E - commerce
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E-commerce, defined as the buying and selling of goods and services over the internet, has evolved since its inception with the first online sale in 1994, shaping various transaction models such as B2C, B2B, C2C, and C2B. The benefits of e-commerce for both customers and sellers include convenience, cost savings, and expanded market reach, while challenges involve security concerns and competition. The e-commerce industry continues to grow, especially in developing countries like Bangladesh, presenting both opportunities and challenges for traditional businesses.
E - commerce
- 1. PRESENTED BY : NAQASH JAVED
- 2. E-COMMERCE (DEFINITION): Ecommerce, also known as electronic commerce or internet commerce, refers to the buying and selling of goods or services using the internet, and the transfer of money and data to execute these transactions. Ecommerce is often used to refer to the sale of physical products online, but it can also describe any kind of commercial transaction that is facilitated through the internet. Whereas e-business refers to all aspects of operating an online business, ecommerce refers specifically to the transaction of goods and services. HISTORY OF E-COMMERCE: The history of E-Commerce begins with the first ever online sale: on the August 11, 1994 a man sold a CD by the band Sting to his friend through his website Net Market, an American retail platform. This is the first example of a consumer purchasing a product from a business through the World Wide Web—or “E-Commerce” as we commonly know it today. Since then, E-Commerce has evolved to make products easier to discover and purchase through online retailers and marketplaces. Independent freelancers, small businesses, and large corporations have all benefited from ecommerce, which enables them to sell their goods and services at a scale that was not possible with traditional offline retail.
- 3. TYPES OF E-COMMERCE: There are four main types of ecommerce models that can describe almost every transaction that takes place between consumers and businesses. BUSINESS TO CONSUMER (B2C): When a business sells a good or service to an individual consumer (e.g. You buy a pair of shoes from an online retailer). BUSINESS TO BUSINESS (B2B): When a business sells a good or service to another business (e.g. A business sells software-as-a-service for other businesses to use) CONSUMER TO CONSUMER (C2C): When a consumer sells a good or service to another consumer (e.g. You sell your old furniture on eBay to another consumer). CONSUMER TO BUSINESS (C2B): When a consumer sells their own products or services to a business or organization (e.g. An influencer offers exposure to their online audience in exchange for a fee, or a photographer licenses their photo for a business to use).
- 4. BENEFITS OF E-COMMERCE: The main benefit from the customers’ 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. BENEFITS OF E-COMMERCE TO CUSTOMERS :- 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 informationCustomer 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.
- 5. BENEFITS OF E-COMMERCE TO SELLERS:- 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.
- 6. APPLICATIONS OF E-COMMERCE: Online shopping Online banking Electronic bill payment Electronic ticketing Supply chain management
- 8. ADVANTAGES AND DISADVANTAGES OF ECOMMERCE: The invention of faster internet connectivity and powerful online tools has resulted in a new commerce arena – Ecommerce. Ecommerce offered many advantages to companies and customers but it also caused many problems. ADVANTAGES OF ECOMMERCE: Faster buying/selling procedure, as well as easy to find products. Buying/selling 24/7. More reach to customers, there is no theoretical geographic limitations. Low operational costs and better quality of services. No need of physical company set-ups. Easy to start and manage a business. Customers can easily select products from different providers without moving around physically. DISADVANTAGES OF ECOMMERCE: Any one, good or bad, can easily start a business. And there are many bad sites which eat up customers’ money. There is no guarantee of product quality. Mechanical failures can cause unpredictable effects on the total processes. As there is minimum chance of direct customer to company interactions, customer loyalty is always on a check. There are many hackers who look for opportunities, and thus an ecommerce site, service, payment gateways, all are always prone to attack.
- 9. E-COMMERCE SWOT ANALYSIS: STRENGTH: BOUNDARY LESS (GLOBAL LOCATION): E-commerce can be dealt globally as no specific boundary is required. It enables all the companies to expand them to global level. TIME SAVING: It saves time and transportation. Because there is no need to go anywhere physically. NO TIME CONSTRAINTS: It can be used anywhere any time as there is no time constraints. PRICE/PRODUCT COMPARISON: Helps consumers to compare price and product effectively and efficiently. COST EFFECTIVE: Reduces logistical problems and puts a small business on a par with giants. DIRECT COMMUNICATION WITH CONSUMER: Social networking sites, online advertising networks can be mediums to buzz about online store. IMPROVED CUSTOMER INTERACTION: Quick feedback and comment forms are main features to interact with customers. FLEXIBLE TARGET MARKET SEGMENTATION: Target market segment here in e commerce is flexible can be modified any time.
