E-commerce

E-commerce
From Wikipedia, the free encyclopedia
Electronic commerce, commonly known as E-commerce or eCommerce, is trading in products or
services using computer networks, such as the Internet. 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. Modern electronic commerce typically uses the World Wide
Web for at least one part of the transaction's life cycle, although it may also use other technologies
such as e-mail.
E-commerce businesses usually employ some or all of the following practices:
Provide Etail or virtual storefront on websites with online catalogs, sometimes gathered into a
"virtual mall"
Buy or sell on online marketplaces.
Gather and use demographic data through web contacts and social media.
Use electronic data interchange, the business-to-business exchange of data.
Reach prospective and established customers by e-mail or fax (for example, with newsletters).
Use business-to-business buying and selling.
Provide secure business transactions.
Engage in pretail for launching new products and services
Contents
1 Timeline
2 Business applications
3 Governmental regulation
4 Forms
5 Global trends
6 Impact on markets and retailers

7 Distribution channels
8 Examples of new E-commerce system
9 See also
10 References
11 Further reading
12 External links
Timeline
A timeline for the development of e-commerce:
1971 or 1972: The ARPANET is used to arrange a sale between students at the Stanford Artificial
Intelligence Laboratory and the Massachusetts Institute of Technology, later described as "the
seminal act of e-commerce" in John Markoff's book What the Dormouse Said.[1]
1979: Michael Aldrich demonstrates the first online shopping system.[2]
1981: Thomson Holidays UK is first business-to-business online shopping system to be installed.[3]
1982: Minitel was introduced nationwide in France by France Télécom and used for online ordering.
1983: California State Assembly holds first hearing on "electronic commerce" in Volcano,
California.[4] Testifying are CPUC, MCI Mail, Prodigy, CompuServe, Volcano Telephone, and Pacific
Telesis. (Not permitted to testify is Quantum Technology, later to become AOL.)
1984: Gateshead SIS/Tesco is first B2C online shopping system [5] and Mrs Snowball, 72, is the first
online home shopper[6]
1984: In April 1984, CompuServe launches the Electronic Mall in the USA and Canada. It is the first
comprehensive electronic commerce service.[7]
1984: California becomes first US state to enact an Electronic Commerce Act defining basic
consumer rights online.
1990: Tim Berners-Lee writes the first web browser, WorldWideWeb, using a NeXT computer.[8]
1992: Book Stacks Unlimited in Cleveland opens a commercial sales website (www.books.com)
selling books online with credit card processing.
1992: St. Martin's Press publishes J.H. Snider and Terra Ziporyn's Future Shop: How New
Technologies Will Change the Way We Shop and What We Buy.[9]
1992: Terry Brownell launches a fully graphical, iconic navigated Bulletin board system online
shopping using RoboBOARD/FX.
1993: Paget Press releases edition No. 3 of the firstAppStore, The Electronic AppWrapper [10]

1994: Netscape releases the Navigator browser in October under the code name Mozilla. Netscape
1.0 is introduced in late 1994 with SSL encryption that made transactions secure.
1994: Ipswitch IMail Server becomes the first software available online for sale and immediate
download via a partnership between Ipswitch, Inc. and OpenMarket.
1994: "Ten Summoner's Tales" by Sting becomes the first secure online purchase.[11]
1995: The US National Science Foundation lifts its former strict prohibition of commercial
enterprise on the Internet.[12]
1995: Thursday 27 April 1995, the purchase of a book by Paul Stanfield, Product Manager for
CompuServe UK, from W H Smith's shop within CompuServe's UK Shopping Centre is the UK's first
national online shopping service secure transaction. The shopping service at launch featured W H
Smith, Tesco, Virgin Megastores/Our Price, Great Universal Stores (GUS), Interflora, Dixons Retail,
Past Times, PC World (retailer) and Innovations.
1995: Jeff Bezos launches Amazon.com and the first commercial-free 24-hour, internet-only radio
stations, Radio HK and NetRadio start broadcasting. Dell and Cisco begin to aggressively use
Internet for commercial transactions.eBay is founded by computer programmer Pierre Omidyar as
AuctionWeb.
1996: IndiaMART B2B marketplace established in India.
1996: ECPlaza B2B marketplace established in Korea.
1996: Sellerdeck, formerly Actinic, the UK's first PC/LAN e-commerce platform established.
1998: Electronic postal stamps can be purchased and downloaded for printing from the Web.[13]
1999: Alibaba Group is established in China. Business.com sold for US $7.5 million to eCompanies,
which was purchased in 1997 for US $149,000. The peer-to-peer filesharing software Napster
launches. ATG Stores launches to sell decorative items for the home online.
2000: The dot-com bust.
2001: Alibaba.com achieved profitability in December 2001.
2002: eBay acquires PayPal for $1.5 billion.[14] Niche retail companies Wayfair and NetShops are

