Electronic commerce or E-commerce is the buying, selling, marketing, and servicing of products or services over computer networks. It is an electronic business application aimed at commercial transactions. E-commerce is the conduct of business commercial communications and management through electronic methods, such as electronic data interchange and automated data collection systems. Electronic commerce may also involve the electronic transfer of information between businesses (EDI). According to Forrester Research (as cited in Kessler, 2003), electronic commerce is a 12.2 billion USD industry, as of 2003.
Historical development
The meaning of the term electronic commerce has changed over the years. Originally, "electronic commerce" meant the facilitation of commercial transactions electronically, usually using technology like Electronic Data Interchange (EDI) to send commercial documents like purchase orders or invoices electronically.
Today it includes things that may more correctly be termed "Web commerce" -- the purchase of goods and services over the World Wide Web via secure server (HTTPS, a special server which encrypts confidential ordering data for customer protection) with e-shopping carts and electronic pay services, like credit card pay authorizations.
There are several factors that are critically important to the success of any e-commerce venture. They include:
Even if these sixteen key factors are used to devise an exemplary e-commerce strategy, there could still be problems. Sources of problems include:
Certain products/services are more suitable for online sales and others are more suitable for offline sales. The best purely virtual companies are those that deal with digital products. This includes information storage, retrieval, and modification, music, movies, education, communication, software, photography, and financial transactions. Examples of this type of company are : Schwab, Google, eBay, Paypal, Egghead, and Morpheus.
There are some non-digital products/services that can be successful for virtual marketers. They are products that have a high value to weight ratio, and/or are embarrassing purchases, and/or are typically purchased by people in remote locations, and/or are typically purchased by shut ins.
One product that is both virtual (or if non-virtual, generally high-value) and a potentially embarrassing purchase is pornography and other sex-related products and services; it is unsurprising that these services have been the most profitable e-commerce businesses.
Products that are not suitable for e-commerce include products that have a low value to weight ratio, products that have a smell, taste, or touch component, products that need to be tried on for fit, and products where colour integrity is important.
Consumers have been slower accepting the e-commerce business model that people originally thought. Even in product categories suitable for e-commerce, electronic shopping has been slow to catch on for several reasons including:
Key success factors in e-commerce
E-commerce problems
Product suitability
Acceptance of e-commerce
Companies
See also
Finding related topics
External Links
Further reading
References