1

“ A PROJECT REPORT ON STUDY OF E-COMMERCE “

Of
Submitted In Partial Fulfillment Of The Requirement
For
MASTER IN COMMERCE
PART II SEM III
{2022-2023} BY
MISS. FARHEEN ASLAM MAPKAR

Under Guidance
MR:DR.S.T.NIMBALKAR

UNIVERSITY OF MUMBAI
N.K. VARADKAR ARTS &
R.V.BELOSE COMMERCE COLLEGE’
DAPOLI
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CERTIFICATE

This is to certify that MISS. FARHEEN ASLAM MAPKAR of M.COM

part II semesterIII has undertaken and completed the project report
on “E-COMMERCE” during the academic year 2022-2023 under
guidance of MR.S.T.NIMBALKAR Submitted on / 02/2023 date to
the college in fulfillment of curriculum of M.COM UNIVERSITY OF
MUMBAI this is bonafide project work and information presented is
true and to the best of my knowledge and belief.

SIGNATURE OF GUIDING TEACHER

(MR.S.T.NIMBALKAR)
DATE:- 12 /02/2023
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DECLARATION

I MISS.FARHEEN ASLAM MAPKAR here by declared that project

report entitled “E-COMMERCE” under the guidance of MR: DR
S.T.NIMBALKAR submitted in partial fulfilment the requirement of
the award of degree of MASTER OF COMMERCE by UNIVERSITY OF
MUMBAI is my original work.

SIGNATURE

(MISS.FARHEEN ASLAM MAPKAR)

(CLASS:M.COM PART II)
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PREFACE

E-Commerce as anything that involves an online transaction. E-

Commerce provides multiple benefits to the customers in the form of
availability of goods at lower cost, wider choice and saves time. The general
category of e-commerce can be breakdown into two parts : E-merchandise: E-
finance. E-commerce involves conducting business using modern
communication instruments : telephone, fax, e-payment, money transfer
systems, e-data interchange and the internet. Online businesses like financial
services, travel, entertainment, and groceries are all likely to grow. Forces
influencing the distribution of global e-commerce and its forms include
economic factors, political factors, cultural factors and supranational
institutions. It has an impact over the economy of many countries among
which india is on the top of that list. It has named as new gold rush in e-
commerce. E-commerce has many reasons that why it is very crucial in
developing the country.
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ACKNOWLEDGEMENT

I would like to express my special thanks of gratitude to our Teacher

“MR.DR.S.T.NIMBALKAR “ for his able guidance and support in
completing this project.
I would also like to extend my gratitude to our Principal MR.
BHARAT KARHAD for providing me with all the required facilities.
Secondly, I would also like to thank my parents and friends who
helped me a lot in finishing this project within the limited time. Just
because of them I am able to create my project and make it good
and enjoyable experience.
Thanks again to all who helped me during the project.
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INDEX

SR.NO TOPIC NAMES

1. Introduction.
2. E-COMMERCE.
3. History of e-commerce.
4. Classification of e-commerce.
5. E-Commerce sales (product) life cycle (ESLC)
Model.
6. World Wide Web.
7. Global Trends.
8. E-Commerce in the times od Covid-19.
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1.INTRODUCTION

After the internet and dot com revolution, electronic commerce (e-commerce)
remains a new, emerging and constantly changing field of information
technology and business management. With the advent of the internet, the
term e-commerce has gained popularity. It includes:-
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 companies
such as collaborative on-line design and engineering or virtual business
consultancy teams.
Thus is an emerging concept that describes the process of buying and selling or
exchanging of products, services, and information via computer networks
including the internet.
Before 40 years the commerce concept created very important aspect in its
area and turned into e-commerce or electronic commerce, which is the buying
and selling of products or services through the internet in few fpreign
countries it is a regular process for the seller and buyers and today more than
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85% of the customers are buying products on a daily basis, like online bill,
online shopping, payment or purchasing from an e-tailer etc. Nowadays e-
commerce is continuosly growing with new twchnologies,innovations,and
thousands of businesses entering the on-line market each year.The thought of
living without e-commerce seems unsounded, complicated and an
inconvenience to many e-commerce is the buying and selling of goods and
services,or the transmitting of funds or data, over the electronic network,
primarily the internet internet . These business transactions occur either as
business-to-business, business-to-consumer,conumer-to consumer or
consumer-business and included other models also.
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2. E-COMMERCE

E-commerce is more than just buying and selling products online. Instead, it
encompasses the entire online processes of developing, marketing,selling,
delivering, and paying for products and services purchased on internet. E-
commerce is the activity of electronically buying or selling of products on
online services or over the internet. The term was coined and first employed
by Dr.Robert Jacobson, principal consultant to the California State Assembly’s
Utilities & Commerce Committee, in the title and text of California’s Electronic
Commerce Act, carried by the late committees Chairwoman Gwen Moore (D-
L.A.) and enacted in 1984. Electronic commerce draws on technologies such as
mobile commerce, electronic funds transfer, supply chain management,
internet marketing, online transaction processing, electronic data interchange
(EDI), inventory management systems, and automated data collection systems.
E-commerce is in turn driven by the technological advances of the
semiconductor industry, and is the largest sector of the modern electronic
commerce typically uses the World Wide Web fpr at least one part of the
transaction’s life cycle although it may also use other technologies sucj as e-
mail. Typical e-commerce transactions icludee the purchase of online books
(such as Amazon) and music purchases (music download in the form of digital
distribution such as Tunes Store), and to a less extent,
customized/personalised online liquor store inventory services.There are three
areas of e-commerce:online retailing, electronic markets, and online auctions.
E-commerce is supported by electronic business.
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▪ E-commerce business may also employ some or all of the following:

• Onlineshopping for retail sales direct to consumers via web sites and
mobile apps, and conversational commerce via live chat , chabot’s and
voice assistants;

• Providing or participating in online marketplaces,which process third-

party business-to-consumer (B2C) or consumer-to-consumer (C2C) sales;

• Business-to-business buying and selling;

• Gathering and using demographic data through web contacts and social
media;

• Business-to-business (B2B) electronic data interchange;

• Marketing to prospective and established customers by e-mail or fax (for

example, with newsletters)

• Engaging in retail for launching new products and services;

• Online financial exchanges for currency exchanges or trading purposes.

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Importance of E-Commerce:

In the continuously emerging of technologies, ecommerce has

become a vital part of all types of businesses. The increase in the
popularity of ecommerce, there is a decrease in the inflation caused
on the products and services with perks such as cost savings, kickass
competitions, and changes in the pricing behaviour of the sellers. At
the same time, the online buyers of a now know the convenience of
purchasing online. If you are still sceptical about opting for an
ecommerce, here are a few compelling reasons that will surely drive
you to create one soon:

Ecommerce helps you keep a check on costs

When you sell online, it is not necessary to showcase only those
products that are stored in a physical place. Many online sellers
showcase their entire inventory using the ecommerce. By doing so,
you can save on the rental for the storage space, the electricity and
all the charges involved to manage the products in a physical
medium. Also, even if you wish to provide a physical space, y ou don’t
need to make one that includes all the products you sell. Either way,
you are saving your money with ecommerce.

It helps your expand your brand

Ecommerce helps you take your brick and mortar store online in a
creative, more attractive, and easier way. When you offer quality
products round the clock along with a dedicated customer support
team, social media interactions, knowledge -base, blogs, etc, you are
creating a strong online presence for your brand. And by creating a
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strong online presence, gone would be the days when you had to
worry about business expansion, change of locations, product
expansion, and brand recognition. All these can be done from a single
screen right from the comfort of your house using the internet and
ecommerce.

Wide Range of Products

In the areas where there is a lack of availability for all kinds of
products or services, there will be a need for comprehensive services.
They would face a scarcity of products or services with limited access
to the normal. This is when ecommerce plays an important role. The
traditional brick and mortar stores usually fail to satisfy customers
due to limited access to varieties of products. You have been into the
market at least once where you had to visit more than one shops to
get what you desire. It is near to impossible for retailers to provide all
the variations in the products and that’s when ecommerce helps by
expanding the product variations breaking the boundaries of the
traditional brick and mortar store. With ecommerce, peopl e can now
purchase any product by visiting n number of websites in a few
minutes and they can choose their required colour, size, pattern, and
so on by filtering their searches. With ecommerce, you can now shop
online for anything within 15 minutes or even lesser.

Attract newer customers

Online sellers have wider visibility to a large set of an audience from
around the globe. While a brick and mortar store can only be seen by
a passerby or the localities’, an ecommerce store can be viewed,
browsed, and accessed by people from anywhere on earth, provided
they have access to the internet. If your ecommerce website or store
is well-optimized, you will be easily visible by online shoppers
through browsers such as Google and Bing. The better the
optimization of your store, the higher are the chances of attracting
newer customers to your business. Just as word of mouth works for
the brick and mortar stores, social sharing works for ecommerce
stores. By social sharing, customers can share their experience with
your services using the internet. Moreover, they can share the link to
your products based on their contentment with your services. Other
online sellers can easily know which product is been loved by many
and where to find it; credits to ecommerce.
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Lower business risks

As said earlier, starting an online ecommerce store or website will
cost you much lower than that of a brick and mortar store. You need
not worry about the overhead charges that might incur while selling
online which is otherwise an uninvited guest for brick and mortars.
This will help you sell your products at a competitive price, increased
profits, and lower business risks.

Convenient selling option

An online ecommerce store is available to customers and shoppers
throughout the day for 365 days, irrespective of their schedules. It is
known without saying that people are now convenience -driven and no
one has got time to shop from a physical or a brick and mortar shop.
Instead, people are now browsing for online shopping options to get
products and services delivered at their footsteps without needing for
them to step outside their houses. Especially during the corona wave,
people are willingly or unwillingly locked down in their houses to stay
safe and this is the time when the number of online s hoppers has
significantly raised.

Transparency in business
With the increase in the number of frauds in online shopping,
customers now look for trustworthy online retailers on which they
can invest their money. For building such trustworthiness, your
business should be transparent in all possible ways. When your
business methods are transparent with your customers, they can
easily know and believe in the authenticity of your brand, products,
and services. When it comes to ecommerc e transparency, you are
responsible for accounting to the mode of receiving payments, the
source of income, expenditure, and transfer of amount. Ecommerce
businesses mostly use digital paying methods such as credit cards,
debit cards, net banking, and so o n. The online transactions are
facilitated by payment gateways and therefore are under the
Governments supervision. Any fraudulent act can and must be
questioned by the buyer or the concerned officials. Ecommerce is
hence important for your business to cre ate a transparent business
system.
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Better marketing opportunities

An ecommerce site is the best marketing tool any online seller can
get. It helps in creating an authentic online presence for all other
marketing options. With the increased use of the internet, there are
many marketing tools available online such as Search Engine
Optimization or SEO, email marketing, social media marketing, Pay
Per Click or PPC ads, and Search Engine Marketing or SEM. For
instance, if you have invested your time in working for quality SEO
optimization, you can be assured that your ecommerce store will
appear in the top lists of Google’s Search Engine Results Page (SERP).
The social media platforms will help you get social reviews and
feedbacks of your customers’ experiences. Moreover, it can help you
keep your customers engaged and interact with them easily.
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SCOPE OF STUDY

This study being-desk analysis” contains views of various writers and

researchers of E-Commerce . This study includes the global trends including
india as a major source of E-Commerce, Increasing use of e-commerce in
developing nations, reasons behind success of e-commerce as an industry, the
use of e-commerce inglobal sourcing, advantages of E-commerce and several
more topics being covered under the project analysis. The use of e-commerce
in various countries and their influence over the people or citizens of that
country is remarkable.
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OBJECTIVES

The study is focused on achievement of following objectives:

• The assess the latest trend in E-commerce globally.

• The impact of growth of e-commerce

• To analyse the latest global scenerio of e-commerce.

• The impact of growth on overall economy.

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Data Collection and Research Methodology

The five phases of the project are as follows:

Scoping and Planning:

This phase focuses on the planning of the project’s overall direction, including
the definition of the project’s scope, objectives, and timelines. The deliverable
from this phase is this Design Plan.

Conceptual design and research:

In this phase, the conceptual design of the methodology is developed and
research on existing methodologies is conducted.

Development of methodology:
The actual methodology is developed in this phase . Detailed description of each
task in the methodology are documented, including the objectives, inputs,
approach relevant models, applicable tools and techniques, outputs, and any
references.

Implementation of methodology:
The methodology will be implemented with a client. This phase includes the
marketing of E-Commerce strategy development services and the closing of the
sale, followed by the actual implementation.

Revision methodology:
Final touches and revisions to the methodology are made in this phase. The
majority of these revisions come from experiences on the client project. Sample
reports and any additional references are added to the methodology.
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BENEFITS OF E-COMMERCE

The main benefit from the customer’s point of view is significant increase and
saves of time and eases access from anywhere in the globe. Customer can place
a purchase order at any time. The main benefits of ecommerce for customers
are as follows:

• Reduced transaction costs for participating exchange in a market.

• Increased comfort - transactions can be made 24 hours a day, without

requiring the physical interaction with the business organization

• Time saving- Customer can buy or sell any product at any time with the help
of internet.

• Quick and continuous access to information-Customer will have easier to

access information check on different websites at the click of a button.

• Convenience-All the purchases and sales can be performed from the comfort
sitting a home or working place or from the place a customer wants to.

• Switch to others companies-Customer can easily change the company at any

time if the service of a company is not satisfactory.

• Customer can buy a product which is not available in the local or national
market, which gives customer a wider range of access to product than before.

• 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.
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The main benefits of e-commerce from sellers’ point of view is increasing

revenue and reducing operation and maintenance costs through internet.
These include as follows:

• Increases revenue.

• Reduces operation and maintenance costs.

• Reduces purchase and procurement costs.

• Raises customer loyalty and retention.

• Reduces transportation costs.

• Develops customer and supplier relationships.

• Improves speed of the process of selling.

• Improves internal and external communication. And

• Develops the company image and brand.

