Unit-1 Introduction to Electronic-Commerce.pptx
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Sep 01, 2025
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About This Presentation
E-Commerce Study Material for BIT
Slide Content
Unit 1
Introduction
Introduction
What is Commerce?
•According to dictionary.com,
Commerce is a division of trade or production which deals with the exchange of
goods and services from producer to final consumer.
•It comprises the trading of something of economic value such as goods, services,
information, or money between two or more entities.
•Commerce can be classified into two categories:
▪Traditional Commerce
▪Electronic Commerce
•According to dictionary.com,
Commerce is a division of trade or production which deals with the exchange of
goods and services from producer to final consumer.
•It comprises the trading of something of economic value such as goods, services,
information, or money between two or more entities.
•Commerce can be classified into two categories:
▪Traditional Commerce
▪Electronic Commerce
What is E-Commerce?
•Commonly known as Electronic Marketing.
•It consist of buying and selling goods and services over an electronic systems such as the
internet and other computer networks.
•E-commerce is the purchasing, selling and exchanging goods and services over computer
networks (internet) through which transaction or terms of sale are performed
electronically.
•Electronic commerce focuses on the use of ICT (Information and Communication
Technologies) to enable the external activities and relationships of the business with
individuals, groups and other businesses.
•Commonly known as Electronic Marketing.
•It consist of buying and selling goods and services over an electronic systems such as the
internet and other computer networks.
•E-commerce is the purchasing, selling and exchanging goods and services over computer
networks (internet) through which transaction or terms of sale are performed
electronically.
•Electronic commerce focuses on the use of ICT (Information and Communication
Technologies) to enable the external activities and relationships of the business with
individuals, groups and other businesses.
Traditional Commerce Vs E-Commerce
Traditional Commerce Electronic Commerce
Traditional commerce refers to the commercial
transactions or exchange of information, buying
or selling product/services from person to person
without use of internet.
E-commerce refers to the commercial
transactions or exchange of information, buying
or selling product/services electronically with the
help of internet.
In traditional commerce it is difficult to establish
and maintain standard practices.
In e-commerce it is easy to establish and
maintain standard practices.
In traditional commerce direct interaction
through seller and buyer is present.
In e-commerce indirect interaction through seller
and buyer occurs using electronic medium and
internet.
Traditional commerce is carried out by face to
face, telephone lines or mail systems.
E-commerce is carried out by internet or other
network communication technology.
Traditional Commerce Electronic Commerce
Traditional commerce refers to the commercial
transactions or exchange of information, buying
or selling product/services from person to person
without use of internet.
E-commerce refers to the commercial
transactions or exchange of information, buying
or selling product/services electronically with the
help of internet.
In traditional commerce it is difficult to establish
and maintain standard practices.
In e-commerce it is easy to establish and
maintain standard practices.
In traditional commerce direct interaction
through seller and buyer is present.
In e-commerce indirect interaction through seller
and buyer occurs using electronic medium and
internet.
Traditional commerce is carried out by face to
face, telephone lines or mail systems.
E-commerce is carried out by internet or other
network communication technology.
Traditional Commerce Vs E-Commerce (Contd.)
Traditional Commerce Electronic Commerce
In traditional commerce processing of
transaction is manual.
In e-commerce processing of transaction is
automatic.
In traditional commerce delivery of goods is
instant.
In e-commerce delivery of goods takes time.
Its accessibility is for limited time in a day. Its accessibility is 24×7×365 means round the
clock.
Its resource focuses on supply side. Its resource focuses on demand side.
In traditional commerce customers can inspect
products physically before purchase.
In e-commerce customers can not inspect
products physically before purchase.
Its business scope is a limited physical area. Its business scope is worldwide as it is done
through digital medium.
Traditional Commerce Electronic Commerce
In traditional commerce processing of
transaction is manual.
In e-commerce processing of transaction is
automatic.
In traditional commerce delivery of goods is
instant.
In e-commerce delivery of goods takes time.
Its accessibility is for limited time in a day. Its accessibility is 24×7×365 means round the
clock.
