E-commerce refers to the buying and selling of goods and services over the Internet. It includes business-to-business transactions (B2B), business-to-consumer transactions (B2C), consumer-to-consumer transactions (C2C), and consumer-to-business transactions (C2B). E-commerce provides benefits like lower costs, larger catalogs, and improved customer interactions for businesses and greater access, selection, and convenience for consumers. However, it also faces limitations such as security issues, lack of standards, and threats to privacy.

1. E-Commerce and Marketing
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2. • Electronic commerce, commonly known as E-commerce or ecommerce, is
a type of industry where the buying and selling of products or services is
conducted over electronic systems such as the Internet and other
computer networks.
• Consists of:
Definition of Commerce
1. Buyers - these are people with money who want to purchase a
good or service.
2. Sellers - these are the people who offer goods and services to
buyers.
3. Producers - these are the people who create the products and
services that sellers offer to buyers.

3. • Business to Business (B2B) refers to the full spectrum of e-commerce
that can occur between two organizations.
This includes purchasing and procurement, supplier management,
inventory management, channel management, sales activities, payment
management & service and support.
Examples: Free Markets, Dell and General Electric
• Business to Consumer (B2C) refers to exchanges between business and
consumers, activities tracked are consumer search, frequently asked
questions and service and support.
Examples: Amazon, Yahoo and Charles Schwab & Co
Categories of E-Commerce

4. • Peer to Peer (C2C) exchanges involve transactions between and among
consumers. These can include third party involvement, as in the case of
the auction website EBay.
Examples: Owners.com, Craigslist, Monster
• Consumer to Business (C2B) involves when consumers band together to
present themselves as a buyer in group.
Example: www.planetfeedback.com
Categories of E-Commerce

5. Model of an Electronic Exchange

6. Architecture of Web-based E-Commerce
System
Backend system
Firewall
Internet
Server side
Intranet
(Secure)
Web Server Application Server
Database
Service system
Client side

7. • Digital certificate: an attachment to an e-mail message or data
embedded in a Web page that verifies the identity of a sender or a Web
site
• Certificate authority (CA): a trusted third party that issues digital
certificates
• Secure Sockets Layer (SSL): a communications protocol used to secure
sensitive data
• Electronic cash: an amount of money that is computerized, stored, and
used as cash for e-commerce transactions
Electronic Payment Systems

8. • Electronic wallet: a computerized stored value that holds credit card
information, electronic cash, owner identification, and address
information
• Credit card
• Charge card
• Debit card
• Smart card
Electronic Payment Systems (Cont.)

9. • Lower transaction costs - if an e-commerce site is implemented well, the web can
significantly lower both order-taking costs up front and customer service costs
• Larger purchases per transaction - Amazon offers a feature that no normal store
offers
• Integration into the business cycle
• People can shop in different ways. The ability to build an order over several days
• The ability to configure products and see actual prices
• The ability to easily build complicated custom orders
• The ability to compare prices between multiple vendors easily
• The ability to search large catalogs easily
• Larger catalogs
• Improved customer interactions - company.
Appeal of E-commerce

10. Benefits to Consumers
Convenience
Buying is easy and private
Provides greater product access and selection
Provides access to comparative information
Buying is interactive and immediate

11. Benefits to Organizations
Powerful tool for building customer relationships
Can reduce costs
Can increase speed and efficiency
Offers greater flexibility in offers and programs
Is a truly global medium

12. Benefits to Society
More individuals can work from home
Benefits less affluent people
Third world countries gain access
Facilitates delivery of public services

13. • To organizations: lack of security, reliability, standards, changing
technology, pressure to innovate, competition, old vs. new technology
• To consumers: equipment costs, access costs, knowledge, lack of privacy
for personal data, relationship replacement
• To society: less human interaction, social division, reliance on
technology, wasted resources, JIT manufacturing
Limitations of E-commerce

14. • E- and m-commerce incidents
• Theft of intellectual property
• Intellectual property: music, books, inventions, paintings, and other special
items protected by patents, copyrights, or trademarks
• Patents on business processes
Threats to E-Commerce

15. • Phishing: bogus messages purportedly from a legitimate institution to
pry personal information from customers by convincing them to go to a
“spoof” Web site
• Online auction fraud
• Spam: e-mail sent to a wide range of people and Usenet groups
indiscriminately
Fraud

16. • Online profiling: the practice of Web advertisers’ recording online
behavior to produce targeted advertising
• Clickstream data: data gathered based on the Web sites visited and the
items clicked on
• Safe harbor principles: principles that address the e-commerce data
privacy issues of notice, choice, and access
Invasion of Consumer Privacy