founded with the concept of selling products through several targeted domains, rather than a central
portal.
2003: Amazon.com posts first yearly profit.
2004: DHgate.com, China's first online b2b transaction platform, is established, forcing other b2b
sites to move away from the "yellow pages" model.[15]
2007: Flipkart is established in India.Business.com acquired by R.H. Donnelley for .$345 million.[16]
2009: Zappos.com acquired by Amazon.com for $928 million.[17] Retail Convergence, operator of
private sale website RueLaLa.com, acquired by GSI Commerce for $180 million, plus up to $170
million in earn-out payments based on performance through 2012.[18]
2010: Groupon reportedly rejects a $6 billion offer from Google. Instead, the group buying websites
went ahead with an IPO on 4 November 2011. It was the largest IPO since Google.[19][20]
2011: Quidsi.com, parent company of Diapers.com, acquired by Amazon.com for $500 million in cash
plus $45 million in debt and other obligations.[21]GSI Commerce, a company specializing in
creating, developing and running online shopping sites for brick and mortar businesses, acquired by
eBay for $2.4 billion.[22]
2013: US eCommerce and Online Retail holiday sales reach $46.5 billion, up 10 percent.[23]
2014: Overstock.com processes over $1 million in Bitcoin sales.[24] India's e-commerce industry is
estimated to have grown more than 30% from a year earlier to $12.6 billion in 2013.[25] US
eCommerce and Online Retail sales projected to reach $294 billion, an increase of 12 percent over
2013 and 9% of all retail sales.[26]Alibaba Group has the largest Initial public offering ever, worth
$25 billion.
Business applications
An example of an automated online assistant on a merchandising website.
Some common applications related to electronic commerce are:
Document automation in supply chain and logistics

Domestic and international payment systems
Enterprise content management
Group buying
Print on demand
Automated online assistant
Newsgroups
Online shopping and order tracking
Online banking
Online office suites
Shopping cart software
Teleconferencing
Electronic tickets
Social networking
Instant messaging
Pretail
Governmental regulation
In the United States, some electronic commerce activities are regulated by the Federal Trade
Commission (FTC). These activities include the use of commercial e-mails, online advertising 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 truthful and non-deceptive.[27] Using its authority
under Section 5 of the FTC Act, which prohibits 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.[28] As result, any corporate privacy policy 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.[29]
There is also collaboration between Google and US federal authorities to block illegal online
pharmacies from appearing in Google search results.[30] Recently FedEx Corporation pleaded not
guilty to charges made against it regarding dealing with illegal online pharmacies.[31]
Conflict of laws in cyberspace [32] is a major hurdle for harmonisation of legal framework for e-
commerce around the world. In order to give a uniformity to e-commerce law around the world,

many countries adopted the UNCITRAL Model Law on Electronic Commerce (1996) [33]
Internationally there is the International Consumer Protection and Enforcement Network (ICPEN),
which was formed in 1991 from an informal network 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 a portal to report complaints about
online and related transactions with foreign companies.
There is also Asia Pacific Economic Cooperation (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,[34]
and the Australian Competition and Consumer Commission[35] regulates and offers advice on how
to deal with businesses online,[36][37] and offers specific advice on what happens if things go
wrong.[38]
In the United Kingdom, The Financial Services Authority (FSA)[39] was formerly the regulating
authority for most aspects of the EU's Payment Services Directive (PSD), until its replacement in
2013 by the Prudential Regulation Authority and the Financial Conduct Authority.[40] The UK
implemented the PSD through the Payment 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, non-bank credit card issuers and non-bank merchant acquirers, e-money
issuers, etc. The PSRs created a new class of regulated firms known as payment institutions (PIs),
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.[41]
In India, the Information Technology Act 2000 governs the basic applicability of e-commerce. It is
based upon UNCITRAL Model but is not a comprehensive legislation to deal with e-commerce
related activities in India. Further, e-commerce laws and regulations in India [42] are also
supplemented by different laws of India as applicable to the field of e-commerce. For instance, e-
commerce relating to pharmaceuticals, healthcare, traveling, etc. are governed by different laws
though the information technology act, 2000 prescribes some common requirements for all these
fields. The competition commission of India (CCI) regulates anti competition and anti trade practices
in e-commerce fields in India.[43] Some stakeholders have decided to approach courts and CCI
against e-commerce websites to file complaint about unfair trade practices and predatory pricing by
such e-commerce websites.[44][45]
Forms
Contemporary electronic commerce involves everything from ordering "digital" content for
immediate online consumption, to ordering conventional goods and services, to "meta" services to
facilitate other types of electronic commerce.
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 very
hot and pressing issues for electronic commerce.
Aside from traditional e-Commerce, m-Commerce as well as the nascent t-Commerce[46] channels
are often seen as the current 2013 poster children of electronic I-Commerce.
Global trends
In 2010, the United Kingdom had the biggest e-commerce market in the world when measured by
the amount spent per capita.[47] The Czech Republic is the European country where ecommerce
delivers the biggest contribution to the enterprises´ total revenue. Almost a quarter (24%) of the
country's total turnover is generated via the online channel.[48]
Among emerging economies, China's e-commerce presence continues to expand every year. With
384 million internet users, China's online shopping sales rose to $36.6 billion in 2009 and one of the
reasons behind the huge growth has been the improved trust level for shoppers. The Chinese
retailers have been able to help consumers feel more comfortable shopping online.[49] China's
cross-border e-commerce is also growing rapidly. 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 [50] In 2013, Alibaba had an e-commerce market share of 80% in
China.[51]
Other BRIC countries are witnessing the accelerated growth of eCommerce as well. Brazil's
eCommerce is growing quickly with retail eCommerce sales expected to grow at a healthy double-
digit pace through 2014. By 2016, eMarketer expects retail ecommerce sales in Brazil to reach $17.3
billion.[52] India's ecommerce growth, on the other hand, has been slower although the country's
potential remains solid considering its surging economy, the rapid growth of internet penetration,
English language proficiency and a vast market of 1.2 billion consumers (although perhaps only 50
million access the internet through PCs and some estimate the most active group of e-commerce
customers numbers only 2-3 million). E-commerce traffic grew about 50% from 2011 to 2012, from
26.1 million to 37.5 million, according to a report released by Com Score. Still much of the estimated