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CHALLENGES IN E-COMMERCE

The major challenges faced by the sellers and the buyer which carrying out
business transactions through internet are as follows.

• Private and public corporation is not involved jointly to grow the business of
e-commerce. Private and public joint initiative is needed to develop the
ecommerce business. Joint initiatives bring credibility inside people, which is
needed for flourishing the ecommerce business.

• There is a lack of system security, reliability, standards, and some

communication protocol.
Customer loses their money if the website of ecommerce site is hacked. Most
common problem of e-commerce website is not having enough cyber security.

• Financial institutions and intermediaries: Thus far, financial institutions and

banks in developing countries are hesitant to take an active role in promoting e-
commerce. However, merchants need the involvement of banks to broaden the
reach and appeal of ecommerce and to help prevent fraud and potential losses
attributable to credit card fraud. But beyond the credit card approach, banks
and other financial service intermediaries are challenged to develop alternative
modalities for secure and reliable online transactions in environments where
credit cards are not commonplace (Anupam-2011).

• In developing countries there is a culture of buying product by negotiating

price with seller, which is not easily possible in case of e-commerce in developing
countries because of lack of infrastructure facility.
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• One of the biggest challenges is the cutting down the price of internet.
Authorities are trying to keep low the price of bandwidth low. But the high cost
of spreading networks and operating expenses hinder to keep price low for
internet.

• Trust is the most important factor for the use of the electronic settlements.
Traditional paper about based rules and regulations may create uncertainties
the validity and legality of e-commerce transactions. Modern laws adopted and
impartiality implemented in the electronic transactions form the basis of trust
in the developed world. Where legal and judicial systems are not developed
ecommerce based transactions are at a disadvantage because of lack of security
whether real or perceived. In many developing countries even today cash on
delivery is the most accepted system, even cheques and credit cards are not
readily accepted (Roni Bhowmik-2012).

• New methods for conducting transactions, new instruments, and new service
providers will require legal definition, recognition, and permission. For example,
it will be essential to define an electronic signature and give it the same legal
status as the handwritten signature. Existing legal definitions and permissions
such as the legal definition of a bank and the concept of a national border—will
also need to be rethought (chavan-2013). Besides the above challenges, the
emerging economy like India also faced the following challenges:
• Lack of education

• Cultural tradition

• Poor concept of online marketing

• Less marketing or promote

• Political problem

• High cost of products/services comparing traditional market

• Internet coverage arena is limited

• Communication is haphazard over the country

• Lack of trustable business and enterprise and

• Lack of experience of meeting directly with merchant and customer
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Advantages of E-Commerce

There are a number of prominent and not-so-obvious advantages for doing

business on an online platform. Understanding exactly how e-Commerce works
can help individuals leverage them to their and their businesses advantage:

1. A Larger Market: E-Commerce allows individuals to reach customers all

across the country and all around the world. E-Commerce gives business
owners the platform to reach people from the comfort of their homes.
The customers can make any purchase anytime and anywhere, and
significantly more individuals are getting used to shopping on their
mobile devices.

2. Customer Insights Via Tracking And Analytics: Whether the businesses

are sending the visitors to their eCommerce website via PPC, SEO, ads, or
a good old postcard, there is a way of tracking the traffic and the
consumers’ entire user journey for getting insights into the keywords,
marketing message, user experience, pricing strategy, and many more.

3. Fast Response To The Consumer Trends And The Market

Demands: Especially for the business people who do “drop ship,” the
logistics, when streamlined, allow these businesses to respond to the
market and the trends of eCommerce and demands of the consumers in a
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lively manner. Business people can also create deals and promotions on
the fly for attracting customers and generate more sales.

4. Lower Cost: With the advancement of the eCommerce platforms, it has

become very affordable and easy to set up and run an eCommerce
business with a lower overhead. Business people no longer need to spend
a big budget on TV ads or billboards, nor think about personnel and real
estate expenses.

5. More Opportunities For “Selling.”: Business people can only offer a

limited amount of information about a product in a physical store.
Besides that, eCommerce websites give them the space to include more
information like reviews, demo videos, and customer testimonials for
helping increased conversion.

6. Personalised Messaging: E-Commerce platforms give people in business

the opportunity to provide personalised content and product
recommendations for registering customers. These targeted
communications can help in increasing conversion by showing the most
relevant content to the visitor.

7. Increased Sales Along with Instant Gratification: For businesses selling

digital goods, eCommerce allows them to deliver products within seconds
of placing an order. This satisfies the needs of the consumers for instant
gratification and assists increase sales, especially for the low-cost objects
that are often known as “impulse buys.”

8. Ability to Scaling Up (Or Down) Quickly Also Unlimited “Shelf

Space.”: The growth of any online business is not only limited by the
availability of space. Even though logistics might become an issue as one’s
business grows, it’s less of a challenge compared to running any brick-
and-mortar store.
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Disadvantages of E-Commerce

Running a business that is e-commerce is not always rainbows and unicorns.

There are unique challenges to this business model — learning about them will
help business people navigate the choppy waters and avoid common pitfalls.

1. Lack of Personal Touch: Some customers appreciate the personal touch

they offer when visiting a physical store by interacting with the sales
associates. Such personal touch is especially essential for businesses that
sell high-end products as customers will want to buy the products and
have an excellent experience during the process.

2. Lack of Tactile Experience: No matter how good a video is made,

customers still can’t feel and touch a product. Not to mention, it’s never
an easy task to deliver a brand experience that could often be including
the sense of touch, taste, smell, and sound via the two-dimensionality of
any screen.

3. Product and Price Comparison: With online shopping, customers can

compare several products and find the least price. This forces many
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businesses to compete on price and reduce their profit margin, reducing

the quality of products.

4. Need for Access to the Internet: This is obvious, but don’t forget that the
customers do need access to the Internet before purchasing from any
business! As many eCommerce platforms have the features and
functionalities which require a high-speed Internet connection for an
optimal consumer experience, there’s a chance that companies are
excluding visitors who have slow internet connections.

5. Credit Card Fraud: Credit card frauds are a natural and growing problem
for online businesses. It can lead to many chargebacks, which result in the
loss of penalties, revenue, and a bad reputation.

6. IT Security Issues: More and more organisations and businesses have

fallen prey to malicious hackers who have stolen information of the
customers from their databases. This could have financial and legal
implications, but it also reduces the company’s trust.

7. All the Eggs in One Basket: E-Commerce businesses rely solely or heavily
on their websites. Even just some minutes of downtime or technology
glitches could be resulting in a substantial revenue loss and customer
dissatisfaction.

8. Complexity in Regulations, Taxation, and Compliance: Suppose any

online business sells to its consumers in different territories. In that case,
they’ll have to stick to the regulations in their own countries or states and
their consumers’ places of residence. This could be creating a lot of
complexities in accounting, taxation and compliance.
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3. HISTORY OF E-COMMERCE

In 1969 two computers were connected to a network on ARPANET

(Advanced Research Project Agency Network) which was the sponsor of
the research. This was the beginning of what we now call the internet. In
1984, it split into two inter connected network. The military part was
named MILNET. The educational part, Which kept the name
ARPANET,became known as the internet. At first , internet traffic was
Government related and ordinary person or company could not use the
internet.in April 1995 (ISA Government has removed the restrictio).
Today it is spreading all over the world, used in more than 150
countries, more than 1.46 billion global digital buyers in 2015. By 2016,
the number of digital buyers in india alone is expected to reach 41
million, representing some 27% of the total number of internet users in
the country.

A CASE
In 1995, a young financial analyst by the nam eof jeff bezoz was full of
hope about the potential of doing business on the internet. He sat down
one evening and came up with a list of 20 products he believed would
sell well on the internet. Three years later he formed Amazon.com . This
is a story of E-commerce trends, how it was developed in the world.
Bezos figured that there were probably over five million book title
worldwide in a given year, and that no bookstore could conceivably
stock more than a fraction of the total. He developed a strategic plan for
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selling books online. It sold $148 million worth of books in its third year
of operations with no store. Surviving the 2001-2003 recessions,
Amazon.com began to expand beyond books into musics, hardware, and
electronics, even food items like cakes, cheese and coffee. It listed over
200 merchants in its food department alone. History / Evolution of
Electronic Commerce.

1. 1960
Businesses were using primitive computer networks to conduct
electronic transactions and the e-commerce was started with Electron
which permits various companies to carry out electronic transactions. A
percursor to A company’s computer system could share business
documents such as invoices, order forms, shipping, confirmation with
another company’s computer and the birth of e-commerce has taken
place.

2. 1971

Researchers developed the Terminal Interface Processor (TIP) for

dealing into the ARPANET from an individual computer terminal. The
ARPANET is used to cannabis sale between students at the tan or
Artificial Intelligence Laboratory and the Massachusetts Institute of
Technology, later described as “the seminal act of e-commerce” in
John Markoffs book “What the Dormouse Said”.

3. 1979

Michael Aldrich discovered online shopping with the help of

connected a TV set to a computer with a phone line and formed
teleshopping. Alao the American National Standards Institute (ANSI)
came up with something called ASC X 12, a universal standard for
sharing business documents over electronic networks.
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4. 1981 to 183

Thompson Holidays used the first B2B (Business electronic trade

transaction) with the help of online technology.

1982:
France telecom invests Minitel that is considered the most successful
pre-world wide web (wwvv) online service. But the greatest
networking evolution came in 1982, when ARPANET switched over to
Transmission Control Protocol and Internet Protocol (TCP/IP) . The
Boston Computer Exchange, a marketplace for used computer
equipment started in 1982 , was one of the first known examples of
e-commerce.

1983:
California State Assembly holds first hearing on “electronic
commerce” in Volcano, California: Testifying are CPUC,MCI Mail;
Prodigy, Compuserve,Volcano Telephone,and Pacific Telesis.(Not
permitted to testify is Quantum Technology,later to become AOL.)

5. 1984 to 1989

The Electronic Mall is launched by CompuServe- users could purchase

items directly from 110 online merchants and CompuServe was one
of the first popular networking services for home PC users, oroviding
tools like e-mail, message boards and chat rooms. Mrs. Jane Snowball
,72,is the first online home shopper and gateshead SIS/Tesco is the
first B2C online shopping.

1985:
UK based Nissan Sells cars and finance with credit checking to
customers from dealer’s lot.

1987:
Swerg creates the first electronic merchant account to let software
developers sell online.
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1989:
Peapod brings the grocery store to the home PC. In may 1989,
Sequoia DataCorp. Introduced Compumarket, the first internet based
system for e-commerce.

6. 1990 to 1993

In 1990 Tim Berners Lee, Director of the World Wide Web

Consortium creates the first World Wide Web server and browser,
using Next computer and proposed building a “web of nodes”storing
“hyoertext pages”/ viewed by “browsers” on a network and released
that web in december.

1991:
The national Science Foundation lifts restrictions on the commercial
use of the NET and allows the internet to be used for commercial
purposes.

1992:
J.H.Snider and Terra Ziporyn publish Future shop: How new
technologies will change the way we shop and what we buy. Book
Stacks unlimited in Cleveland opens a commercial sales website
(www.books.com) selling books online with credit card processing.

1993:
Marc Andreesen at the National Center for Supercomputing
Applications (NCSA) introduced the first widely distributed web
browser called mosaic. Pget press releases edition No.3 of the first
app store.

7. 1994

In Aug, Online retailers Net market makes the first secure retail
transaction on the web a copy of stings album Ten Summoner’s Tales
In October, Joe maCmbley ran the first ever online banner ad. It went
live on Hotwired.com and promoted seven art musems.
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Netscape releases the Navigator browser included an important

security protocol called Secure Socket Layer (SSL) that encrypted
messgaes on both the sending and receiving side of an online
transaction.
Pizza Hut offers online ordering on its web page, and the first online
bank opens.
Dell.com’s website was launched in 1994 with a single static web
page and their online presence quickly grew.
Ipswitch Mail Server becomes the first software available online for
sale and immediate download via a partnership between
ipswitch,inc.and Openmarket.

8. 1995 to 1998

In July Amazon sold its first item—a science textbook and later starts
selling many different products through online. In September eBay
sold its first item a broken laser pointer. Verisign begins developing
digital IDs or certificates, which verified the identity of online
businesses.

1997:
Dell announced a single-day sales record of a million dollars on its
websites.

1998:
Yahoo Launches Yahoo stores, Google and paypal launched their e-
commerce services in and SBC Communications began offering hifh-
speed-connections.

9. 1999 to 2004
The first online-only shop, Zappo’s opens for shoe. Global sports
launches outsource e-commerce platform.

2000:
E-commerce is started in germany as exchange project and ongoing
dotcom investment bust.
 31

2002:
EBay acquires PayPal for $1.5 billion and changes the scope of online
shopping forever. CNS stores and Netshops begin selling products.

2003:
Apple started iTunes store and Zencart opens branches.

2004:
Credit card companies create PCI data security standard.

10. 2005

Social Commerce Means people using social media intheir buying

decisions is born thanks to networks like facebook. First internet
retailer’s conference and exhibition also launches YouTube. Web 2.0
takes hold making sites more interactive and final release of Virtue-
mart.

11.2007 to 2010

Another major player, Magento ,is an e-commerce content

management system that first started development in 2007 and was
later acquired by eBay. Apple launches the iphone with full web
browsing.

2008:
Group on is launched.

2009:
Total e-commerce sales amount to $ 143.4 billion.

2010:
Forrester Research, for example, predicted American firms alone
would sell $ 316 billion in goods and services via the web by 2010.
 32

12. 2014

With mobile commerce gaining speed, mobile payments are

expected to quadruple by 2014, reaching $630 billion in value Data
released last February by the a.s. Commerce Department indicates
that Americans spent $304.91 billion online in 2014 alone.
 33

ROADMAP OF E-COMMERCE IN INDIA

1. 1990

Internet access in india was limited to govt. Institutes and Research

bodies that were connected through the ERNet network since the early
1990’s.

