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Lesson 1

E-commerce refers to commerce conducted electronically and involves digital transactions between organizations and individuals. It uses technology to create and transform relationships for value creation. Key drivers of e-commerce include technological advancements, supportive political policies, an educated workforce, and economic growth factors like income levels and technology costs. Advantages include increased sales and decreased costs, while disadvantages include inability to inspect products remotely and difficulties calculating returns on investment.

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Felix Lopuran
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21 views

Lesson 1

E-commerce refers to commerce conducted electronically and involves digital transactions between organizations and individuals. It uses technology to create and transform relationships for value creation. Key drivers of e-commerce include technological advancements, supportive political policies, an educated workforce, and economic growth factors like income levels and technology costs. Advantages include increased sales and decreased costs, while disadvantages include inability to inspect products remotely and difficulties calculating returns on investment.

Uploaded by

Felix Lopuran
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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E-commerce

• Commerce refers to all the activities the purchase


and sales of goods or services.
– Marketing, sales, payment, fulfillment, customer service

• Electronic commerce is doing commerce with the use


of computers, networks and commerce-enabled
software (more than just online shopping)

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E-commerce
E-commerce involves
 Digitally enabled commercial transactions
between organizations and individuals.
 Digitally enabled transactions include all
transactions mediated by digital technology
 Commercial transactions involve the exchange of
value across organizational or individual
boundaries in return for products or services

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E-commerce
 E-commerce
 is the use of electronic communications and
digital information processing technology in
business transactions to create, transform, and
redefine relationships for value creation
between or among organizations, and between
organizations and individuals

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E-business
E-business involves
 Digital enablement of transactions and
processes within a firm, involving
information systems under the control of
the firm
 E-business does not involve commercial
transactions across organizational
boundaries where value is exchanged

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E-business
 The transformation of an organization’s
processes to deliver additional customer value
through the application of technologies,
philosophies and computing paradigm of the
new economy.
 Three primary processes are enhanced in e-
business
 Production processes,
 Customer-focused processes,
 Internal management processes,

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History
• 1970s: Electronic Funds Transfer (EFT)
– Used by the banking industry to exchange account information over
secured networks
• Late 1970s and early 1980s: Electronic Data Interchange (EDI)
for e-commerce within companies
– Used by businesses to transmit data from one business to another
• 1990s: the World Wide Web on the Internet provides easy-to-
use technology for information publishing and dissemination
– Cheaper to do business (economies of scale)
– Enable diverse business activities (economies of scope

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Process of e- commerce
1. Attract customers
– Advertising, marketing
2. Interact with customers
– Catalog, negotiation
3. Handle and manage orders
– Order capture
– Payment
– Transaction
– Fulfillment (physical good, service good, digital good)
4. React to customer inquiries
– Customer service
– Order tracking

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Key drivers
1.Technological factors
2.Political factors
3. Social factors
4. Economic factors

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1.Technological factors

 Telecommunications infrastructure
 Backbone infrastructure and architecture
 Industry players and competition
 Pricing
 Internet service providers
 Ownership (private or public sector)
 Access to new technology developments
 Bandwidth
 Speed of development and implementation of
new technology by industry sector

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2. Political factors
 Number and type of government incentives and
programmes to support the use and development of
new technology
 Legislation – number and type of supportive or
restrictive laws and policies that govern electronic data,
contacts and financial transactions. For example,laws
that recognise and enforce the validity of electronic
documentation,
contracts and transactions in a court of law; the validation
of digital signatures; the legal usage of electronic security
measures such as encryption
 Public policies – whether government supports the
growth of electronic transactions and processes. For
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3. Social factors
 Skills of workforce
 Number of users on-line
 Penetration rate of PCs
 Level of education; computer literacy and IT
skills
 Culture of technophilia – a willingness and
ability to adopt new technology
 and the speed at which technology achieves
critical mass as in Japan

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4.Economic factors
 Economic growth – GDP
 Average income
 Cost of technology (hardware and software)
 Cost of access to telecommunications
infrastructure – pricing structures and rates
 Commercial infrastructure – advancement of
banking sector; payment systems
 Innovative business models

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Advantages
• Increased sales
– Reach narrow market segments in geographically dispersed
locations
– Create virtual communities
• Decreased costs
– Handling of sales inquiries
– Providing price quotes
– Determining product availability
• Being in the space

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Disdvantages
• Loss of ability to inspect products from remote
locations
• Rapid developing pace of underlying technologies
• Difficult to calculate return on investment
• Cultural and legal impediments

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exercise
 The third law of newton state when there is a
force, then there is equal but apposite force
resisting it
 In light of e-commerce explain the above
statemen

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