The business evolution went through many progressive stages or so called developmental steps. The business of the present stage has been developed from the very beginning of human civilization. Over the course of 20 years, e-commerce evolved from a novel new concept into a major part of the world’s economy. But how did that happen?
Before we analyze the impact, let’s look onto a brief history of e-commerce and its evolution through years.
What Is E-Commerce?
E-commerce means using the Internet and the web for business transactions and commercial transactions, which typically involve the exchange of value (e.g., money) across organizational or individual boundaries in return for products and services.
Introduction and Evolution
In 1991, the World Wide Web was created. Although the Internet is now a major part of most of our daily lives, it’s important to recognize that it’s still a relatively new development compared to the overall retail industry. Then, in 1994, Pizza hut officially became the first major business to offer online purchasing.
One year later, eBay and Amazon were founded. By 1996, online sales surpassed $1 billion. E-commerce sales have continued to grow steadily, with the total sales increasing 135% from 2009 to 2015. Today, there are more than 800,000 stores online. E-commerce businesses are fast gaining grounds and changing the way of doing business. The main aspect of e-commerce includes doing business on web and includes
Business to business [B2B] trading which involves a business such as a company trading with another business on the World Wide Web.
Business to consumer [B2C] trading which involves a business such as a company directly dealing with a consumer over the World Wide Web.
Impact of E-Commerce
E-commerce has made a profound impact on society. People can now shop online in the privacy of their own homes without ever having to leave. It also changes the way people look at making purchases and spending money. E-commerce has changed the face of retail, services, and other things that make our economy work.
Impact on Global Economy
E-commerce enhances promotion of products and services through direct, information-rich, and interactive contact with customers.
E-commerce creates a new distribution channel for existing products.
The cost of delivering information to customers over the internet results in substantial savings to senders when compared with non-electronic delivery.
Reduced Cycle Time – The delivery of digitized products and services can be reduced to seconds
Customer service can be greatly enhanced by enabling customers to find detailed information online.
On the web, newcomers can establish corporate images very quickly.
E-commerce provides for customization of products and services, in contrast to buying in a store or ordering from a television, which is usually limited to standard products.
Business to business [B2B] trading which involves a business such as a company trading with another business on the World Wide Web.
Business to consumer [B2C] trading which involves a business such as a company directly dealing with a consumer over the World Wide Web.
Impact of E-Commerce
E-commerce has made a profound impact on society. People can now shop online in the privacy of their own homes without ever having to leave. It also changes the way people look at making purchases and spending money. E-commerce has changed the face of retail, services, and other things that make our economy work.
Impact on Global Economy
E-commerce enhances promotion of products and services through direct, information-rich, and interactive contact with customers.
E-commerce creates a new distribution channel for existing products.
The cost of delivering information to customers over the internet results in substantial savings to senders when compared with non-electronic delivery.
Reduced Cycle Time – The delivery of digitized products and services can be reduced to seconds
Customer service can be greatly enhanced by enabling customers to find detailed information online.
On the web, newcomers can establish corporate images very quickly.
E-commerce provides for customization of products and services, in contrast to buying in a store or ordering from a television, which is usually limited to standard products.
Impact on Manufacturing
The production systems are integrated with finance, marketing, and other functional systems, as well as with business partners and customers. Using web-based systems, orders that are taken from customers can be directed to designers and to the production floor, within seconds.
Impact on Finance
E-commerce requires special finance and accounting systems. Traditional payment systems are ineffective or inefficient for electronic trade. The use of the new payment systems such as electronic cash is complicated because it involves legal issues and agreements on international standard.
Advantages of E-Commerce
Convenience – Customers can order products or services 24 hours a day wherever they are.
Information – Customers can find reams of comparative information about companies, products, competitors and prices without leaving their office or home.
Quick Adjustment to Market Conditions by Marketers – Companies can quickly add products to their offering and change prices and descriptions.
Lower Cost – On-line Marketers avoid the expense of maintaining a store and the costs of rent, insurance and utilities.
Disadvantages of E-commerce
Security - Security continues to be a problem for online businesses.
System and Data Integrity - Data protection and the integrity of the system that handles the data are serious concerns.
E-Commerce is Not Free
Written by - Abija P.B.
Edited by - Gunika Manchanda
0 Comments