Its resource focuses on supply side. Its resource focuses on demand side.
In traditional commerce customers can inspect
products physically before purchase.
In e-commerce customers can not inspect
products physically before purchase.
Its business scope is a limited physical area. Its business scope is worldwide as it is done
through digital medium.
E-Commerce Terminology and Fundamentals
•B2B (Business to Business)
▪The exchange of goods and services between business.
•B2C (Business to Consumer)
▪The exchange of goods and services with the end consumer being the target market.
•Chargeback
▪Where a transaction is debited against a merchant account in cases of refunds and
fraud.
▪Chargebacks usually attract a fee that is debited against the merchant.
•Certificate Authority
▪A third party company that issues digital certificates that confirms a company or
individuals identification.
▪A digital certificate is a crucial part of secure ecommerce.
•B2B (Business to Business)
▪The exchange of goods and services between business.
•B2C (Business to Consumer)
▪The exchange of goods and services with the end consumer being the target market.
•Chargeback
▪Where a transaction is debited against a merchant account in cases of refunds and
fraud.
▪Chargebacks usually attract a fee that is debited against the merchant.
•Certificate Authority
▪A third party company that issues digital certificates that confirms a company or
individuals identification.
▪A digital certificate is a crucial part of secure ecommerce.
E-Commerce Terminology (Contd.)
•Cobranding
▪Where two companies identify a partnership between them through one company
displaying their logos, color schemes, etc. on another companies application.
•Cookies
▪Small text files stored on your computer when visiting a site that record preference for
that particular site’s usage.
▪Cookies are also common in shopping cart applications in order to remember visitors
as they move throughout product pages.
•CRM – Customer Relationship Management
▪The entire process of a pre-sales, sales, and service relationship with a customer.
▪Many software applications are now available that permit you to record this
relationship from the time the clients asks their first question.
▪Good CRM software is much more efficient than fragmented records as it can save
time in tracking communications and transactions with a particular person.
•Cobranding
▪Where two companies identify a partnership between them through one company
displaying their logos, color schemes, etc. on another companies application.
•Cookies
▪Small text files stored on your computer when visiting a site that record preference for
that particular site’s usage.
▪Cookies are also common in shopping cart applications in order to remember visitors
as they move throughout product pages.
•CRM – Customer Relationship Management
▪The entire process of a pre-sales, sales, and service relationship with a customer.
▪Many software applications are now available that permit you to record this
relationship from the time the clients asks their first question.
▪Good CRM software is much more efficient than fragmented records as it can save
time in tracking communications and transactions with a particular person.
E-Commerce Terminology (Contd.)
•EDI (Electronic Data Interchange)
▪This is the business to business (B2B) flow of information between companies or
within a company itself.
▪The 90’s saw the concept of information equaling power.
▪Whatever creates power also generates money and therefore creates new enterprises
to supply this information.
•Encryption
▪Process of transforming data into a type that prevents casual observers from
deciphering.
•E-tailing (Electronic Retailing)
▪These are mainly “virtual” storefronts which act as a catalogue of products of
merchants and usually include a “shopping cart” system to enable consumers to
purchase online with the use of credit cards.
•EDI (Electronic Data Interchange)
▪This is the business to business (B2B) flow of information between companies or
within a company itself.
▪The 90’s saw the concept of information equaling power.
▪Whatever creates power also generates money and therefore creates new enterprises
to supply this information.
•Encryption
▪Process of transforming data into a type that prevents casual observers from
deciphering.
•E-tailing (Electronic Retailing)
▪These are mainly “virtual” storefronts which act as a catalogue of products of
merchants and usually include a “shopping cart” system to enable consumers to
purchase online with the use of credit cards.
E-Commerce Terminology (Contd.)
•Firewall
▪Software/Hardware used to prevent unauthorized access from a computer system or
network of computer systems.
•Infomediary
▪An infomediary is an online resources that collate data from a variety of sources and
acts in a middleman between those distributing the information and people who want
the information.