2. 1995

16 August 1995, Videshi Sanchar Nigam Ltd. (now BSNL) introduced

internet in india and only 2% beginners were there . But from the last
two decades, use of internet and mobile phone in india has been
changing a lot.

3. 1996 -2000

It includes launch of internet in india via dialup in 6 cities included

launch of first online B2B directory portals, launch of onlinE matrimanial
portals, Not to scale launch of Online Travel Agents (OTAs). Launch of
first group buying website in india New trend of use of social networking
sites (SNS) as marketing tool begins or the advent of social commerce.
 34

1997:India’s online recruitment industry took shape in 1997.

1999:
As per an IRS study in 1999, the reach of the internet in india have
increased to around 1.05 ,illion users in 1999 as compared to 593,000
users in 1998.

4. 2002

India first came into commercial interaction with the online E-

commerce via the IRCTC. For the public convenience,the Government of
india tried this online strategy to book the train tickets from their home.
e-bay started their online operations or even got a big business in india.

5. 2003

After the unpredicted success of the IRCTC many of the airline services
like AirDeccan,Indian Airlines, Spicejet,etc. Were followed the online
ticket booking system.

6. 2005

There might have been quite a few companies in the between 2005-
2010 that came into online business but none of them received great
number of positive responses from the indian population as they were
expected.

7. 2006

A recent sudy by the internet 6 Mobile Association of india in July 2006,

we have 38.5 million internet users. The study reveals that with india’s
internet population poised to reach 100 million by 2007-2008.

8. 2007
 35

In 2007 Sachin Bansal and Binny Bansal from IIT Delhi came up with an
online company called flipkart to change the view of the indian
customers towards online shopping.
India’s consumer-facing e-commerce market (B2C-C2C) grew at a
whopping CAGR of 49.1% from 2007 to 2011 to reach a market size od
OS$9.9 billion. On the other hand, the B2B market is a small contributor
to the overall domestic e-commerce market, and it was estimated at US
$50.37% million in 2011.5.
In the same year, Myntra came into picture with their model of fashion
industry. Likewise, there were several other companies like Home shop
18, infibeam, Lets buy etc. which came into the league.

9. 2009

However over the past few years, the sectors has grown by almost 35 %
CAGR from 3.8 billion (ISD in 2009 to an estimated 12.6 billion ISD in
2013.)

10. 2014

Online shopping in its early stage was a simple medium for shopping
with fewer options. But today with the help of new and simple
techniques like attractive online websites,user friendly interface, bulky
online stores with new fashion, easy payment methods, no bound on
quantity 6 quality ,one can choose the items based on size, colour, price,
etc. the online shopping has bezome a trend in india.

11. 2015

There was 354 million internet in india as of june 2015 and according to
indian’s response now expected these users are to cross 500 million in
2016. While in countries such as the OS and china, e-commerce has
taken significant studies to achieve sales of over 150 billion (JSD) in
revenue,the industry in india is still at its infacy.
 36

12.2016

From last few years participation of online shoppers are increasing it

includes:

CHIEF EXECUTIVE OFFICER LIST OF PARTICIPANTS

Name Designation Company

Kunal Bahl Chief Executive SnapDeal
Officer
Sundeep Chief Executive HomeShop18
Malhotra Officer
Vikram Malhi Country Head Expedia (india)
Hitesh Chief Executive Info Edge
Oberoi Officer
Madhup Head, New IndiaMART
Agarwal Initiatives
Vivek Senior Vice- Times Business
Madhukar President Solution
Vishal Mehta Chief Executive Infibeam.com
Officer
Manu Chief Executive Naaptol.com
Agarwal Officer
Sandeep Chief Executive Cleartrip
Murthy Officer
 37

4. CLASSIFICATION OF E-COMMERCE

E-Commerce exchanges may be business –to- business, business-to-

consumer or, with facilities such as online auctions, consumer-to-consumer.
The E-Commerce customer may be a home computer user, a business
computer user, a commercial intermediary or the transactions may be
generated from the customer’s business information system. The first two of
these may use internet e-commerce, the commercial intermediary an e-
market, whereas the exchange of data between business information systems
is properly the province of EDI (Electronic Data Interchange).

• Classification of E-commerce is based on :

a) Who orders, the goods and services to be sold.
b) Who sold those goods and services and the nature of transactions.

Based on above two criteria, E-commerce can be further classified as:

a) Business-to-Business (B2B)
b) Business-to-Consumer (B2C)
c) Consumer-to-Business (C2B)
d) Consumer-to-Consumer (C2C)
e) Business-to-Government (B2G)
 38

a. Business-to-Business (B2B):

This model describes commerce transactions between businesses, such

as between a manufacturer and a wholesaler, or between a wholesaler
and a retailer. It is the largest form of E-commerce. In this form the
buyers and sellers are both business entities and do not involve an
individual consumer. It is commonly known as EDI (Electronic Data
Interchange). In the past EDI was conducted on a direct link of some
form between the two businesses where as today the most popular
connection is the internet. The two businesses pass information
electronically to each other.

Characteristics of Business to Business (B2B):

According to the B2B business model, organisations are gelling their

product to an intermediate buyer who then sells the product to the final
customer. B2B covers large number of applications which enables
business to form relationships with their distributors, resellers, suppliers
etc. As an example , a wholesaler places an order from a company’s
website and after receiving the consigment, sells the end product to final
customer who comes to buy the product at wholesaler’s retail outlet
for.e.g : IndiaMART.

• Main users:-
The most common users of B2B online classifieds are micro, small and
medium enterprises (MSMEs). Trade through online B2B portals
increases the visiblity of MSPIEs in marketplace and helps them
overcome barriers of the time, communication and geography.

• Prime Product Selling:-

Through B2B company can sell various lead products such as
Electronics, Shipping and Warehousing, Motor vehicles, Petrochemicals,
Paper, Office products, Food, Agriculture etc;
 39

• Vital Technologies:
Following are the key technologies used in B2B e-commerce such as
Electronic Data Interchange (EDI), Internet, Intranet, Extranet, Back-End
Information System Integration etc;

• Important Models:
There are various architectural models in B2B e-commerce like
Supplier Oriented Marketplace, Buyer Oriented Marketplace,
Intermediary Oriented Marketplace,etc.

• Multiple Decision Makers:-

In B2B, there is often multiple decision makers involved in the
purchase process. It is a communication process between various
businessmen like wholesalers, retailers, agents etc; therefore it may
require multiple user roles in the cart process with multiple stages
taking many days.

• Lengthy Buying Cycle:

The B2B buying cycle is much longer and lengthy than for B2C, so the
lead time between initial contact and receiving any payment are much
longer. In this model, customer expectation is different wanting to
change exact details of the order through the process.

• Variation in Price:
In B2B the variations in price lists, discounts, and even available
products are generally more complex. Here one businessman is
definitely or complusory giving discount to other businessman which is
differ according to relations.

• Conflict with Direct Sales Channels:

Many B2B businesses have an established sales team who will be
unhappy with online competition that can be seen to decrease their
performance bonus. Careful thought must be given to how this is
introduced.
 40

• International Markets:
B2B ecommerce is often used as a way of reaching international
markets, maybe in small numbers, Government policies of various
countries, legal and cultural issues can cause more of an impact than for
B2B e-commerce and this impact is exaggerate if products are small in
number and hugh in value.

• Limited Customers:
These serve a limited no of customers and they make profits e.g.
Intel is selling its chips to other business. OEMs who make computers,
motherboards, digital devices and components are contacted Intel
through this route B2B sites are pulling in a Billion doller a month
through this route.

b. Business-to-Consumer (B2C):
In this mode, business and consumers are involved . Business sells to the
public typically through catalogs utilizing shopping cart software. (i.e.
typical online buying) Customer identities a aneed. Searches for the
product or services to satisfy the need. Selects a vendor and negotiates a
price. Receives the product or services (delivery logistics, inspection and
acceptance). Makes payment.
Gets service and warranty claims. Example websites like Amazon.com,
Flipcart, etc.

Characteristics of Business to Consumers (B2C):

Business-to-Consumer (B2C)
As per the B2C business model, companies are selling their products
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. For e.g.eBay. Flipcart etc.
 41

1. Large Number of Customers:

In these sites the pet customer volume of a transaction is low, but
the no of consumers serviced is large. Its provided lot of advertising
both on and off athe net. It require huge investment in terms of
hardware and software e.g.Amazon.com.

2. Bulk Revenue:
The B2C market in india generates the bulk of revenues across the
consumer-facing modes of e-commerce. Furthermore though online
travel has typically held a major share of the B2C market. Online
retail is also growing rapidly and is expected to significantly increase
its share.
3. Disintermediation:
In B2C website, manufacturer can sell products directly to
consumers. The process of business layers (Intermediaries)
responsible for intermediary functions is called Disintermediation.

4. Required Proper Process:

This model is including following process like,determines, searches
available items on the website compares similar items for price,
delivery date or any other terms, gives the order. Pays the bill,
receives the delivered item and review/inspect them, review thr
process after consults the vendor to get after service support or
returns the product if not sat-shed with the delivered product.

5. Heavy Advertising:
It requires attracting large number of customers. This model is also
called “Advertising Based Model”. Many popular e-commerce
websites rely on advertising-based model. These websites offer a free
service to consumers and use advertising revenue to cover costs.
Advertisers will pay a premium (first rate) to sites that deliver high
traffic numbers.
 42

6. Lower Purchase Volume for Higher Priced Goods:

The B2C model enables companies to make a higher profit, as the
wholesale purchaser is eliminated. The B2C model is characterizes by
a lower purchase volume for higher priced goods. Examples included
airline tickets and electronics.

7. High Investment:
In terms of hardware/software involvement the organisation is
required large amount investment in the e-commerce business so
that they can easily reach to the potential customers.

8. The Future:
The future of B2C appears to be bright.Average online purchases are
expected to increase by in 2016 from 66% in 2015, due to attractive
deals and aggressive marketing. This type of commerce may still only
be in its infancy and likely to grow simply because it is a convenient
form of purchasing.

9. Growth through Mobile:

Decades after the e- commerce boom, B2C companies are continuing
to eye a new growing market. With smartphone apps and growing
traffic, B2C companies have been shifting attention to mobile users
and capitalizing on the popular technology.

10. Five Major Categories:

B2C companies divide into five major categories: direct sellers, online
intermediaries, advertising-based models,community-based models
and fee-based models. Each category is so different from the others
that they are not directly comparable. In fact, some B2C businesses
utilize more than one type to reach different audiences.

a) Direct Sellers: Direct sellers, such as online retailers (e-tailers),

sell a product or service directly to the customer via a website.

b) Online Intermediaries: Online intermediaries perform the same

function as any other broker.
 43

c) Advertising-based-models: details in heavy ads.

d) Community-Based-Models: Community-based models combine

the advertising method relies on traffic at sites that focus on
specialized groups to create communities.

e) Fee-Based-Models: Pay-as-you-buy or paid subscription

services fall under fee based models e.g. netflix.

C. Consumer-to-Business (C2B):

In this, the customer requests a specific service from the business.

Consumer to business is a growing arena where the consumer
requests a specific service from the business. It enables buyers to
name their own price, often binding, for a specific good or services
generating demand. A consumer posts his project with a set budget
online and within outs: companies review the customer’s
requirements and bids out the project. Example: online trading,
tenders, freelancing with website like Bazee.com.

The number of such sites is very limited in such sites, the

consumer places an estimate of the amount of money he is willing to
sprnd for particular sentice e.g. razorfinish.com and priceline.com. In
this model, a consumer approaches website showing multiple
business organizations for a particular service and it is very commen
in crowdsourcing based projects or, a business could have a site
where consumer can sell them things that they need. A large number
of individuals make their services or products available for purchase
by the companies. For e.g. the designers present several proposals
for a company logo and where only one of them is selected and
effectively purchased.

Characteristics of Consumer to Business (C2B):

Consumer-to-Business (C2B)
 44

Consumer to business is an up and coming business market that can

be utilized as a company's entire business model or added to an already
existing model. Consumer to business (C2B) is the opposite of
business to consumer (B2C) practices and is facilitated by the internet
or online forms of technology.

1. Increase Brand Awareness

One way that C2B relationships are helpful is when businesses
have consumers help create brand awareness. Traditionally, press
coverage highlighting new product launches and critical
developments was critical for digital companies.

2. Request More Reviews:

More businesses need this customer input right now because
online ratings have become one of the top deciding factors for
whether new buyers will choose any given brand over another. It’s
not just enough anymore that you offer goods or excellent service
at reasonable prices - these days every company needs positive
words from the public to sell.

3. Freelancers, Contractors, and Gig Workers:

In recent years, the freelance work industry has exploded.
Freelancers can provide everything from a press release to an
entire logo for clients who need assistance in these areas but are
unable or unwilling to hire full-time employees.

d. Consumer-to-Consumer (C2C) model:

Consumer to consumer (C2C) is a business model in which third-party

companies facilitate transactions for products or services between
private consumers without a business participating on either end of the
sale. Today, most C2C business is conducted via online companies.
Before the Internet, C2C transactions primarily occured in places like
newspaper classifieds, live auctions, or garage sales.

In addition to C2C, other primary sales models include business to

consumer (B2C), consumer to business (C2B), and business to business (B2B)
 45

4 Types of C2C Model Platforms

There are many e-commerce platforms that help individual buyers search for
desired items and give sellers a place with a built-in audience of potential
buyers. Most C2C platforms make money by charging sellers a small fee to list
their item or a small commission on the final sale. Examples of C2C platforms
include:

1. Auction platforms: Online auction sites let sellers list their goods at a
minimum price and then allow multiple buyers to bid on the item until there’s
a winner. Bidding can potentially drive up the price higher than if sellers listed
the item at a set price, and bidders can potentially find a good deal if there aren't
many other interested bidders.

2. Exchange of goods platforms: There's a number of online platforms that

connect buyers and sellers looking to exchange physical goods—from used
furniture to artwork and anything in-between. Many of these platforms
exist in both website and app form and even let you search by geographic
location so you can perform the transaction in person.

