What is E commerce?

The term e-commerce or electric commerce refers to a comprehensive system of trading that uses networks of computers for buying and selling of goods, information and services. In simple words, e-commerce refers to buying and selling of goods, information and services through electronic means.

Fig : 1. E-commerce

Thus, e-commerce includes buying and selling of

  1. Goods- e.g. digital cameras, music systems, clothes, accessories
  2. Information-e.g. subscription to some law site may give access to some court cases
  3. Services-e.g. matrimonial services through shaadi.com, placement services through naukri.com

The European Union website defines e-commerce as a general concept covering any form of business transactions or information exchange that is made by using information and communication technology. According to International Fiscal Association, e-commerce means “commercial transactions in which an order is placed electronically and goods or services are delivered in tangible or electronic form. For instance, a digital camera purchased by a consumer from indiatimes.com which might be delivered to him at his residence, is a good delivered in a tangible form whereas, a song downloaded from a site like cooltoad.com, is a good delivered in electronic form.

Fig : 2. E-commerce marketing
Fig : 3. Online Payments
Fig : 4. Online Shoping

Classification of E-Commerce :

Based upon the entities involved in transaction, electronic commerce has been classified into the following categories:

Fig : 5. Types of E-commerce
  1. Business-to –Business (B2B)
  2. Business-to-Consumer (B2C)
  3. Consumer-to-Business (C2B)
  4. Consumer-to-Consumer (C2C)

1.Business-to-Business (B2B) Electronic Commerce :

Fig : 6. Electronic commerce solutions

Under B2B electronic commerce, commercial transactions take place between different business organisations. An example of B2B transaction is a business organisation purchasing material from suppliers. Compared to B2C and C2C transactions, the value per transaction is higher in B2B transactions because bulk purchases are made. The buyers also might get the advantage of discounts on bulk purchases.

2. Business-to-Consumer (B2C) Electronic Commerce :

Under B2C electronic Commerce, commercial transactions take place between business firms and their consumers. Here companies sell goods, information or services to customers online in a more personalized dynamic environment. An example of B2C transaction is Amazon.com selling books to customers.

3. Consumer-to-Business (C2B) Electronic Commerce :

C2B can be described as a form of electronic commerce where, the transaction, originated by the consumer has a set of requirement specifications or specific price for a commodity, service or item. It is the responsibility of electronic commerce business entity to match the requirements of the consumers to the best possible extent. For instance, a consumer may specify on a site like yatra.com his dates of travel, his source and destination of travel, specifying the total number of tickets required in business/economy class. Yatra.com then finds out the various options for him which best meet his requirements.

4. Consumer-to-Consumer(C2C) Electronic Commerc :

C2C is the electronic commerce activity that provides the opportunity for trading of products and/or services amongst consumers who are connected through the internet. In this category, electronic tools and internet infrastructure are employed to support transactions between individuals. For instance, a consumer who wants to sell his property can post an ad on timesclassifieds.com. Another person interested in purchasing a property can browse the property ads posted on this site. Thus, the two consumers can get in touch with each other for sale/purchase of property through timesclassifieds.com.

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