- 10. STRENGTH: (cont…) SIMPLE AND EASIER EXCHANGE OF INFORMATION: Improves information sharing among merchants and customers and enables prompt quick just in time deliveries. LOWERS TRANSACTION COST: Things can be automated in a well implemented online store. If online download facility is available then distribution cost can be cut off. EASY ARRANGEMENT OF PRODUCTS: Products can be arranged in the shelves within minutes. With online store it is quite easy. FASTER BUYING PROCEDURE: Ecommerce means better and quick customer services. Online customer services make customer happier. Due to absence of intermediaries for buying products. So buying procedure will be fast and quick. NO PHYSICAL COMPANY SET UP: Doing e business is cost effective because no physical set up is required for that. EASY TRANSACTIONS: Financial transactions through electronic fund transfer are very fast and can be done from any part of the world. NICHE PRODUCTS: Almost everything can be sold on internet. Even if products targeted to smaller markets the buyer will be somewhere on net. LOW OPERATING COST: It can be started and continued with very low investment. Staff cost is very low.
- 11. WEAKNESS: SECURITY: Security matter confuses customers especially about the integrity of the payment process. FAKE WEBSITES: Fake websites can not only disgrace e commerce but bring bad name to e commerce also. FRAUD: Concerns about misuse of financial and personal data is a great weakness in e commerce. FEWER DISCOUNTS AND BARGAINING: Hardly online businesses offer discounts and bargaining cannot be possible. LONG DELIVERY TIMING: Delivery time can be in days or weeks which one cannot wait for. NO IDEAABOUT QUALITY AND PHYSICAL CONDITION OF THE PRODUCT: Online products cannot be touched, wear or sit on the products. LIMITATION OF PRODUCTS: Limited number of products can be available. LACK OF PERSONAL SERVICES: Physical products can be available but lack in personal services which are intangible. MORE SHIPPING COST: Shipping cost increases if we order online.
- 12. OPPORTUNITIES: CHANGING TRENDS: Ecommerce is fast and effective even financial transactions can be made from any part of the world. People of tomorrow will feel more comfortable to buy products through internet only. NEW TECHNOLOGIES: Daily number of internet users is increasing. People feel more comfortable to shop online. GLOBAL EXPANSION: Ecommerce can be operated any where any time without any interruption. HIGH AVAILABILITY (24 HOUR AND SEVEN DAYS A WEEK): Along with each and every click of the mouse business is in operation. WIDE BUSINESS GROWTH: E-business has wide scope and broader vision to grow. CUT DOWN ON LOCAL COMPETITION: Online customer services is a competitive advantage for the company. ADVERTISING: Advertising is cost effective as compare to conventional offline system.
- 13. THREATS: COMPETITORS: Competition is increasing day by day big companies have already entered in this field. They are making people habitual at the cost of their companies. CHANGES IN ENVIRONMENT, LAW AND REGULATIONS: Change in trends, fashion and fad can distress E Commerce side by side change in law and regulations can also affect it. INNOVATION: Customers now a days are always in a search of innovative products. Innovation can be either in product, place, promotion and even price. PRIVACY CONCERNS: Fears that information can be misused lead to spam e mail or identity fraud. NO DIRECT INTERACTION: In e commerce there is no direct interaction of customer and the seller. That’s why bargaining does not exist. People prefer to buy physically a compare to online. FRAUD: Persons using unfair means to operate e commerce can damage the confidence and faith of common people. RISK: Nature of fraud and risk is different because when a customer relies on unseen set up, he trusts and makes transactions. In such a way he is ready to face risk.
- 14. LABOUR INCREASING IN E-COMMERCE : E-Commerce jobs are increasing fast. Employment attributed to electronic shopping firms has doubled in the last five years, outpacing other types of retail.
- 15. LABOUR INCREASING IN E-COMMERCE : (cont…) But there are still a small component of overall retail employment. Even with the fast growth, the number of online shopping jobs is small compared with department stores, warehouse clubs and grocery stores.
- 16. LABOUR INCREASING IN E-COMMERCE : (cont…) Partly because E-commerce is less labor intensive. Online retailers can sell more products with fewer workers than traditional stores. Nearly three-quarters of e-commerce firms have four or fewer employees. Even through online companies pay higher average wages to their workers, they have a bigger impact on retail sales than on retail employment.
- 17. GENDER DIFFERENCE IN E-COMMERCE: Male and female online shoppers are almost half and half (male 51.7% VS female 48.3% ). The youth are the main force of online shopping, 60.8% of online shoppers are aged between 18-30 years old.
- 18. CONCLUSION: 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 Bangladesh, 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.