3. Exchange of services platforms: You can also use online C2C sites to buy
and sell services such as hiring a dog trainer, a website designer, or a
handyperson, or renting someone's home for vacation.

4. Payment platforms: C2C online payment platforms exist to list goods and
services for sale and to facilitate payment for C2C sales on other platforms.
These platforms may make money by charging users a small fee to transfer
earnings into their own bank accounts.

Concepts of other models of E-Commerce:-

Business models or types are the collection of processes and activities that
enable organisations to achieve their goals. Types of E-Commerce are based
on who is selling to whom, what they are selling, where they got it, and how
they are completing the transactions and E-Commerce business can build
completely unique model that gives them special leverage within a given
market.

1. Business-to-Business (B2B)
 46

Business-to-Business (B2B) e-commerce includes all electronic

transactions of goods or services conducted between two or more
companies. Basically it refers to a business selling the goods and services
directly to another business than the final consumers. For instance the
business is selling cement to a construction company. Wholesalers, such
as parts of Alibaba’s model or manufacturer of original products, will
typically sell B2B. Other examples could include Aramark which sells
food, equipment, and other services to business. A typical supply chain
involves multiple business to business transactions, as companies
purchase components and products such as other raw materials for use
in the manufacturing processes. Finished products can then be sold to
individuals via business to consumer transactions.

2. Business-to-Consumer(B2C)

The idea of B2C was first utilized by Michael Adrich in 1979; and used
television as the primary medium to reach out to consumers.
The Business-to-Consumers type of e-commerce is distinguish by the
establishment of eletronic business relationships between business and
final consumers.It corresponds to the retail section of e-commerce,
where traditional retail trade normally operates. Business to Consumer
(B2C) is among the most popular and widely known of sales models.
However, the rise of internetn created a whole new B2C business
channel in the form of e-commerce which sell all kinds of consumer
goods, such computers, software, books, shoes, cars, food, financial
products, digital publications, tourism, banking or insurance etc; services
over the internet. For example, you might buy an HDIV directly from
BestBuy.com, or buy lamps and furniture directly from Target.com, and
then use them in your own home. B2C can also include sites such as
Monster.com and Careerbuilder.com

3. Consumer-to-Business(C2B)

The number of such sites is very limited and in such sites, the consumer
places an estimate of the amount of money he is willing to spend for a
particular service e.g. razorfinish.com and priceline.com. In this model, a
consumer approches website showing multiple business organizations
for a particular service and it is very common in crowdsourcing based
projects or, a business could have a site where consumers can sell them
things that they need. A large number of individuals make their services
 47

or products available for purchase by the companies. For e.g. the

designers present several proposals for a company logo and where only
one of them is selected and effectively purchased. Another platform that
is very common in this type of commerce is the markets that sell royalty-
free photographs, images, and media and design elements, such as
iStockphoto.

4. Consumer-to-Consumer (C2C)

Consumer-to-Consumer (C2C) type e-commerce involved all electronic

transactions of goods or services conducted between consumers to
consumers. Generally, these transactions are conducted through a third
party, which provides the online platform where the transactions are
actually carried out. From these sites, If you have something to sell, than
you get it listed at an auction, and others can bid for it. It is depend on
more and more people visiting and using the sites’s services e.g.
Bazi.com, Quikr, Auction sites such as eBay are the classic examples of
C2C ecommerce sites like Esty where individuals can sell directly to other
individuals could be considered another example of C2C ecommerce.

5. Business-to-Government (B2G)

B2G is Business-to-Government, the concept that business and

government agencies can use central Web sites to exchange information
and do business with each other more efficiently than they usually can off
the Web. B2G is as like as B2B and often referred to as a market definition
of “public sector marketing” which involves marketing products and
services to various government levels. Also many times Government uses
B2G model website to approach business organizations. Such websites
support auctions, tenders and application submission functionalities. B2G
networks provide a platform for business to bid on government
opportunities which are presented as solicitators in the form of RFPs
(Request For Proposals) in reverse auction fashion. Public Sector
Organization (PSOs) post tenders in the form of REF, REI, (Request For
Information) RFQ (Request For Quotation ) Sources Sought, etc. and
suppliers respond to them. For e.g. Bizbilla.

6. Business-to-Administration (B2A)
 48

B2A is a trade transaction through internet between Business and

Administration (Public Administration). This is an area that involves large
amount and a variety of services, particularly in areas such as fiscal,
social security, employment, legal documents and registers, etc. These
types of services have increased considerably in recent years with
investments made in E-Government.

7. Consumer-to-Administration (C2A)

C2A means trade or communication between the Consumer and

Administration which covers all electronics transactions conducted in
individuals and public administration.

Examples of application include:

• Education – disseminating information, distance learning, etc.

• Social Security --- through the distribution of information, making
payment, etc.
e Taxes filing tax returns, payments, etc.

Health appointments, information about illness, and payment of health

services, etc.
This is strongly associated to the idea of efficiency and easy usability
of the services provided to citizens by the Government, with the support
of information and communication technologies.

• Government to citizen (G2C)

Government uses G2C model website to approach citizen in general. It

involves Government is communicate with general Citizens. Such
websites support services like registration for birth, marriage, or death
certificates and also maintain auctions of vehicles machinery or any
other material. The main objectives of G2C website are to provide easy
services to the citizens reduce average time for fulfilling citizen’s request
for various Government services, also available these services on less
prices to them.

• Peer to Peer (P2P):

 49

The peer to peer business model works on the premise of playing

matchmaker between individuals with a since to offer and others who
could use that service. The company can provide the platform, rules and
regulations, and payment/remunaration methods to facilitate this type
of community based business. For e.g. individuals who need a ride, he
can tie up with such people who have a car and want to earn money by
giving rides.

BUSINESS TO CONSUMER E-COMMERCE PROCESS:-

It includes two ways process as Businesses are searching their customers

and customers are searching the products/services.B2C e-commerce
process is called selling process refers to the sequence of steps
salespeople follow each time they make a sale
throughbinternet/website. The process gives one way of selling products
or services to the final consumer and gives them power to successfully
sell almost anything. At the same time it involves other process of
purchasing goods from customers side.

1. Selling process: It includes following steps:-

Some of the Important Steps Involved in Selling Process are: (i) Pre-
Sale Preparations (ii) Prospecting (iii) Pre-Approach (iv) Approach (v)
Sales Presentation (vi) Objections (vii) Close and (viii) The Follow-up:

Prospecting, Pre-approach, Approach, Presentation and Handling,

Objection, Closing, Follow- up. The communication view of the Selling
Process is much richer and comprehensive view of Salesmanship.
Personal Selling is an oral presentation in conversation with one or more
prospects. Here, both buyer and seller are active participants and in the
direct face to face communication. Both try to influence each other.

The process of selling involves the following steps:

(i) Pre-Sale Preparations:

 50

A salesman has to serve the customer and must identify a customer’s problems
and prescribe a suitable solution. For this, a salesman must be familiar with the
product characteristics, the market, the organisation and the techniques of
selling. Also he must know the customer, himself and the company. He must
know buying motives and buying behaviour of the customers or prospects. He
should be aware of current competition and market environment.

(ii) Prospecting:
A salesman has to seek potential customers who are his prospects i.e.,
probable buyers. A prospect has unsatisfied need, ability to buy and willingness
to buy. Prospecting relates to locating prospects. They can be through present
customers, other salesman, phone directories, or by direct cold canvassing.
These prospects must, of course, be accessible to salesman. Thus, prospecting
is similar to the seeking function for the total marketing activities.

(iii) Pre-Approach:
After locating a prospect, salesman should find out his needs and problems, his
preferences and behaviour etc. The product may have to be tailored to the
specific requirement of customer. On the basis of adequate information of the
customer’s wants and desires, salesman can prepare his plan of sales
presentation or interview. The sales presentation should match to the needs of
the individual prospect. It should enable the salesman to handle his prospect
smoothly through the buying process, i.e., during, the sales talk.

(iv) Approach:
The next step is approach where the salesman comes face to face with the
prospect. The approach has two parts, i.e., obtaining an interview, the first
contact. He may use for this, telephone, reference or an introduction from
another customer; and his business card. The salesman must be able to attract
 51

the prospect’s attention and get him interested in the product. It is very
important to avoid being dismissed before he is able to present his product.

(v) Sales Presentation:

After the salesman has found a prospect and he has matched the customer’s
wants with his product, he becomes ready to make a sales presentation. The
sales presentations is closely related to the buying process of customers. The
sales interview should generally go according to AIDA theory (i.e., Attention,
Interest, Desire and Action).

Attention is attracted and interest is gained. The salesman at this point can
increase the interest through smart and lively sales talk together with proper
demonstration. Sometimes, visual aids are used in sales demonstration. These
are common for capital goods or machineries.

After explaining the product characteristics and expected benefits, the

salesman should find out customer’s reactions. The prospective customer’s all
queries and doubts must be clearly answered. The salesman should find the
customer satisfied. A satisfied sales presentation must be clear, complete,
assertive about product’s superior performance and be able to gain the
confidence of the prospect.

(vi) Objections:

At any stage of sales interview, the prospect may attempt to postpone the
purchase or resist purchase. A good salesman must consider an objection as an
indication of how the prospect’s mind is working. The clever salesman should
welcome an objection, interpret it correctly and will avoid it tactfully, without
arguing with the customer.

(vii) Close:
 52

The close is the act of actually getting the prospects’ consent to buy. It is
culmination of the efforts so far made by the salesman and is the climax of the
entire sales process.

It is very important for salesman to be alert and find out the right moment for
closing the deal. This is the “Psychological or reaction movement”, at which
the minds of salesman and prospect are tuned together.

The salesman watches every sign of prospect willing to buy and shall apply
“the close”. A sale is never complete until the product is finally in the hands of
a satisfied customer.

(viii) The Follow-up:

This stage is the post sale contacts. The salesman after obtaining the order,
arranges for despatch and delivery of the product, facilitate grant of credit,
reassure the customer on the wisdom of his purchase decision, and minimize
dissatisfaction, if any.

The salesman should contact the customer periodically to maintain his

goodwill. A sale is made not in the mind of salesman, nor over the counter, but
in the mind of the buyer. A salesman should have the quality of empathy, i.e.,
reading customer’s mind. This will provide the salesman accurate information
of buyer’s motives, feelings, emotions, and attitude etc.

1. Selling process :it includes following three steps (Business point of

view):-

1. Shopping Carts:
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One of the software used by the sellers to keeping a track that Hat
the buying through the internet or the website before proceeding to
the checkout shopping cart consists of three parts.

▪ Product catalogue

▪ Shopping

▪ Checkout system.

The Product Catalogue:-

For completion of transaction through online, sellers are preparing all

such as features, price, image, identification number, multi-media
information, product options or choices about any product or services to
the customer which are needed.

A Shopping List:-

This list allows users to track the items they want to purchase. A
shopping cart image is used to show what items the shopper has
selected for purchase. In order for the shopping cart to function
properly. The user’s computer must be set to allow “cookies”.

2. The checkout system:-

It allows customers to select products by clicking an “add items to

cart”Button and then enables them to pav for these products.

Secure server:-

The secure server helps provide protection against the loss or

modification of personal information. Through the Secure Socket Layer
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(SSL) technology, company can secure online transactions. SSL encrypts

(or codes) all data between the shop’s server and the customer’s
computer. This makes it very difficult for third parties to decode any
information exchanged such as credit card numbers. It protects
transaction information following way:

Digital Wallet Software:

Digital Wallet allows card holder to make secure purchases online via
point and click interface.

A payment Gateway:

Shopping carts do not deal with the entire transaction, They pass
information means what the user has ordered to a payment gateway. A
payment gateway is a separate service it links the shopping cart to the
financial networks involved with the transaction.

Cookies:-

These are small pieces of software that websites store on users

computers. They have a very wide variety of uses, but an important one
is to track how people arrive at the website and how they use the
website.

Servers:-

Servers are the backbone of the internet they are computers linked by
communication lines which “serve up” Information in the form of text,
graphics, and multimedia to online computers that request data.
(Source: Expedite Media Group,ins).
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Digital Certificate:-

Selling through online, company will need a Digital Certificate for SSL
technology to work it is an electronic ID that helps to show the
credibility of a.website.

Identity a Secure Server:-

Look for a URL address that begins with https:// as opposed to http://
and a browser that notifies you that you are on a secure site. Many
browser use a symbol (e.g. lock icon) or a message.

3. Payment Processing Options:-

Company should consider the aspects when choosing a payment

option such as costs associated with the payment option (consider
transaction fees, setup fees, monthly fees), Privacy of the transaction
dats, Fraud protection and General creadibility of the service
provider. There are five payment processing options:

Third Party Payment Processing:

These services offer an alternative to obtaining an Internet Merchant

Account. The advantage of this alternative is that it is possible to start
selling online more quickly and easily. PayPal (www.paypal.com) is
the most popular third-party service provider.

Internet Merchant Account:-

An Internet Merchant Account is an account issued by a financial

institution that enables a business to accept credit card payments
online. Businesses must obtain a separate Internet Merchant Account
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for each type of credit card they wish to accept for e.g VISA ,Master
card, American Express.

Manual (Offline) Payment Processing:-

You can set up an e-commerce website where users can order online
but you process credit cards manually rather than relying on online
payment processing options. With option, credit card information can
be obtained through a secure server and the transaction, can be
processed manually.

EBPP and On Demand Payment Gateways:

Electronic Bill Presentment and Pyment (EBPP) is a process that

allows bills to be delivered and paid over the internet.EBPP has faster
payment capabilities. There are three ways for small businesses to
utilize EBPP: Consolidation service, Biller Direct , Direct Ernail
Delivery.

RFID & NFC Mobile Commerce:-

Near Field Communication (NFC) is wireless technology using Radio

Frequency Identification (RFID) that allows devices to send data
between each other for mobile commerce and payment.

B. Buying Process: (consumer point of view)

• Determines the requirement.

• Searches available items on the website meeting the requirement.