•LUHN Algorithm (named after its creator, IBM scientist Hans Peter Luhn.)
▪The LUHN algorithm also known as the "modulus 10" or "mod 10" algorithm is
used for credit card number generation and validation.
•Firewall
▪Software/Hardware used to prevent unauthorized access from a computer system or
network of computer systems.
•Infomediary
▪An infomediary is an online resources that collate data from a variety of sources and
acts in a middleman between those distributing the information and people who want
the information.
•LUHN Algorithm (named after its creator, IBM scientist Hans Peter Luhn.)
▪The LUHN algorithm also known as the "modulus 10" or "mod 10" algorithm is
used for credit card number generation and validation.
E-Commerce Terminology (Contd.)
•E-Check
▪An E-Check is a form of payment that deducts funds directly from your own standard
checking account.
▪E-Check services are usually managed by third party companies that interface with a
number of different banks.
▪An E-Check provides more fraud resistant option in terms of ecommerce transactions.
•Merchant Account
▪A special account where money from credit card sales is first routed to and held
before transfer to your own business account.
▪This process is usually fully automated in ecommerce transactions.
▪Money may in real-time or during various points in a 24 hour period.
▪A merchant account is a crucial part of ecommerce.
•E-Check
▪An E-Check is a form of payment that deducts funds directly from your own standard
checking account.
▪E-Check services are usually managed by third party companies that interface with a
number of different banks.
▪An E-Check provides more fraud resistant option in terms of ecommerce transactions.
•Merchant Account
▪A special account where money from credit card sales is first routed to and held
before transfer to your own business account.
▪This process is usually fully automated in ecommerce transactions.
▪Money may in real-time or during various points in a 24 hour period.
▪A merchant account is a crucial part of ecommerce.
E-Commerce Terminology (Contd.)
•Merchant Identification Number (MIDS)
▪Unique merchant identification number that is used in conjunction with all
transactions.
•Out of the Box
▪Refers to an application suitability to be rapidly integrated into an existing system.
•P2P (Peer-to-Peer)
▪Process whereby computers can trade information between each other directly
without the assistance of a third party network.
•Payment Threshold
▪The minimum accumulated commission an affiliate must earn to trigger payment
from an affiliated program.
•Merchant Identification Number (MIDS)
▪Unique merchant identification number that is used in conjunction with all
transactions.
•Out of the Box
▪Refers to an application suitability to be rapidly integrated into an existing system.
•P2P (Peer-to-Peer)
▪Process whereby computers can trade information between each other directly
without the assistance of a third party network.
•Payment Threshold
▪The minimum accumulated commission an affiliate must earn to trigger payment
from an affiliated program.
E-Commerce Terminology (Contd.)
•Privacy Policy
▪A web site’s official statement on the type of information collected on a site, how the
information will be used, how the person can access this data and the steps for having
the data removed.
▪A privacy statement will also usually include information regarding system that are in
place to protect the information of web site visitors.
•Privacy Seal Programs
▪Independent organizations that verify if an online companies Privacy Statement is
verifiable and accurate. Privacy seal programs include, TRUSTe, BBBOnline, and
CPA Webtrust.
•Scalability
▪The ability and flexibility of an application to meet growth requirements of an
organization.
•Privacy Policy
▪A web site’s official statement on the type of information collected on a site, how the
information will be used, how the person can access this data and the steps for having
the data removed.
▪A privacy statement will also usually include information regarding system that are in
place to protect the information of web site visitors.
•Privacy Seal Programs
▪Independent organizations that verify if an online companies Privacy Statement is
verifiable and accurate. Privacy seal programs include, TRUSTe, BBBOnline, and
CPA Webtrust.
•Scalability
▪The ability and flexibility of an application to meet growth requirements of an
organization.
E-Commerce Terminology (Contd.)
•Secure Servers
▪Special servers that utilize encryption to prevent unauthorized users from intercepting
and reading a message that passes through its system.
•Session Cookie
▪Temporary cookie stored in a computers memory for remembering preferences during
a web site visit that is flushed on leaving the site.
