real world application of e-commerce are online banking, online shopping, online ticket booking, social networking, etc.
The basic requirement of e-commerce is a website. The marketing, advertising, selling and conducting transaction are done with the help of internet. Any monetary transaction, which is done with the help of electronic media is e-commerce. The following are the types of e-commerce:
B2B – The process where buying and selling of goods and services between businesses is known as Business to Business. Example: Oracle, Alibaba, Qualcomm, etc.B2C – The process whereby the goods are sold by the business to customer. Example: Intel, Dell etc.C2C – The commercial transaction between customer to customer. Example: OLX, Quickr etc.C2B – The commercial transaction between customer to the business.
E-commerce is nothing but buying and selling of goods around the web. e-business is a little different as it is not limited to, commercial transactions, but it also provides other services.
Differences Between e-commerce and e-business.
Buying and Selling of goods and services through the internet is known as e-commerce. Unlike e-business, which is an electronic presence of business, by which all the business activities are conducted through the internet.
e-commerce is a major component of e-business.It is a subset of e-business. E - business is a super set.
e-commerce includes transactions which are related to money, but e-business includes monetary as well as allied activities.
e-commerce has an extroverted approach that covers customers, suppliers, distributors, etc. On the other hand, e-business has an ambivert approach that covers internal as well as external processes.
e-commerce requires a website that can represent the business. Conversely, e-business requires a website, Customer Relationship Management(CRM) and Enterprise Resource Planning( ERP) for running the business over the internet.
e-commerce uses the internet to connect with the rest of the world. In contrast to e-business, the internet, intranet and extranet are used for connecting with the parties .
Conclusion:
e-commerce is the major part of e-business. It can also be said that e-commerce is e-business websites, but e-business is not necessarily e-commerce.
At present most of the companies are doing e-business just to capture the maximum part of the market. Some e-commerce websites have emerged since last few years who are vanishing the market traditional commercial business, like Flipkart, Amazon, eBay, etc.
comparison chart
(put 3 columns )
Basis for comparison.
E-commerce
E-business
Meaning
Trading of merchandise, over the internet is known as E-commerce.Running business using the internet is known as E-business.
.What is it?
Subset
Superset
Is it limited to monetary transactions?
Yes
No
What they carry out?
Commercial transactions
Business transactions
Approach
Extroverted
Ambiverted
Requires
Website
Website, CRM, ERP, etc.
Which network is used?
Internet
Internet, Intranet and extra net.
Comparison chart 👇
E-Commerce or Electronics Commerce business models can generally categorized in following categories.
Business - to - Business (B2B)Business - to - Consumer (B2C)Consumer - to - Consumer (C2C)Consumer - to - Business (C2B)Business - to - Government (B2G)Government - to - Business (G2B)Government - to - Citizen (G2C)
Business - to - Business (B2B)
Website following B2B business model sells its product to an intermediate buyer who then sells the product to the final customer. As an example, a wholesaler places an order from a company's website and after receiving the consignment, sells the end product to final customer who comes to buy the product at wholesaler's retail outlet.
Business - to - Consumer(B2C)
Website following B2C business model sells its product directly to a customer. A customer can view products shown on the website of business organization. The customer can choose a product and order the same. Website will send a notification to the business organization via email and organization will dispatch the product/goods to the customer.
Consumer - to - Consumer (C2C)
Website following C2C business model helps consumer to sell their assets like residential property, cars, motorcycles etc. or rent a room by publishing their information on the website. Website may or may not charge the consumer for its services. Another consumer may opt to buy the product of the first customer by viewing the post/advertisement on the website.
Consumer - to - Business (C2B)
In this model, a consumer approaches website showing multiple business organizations for a particular service. Consumer places an estimate of amount he/she wants to spend for a particular service. For example, comparison of interest rates of personal loan/ car loan provided by various banks via website. Business organization who fulfills the consumer's requirement within specified budget approaches the customer and provides its services.
Government - to - Business (G2B)
Government uses B2G model website to approach business organizations. Such websites support auctions, tenders and application submission functionalities.
Business - to - Government (B2G)
B2G model is a variant of B2B model. Such websites are used by government to trade and exchange information with various business organizations. Such websites are accredited by the government and provide a medium to businesses to submit application forms to the government.
Government - to - Citizen (G2C)
Government uses G2C model website to approach citizen in general. Such websites support auctions of vehicles, machinery or any other material. Such website also provides services like registration for birth, marriage or death certificates. Main objectives of G2C website are to reduce average time for fulfilling people requests for various government services.
G2C
The electronic commerce activities performed between the government and its citizens or consumers, including paying taxes, registering vehicles, and providing information and services
G2C (Government to Citizen) is a term that refers to the relationships between organizations (subjects) of public administration and a citizen.
The relationship may refer the demand for information from the citizen in any life situation or a transfer of an official document to the citizen.
G2B
Government-to-business, referring to the conducting of transactions between government bodies and business via the Internet.