• Compares similar items for price, delivery date or any other terms.
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• Gives the order.

• Pays the bill.

• Receives the delivered item and review/inspect them.

• Consults the vendor to get after service support or returns the product if
not satisfied with the delivered product.

Business to Business E-Commerce—Need and Importance:-

An independent e-market place is usually a business-to-business online

platform operated by a third party which is open to buyers or sellers in a
particular industry. By registering on an independent e-marketplace,
organisations can access classified ads or requests for quotations or bids
in the industry sector. B2B E-Commerce platforms are designed to
support the multi-stage, multi-user, multi-transaction relationships that
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typify the B2B International E-Commerce trading environment. B2B E-

Commerce model is having following importance:

Cost Reduction:-

It cost reduction technique for the company so as to overcome

mediator. The cost of the customers is reduced significantly as they can
access the information about various alternative and choose the best
that suits their needs. It can impose higher switching cost on the buyers
and sellers.

Economics of scale and scope:

It provides economies of scale and scope through different buyers and

suppliers those can work in collaboration to reap the larger benefits
from each other. Also included important functional areas like extensive
product lifecycle management, order management retail as well as bulk
ordering and account management with modified price agreements etc;
which has given profit based economy to the organisations.

New Market:-

An effective B2B E-Commerce enable the organisation to grow and

evaluate easily to meet market demand and customer needs by opening
new sales channels and continuously reaching new market segments.

Improved Efficiencies:-

Through Integration to the Enterprise Resource Planning and other back-

end business systems. Eliminating the possibility of errors and improving
shipping processes and increasing order which is helping to E-commerce
efficiencies for B2B organisations.
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JIT:-

Just In Time Delivery (JIT) is one of the importance of B2B, the company
can have the track of goods as to which place it has reached with the
help of electronic commerce. This is helping to create corporate image
and brand loyalty in the customer mind.

Improve Sales and Sales-Team:

B2B E-commerce allows the company to easily implement an automated

cross-sell and up-sell recommendation program, offering relevant
suggestions to customers on the site and encouraging them to purchase
related items also a B2B E-Commerce site or portal will improve the
sales teams’ visibility into customer orders,pricing, and history.

Quick and Cheap Deal:-

B2B model is including many competitors in an online auction. It helps in

lowering the cost for selling and marketing also shortens’ the selling
cycle hence other business can get quick, suitable, and cheap deal of the
products or services.

Analytics:-

B2B E-Commerce:- provides the perfect platform for an organisation to

launch a comprehensive analytics campaign. Through ecommerce,
oraganisations can more easily measure and evaluate marketing
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campaigns, sales effectiveness, product mix, inventory turns, customer’s

sales effectiveness, and customer engagement.

Customer Service:-

B2B organization is important to improve its customer service initiatives.

Through ERP system, a strong e-commerce site can display customer
specific products, services and pricing based on customer lig in
credentials. Hence the customer’s number will grow for the
oraganisations Amazon.com sets the standard for providing an
exceptional e-commerce experience and todays’s online shopper
expects an Amazon-like experience whether they are shopping for
business or pleasure. To remain relevant, B2B oraganizations need to
employ intuitive design, rich content, and interactive functionality in
their websites.

Various Segment Importance:-

B2B model is important for following aspects:-

a. A Price-Focused Segment:-

B2B E-Commerce is favouring a more ‘transactional’ way of doing

business, placing less importance on ‘extras’ in order to keep costs.
Companies in this segment are often small, working to low margins
anad regard the product/service in question as of low strategic.

• A Quality and Brand-Focused Segment:-

It can search out best possible product of service and is willing

to pay premium for it which wants the best possible product and
is prepared to pay for it.
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• A Service-Focused Segment:-

It can place high importance on customer service, such as

aftersales services, customer care and fast, reliable delivery
which has high requirements in terms of product quality and
range, but also in terms of aftersales, delivery,etc.

A Partnership-Focused Sergement:-

This can represents a company’s key accounts, this segment places huge
importance (trust) and reliability with the supplier as a strategic partner.

Alternative models of B2B E-commerce The Architectural Models in B2B E-

commerce

The collection of business models, enhanced by technology that generates

revenue for online activity and creates and promotes electronic sharing of
information among vendor; suppliers and customers in this setting, is known as
Business-to-Business e-commerce.

1. Supplier Oriented Marketplace:-

This type pf marketplace is also known as supplier’s directory. It

provides a platform of the seller those who are new or those who want
to improve their visibility through different mediums of communication.
The suppliers can target the large number of potential buyer: and try to
turn them into the loyal customers. In this type of model, a common
marketplace provided by suppliers used bt both individual customers as
well as business users hence it called Supplier Oriented Marketplaces
and they offer a group customers a wide range of products and services
through e-stores for sales promotion and also support them in their own
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business. Excellent corporate image and a group of loyal customers are

necessary for the success of the sites using this model. A successful
example of this business model is cisco (Cisco Commerce) or e-Bay.

Buyer Oriented Marketplace:-

In this type of model, buyer has his/her own market place or e-market.
He invites suppliers to bid on product’s catalogue. A Buyer company
opens a bidding site. A bunch of people with similar business interests
come toghether to create an efficient purchase environment. This helps
a party get sufficient bargaining power to purchase at a desired price
from the supplier. A Supplier can also benefit from this marketplace as it
gives them a customer base with which they can share their catalogue.
Example—Amazon. By using Supplier-Oriented Market places, buyers
would have to search online stores to find and compare suppliers and
products. This would be an expensive and time consuming process for
big buyers, who purchase a lot of items on the internet. As a result, sucj
big buyers prefer to open their own marketplace, which is called a
Buyer-Oriented Marketplace. An example of this is GE supplier portal.

Intermediary Oriented Marketplace:-

This is also called third party which is established by an intermediary

company which runs a marketplace where business buyers and sellers
can meet. In this type of business buyers and sellers can transact with
each other. It is as like as B2B mall brings buyers and sellers or bidders in
one place. The corporate information systems need great link with
intermediaries electronic mall. The basic motive of this model is to
generate revenue. A B2B platform which is managed by a third party and
is open to buyers and sellers from a particular industry. When a party
 63

registers on an independent e-marketplace it getsquotations or bids in s

psrticular sector. Example-ALIbaba There are two types of Itermediary-
Oriented Marketplace:-

Horizontal Marketplaces:-

The buyers and suppliers from different industries or regions can come
together to make a transaction an offer services to all industrial sectors.
Example of this market- Alibaba Amazon Source.

Vertical Marketplace:-

It provides access over the internet to various segments of a particuklar

industry up and down the hierarchy and concentrates on one industrial
sector. Example of this market paper Exchange ,plasticsnet.

4. Other models it includes:-

a) Virtual Corporation:

It is an organisation composed of several business partners

sharing cost and resources for the purpose of producing
product or services. It included goals like excellent, utiilisation,
opportunism.

b) Networking:-

It include procurement management.

c) Online Services to Business:-

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It included travel services, real estate, electronic payment,e-

auction.

5. E-COMMERCE SALES (PRODUCT) LIFE CYCLE (ESLC)

MODELS:-

The sellers are planning to attract the customers towards their products-
through following process called E-Commerce Sales Life Cycle (ESLC).
Anderson 1995 who breaks the selling process into seven steps also
these steps can describe these steps as s Sales Life Cycle because the last
step on the first call will be the first step in the next call E-Commerce
Sales Life Cycle (ESLC).

Step 1: Prospecting and Qualifying (Need Establish)

This is the Introductory stage of ESCL. Before planning a sale, sellers

conduct research to identify the people or companies that might be
interested in their product. This step is called prospecting. In the
beginning of the sales cycle, sellers can develop a need of the products.
A prospect is a lead that is qualified or determined to be ready, willing,
and able to buy, and they asked some questions to qualify him as a
prospect, a qualified prospect, one who has the desire or ability to buy
the product or service.
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Step 2 : Pre-approach

The pre-approach is the “doing proper homework” part of the process. It

is a proper plan to approach perfectly to the potential customers. A
good salesperson researches his prospect, familiarizing himself with the
customers needs and learning all the relevant background info he can
about the individual or business. Once again this is also Introductory
stage of the ESCL where the sales are growing because the preparation
of selling products to the customers is starting.

Step 3 : Approach

In this step of ESCL Growth of the soles taken place. First impressions is
crucial to building the client’s trust usually involves introductions, asking
a few questions, and generally explaining about the company. The
approach may be on the phone. In person, of vio method such as a social
network.

Step 4 : Presentation

Another stage of growth where there is a good deal of preporation

involved before salesperson ever makes the pitch or presentation,
sellers presents their product and understand the customer’s needs well
enough. The presentation should be tailored to the customer, Explaining
how the product meets that person or company’s needs. In this stage,
the e-sellers are slowly moving towards the closing of the sole in ESCL.

Step 5: Handling Objections

While the sellers are presenting their products and customers are trying
to select the product the maturity stage of the ESCL is starting as
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customer are asking many queries to the sellers before purchase the
products. After sellers have mode their sales presentation, it’s natural
for the customer to have some queries or concerns called objections.
Good salespeople look at objections as opportunities to further
understand and respond to customer’s needs.

Step 6: Closing the Sale

Eventually, if the customer is convinced with the sellers answer or it they

could satisfy the objection of the customer then seller can close by
agreeing on the terms of the sale and finishing up the transaction. So we
can say that the sale becomes mature which turns into maturity stage. If
the customer is not convinces then also sellers can closed down the
selling activity as customer is not interested to purchase the product and
it turns into Decline stage of ESCL.

Step 7: Following Up

The follow-up is an important part of assuring customer satisfaction,

retaining customers and prospecting for new customers. This might
mean sending a thank-you note, calling the customer to make sure a
product was received in satisfactory condition. This follow up step
belongs to maturity of the Sale Life Cycle. While sellers are trying to find
out that “why the customers couldn’t purchase their product?” then this
follow up step belongs to Decline stage of the ESCL. For example,
Amazon’s invitation to “rate your transaction” after the customer is
receiving the Amazon order. Good rate shows maturity level of the Sale
Life Cycle and bad rating shows decline level of ESCL.
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6. WORLD WIDE WEB:-

It is a system of information, where documents and other resources are

identified through URLs (Uniform Resource Locator), and are interlinked
through hypertext links. Which are accessed via medium of internet. The
internet server supports documents in a format of mark-up language called
HTML (Hyper Text Mark CIP Language), and these documents are linked to
other documents, graphics, audio and video files, By clicking on the hyperlink.
The user jump from one document to another. Sir Tim Berners-Lee invented
World Wide Web in the year 1989. By october, 1990 he wrote three
fundamental technologies that become the foundation of today’s World Wide
Web:

• HTML:

Hyper Text Markup Language. The markup (formatting)

language for the web.
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• QRL:
Uniform Resource Identifier. A kind of “Address” that is unique
and used to identify to each resource on the Web. It is also
commonly called a URL.

• HTTP:
Hypertext Transfer Protocol. Allows for the retrieval of linked
resources from across the Web.

Reasons for building own website:

Today almost every big business has designed a website, which

is used not for just sharing information, but it has a platform to
buying and selling real time.

Following are the different reasons that explain the relationale behind
building own website by an organisation:

Demonstrates Mission and Vision of the Organization:

Company is having a business website, makes more credible as it shows that
the business ia passionate about what it is doing. It helps the organisation to
convey its mission and vision statements and keep its customers, shareholders,
creditors and investors upto date regarding the ongoing activities of the
company.
Showcase the Talent:
Nowadays, creative people use their website as a type of portfolio. It is one of
the most convenient ways to showcase their work and it helps to take
advantage of web design to highlight the talent. The main advantage of having
an online portfolio is that it can be so easy to keep up-to-date.
Enhances Employment Opportunities:
 69

It is becoming increasingly common that people, have been headhunted for

jobs because of their website. The amazing feature about this type of online
base is that they never know who is going to be reading their content. It helps
new opportunities and it could be an easy way to get the dream job.
Introduction of E-Business:
Launching a business online is cost effective as compared to traditional
business. This implies that practically anyone can become an entrepreneur
because the financial cost of entering the market is so low. Furthermore,
launching a business online can help to reach out to customers located all over
the globe.
Cost Effective for Promotion:
A website is also the most cost-effective way to promote different products
and services as it has the potential to reach millions of people from all around
the globe. Traditional advertising for this type of exposure would cost a
fortune, however it costs very little to launch a website as a promotional tool.
Enhances Creativity:
One of the effective ways to nurture the creativity is to express it. For instance,
a writer can create a blog on his website and commit to adding new content
every week whereas.

Benefits of Website
Traditional Business models arc being challenged with new business models.
Invitations ace in the process or have already finished the process of designing
the website, where the required information is being dislayed.
Following are the benefits that the organisations can gain by having a website
of it:
Less Expensive:
Launching a business online is cost effective as compared to traditional business
because all is needed is a website and a system for collecting money. Also,
having a website will make promoting the company less expensive as many
versions of offline advertising available on the internet are sometimes free.
Advertising:
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A webiste is more eco-friendly when it comes to advertising and marketing and

can boost the ranking of the website which quickly results in increased sales and
higher profits. Traditional advertising for this type of exposure would costt a
fortune, however it costs very little to launch a website as a promotional tool.
Convenience:
Having a website is more convenient for customers as online shopping is
convenient and gaining popularity nowadays. Many customers would prefer to
visit company website rather than driving to a physical location and checking for
products. It is more simple and easy if customers can find their required
products on the company website.
Increase in Customer Base:
Most businesses have local popularity but potential customers outside the city
are neglected. A website can help an organisation to increase its customer base
and generate more customers not just outside the city but world wide. The
internet offers a global community and with the help of a website the business
will be visible around the world.
Accessibility 24/7:
An online site can be visited any time of the day or night and provides
accessibility 24/7. People will prefer to take a look at the site instead of going to
the shop because it is more accessible. However, firms must ensure that they
post enough information about their products and services.