•Shareware
▪Software that is distributed at no cost that can be used for free for a specific period of
time or under certain circumstances to allow evaluation.
•Shopping Cart
▪Software that keeps track of items a visitor picks to buy from your site until they
proceed to the “Checkout”.
•Secure Servers
▪Special servers that utilize encryption to prevent unauthorized users from intercepting
and reading a message that passes through its system.
•Session Cookie
▪Temporary cookie stored in a computers memory for remembering preferences during
a web site visit that is flushed on leaving the site.
•Shareware
▪Software that is distributed at no cost that can be used for free for a specific period of
time or under certain circumstances to allow evaluation.
•Shopping Cart
▪Software that keeps track of items a visitor picks to buy from your site until they
proceed to the “Checkout”.
E-Commerce Terminology (Contd.)
•SLA (Service Level Agreement)
▪Used in many merchant/institution and merchant/consumer transactions to define the
boundaries of what the service is committed to deliver and under what circumstances.
•SSL (Secure Socket Layer)
▪A secure protocol that ensures the integrity of information that is transmitted via this
means.
•Uptime
▪The amount of time a web site is available.
▪The industry benchmark at this point in time for availability is 99.99%.
•SOHO
▪Stands for Small Office/Home Office and refers to a specific group of people who
work from home or very small companies.
•SLA (Service Level Agreement)
▪Used in many merchant/institution and merchant/consumer transactions to define the
boundaries of what the service is committed to deliver and under what circumstances.
•SSL (Secure Socket Layer)
▪A secure protocol that ensures the integrity of information that is transmitted via this
means.
•Uptime
▪The amount of time a web site is available.
▪The industry benchmark at this point in time for availability is 99.99%.
•SOHO
▪Stands for Small Office/Home Office and refers to a specific group of people who
work from home or very small companies.
E-Commerce Terminology (Contd.)
•Turnkey
▪Refers to an application that with very few adjustments is ready for use, such as a
remotely hosted shopping cart service.
•User Session
▪Each visit to a web site by one person.
▪The session is usually “ended” when all pages have been closed or after a specific
time of inactivity.
•Vortals (Vertical Industry Portals)
▪Online resources that are gateways to specific industry related information.
•WYSIWYG (What You See Is What You Get)
▪An application that displays how the resulting page will look as it is being developed
by the user in which the screen displays what the end result will look like, while the
document is being created or modified.
•Turnkey
▪Refers to an application that with very few adjustments is ready for use, such as a
remotely hosted shopping cart service.
•User Session
▪Each visit to a web site by one person.
▪The session is usually “ended” when all pages have been closed or after a specific
time of inactivity.
•Vortals (Vertical Industry Portals)
▪Online resources that are gateways to specific industry related information.
•WYSIWYG (What You See Is What You Get)
▪An application that displays how the resulting page will look as it is being developed
by the user in which the screen displays what the end result will look like, while the
document is being created or modified.
Trends in E- commerce
1. AI and Personalization
•AI-powered recommendations: Platforms use AI to suggest products based on user
behavior.
•Chatbots and virtual assistants: Improve customer support and guide shoppers 24/7.
•Dynamic pricing: Prices adjust in real-time based on demand, competitor pricing,
and inventory.
2. Mobile Commerce (M-Commerce)
•Over 70% of e-commerce traffic now comes from mobile devices.
•Brands are optimizing for mobile-first design, faster loading speeds, and native apps.
•One-click payments (like Apple Pay or Google Pay) improve the checkout
experience.
1. AI and Personalization
•AI-powered recommendations: Platforms use AI to suggest products based on user
behavior.
•Chatbots and virtual assistants: Improve customer support and guide shoppers 24/7.
•Dynamic pricing: Prices adjust in real-time based on demand, competitor pricing,
and inventory.
2. Mobile Commerce (M-Commerce)
•Over 70% of e-commerce traffic now comes from mobile devices.
•Brands are optimizing for mobile-first design, faster loading speeds, and native apps.