14 billion dollars in 2012 ecommerce was generated from travel sites.
E-Commerce has become an important tool for small and large businesses worldwide, not only to sell
to customers, but also to engage them.[53][54]
In 2012, ecommerce sales topped $1 trillion for the first time in history.[55]
Mobile devices are playing an increasing role in the mix of eCommerce. Some estimates show that
purchases made on mobile devices will make up 25% of the market by 2017.[56] According to Cisco
Visual Networking Index,[57] in 2014 the amount of mobile devices will outnumber the number of
world population.
Impact on markets and retailers
Economists have theorized that e-commerce ought to lead to intensified price competition, as it
increases consumers' ability to gather information about products and prices. Research by four
economists at the University of Chicago has found that the growth of online shopping has also
affected industry structure in two areas that have seen significant growth in e-commerce, bookshops
and travel agencies. Generally, larger firms are able to use economies of scale and offer lower
prices. The lone exception to this pattern has been the very smallest category of bookseller, shops
with between one and four employees, which appear to have withstood the trend.[58]
Individual or business involved in e-commerce whether buyers or sellers rely on Internet-based
technology in order to accomplish their transactions. E-commerce is recognized for its ability to
allow business to communicate and to form transaction anytime and anyplace. Whether an individual
is in the US or overseas, business can be conducted through the internet. The power of e-commerce
allows geophysical barriers to disappear, making all consumers and businesses on earth potential
customers and suppliers. eBay is a good example of e-commerce business individuals and businesses
are able to post their items and sell them around the Globe.[59]
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.[60]
Examples of new E-commerce system
According to eMarketer research company, "by 2017, 65.8 per cent of Britons will use smartphones".
(cited by Williams, 2014)
Bringing online experience into the real world, allows also the development of the economy and the

interaction between stores and customers. A great example of this new e-commerce system is what
the Burberry store in London did in 2012. They refurbished the entire store with numerous big
screens, photo-studios, and also provided a stage for live acts. Moreover, on the digital screens
which are across the store, some fashion shows´ images and advertising campaigns are displayed.
(William, 2014) In this way, the experience of purchasing becomes more vivid and entertaining while
the online and offline components are working together. Another example could be Kiddicare
smartphone app, in which costumers can compare prices against adversaries. Moreover, the app
allows people to know where the sale products are and to check whether the item they are looking
for is in stock or if they have to ask for it online without going to the `real´ store. (William, 2014) In
the United States, Walmart app in which you can check the product availability and prices both
online and offline. Moreover, you can also add to your shopping list items by scanning them, see
their details and information, and check purchasers´ ratings and reviews.
See also
Alternative payments
Mobile commerce
Comparison of shopping cart software
Digital economy
Electronic bill payment
Electronic money
E-commerce credit card payment system
Comparison of free software e-commerce web application frameworks
Non-store retailing
Online marketplace
Paid content
Payments as a service
References
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a drugs deal". The Guardian (London). Retrieved 17 June 2013.
^ Tkacz, Ewaryst; Kapczynski, Adrian (2009). Internet -- Technical Development and Applications.
Springer. p. 255. ISBN 978-3-642-05018-3. Retrieved 28 March 2011. The first pilot system was
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Shop and What We Buy. St. Martin's Press. ISBN 978-0-312-06359-7. Retrieved 28 December 2012.
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^ "Diane Wang: Rounding up the "Ant" Heroes". Sino Foreign Management. Retrieved 3 September
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^ "R.H. Donnelley Acquires Business.com for $345M". Domain Name Wire. Retrieved 4 September
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^ "Amazon Buys Zappos; The Price is $928m, not $847m". TechCrunch. 22 July 2009. Retrieved 21
December 2012.
^ Ahmed, Saqib Iqbal (27 October 2009). "GSI Commerce to buy Retail Convergence for $180 mln".
Reuters. Retrieved 6 April 2013.
^ "Groupon rejects Google's $6 billion offer". MS-NBC. MSN. 3 December 2010. Retrieved 21
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^ "Groupon's IPO biggest by U.S. Web company since Google". Reuters. 4 November 2011. Archived
from the original on 13 September 2012. Retrieved 13 September 2012.
^ "Amazon buys Diapers.com parent in $545 mln deal". MarketWatch. Retrieved 21 December 2012.
^ "eBay Acquires GSI Commerce For $2.4 Billion in Cash And Debt". TechCrunch. 28 March 2011.
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^ "2013 Holiday Season U.S. Desktop E-Commerce Spending Reaches Record $46.5 Billion, Up 10
Percent vs. Year Ago". 7 January 2014. Retrieved 27 August 2014.