Role of Website in B2C E-Commerce:

B2C (Business to Consumer) e-commerce or electronic commerce is basically a
transaction done over the internet between a business and a consumer for
his/her personal use. B2C as a business model differs from the B2B (Business to
Business) model, which refers to commerce between two or more businesses.
Maketing and Promotion
A website is one of the most cost-effective ways to promote the products and
services as it has the potential to reach millions of people from all around the
globe. Traditional advertising for this type of exposure would cost a fortune,
however it costs very little to launch a website as a promotional tool.
 71

Reduction in Customer Complaints

Organizations can provide 24/7 customer service with the help of their websites
and customers can approach the organisation with their complaints at any time.
This helps in effective resolution of customer complaints and improves customer
satisfaction.

7.EDI ND PAPERLESS TRADING:

EDI stands for Electronic Data Interchange which refers to Exchange of Data or
business documents between two or more businesses using a standardized
electronic format, without human intervention. EDI is mostly used by large
businesses to carry out their business processes over a secured network with
accuracy and in less time.It also defined as computer to computer exchange of
business documents in a standard electronic format between two business
partners.
▪ 1. E-Marketing and Electronic Payment system:
With the advances in the technology, it has been observed that the
internet is available on the computer screen, but it has reached to
portable tablets and even in customer hands on the mobile phones. These
devices are not just for searching irfcrnazcr. On the internet, but it has
gradually grown to an electronic platform, which is today used sell and
market the products/services to the customers.
E-marketing (Electronic Marketing) is also known as internet/web/digital
online marketing. It is the process, where a product or a service is
marketed on the internet. E-mail, social and wireless media. It connects
businesses to their customers using online medium.
E-Marketing can be defined as combination of different strategies. Which
use digital channels to reach the target audience and achieve
corporation’s objectives.

▪ 2. E-COMMERCE CUSTOMER STRATEGIES FOR PURCHASING ACTIVITIES:

Electronic commerce enables the company to work on the potential for
and business process improvement in purchasing, logistics, and support
emerging characteristic of purchasing, logistics, and support activities that
they are flexible. Procurement includes broader range of responsibilities
 72

such purchasing, Monitoring of all elements of purchase transaction,

managing and developing the with key suppliers.

Purchasing activities include:

• Identiting vendors.
• Evaluating vendors.
• Selecting specific products.
• Placing orders.
• Resolving any issues that arise after receiving the ordered goods
and services.
By using a website to process orders, the sellers in the market can gave the cost
of printing catalogs, and the cost of handling telephone orders.
Supply chain: Part of an industry value chain that precedes a particular strategic
business unit.

Procurement: Includes all purchasing activities, plus monitoring of all element

of purchase transactions. Procurement also includes the management and
development of relationships with suppliers. In many case procurement staff
must have knowledge about products. Specialized Web sites can aid in
disseminating information.

Supply Management: Term used to describe procurement activities.

Sourcing: Procurement activity devoted to identifying suppliers and determining

their qualifications.

E-Procurement or E-Sourcing: Use of Internet Technologies in procurement and

sourcing activities.
 73

Direct Material: Materials that become part of the finished product in a

manufacturing process.

Replenishment purchasing: The company negotiates long-term contracts for

ri103t of the materials that it will need.
Indirect Materials: Other materials that the company purchases, including
factory supplies.

Support activities includes:

The categories of finance and administration, human resources, and technology
development E-Finance and Administration: It includes Making payments to
suppliers. Processing payments receive from customers, planning capital
expenditures, Budgeting and planning, Operation of the computing
infrastructure and plan operational system and expenditure.
• Human Resources it includes Hiring, Training, nad Evaluating employees,
banefit programs, Complying with Government rules and regulations,
record-keeping.
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E Marketing and Electronic Payment:

E-marketing is a process of planning and executing the conception, distribution,

promotion, and pricing of products and services in a computerized, networked
environment, such as the Internet and the World Wide Web, to facilitate
exchanges and satisfy customer demands.
E-Marketing is an area of marketing that is based on achieving targets by
using electronic communication technology on the Internet.

Electronic Payments entail the transfer of funds through electronic or digital

mediums. You can choose from different e-payment methods like mobile
wallets, bank cards, mobile banking, etc. E-payments are quick and efficient,
and the fund transfer typically takes place instantly. It is a secure mode of
making payments.

The most popular methods of electronic payments include credit cards, debit
cards, virtual cards, and ACH (direct deposit, direct debit, and electronic
checks).
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Government Regulations:

In the United States, California’s Electronic Commerce Act (1984), enacted by

the Legisiature, and the more recent California privacy Act (2020) enacted
through a popular election proposition, control specifically how electronic
commerce may be conducted in California. In the US in its entirety, electronic
commerce activities are regulated more broadly by the Federal Trade
Commission (FTC). These activities include the use of commercial e-mails, online
advertisng and consumer privacy. The CAN-SPAM Act of 2003 establishes
national standards for direct marketing over e-mail. The Federal Trade
Commission Act regulates all forms of advertising, including online advertising,
and states that advertising must be thruthful and non-deceptive. Using its
authority under section 5 of the FTC Act unfair or deceptive practices, the FTC
has brought a number of cases to enforce the promises in corporate privacy
statements, including promises about the security of consumers personal
information. As a result, nay corporate privacy related to e-commerce activity
may be subject to enforcement by the FTC.
The Ryan Haight Online Pharmacy Consumer Protection Act of 2008, which came
into law in 2008, amends the Controlled Substances Act to address online
pharmacies.
Conflict of laws in cyberspace is a major hurdle for harmonization of legal
framework for e-commerce around the world. In order to give a uniformity to e-
 76

commerce law around the world, many countries adopted the UNCITRAL Model
Law on Electronic Commerce (1996).
Internationally there is the Consumer Protection and Enforcement Network
(ICPEN), which was formed in 1991 from an informal of government customer
fair trade organisations. The purpose was stated as being to find ways of co-
operating on tackling consumer problems connected with cross-border
transactions in both goods and services, and to help ensure exchanges of
information among the participants for mutual benefit and understanding. From
this came Econsumer.gov, an ICPEN initiative since April 2001. It is portal to
report complaints about online and related transactions with foreign
companies.
There is also Asia Pacific Economic Coooeration (APEC) was established in 1989
with the vision of achieving stability, security and prosperity for the region
through free and open trade and investment. APEC has an Electronic Commerce
Steering Group as well as working on common privacy regulations throughout
the APEC region. In Australia, Trade is covered under Australian Treasury
Guidelines for electronic commerce and the Australian Competition and
Consumer Commission regulates and offers advice on how to deal with
businesses online, and offers specific advice on what happens if things go wrong.
In the United Kingdom, The Financial Services Authority (FSA) was formerly the
regulating authority for most aspects of the EU’s Payment Service Directive
(PSD), until its replacement in 2013 by the Prudential Regulation Authority and
the Financial Conduct Authority. The UK implemented the PSD through the
Pyment Services Regulations 2009 (PSRs), which came into effect on 1 november
2009. The PSR affects firms providing payment services and their customers.
These firms include banks, nonbank credit card issuers and non-bank merchants
acquires, e-money issuers, etc. The PSRs created a new class of regulated firms
known as payment institutions, who are subject to prudential requirements.
Article 87 of the PSD requires the European Commission to report on the
implementation and impact of the PSD by 1 November 2012.
In India, the Information Technology Act 2000 governs the basic applicability of
e- commerce.
In China, the Telecommunications Regulation of the People’s Republic of China
(Promulgated on 25 september 2000), stipulated the Ministry of Industry and
Information Technology (MIIT) as the government department regulating all
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telecommunications related activities, including electronic commerce. On the

same day, The Administrative Measures on Internet Information Services
released, is the first administrative regulation to address profit-generating
activities conducted through the Internet, and lay the foundation for future
regulations governing e-commerce in China. On 28 August 2004, the eleventh
session of the tenth NPC Standing Committee adopted the Electronic Signature
Law, which regulates data message, electronic signature authentication and
legal liability issues. It is considered the first law in China’s ecommerce
legislation. It was a milestone in the course of improving China’s electronic
commerce legislation, and also marks the entering of China’s rapid development
stage for electronic commerce legislation.

Distribution Channels:
E-Commerce has grown in importance as companies have adopted pure-click
and brick and click channel systems. We can distinguish pure-click and brick-and-
click channel system adopted by companies.
• Pure-click or Pure-play companies are those that have launched a website
without any previous existence as a firm.
• Bricks-and-clicks companies are those existing companies that have
added an online site for e-commerce.
• Click-to-brick online retailers that later open physical locations to
supplement their online efforts.

E-commerce may take place on retailers Web Bricks-and-clicks companies

are those existing companies that have added an online site for e-
commerce. Click-to-brick online retailers that later open physical
locations to supplement their online efforts. E-commerce may take place
on retailers Web sites or mobile apps, or those of e-commerce
marketplaces such as on Amazon, or Tmall from AliBaba. Those channels
may also be supported by conversational commerce, e.g. live chat or
chatbots on Web sites. Conversational commerce may also be standalone
such as live chat or chatbots on messaging apps and via voice assistants.
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Recommendation:

The contemporary e-commerce trend recommends companies to shift

the traditional business model where focus on “standardized products,
homogeneous market and long product life cycle” to the new business
model where focus on “varied and customized products”. E-commerce
requires the company to have the ability to satisfy multiple needs of
different customers and provide them with wider range of products.
With more choices of products, the information of products for customers
to select and meet their needs become crucial. In order to address the
mass customization principle to the company, the use of recommender
system is suggested. This system helps recommend the proper products
to the customers and help customers to make the decision during the
purchasing process. The recommender system could be operated through
the top sellers on the website, the dempgraphics of customers or the
consumer’s buying behaviour. However, there rae 3 main ways of
recommendations: recommending products to customers directly,
providing detailed products information and showing other buyers
opinion or critiques. It is benefit for consumer experience without
physical shopping. In general, recommender system is used to contact
customers online and assist finding the right products they want
effectively and directly.

Forms:

Contemporary electronic commerce can be classified into two categories.

The first category is business based on types of goods sold (involves
everything from ordering “digital” content for immediate online
consumption, to ordering conventional goods and services, to “meta”
srevices to facilitate other types of electronic commerce). The second
category is based on the nature of the participant B2B, B2C,C2B and On
the institutional level, big corporations and financial institutions use the
internet to exchange financial data to facilitate domestic and
 79

international business. Data integrity and security are pressing issues for
electronic commerce, and services, to “meta” services to facilitate other
type of electronic commerce. The second category is based on the nature
of the particioant (B2B, B2C, C2B) and on the institutional level, big
corporations and financial institutions use the internet to exchange
financial data to facilitate domestic and international business. Data
integrity and security are pressing issues for electronic commerce. Aside
from traditional e-commerce the term m-commerce (mobile-commerce)
as well (around 2013) t-commerce have also been used.
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7.GLOBAL TRENDS

In 2010, the United Kingdom had the highest per capital E-Commerce spending
in the world. As of 2013, the Czech Republic was the European country where
e-commerce delivers the biggest contribution to the enterprises total revenue.
Almost quarter (24%) of the country’s total turnover is generated via the
online channel. Among emerging economies, China’s e-commerce presence
continues to expand every year. With 668 million internet users, China’s online
shopping sales reached $253 billion in the first half of 2015, accounting for 10%
of total Chinese consumer retail sales in that period. The Chinese retailers have
been able to help consumers feel more comfortable shopping online. E-
commerce transactions between China and other countries increased 32% to
2.3 trillion yuan ($375.8 billion) in 2012 and accounted for 9.6% of China’s total
international trade. In 2013, Alibaba had an e-commerce market share of 80%
in China. In 2014, there were 600 million Internet users in China (twice as many
as in the US) , making in the world’s biggest online market. China is also the
largest e-commerce market in the world by value of slaes, with an estimated
US $899 billion in 2016. Research shows that Chinese consumer motivations
are different enough from Western audiences to require unique e-commerce
app designs instead of simply porting Western apps into the Chinese market.
 81