•One-click payments (like Apple Pay or Google Pay) improve the checkout
experience.
Trends in E- commerce
3. Social Commerce
•Shopping directly on platforms like Instagram, TikTok, Facebook, and
YouTube.
•Influencer marketing and livestream shopping events drive engagement and
sales.
•TikTok Shop is rapidly growing, especially among Gen Z.
4. Omni channel Retailing
•Seamless experience across online and offline channels.
•Features like "Buy Online, Pick Up In Store" (BOPIS) and same-day delivery
are rising.
3. Social Commerce
•Shopping directly on platforms like Instagram, TikTok, Facebook, and
YouTube.
•Influencer marketing and livestream shopping events drive engagement and
sales.
•TikTok Shop is rapidly growing, especially among Gen Z.
4. Omni channel Retailing
•Seamless experience across online and offline channels.
•Features like "Buy Online, Pick Up In Store" (BOPIS) and same-day delivery
are rising.
Trends in E- commerce
5. Cross-Border E-commerce
•More consumers are buying from international websites, especially from Asia
and the US.
•Platforms are offering better localization (language, currency, customs) and
global logistics solutions.
6. Sustainable and Ethical Shopping
•Eco-conscious consumers prefer brands with sustainable packaging, ethical
sourcing, and carbon-neutral delivery.
•Brands highlight transparency and supply chain ethics in marketing.
5. Cross-Border E-commerce
•More consumers are buying from international websites, especially from Asia
and the US.
•Platforms are offering better localization (language, currency, customs) and
global logistics solutions.
6. Sustainable and Ethical Shopping
•Eco-conscious consumers prefer brands with sustainable packaging, ethical
sourcing, and carbon-neutral delivery.
•Brands highlight transparency and supply chain ethics in marketing.
Trends in E- commerce
7. Subscription Models & DTC (Direct to Consumer)
•Subscription boxes (like Dollar Shave Club or HelloFresh) are gaining
popularity.
•Brands are going DTC to build deeper customer relationships and better
margins.
8. Flexible Payment Options
•Growth of Buy Now, Pay Later (BNPL) services like Klarna, Afterpay, and
Affirm.
•Crypto payments are being explored, though still niche.
7. Subscription Models & DTC (Direct to Consumer)
•Subscription boxes (like Dollar Shave Club or HelloFresh) are gaining
popularity.
•Brands are going DTC to build deeper customer relationships and better
margins.
8. Flexible Payment Options
•Growth of Buy Now, Pay Later (BNPL) services like Klarna, Afterpay, and
Affirm.
•Crypto payments are being explored, though still niche.
Trends in E- commerce
9. Enhanced Cybersecurity & Data Privacy
•Increased focus on data protection, especially with regulations like GDPR and
CCPA.
•Two-factor authentication (2FA) and secure checkout are becoming standard.
10. AR/VR and Immersive Shopping
•Augmented Reality (AR) for trying on clothes, glasses, or seeing furniture in
your home.
•Virtual stores and showrooms powered by VR for a more immersive
experience.
9. Enhanced Cybersecurity & Data Privacy
•Increased focus on data protection, especially with regulations like GDPR and
CCPA.
•Two-factor authentication (2FA) and secure checkout are becoming standard.
10. AR/VR and Immersive Shopping
•Augmented Reality (AR) for trying on clothes, glasses, or seeing furniture in
your home.
•Virtual stores and showrooms powered by VR for a more immersive
experience.
Features of E-Commerce
•Non-Cash Payment
▪E-commerce enables use of credit cards, debit cards, smart cards, electronic fund
transfer via bank’s website and other modes of electronics payment.
•24 X 7 Service Availability
▪E-commerce automates business of enterprises and services provided by them to
customers are available anytime, anywhere.
▪Here 24 X 7 refers to 24 hours of each seven days of a week.
•Advertising
▪E-commerce increases the reach of advertising of products and services of businesses.
•Non-Cash Payment
▪E-commerce enables use of credit cards, debit cards, smart cards, electronic fund
transfer via bank’s website and other modes of electronics payment.