Government-to-Business (G2B) is the online non-commercial interaction between local and central government and the commercial business sector with the purpose of providing businesses information and advice on e-business 'best practices'.
B2G:
Professional transactions between the company and the district, city, or federal regulatory agencies.
B2G usually include recommendations to complete the measurement and evaluation of books and contracts.
G2G
The aim of G2G is to enable governments and organizations related to them to more easily work together and to better serve citizens within key lines of business.
Government to government (G2G) is the electronic sharing of data and/or information systems between government agencies, departments or organizations.
The goal of G2G is to support e-government initiatives by improving communication, data access and data sharing.
G2C
The goal of Government to Customer (G2C) e-Governance is to offer a variety of ICT services to citizens in an efficient and economical manner, and to strengthen the relationship between government and citizens using technology.
G2C (Government to Citizen) is a term that refers to the relationships between organizations (subjects) of public administration and a citizen
G2G (Government-to-Government), G2E (Government-to-Employee), G2B (Government-to-Business), B2G (Business-to-Government), G2C (Government-to-Citizen), C2G (Citizen-to-Government) are other forms of ecommerce that involve transactions with the government--from procurement to filing taxes to business registrations to renewing licenses.
Electronic commerce
Electronic commerce or eCommerce is a term for any type of business, or commercial transaction, that involves the transfer of information across the Internet.
Ecommerce allows consumers to electronically exchange goods and services with no barriers of time or distance.
Electronic commerce has expanded rapidly over the past five years
Questions :
What is E-business?
What is e-commerce?
Differentiate between e-business and e-commerce.
Explain e-business/e commerce models or types of e business.
Peer-to-Peer
Peer-to-peer refers to the design of a service that does not rely on centralized networking services such as DNS to connect end users' computers. This design accounts for the unpredictable accessibility of these end nodes in making connections between users.
or
Peer-to-peer (P2P) is a decentralized communications model in which each party has the same capabilities and either party can initiate a communication session. Unlike the client/server model, in which the client makes a service request and the server fulfills the request, the P2P network model allows each node to function as both a client and server.
What are the merits and demerits of e-commerce?
E-Commerce Advantages
E-Commerce advantages can be broadly classified in three major categories:
Advantages to Organizations
Advantages to Consumers
Advantages to Society
Advantages to Organizations
Using E-Commerce, organization can expand their market to national and international markets with minimum capital investment. An organization can easily locate more customers, best suppliers and suitable business partners across the globe.
E-Commerce helps organization to reduce the cost to create process, distribute, retrieve and manage the paper based information by digitizing the information.
E-commerce improves the brand image of the company.
E-commerce helps organization to provide better customer services.
E-Commerce helps to simplify the business processes and make them faster and efficient.
E-Commerce reduces paper work a lot.
E-Commerce increased the productivity of the organization. It supports "pull" type supply management. In "pull" type supply management, a business process starts when a request comes from a customer and it uses just-in-time manufacturing way.
Advantages to Customers
24x7 support. Customer can do transactions for the product or enquiry about any product/services provided by a company any time, any where from any location. Here 24x7 refers to 24 hours of each seven days of a week.
E-Commerce application provides user more options and quicker delivery of products.
E-Commerce application provides user more options to compare and select the cheaper and better option.
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 buy.
E-Commerce provides option of virtual auctions.
Readily available information. A customer can see the relevant detailed information within seconds rather than waiting for days or weeks.
E-Commerce increases competition among the organizations and as result organizations provides substantial discounts to customers.
Advantages to Society
Customers need not to travel to shop a product thus less traffic on road and low air pollution.
E-Commerce helps reducing cost of products so less affluent people can also afford the products.
E-Commerce has enabled access to services and products to rural areas as well which are otherwise not available to them.
E-Commerce helps government to deliver public services like health care, education, social services at reduced cost and in improved way.
E-Commerce Disadvantages
E-Commerce disadvantages can be broadly classified in two major categories:
Technical disadvantages
Non-Technical disadvantages
Technical Disadvantages
There can be lack of system security, reliability or standards owing to poor implementation of e-Commerce.
Software development industry is still evolving and keeps changing rapidly.
In many countries, network bandwidth might cause an issue as there is insufficient telecommunication bandwidth available.
Special types of web server or other software might be required by the vendor setting the e-commerce environment apart from network servers.
Sometimes, it becomes difficult to integrate E-Commerce software or website with the existing application or databases.
There could be software/hardware compatibility issue as some E-Commerce software may be incompatible with some operating system or any other component.
Non-Technical Disadvantages
Initial cost: The cost of creating / building E-Commerce application in-house may be very high. There could be delay in launching the E-Commerce application due to mistakes, lack of experience.
User resistance: User may not trust the site being unknown faceless seller. Such mistrust makes it difficult to make user switch from physical stores to online/virtual stores.
Security/ Privacy: Difficult to ensure security or privacy on online transactions.
Lack of touch or feel of products during online shopping.
E-Commerce applications are still evolving and changing rapidly.
Internet access is still not cheaper and is
and is inconvenient to use for many potential customers like one living in remote villages