Recent research clearly indicates that electronic commerce, commonly for

products.
The GCC in which people shop for products. The GCC countries have a rapidly
growing market and are characterized by a population that becomes wealthier
(Yuldashev). As such, retailers have launched Arabic-language websites as a
means to target this population. Secondly, there are predictions of increased
mobile purchases and an expanding internet audience (Yuldashev). The growth
and development of the two aspects make the GCC countries become larger
players in the electronic commerce market with time progress. Specifically,
research shows that the e-commerce market is expected to grow to over $20
billion by the year 2020 among these GCC countries (Yuldashev). The e-
commerce market has also gained much popularity among western countries,
and in particular Europe and the US. These countries have been highly
characterized by consumer-packaged goods (CPG). However, trends show that
there are future signs of a reverse. Similar to the GCC countries, there has been
increased purchase of goods and services in online channels rather than offline
channels. Activist investors are trying hard to consolidate and slash their
overall cost and the governments in western countries continue to impose
more regulation on CPG manufactures (Geisler,36). In these senses, CPG
investors are being forced to adapt to e-commerce as it is effective as well as a
means for them to thrive.
In 2013, Brazil’s e-commerce was growing quickly with retail e-commerce sales
expected to grow at a double-digit pace through 2014. By 2016, e marketer
expected retail e-commerce sales in Brazil to reach $17.3 billion [55] India has
an internet user base of about 460 million as of december 2017. 1561 Despite
being the third largest user base in the world, the penetration of the internet is
low compared to markets like the United States, United Kingdom of France but
is growing at a much faster rate, adding around 6 million new entrants every
month.
In India, cash on delivery is the most preferred payment method, accumulating
75% of the e-retail activities. The India retail market is expected to rise from
2.5% in 2016 to 5% in 2020. The future trends in the GCC countries will be
similar to that of the western countries. Despite the forces that push business
to adapt e-commerce as a means to sell goods and products, the manner in
which customers make purchases is similar in countries from these two
regions. For instance, there has been an increased usage of smartphones
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which comes in conjunction with an increase in the overall internet audience

from the regions. Yuldashev writes that consumers are scaling up to more
modern technology that allows for mobile marketing. However, the percetage
of smartphone and internet users who make online purchases is expected to
vary in the first few years. It will be independent on the willingness of the
people to adopt this new trend For example, UAE has the greatest smartphone
penetration of 73.8 per cent and has 91.9 per cent of its population has access
to the internet. On the other hand, amartphone penetration in Europe has
been reported to be 64.7 percent (The Statistics Portal). Regardless, the
disparity in percentage between these regions is expected to level out in future
because e-commerce technology is expected to grow to allow for more users.
The e-commerce business within these two regions will result in competition.
Government bodies at the country level will enhance their measures and
strategies to ensure sustainability and consumer protection. These increased
measures will raise the environmental and social standards in the countries,
Factors that will determine the success of the e-commerce market in these
countries. For example, an adoption of tough sanctions will make it difficult for
tough sanctions will make it difficult for companies to enter the e-commerce
maket while lenient sanctions will alllow ease of companies. As usch, the
future trends between GCC countries and the Western countries will be
independent of these sanctions. These countries need to make rational
conclusions in coming up with effective sanctions. The rate of growth of the
number of internet users in the Arab countries has been rapid—13.1% in 2015.
Asignificant portion of the e-commerce market in the Middle East comprises
people in the 30-34 year age group. Egypt has the largest number of internet
users in the region, followed by Saudi Arabia and Morocco; these constitute
3/4th of the region’s share. Yet, internet penetration is low: 35% in Egypt and
65% in Saudi Arabia.
E-Commerce has become an important tool for small and large businesses
world wide, not only to sell to customers, but also to engage them. In 2012, e-
commerce sales topped $ 1 trillion for the first time in history. Mobile devices
are playing an increasing role in the mix of e-commerce, this is also commonly
called mobile commerce, or e-commerce. In 2014, one estimate saw purchases
made on mobile devices making up 25% of the market by 2017. For traditional
businesses, pne research stated that information technology and crossborder
e-commerce is a good opportunity for the rapid development and growth of
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enterprises. Many companies have invested an enormous volume of

investment in mobile applications. The Delone and Mclean Model stated that
three perspectives contribute to a successful e-business: Information system
quality, service quality and users satisfaction. There is no limit of time and
space, there are more opportunities to reach out to customers around the
world, and to cut down unnnecessary intermediate links, thereby reducing the
cost price, and can benefit from one on one large customer data analysis, to
achieve a high degree of personal customization strategic plan,in order to fully
enhance the core competitiveness of the products in the company.Modern 3D
graphics technologies, such as Facebook 3D posts,are considered by some
social media marketers and advertisers as a preferable way to promote
consumer goods than static photos, and some brands like Sony are already
paving the way for augmented reality commerce. Wayfair now lets you inspect
a 3D version of its furniture in a home setting before buying.
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8. E-COMMERCE DURING COVID-19

In March 2020, global retail website traffic hit 14.3 nillion cisits signifying an
unprecedented growth of e-commerce during the lockdown of 2020. Studies
show that in the US, as many as 29% of surveyed shoppers state that they will
never go back to shopping in person again; in the UK, 43% of consumers state
that they expect to keep on shopping the same way even after the lockdown is
over. Retail sales of e-commerce shows that COVID-19 has a significant impact
on e-commerce and its sales are expected to reach $6.5 trillion by 2023.

E-Commerce in the times of COVID-19:

This brief discusses how the COVID-19 crisis is accelerating an expansion of
e-commerce towards new firms, customers and types of products, likely
involving a long-term shift of e-commerce transactions from luxury goods and
services to everyday necessities. It also highlights how policy makers can
leverage the potential of digital transformation in retail and related areas to
support business adaotation and to enhance social distancing, while ensuring
that no one is left behind.
 85

The COVID-19 crisis accelerated an expansion of e-commerce towards new

firms, customers and types of products. It has provided customers with access
to a significant variety of products from the convenience and safety of their
homes, and has enabled firms to continue operation in spite of contact
restrictions and other confinement measures.
Despite persistent cross-country differences, the COVID-19 crisis has anhanced
dynamism in the e-commerce landscape across countries and has expanded
the scope of e-commerce . Including through new firms, consumer segments
and products. Meanwhile, e-commerce transactions in many countries have
partly shifted from luxury goods and services towards everyday necessities,
relevant to a large number of individuals.
Some of these changes in the e-commerce landscape will likely be of a long-
term nature, in light of the possibility of new waves of the epidemic, the
convenience of the new purchasing habits, learning costs and the incentive for
firms to capitalise on investments in new sales channels.
Despite the efforts of some governments to foster e-commerce during the
COVID-19 crisis, persistent digital divides imply that not everyone has been
able to paticipate. Moreover, regulations that are not adapted to e-commerce
can create barriers to firms, such as in the case of emerging omni-channel sales
models or new modes of delivery, while many of these challenges existed
before COVID-19. The current crisis and the new role of e-commerce for
individuals’s and firms has heightened the need for policy action.
For consumers, systematic financial inclusion, skills and trust e.g. digitals
secure privacy and have been brought into sharp relief. To address this issue
governments could expand affordable and quality broadband to rural and
undereserved areas. Enhance financial inclusion, and foster trust and the
acquisition of skills to participate in e-commerce.
For firms, policy makers should reduce regulatory uncertainty to support the
creation of innovative business models, e.g in the context of an increasingly
complementary relationship between offline and online sales strategies.
Governments also need to address the particular need of SMEs. Including by
ensuring a fair playing field in the context of intermediated services (e.g. online
platforms). Ensuring sufficient competition in the retail sector and a well-
functioning enabling environment for e-commerce, including communication
services. Logistics or trade, is also crucial.
 86

The COVID-19 crisis is likely to have long-lasting effects on e-commerce. There

has been a shift in demand from brick-and-mortar retail to e-commerce.
The COVID-19 crisis has led people in many OECD countries to significantly
limit physical interactions. Self-imposed social distancing to avoid contagion,
together with the strict confinement measures implemented in many OECD
countries, have put a large share of traditional brick-and-molar retail virtually
on hold, at least temporarily (OECD,2020m). In the United States retail and
food services sales between February and April 2020 were down 7 compared
to the same period in 2019. However, sales increased for grocery stores and
non-store retailers (mostly e-commerce providers), 1 by 16% and 14.8%
respectively. In the ELI-27.2 retail sales via mail order houses or the internet, in
April 2020 increased by 30% compared to April 2019. Total retail sales
diminished by 17.9%. The resulting shifts from bricks-and-mortar retail e-
commerce are likely significant across countries. For example, while in the
United States the share of e-commerce in total retail had only slowly
increased between the first quarter of 2018 and the first quarter of 2020 (from
9.6% to 1 it spiked to 16.1%) between the first and second quarter of 2020.
The development is similar for the United Kingdom, where the share of e-
commerce in retail rose from 17.3% to 20.3% between the first quarter of 2018
and the first quarter of 2020, to then rise significantly to 31.3% between the
first and second quarter of 2020. Similar changes are also observed for other
regions, including the people’s Republic of China (hereafter China). Where the
share of online retail in total accumulated retail states between january and
August 2020 reached 24.6% up from 19.4% in August 2019 and 17.3% in
August 2018.
1. The COVID-19 crisis has increased the share of e-commerce in total
retail:
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Note: For the United States, data provides estimates for e-commerce as
a percent of total retail sales, based on data from the Monthly Retail
Trade Survey and administrative records. Data for the second quarter
2020 are preliminary estimates. For the United Kingdom, data provides
Internet sales as a percentage of total retail sales. Quarterly data are
simple averages over monthly estimates. For the 27 members of the
European Union (EU-27), data indicates the percentage change of retail
sales compared to the same period in the previous year. Total retail
sales exclude motor vehicles and motorcycles. Retail sales via mail order
houses or via Internet includes retail sale activities where the buyer
makes his or her choice on the basis of advertisements, catalogues,
information provided on a website, models or any other means of
advertising and places his or her order by mail, phone or over the
Internet. Only the latter can be considered e-commerce according to the
OECD definition. See (OECD, 2019) for a discussion on e-commerce
definitions.

Source: OECD’s elaboration based on data from the US Census Bureau,

the Office for National Statistics in the United Kingdom and Eurostat.

While official statistics are not available for most other countries,
estimates suggest that online orders were up across several regions
during the first half of 2020, including Europe, North America and Asia-
 88

Pacific (OECD, 2020). For Asian-Pacific countries, e-commerce had

already increased significantly during the first quarter of 2020, while the
increase occurred later in Europe and North America, namely after
several OECD countries followed Italy’s example and introduced
confinement measures within a short period of time of each other. The
fact that Google searches for delivery options almost doubled in some
countries before actual confinement measures were brought in place
(e.g. Germany, United Kingdom) thereby illustrates the close
relationship between consumer expectations, government action and
behavioural change.
2. Google search interest in “delivery”, selected OECD countries (February
to April 2020):

The effect of the COVID-19 crisis on e-commerce is not uniform across

product categories or sellers. In the Unites States, for example, a surge
in demand was observed for items related to personal protection (e.g.
disposable gloves), home activities, groceries or ICT equipment, while
demand dropped for items related to travel, sports or formal clothing
(e.g. suitcases, bridal clothing, gym bags, etc.) (OECD, 2020). Shifts
 89

towards e-commerce have been observed in several countries, in

particular along the food supply chain, including farmers who started
using digital technologies to sell their produce directly to consumers or
restaurants that switched to providing food or grocery delivery
services (OECD, 2020). In Germany, online sales grew significantly for
medicines and groceries, historically laggard sectors in terms of e-
commerce, while overall online sales contracted by around 18 percent in
March 2020 in comparison to the previous year (OECD, 2019). In Korea,
where official statistics are available, the e-commerce transaction value
rose by 15.8% between July 2019 and July 2020. Significant increases
were observed for food services (66.3%), household goods (48%) and
food and beverages (46.7%), whereas online transactions involving
culture and leisure services or travel arrangement and transportation
services declined significantly, by 67.8% and 51.6% respectively.
In China, food products were the single biggest winner in e-commerce,
with an increase in accumulated sales from January to April 2020 of 36%,
relative to the previous year. In contrast, total online sales over January
to April 2020 remained almost constant compared to the same period in
2019 (+1.7%), after having grown significantly over 2018-19 (17.8%).
Accumulated sales of clothing products contracted by 16% compared to
2019, after significant growth from 2018-19 (23.7%).

While dynamics likely vary across countries, these data suggest that
despite the shift to e-commerce, a significant share of e-commerce
sellers are facing the same economic repercussions as traditional brick-
and-mortar retailers, following reduced spending by individuals on items
considered non-essential. A sample of 200 000 third-party Amazon
vendors in the Unites States suggests that by April 2020 around 36% of
merchants were inactive, an increase from around 28% in
February.Particularly affected were sellers with less than 1 500 product
listings (ASINs), while sellers with over 3 000 listings saw positive
upswings. This highlights how the COVID-19 crisis might have involved a
shift in demand from small and specialised sellers to larger and
diversified sellers. The COVID-19 crisis also highlights the
 90

complementarity between online and offline sales channels. Thus, while

Amazon’s own sales in the first quarter of 2020 were 26% higher than in
the previous year, its share in total e-commerce in the United States fell
from 42.1% in January 2020 to 38.5% in June 2020. In particular, Amazon
lost market share to Walmart (from 4.2% to 5%) and Target (from 2.2%
to 3.5%). It can be inferred that these and similar companies benefitted
from large networks of bricks-and-mortar stores, facilitating fast delivery
and pick-up by the consumer.

Certain shifts brought by COVID-19 likely involve long-term changes in e-

commerce

While some demand shifts may be temporary, others are likely to have long-
lasting effects. Anecdotal evidence from the outbreak of SARS in 2002 and
2003 suggests that the epidemic has been a core catalyst for the digital
transformation of Chinese retail. For example, the move of JD.com, now one of
the largest online retailers in the world, from brick-and-mortar to online sales
in 2004 was a direct response to the SARS crisis. The same crises also provided
the consumer base for Alibaba’s business-to-consumer (B2C) branch Taobab,
which was launched in 2003.
In the current crisis, for example, elderly consumers who started to engage
with e-commerce as a means to enhance physical distancing might in part stick
to their newly acquired routines. The credit card usage of around 10 million
credit card holders in Japan suggests that the increase in the share of online
purchases in credit card transactions was highest for users in their 60s (from
15.4% in January to 21.9% in March 2020) and those in their 70s (from 10.9%
to 16.4%). A global consumer survey measuring the adoption of digital and
low-touch activities during the COVID-19 crisis by McKinsey further suggests
that new users (i.e. users that had never engaged in these activities before)
drove over 50% of the increase in online grocery shopping (Brazil and South
Africa), kerbside pickup from restaurants (France, Germany, Italy, South Africa,
United Kingdom and United States) or other stores (Italy, South Africa, United
Kingdom, United States). In the United States, 21% of adults report having
ordered groceries online or through an app from a local store as a direct
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response to COVID-19. The percentage remains almost as high (19%) among

only the elderly (age 65+). In Brazil, around 54% of Internet users had bought
food or food products over the Internet in 2020, substantially up from only
22% in 2018. Significant increases were also observed for cosmetics, toiletries
and medicines. As convenience has always been one of the key drivers of e-
commerce participation, it is likely that many of the new users will keep
ordering at least some goods online in the future (OECD, 2019). Others might
continue ordering online out of fear of a pandemic blowback or because
merchants manage to retain them through loyalty programmes or subscription
models introduced.
On the supply side, many operators of brick-and-mortar stores, who often
were forced to completely shut down their physical business, are now
considering e-commerce a potentially crucial complimentary or alternative
sales channel. Because the move to online sales requires an investment, many
of the firms that have enhanced their participation in e-commerce during the
COVID-19 crisis have an incentive to capitalise on their acquired infrastructure
or skills over the long run. This is particularly the case for larger merchants that
have invested in their own sales and distribution infrastructure. For example,
by April 12, 2020, Amazon’s grocery branch Whole Foods Markets had
increased the online order capacity by over 60% to meet the surge in demand,
expanding the pickup services from about 80 stores to more than 150, with
further extensions over time being likely. Even smaller merchants, many of
whom have foregone larger investment by relying on the infrastructure and
services provided by online platforms (e.g. fulfilment, logistics, customer
service), might decide to turn their established online identity and experience
into a long-term asset (OECD, 2019). A similar argument holds for a number of
other players, many of which are only now establishing the foundation of an
online sales infrastructure, as a response to loosening of confinement
measures. This includes cafes, restaurants, museums or public swimming
pools, which were required in some countries to introduce an online booking
system to control the number of persons on their premises at a given point in
time.
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Policy makers need to ensure that e-commerce delivers for everyone –