•24 X 7 Service Availability
▪E-commerce automates business of enterprises and services provided by them to
customers are available anytime, anywhere.
▪Here 24 X 7 refers to 24 hours of each seven days of a week.
•Advertising
▪E-commerce increases the reach of advertising of products and services of businesses.
Features of E-Commerce (Contd.)
•Marketing
▪It helps in better marketing management of products/services.
•Improved Sales
▪Using e-commerce, orders for the products can be generated any time, any where
without any human intervention.
▪By this way, dependencies to buy a product reduce at large and sales increases.
•Support
▪E-commerce provides various ways to provide pre sales and post sales assistance to
provide better services to customers.
•Marketing
▪It helps in better marketing management of products/services.
•Improved Sales
▪Using e-commerce, orders for the products can be generated any time, any where
without any human intervention.
▪By this way, dependencies to buy a product reduce at large and sales increases.
•Support
▪E-commerce provides various ways to provide pre sales and post sales assistance to
provide better services to customers.
Features of E-Commerce (Contd.)
•Inventory Management
▪Using e-commerce, inventory management of products becomes automated.
▪Reports get generated instantly when required.
▪Product inventory management becomes very efficient and easy to maintain.
•Communication Improvement
▪E-commerce provides ways for faster, efficient, reliable communication with
customers and partners.
•Inventory Management
▪Using e-commerce, inventory management of products becomes automated.
▪Reports get generated instantly when required.
▪Product inventory management becomes very efficient and easy to maintain.
•Communication Improvement
▪E-commerce provides ways for faster, efficient, reliable communication with
customers and partners.
Unique features of e-commerce
1.Personalization and AI-Driven Recommendations
•Personalized Experiences: E-commerce platforms now use data-driven algorithms
to tailor product recommendations, emails, and content to individual users based
on their browsing history, preferences, and behaviors.
•AI-Powered Chabot: Virtual assistants are increasingly used for instant customer
support, enhancing customer service with 24/7 availability and guiding users
through purchases.
2.Augmented Reality (AR) and Virtual Reality (VR)
•Virtual Try-On: Customers can visualize products like clothing, makeup, or furniture
in real-time, making online shopping more immersive and helping reduce returns.
•Virtual Stores: Some brands now offer fully virtualized shopping environments,
providing an in-store-like experience from home.
1.Personalization and AI-Driven Recommendations
•Personalized Experiences: E-commerce platforms now use data-driven algorithms
to tailor product recommendations, emails, and content to individual users based
on their browsing history, preferences, and behaviors.
•AI-Powered Chabot: Virtual assistants are increasingly used for instant customer
support, enhancing customer service with 24/7 availability and guiding users
through purchases.
2.Augmented Reality (AR) and Virtual Reality (VR)
•Virtual Try-On: Customers can visualize products like clothing, makeup, or furniture
in real-time, making online shopping more immersive and helping reduce returns.
•Virtual Stores: Some brands now offer fully virtualized shopping environments,
providing an in-store-like experience from home.
Unique features of e-commerce (Contd.)
3. Social Commerce
•Shoppable Posts: Platforms like Instagram and TikTok enable users to buy
products directly through posts and videos, blending social media
engagement with direct purchasing.
•Influencer Integration: E-commerce brands collaborate with influencers to
showcase products, often embedding links for instant purchase.
4. Voice Commerce
With the rise of smart speakers and virtual assistants (like Alexa and Google
Assistant), voice-enabled shopping is growing, allowing users to make
purchases with voice commands.
3. Social Commerce
•Shoppable Posts: Platforms like Instagram and TikTok enable users to buy
products directly through posts and videos, blending social media
engagement with direct purchasing.
•Influencer Integration: E-commerce brands collaborate with influencers to
showcase products, often embedding links for instant purchase.
4. Voice Commerce
With the rise of smart speakers and virtual assistants (like Alexa and Google
Assistant), voice-enabled shopping is growing, allowing users to make
purchases with voice commands.
Unique features of e-commerce (Contd.)
