What is E-Commerce?

To put it in a simplest possible way e-commerce is nothing but electronic commerce. It involves an electronic interface between seller and buyer, a process to accept the requests from the customer or user and delivery of goods or services that has been promised. >>

For example amazon.com, the website acts as an interface between the company and customers to accept online orders, they have a network of warehouses that are linked to each other to process the requests and have a tie-up with logistic companies so that they can courier the goods to the customers. So E-commerce is all about reducing the costs and creating closer, more open relationships with customers, suppliers and partners. We have three basic categories in E-commerce.>>

B2B (Business to Business) like seibel technologies
B2C (Business to customers) like
C2C (Customer to Customer)
like ebay.com>>

There are two types of companies that are involved in E-commerce. One is the company that exists only in Internet and do not have any physical stores to do business, for example Amazon.com or qvc.com. The other type of companies uses the Internet to compliment their existing business for example dell.com where one can buy/order any product online and also through the stores across the country. >>

The Problems >>

The single most important factor that determines the success of any business is customerís confidence towards product or service. E-commerce faces big problems when it comes to customers' privacy and safety while using credit cards to purchase online. Majority of consumers who use e-commerce usually choose phone to complete their online activities as they fear that the credit card information will be disclosed to others. Many online companies have begun to use secure servers for future transactions, to give confidence to the customers about the security of their private information. These secure servers encrypt the data so that an unknown party canít intercept the information.>>

Another problem hindering the growth of e-commerce is the impersonal way of doing business online. Buying products over the web is convenient for consumers, but it lacks the human contact that comes with traditional shopping. Many customers enjoy this one-on-one human interaction when making purchases. By using telephony technology, which allows users to make telephone calls through online networks, some online companies have been able to tackle this problem.>>

The Benefits for Businesses>>

Business have had and still having huge benefits because of E-commerce. By doing online business companies now can sell their products or services to anyone across the globe. This brought tremendous growth in sales and increased their profitability many folds. In addition to bridging the geographic distance, e-commerce has changes the time restriction. Products or services are available 24 hours a day on all the 365 days, right at the fingertips of the user. It has reduced the overhead costs because now companies dose not have to spend the same amount of money on buildings and customer service when compared to business that do not use e-commerce.>>

The Benefits for Consumers>>

There are many ways customer has got benefited because of E-commerce. The most important is convenience that the customer now has to buy or sell things. One can do it any time of the day without leaving the comfort of home. Now in few clicks one can do the desired purchases. Some businesses are making this process even more convenient by making smart shopping carts and so on. Small programs like cookies saves lots of time and effort when user repeats its purchase. >>

E-commerce offers low cost, huge choice to its customers. Online share brokers are lot cheaper then physically going and purchasing the stock. Many online companies that sell books, videos, and CD's offer low prices. Due to this lower cost and lower overhead, which are benefits to both the consumer and business, Amazon.com has become one of the largest "bookstores" in the world. They provide millions of titles to their customers, doing business without buildings, sales staff, inventory, and other overhead costs. Itís quite easy to sell or buy anything that you want in low cost via online auction sites like ebay.com. >>

The Future >>

The mix of commerce and Internet technologies has been very profitable for both businesses and consumers. These benefits are likely to increase and it will continue to become more beneficial to those who choose to take advantage of it. Though there are problems that will have to sort out before this market can reach its full potential. It will still take time for E-commerce to replace physical stores, but business will grow faster and customer will save lots of time and money due to E-commerce. Online business will continue to grow from many years to come. >>

Online community is growing in very fast speed. One million new Internet users are joining the growing online community every month. It is forecasted that e-commerce will top $4 trillion by 2005 around the world. This is a huge increase from $15 billion in 1997 & 90 billion in 1999. The ffice:smarttags" />lace>United Stateslace> alone will make up around 50% of this amount with an estimated $2 trillion by 2005. At this time, 55% of web sites are based on lace>United Stateslace>. E-Commerce is made up of 60% of these lace>USlace> based web sites. It seems as though e-commerce is a fast growing industry in the lace>United Stateslace> and will be a force for economic growth for the country in years to come. >>


The E-commerce is one of the greatest things that have happened to the business. It has changed the way business has been done before and created entire new world. It has brought win-win situation for buyers and sellers witch was the core of its great success. Though there are few weak links that still needs to be improved but with new technologies e-commerce will soon become the easy, convenient and secure. >>

This article has been written by Deepak Dwivedi , CEO U&D Square India. >>

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