^ Duryee, Tricia (2014-03-04). "Overstock hits $1 million in sales from virtual currency". Geekwire.
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^ Laus, Petronela (8 January 2014). "India Weighs FDI In E-Commerce". The Wall Street Journal
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^ "US eCommerce Forecast: 2013 to 2018". Forrester Research.
^ "Advertising and Marketing on the Internet: Rules of the Road". Federal Trade Commission.
^ "Enforcing Privacy Promises: Section 5 of the FTC Act". Federal Trade Commission.
^ "H.R. 6353: Ryan Haight Online Pharmacy Consumer Protection Act of 2008". Govtrack.
^ "Illegal Online Pharmacies Are On Hit List Of Google And Federal Authorities Of US". Exclusive
Techno Legal Centre Of Excellence For Cyber Crimes Investigation In India. 14 March 2014.
Retrieved 19 August 2014.
^ "FedEx Corporation Pleaded Not Guilty To U.S. Charges Of Delivering Prescribed Drugs From
Illegal Internet Pharmacies". E-Retailing Laws And Regulations In India. 31 July 2014. Retrieved 19
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^ "Conflict Of Laws In Cyberspace, Internet And Computer Era". Conflict Of Laws In Cyberspace,
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Further reading
Laudon, Kenneth C.; Guercio Traver, Carol (2014). E-commerce. business. technology. society. 10th
edition. Pearson. ISBN 978-013-302444-9.

Chaudhury, Abijit; Kuilboer, Jean-Pierre (2002). e-Business and e-Commerce Infrastructure.
McGraw-Hill. ISBN 0-07-247875-6.
Frieden, Jonathan D.; Roche, Sean Patrick (19 December 2006). "E-Commerce: Legal Issues of the
Online Retailer in Virginia" (PDF). Richmond Journal of Law and Technology 13 (2).
Graham, Mark (2008). "Warped Geographies of Development: The Internet and Theories of
Economic Development" (PDF). Geography Compass 2 (3): 771. doi:10.1111/j.1749-
8198.2008.00093.x.
Humeau, Philippe; Jung, Matthieu (21 June 2013). In depth benchmark of 12 ecommerce solutions
(PDF).
Kessler, M (22 December 2003), "More shoppers proceed to checkout online", USA today, retrieved
13 January 2004.
Kotler, Philip (2009). Marketing Management. Pearson: Prentice-Hall. ISBN 978-81-317-1683-0.
Miller, Roger (2002). The Legal and E-Commerce Environment Today (hardcover ed.). Thomson
Learning. ISBN 0-324-06188-9. 741 pp.
Nissanoff, Daniel (2006). FutureShop: How the New Auction Culture Will Revolutionize the Way We
Buy, Sell and Get the Things We Really Want (hardcover ed.). The Penguin Press. ISBN 1-59420-0-
7-7. 246 pp.
Seybold, Pat (2001). Customers.com. Crown Business Books (Random House). ISBN 0-609-60772-3.
External links
Wikibooks has a book on the topic of: The Information Age
E-Commerce and E-Business at Wikibooks
Small Business E-Commerce Resources, US: SBA.
Williams, G. (2014) E-commerce is history. WIRED [Online] Available from:
http://www.wiredevent.co.uk/Wired_content/uploads/2014/07/retail.pdf [Accessed: 6 December
2014]
Retrieved from "http://en.wikipedia.org/w/index.php?title=E-commerce&oldid=645828622"

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