now more than ever

As detailed above, the COVID-19 crisis accelerated an expansion of e-

commerce towards new firms, customers and types of products.
For individuals, e-commerce enables physical distancing while retaining access
to the full product variety. While e-commerce in the past for many consumer
groups was centred on high tech goods, toys or books, it now increasingly
involves goods for which availability is critical to a large share of the
population, including groceries, medicine and other necessities. E-commerce
has further enabled continued access, either online or physical, to certain
areas of public life, such as concerts, museums or swimming pools, including
by efficiently allocating time stamped tickets to avoid overcrowding. Similarly,
for many firms e-commerce is now a vital alternative or complementary sales
strategy, allowing continued operation in spite of contact restrictions and
other confinement measures.
It has therefore become increasingly important to close remaining digital
divides. For consumers, these can be linked to factors like access, income,
awareness or skills. For example, the elderly, a segment of the population that
would particularly benefit from e-commerce-enabled physical distancing, have
persistently been lagging behind in terms of e-commerce participation in many
countries (OECD, 2019). Significant and persistent gaps also remain for low-
income households or individuals with low education, which is concerning
given the decreasing costs of connectivity, the ubiquity of digital technologies
and the increasing scope of products available online. Besides closing these
divides, governments also need to ensure that consumers, and in particular the
most vulnerable, are sufficiently protected from unfair, misleading and
fraudulent commercial online practices, which have been increasing in the
current crisis (OECD, 2020).
Persistent gaps in terms of e-commerce participation also remain for firms, and
in particular small and medium enterprises (SMEs). In 2017, the participation
rate for SMEs in e-commerce was less than half the rate for large firms in a
majority of OECD countries (OECD, 2019). This explains and adds to a low level
of resilience and flexibility among SMEs in dealing with the costs of reduced
 93

demand and local containment measures (OECD, 2020) Low levels of

digitalisation and difficulties in accessing and adopting new technologies make
it particularly difficult for those firms to change existing work processes, by
introducing teleworking or an e-commerce sales channel.
The COVID-19 crisis has exacerbated many of these divides. Additionally,
regulatory uncertainties about which rules to follow (e.g. offline or online)
suddenly can affect a larger number of firms trying to flexibly combine and
shift between offline, online and omni-channel sales channels. While many of
these challenges have existed before the COVID-19 crisis (OECD, 2019), the
current situation has heightened the need for policy action. Some countries
have already taken initiatives, in particular to support the digitalisation of
business models, during the COVID-19 crisis, but challenges remain pressing in
many countries.

Closing digital divides among individuals and fostering participation of

the vulnerable

Factors that limit e-commerce participation for certain groups of individuals

are often related to economic and social conditions that reach far beyond e-
commerce, including rural-urban divides, income distribution, unequal access
to education and an aging society. These conditions may manifest themselves
in low connectivity, a lack of digital skills, low levels of trust (including security
and privacy concerns) or a lack of access to online payment mechanisms, all
factors that can be addressed by policy action (OECD, 2019). Relevant
measures in this regard include targeted information campaigns, trust building
initiatives, adult training, or public-private partnerships that target the
participation of low-income households and those in rural areas.
During the COVID-19 crisis, governments and businesses in several countries
(e.g. Japan, the United Kingdom and the United States) announced measures
to reduce the financial burden associated with Internet access for particular
consumer groups, including poor or young individuals (OECD, 2020).
Developing and emerging countries also provide examples for innovative
approaches to tackle lingering digital divides, including through mobile money
(e.g. M-Pesa in Kenya), cash on delivery, deliveries through mom-and-pop
stores in remote areas, or the use of landline phones and social media to co-
 94

ordinate online orders for those with limited digital skills or access to digital
tools. In OECD countries, related strategies could be considered to introduce
community-based delivery programmes for particularly vulnerable consumers
(e.g. those in public care homes) and consumers that lack the required skills to
participate in e-commerce.
Targeted actions may be needed particularly for vulnerable groups in the
context of grocery shopping, a required activity with high contact probability.
Experience from the first wave of the COVID-19 crisis has shown
that difficulties to obtain a delivery slot or wait times of several weeks
deterred many elderly with access to digital technologies from using these
tools for grocery shopping. Some grocery merchants have reacted by reserving
online grocery delivery slots for elderly and vulnerable shoppers or asking non-
vulnerable shoppers to shop in-store in order to ease capacities for the
vulnerable (e.g. Waitrose, Tesco, WholeFoods). Governments can actively
support this process. Ireland’s Citizens Information Board provides information
on safer shopping during COVID-19 and explicitly recommended non-
vulnerable people to shop in-store or pick-up online orders at the retailer to
avoid occupying delivery slots that could be used by vulnerable people. Many
countries have also conditioned the opening of stores on reserving dedicated
shopping hours to vulnerable groups, a practice that could be extended to
home delivery. In some cases it might also be necessary to regulate how
grocery stores can identify vulnerable shoppers in the context of online
shopping, with current approaches often being ad-hoc and heterogeneous, e.g.
based on loyalty schemes and customer accounts.
Additionally, even mainstream consumers often become financially and
psychologically more vulnerable during the crisis. Governments therefore
might need to foster trust, engage in a dialogue with online businesses about
fair business conduct, educate consumers about possible scams, and avoid
rolling back consumer protection and product safety measures (OECD, 2020).
Governments should also ensure sufficient competition in the retail sector,
given that the COVID-19 crisis may lead to the exit of many small and local
brick-and-mortar retailers, enhancing market consolidation (OECD, 2020) to
the benefit of larger retailers with online sales channels.
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Fostering innovative e-commerce business models and digital

transformation in SMEs

As digital transformation progresses, new business models arise in ways that

are difficult to predict and that challenge traditional policy frameworks (OECD,
2019[4]).In particular, regulatory frameworks may preserve artificial
distinctions between online and offline commerce, even as firms increasingly
pursue business models that combine both elements. Planning and zoning
rules can further hinder a swift repurposing of existing brick-and-mortar
facilities (e.g. converting store fronts in warehouses or logistics hubs in urban
centres). They can also prevent or slow down the use of innovative, contact-
free delivery methods, such as drones or robots. This is particularly relevant in
times of the COVID-19 crisis, when firms have to adapt to limitations on
physical interactions or supply chain disruptions, accommodating new business
functions and logistics solutions, to ensure their economic survival.
Regulatory approaches to new e-commerce business models, to the extent
possible, should therefore allow for experimentation, and be transparent and
flexible. Regulatory flexibility in response to the COVID-19 crisis is observable
in a number of countries, including the easing of caps on contact-less
payments or temporary exceptions to planning and zoning rules, e.g. allowing
restaurants to increase their terrace space and creating additional biking lanes
(e.g. in Paris). Governments should consider similar flexibility in the context of
e-commerce, relying for example on properly monitored and evaluated
experimental regulatory waivers (e.g. regulatory sandboxes), which have been
successfully used to test new technologies like drones and digital payment
mechanisms. Governments could also reduce uncertainty for firms, e.g. with
regard to the rules for an omni-channel business models, by providing clear
information about the existing rules and their implications for particular
business models. For example, the Japanese Ministry of Economy, Trade and
Industry provides Interpretative Guidelines on Electronic Commerce and
Information Property Trading since 2002, a good practice that could help to
provide specific and simplified advice to firms transforming their business
models in response to the COVID-19 crisis.
Several governments have also taken targeted steps to support brick-and-
mortar shops in their digital transformation and in fighting the economic
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repercussions of the COVID-19 crisis (OECD, 2020). For example, Japan

designed a business continuity subsidy, helping firms to diversify and expand
their sales channels. Korea also encouraged brick-and-mortar shops to open
their business online through a dedicated support programme. In this context,
some governments have explicitly acknowledged the role of online platforms,
which can play an important role in easing the move from offline to online
sales by providing a range of services, including logistics, fulfilment or
customer service (OECD, 2019). For example, China and Singapore actively
supported MSMEs in accessing e-commerce platforms with regional or global
reach, to help them reduce costs or sell overseas through digital means.
Some online platforms have also directly supported SMEs in the transition to e-
commerce as a response to the COVID-19 crisis. For
example, eBay.uk temporarily dropped registration fees for small sellers (up to
250 items), set up free listings promotions for established sellers and protected
sellers from downgrades in their seller ratings due to late delivery or
cancellation. In Brazil, large online retailers or platforms opened up their sales
platforms to SMEs, including by providing access to their logistics
infrastructure, or have supported SMEs financially. Recent regulatory
approaches to promote fairness and transparency for business users of online
intermediation services are particularly relevant in this regard. Related
platform-to-business regulation has, for example, been recently enacted
in Japan and is being applied in the EU since July 2020.
Fostering the enabling environment for e-commerce

To ensure an efficient e-commerce landscape that delivers for everyone, policy

makers should further foster the enabling environment for online transactions
in areas such as digital connectivity,
(international) logistics and trade, including in digital goods and services. For
example, an area with immediate bearing for e-commerce are postal services.
While logistics and postal services have been slowed in many countries, due to
new COVID-19 related safety guidelines and government recommendations,
the fact that they were considered critical sectors by many governments
helped to retain their functioning as key enablers of e-commerce on the supply
side. Additionally, service providers have reacted by fostering contact-less
delivery options in several countries, including via parcel lockers or by
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replacing signatures with alternative proofs of delivery. Governments can

actively support such solutions. For example, Italy is considering different
measures to encourage the use of automated parcel lockers, including
increasing the coverage of parcel locker networks or promoting a more
efficient use of lockers, such as through increased interoperability or sharing
between different providers.

Key Recommendations

• Close existing digital divides among individuals, for example by

expanding affordable and quality broadband to rural and underserved
areas, enhancing financial inclusion, and fostering trust and the
acquisition of skills to participate in e-commerce.
• Foster e-commerce participation by the most vulnerable, for example by
introducing community based delivery programmes for elderly and
reserved delivery slots. Ensure that vulnerable consumers are protected
from unfair business practices and unsafe products.
• Support the creation of innovative e-commerce business models,
ensuring that regulatory frameworks remain flexible enough to
accommodate combinations of online and offline business functions.
Reduce regulatory uncertainty and promote transparency through
information sharing.
• Ensure that SMEs can participate in e-commerce, for example by
providing policy, regulatory or financial incentives for sales
diversification and establishing a level playing for SMEs relying on the
services of online platforms.
• Reduce bottlenecks in the enabling environment for e-commerce,
including areas such as connectivity, trade, logistics and postal services.
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SUMMARY

There has been a lot of media coverage on E-commerce in recent years.

However, the concept of E-commerce is still unclear to many people due to its
newness. For business executives, it is even more mysterious since there are
no proven business models for generating profits. Conducting research in the
E-Commerce area reveals a few dominant trends:
E-Commerce revenues will grow exposively.
E-Commerce is crucial for business survival.
E-commerce decisions are complex.
Consulting firms are experiencing rapid declines in key practice area.
The implications for these trends are as follows:
Organizations feel the need for expert advice.
E-Commerce is the new business opportunity for consulting firms.
Consulting firms need structured, proven, E-commerce methodologies.
These trends and implicatios are the driving forces for the project.
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CONCLUSIONS

The e-commerce industry will be a leader with popularity in electronic business

world in the upcoming years. The e-commerce revolution has fundamentally
changed the business of transaction by giving new opportunities and breaking
borders easily. In India, it has strongly impacted the traditional business system
and changing the life of people by making it easier. While it gives benefits to
customer and seller, e-commerce gives challenges to traditional business for
competitive position. Developing countries face many obstacles that affect the
successful implementation of e-commerce with the help of comparing with
developed country. When the internet cost will be low then the e-commerce will
flourish easily and will make many of traditional business to run out of their
business. Convenience is one of the benefits that customer gets from the e-
commerce and thus increasing customer satisfaction. This is due to customer
can place a purchase an order from anywhere with internet connection. E-
commerce business provider should give importance on every customer by
giving smooth service and many options for payment and have more functions
available online. Other benefits are expanded product offerings and expanded
geographic reach. But e-commerce business faces a lot of challenges in
flourishing their business.
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SUGGESTIONS

1. Get Rid of Clutter.

2. Make Your Website Trustworthy.

3. Use Appealing Images.

4. Create a streamlined UI/UX.

5. Keep Navigation Simple.

6. Create Engaging Product Demos.

7. Opt for the Best Possible Hosting.

8. Offer a Range of Filters.

9. Cover a Range of FAQs.

10. Don’t Force Shoppers to Create an Account.

11. Add quality product Descriptions.

12. Send Emails for Shopping Cart Abandonment.

13. Work on Improving Loading Times.

14. Improve Your Website’s Responsiveness.

15. Create Scarcity.

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REFERENCES

1. https://www.shipmonk.com/blog/the-history-of-ecommerce-
from-the-1960s-to-the-2020s

2. https://www.builderfly.com/what-is-the-importance-of-
ecommerce-complete-expert-guide/

3. https://www.cloudtalk.io/blog/benefits-of-e-commerce-for-
customers-and-businesses/

4. https://www.oecd.org/coronavirus/policy-responses/e-
commerce-in-the-time-of-covid-19-3a2b78e8/

5. https://www.techtarget.com/searchcio/definition/e-commerce