5. Subscription Models and Auto-Replenishment
•Subscriptions: Many e-commerce brands offer subscription models for
products customers use regularly, like groceries, personal care items, or pet
food.
•Auto-Replenishment: Smart technology can automatically reorder
consumable products, based on usage patterns or predictive AI.
6. Buy Now, Pay Later (BNPL) Options
Popularized by platforms like Klarna, Afterpay, and Affirm, BNPL
services offer consumers flexible payment options, making e-
commerce more accessible by spreading out costs.
5. Subscription Models and Auto-Replenishment
•Subscriptions: Many e-commerce brands offer subscription models for
products customers use regularly, like groceries, personal care items, or pet
food.
•Auto-Replenishment: Smart technology can automatically reorder
consumable products, based on usage patterns or predictive AI.
6. Buy Now, Pay Later (BNPL) Options
Popularized by platforms like Klarna, Afterpay, and Affirm, BNPL
services offer consumers flexible payment options, making e-
commerce more accessible by spreading out costs.
Unique features of e-commerce (Contd.)
7. Enhanced Security with Blockchain and AI
•Blockchain: For supply chain transparency and data security, blockchain is used to
verify transactions and ensure product authenticity.
•Fraud Detection: AI-powered fraud detection systems add an additional layer of
security, helping to reduce transaction fraud by identifying patterns in real time.
8. One-Click Checkout and Digital Wallet Integration
•Platforms integrate with digital wallets like Apple Pay, Google Pay, and PayPal,
streamlining checkout with a single click or tap, reducing cart abandonment rates.
9. Sustainable and Ethical Shopping Options
•E-commerce platforms often highlight eco-friendly products, allowing users to shop
sustainably. Many companies provide transparency on sourcing, production, and
carbon footprint.
7. Enhanced Security with Blockchain and AI
•Blockchain: For supply chain transparency and data security, blockchain is used to
verify transactions and ensure product authenticity.
•Fraud Detection: AI-powered fraud detection systems add an additional layer of
security, helping to reduce transaction fraud by identifying patterns in real time.
8. One-Click Checkout and Digital Wallet Integration
•Platforms integrate with digital wallets like Apple Pay, Google Pay, and PayPal,
streamlining checkout with a single click or tap, reducing cart abandonment rates.
9. Sustainable and Ethical Shopping Options
•E-commerce platforms often highlight eco-friendly products, allowing users to shop
sustainably. Many companies provide transparency on sourcing, production, and
carbon footprint.
Unique features of e-commerce (Contd.)
10. Same-Day and Drone Delivery
•Same-Day Delivery: Companies like Amazon and Walmart offer same-day or even
within-hours delivery in some areas, making online shopping faster and more
convenient.
•Drone Delivery: Though still in early stages, drone delivery has the potential to cut
delivery times drastically, especially for remote areas.
11. Data-Driven Analytics for Dynamic Pricing
•By leveraging real-time data, e-commerce sites can adjust prices dynamically based
on demand, competition, customer profile, or market conditions, optimizing
profitability and customer experience.
12. Omnichannel Experience
•E-commerce retailers increasingly support a seamless experience across physical
stores, online platforms, mobile apps, and social media, allowing customers to
interact with the brand in multiple ways.
10. Same-Day and Drone Delivery
•Same-Day Delivery: Companies like Amazon and Walmart offer same-day or even
within-hours delivery in some areas, making online shopping faster and more
convenient.
•Drone Delivery: Though still in early stages, drone delivery has the potential to cut
delivery times drastically, especially for remote areas.
11. Data-Driven Analytics for Dynamic Pricing
•By leveraging real-time data, e-commerce sites can adjust prices dynamically based
on demand, competition, customer profile, or market conditions, optimizing
profitability and customer experience.
12. Omnichannel Experience
•E-commerce retailers increasingly support a seamless experience across physical
stores, online platforms, mobile apps, and social media, allowing customers to
interact with the brand in multiple ways.
Unique features of e-commerce (Contd.)
13. Crypto currency Payments
•Some e-commerce platforms now accept crypto currencies as a payment
method, offering alternative options to attract a tech-savvy audience.
14. Ethical and Social Responsibility Initiatives
•Many brands are integrating social responsibility directly into their platforms,
such as showing carbon footprints, supporting charitable causes, or
highlighting fair-trade products. It incorporates a “purchase with purpose”
model.
15. Automated Returns and Exchange Processes
•Automated systems for handling returns and exchanges make it easier for
customers to manage these tasks, improving customer satisfaction while
saving businesses time and resources.
13. Crypto currency Payments
•Some e-commerce platforms now accept crypto currencies as a payment
method, offering alternative options to attract a tech-savvy audience.
14. Ethical and Social Responsibility Initiatives
•Many brands are integrating social responsibility directly into their platforms,
such as showing carbon footprints, supporting charitable causes, or
highlighting fair-trade products. It incorporates a “purchase with purpose”
model.
15. Automated Returns and Exchange Processes
•Automated systems for handling returns and exchanges make it easier for
customers to manage these tasks, improving customer satisfaction while
saving businesses time and resources.
E-commerce vs. E-business
Aspect E-Commerce E-Business
Definition Refers specifically to the buying and selling of
goods and services over the internet.
Encompasses all business activities conducted online,
including e-commerce and internal processes.
Scope Narrower in scope, limited to commercial
transactions.
Broader in scope, covering all aspects of business
operations (internal and external).
Focus Focuses on revenue generation through online
sales and transactions.
Focuses on improving overall business efficiency,
integration, and processes.
Key Activities - Online shopping (B2C, B2B, C2C).
- Digital payments and transactions.
- Order processing and fulfillment.
- Online procurement and supply chain management.
- Customer relationship management (CRM).
- Employee training and collaboration.
- Online marketing and advertising.
Examples - Amazon (online retail).
- eBay (auctions and C2C sales).
- Netflix (subscription-based services).
- IBM (enterprise resource planning systems).
- Salesforce (CRM and cloud-based tools).
- Online banking platforms (e.g., Chase, Bank of
America).
Technology Used- Online payment gateways (e.g., PayPal, Stripe).
- Shopping cart software.
- E-commerce platforms (e.g., Shopify,
WooCommerce).
- Enterprise resource planning (ERP) systems.
- Customer relationship management (CRM)
software.
- Collaboration tools (e.g., Slack, Microsoft Teams).
Participants - Buyers and sellers.
- Customers and businesses.
- Employees, suppliers, customers, and partners.
- Internal and external stakeholders.
Aspect E-Commerce E-Business
Definition Refers specifically to the buying and selling of
goods and services over the internet.
Encompasses all business activities conducted online,
including e-commerce and internal processes.
Scope Narrower in scope, limited to commercial
transactions.
Broader in scope, covering all aspects of business
operations (internal and external).
Focus Focuses on revenue generation through online
sales and transactions.
Focuses on improving overall business efficiency,
integration, and processes.
Key Activities - Online shopping (B2C, B2B, C2C).
- Digital payments and transactions.
- Order processing and fulfillment.
- Online procurement and supply chain management.
- Customer relationship management (CRM).
- Employee training and collaboration.
- Online marketing and advertising.
Examples - Amazon (online retail).
- eBay (auctions and C2C sales).
- Netflix (subscription-based services).
- IBM (enterprise resource planning systems).
- Salesforce (CRM and cloud-based tools).
- Online banking platforms (e.g., Chase, Bank of
America).
Technology Used- Online payment gateways (e.g., PayPal, Stripe).
- Shopping cart software.
- E-commerce platforms (e.g., Shopify,
WooCommerce).
- Enterprise resource planning (ERP) systems.
- Customer relationship management (CRM)
software.
- Collaboration tools (e.g., Slack, Microsoft Teams).
Participants - Buyers and sellers.
- Customers and businesses.
- Employees, suppliers, customers, and partners.
- Internal and external stakeholders.
E-commerce vs. E-business
Objective To facilitate online transactions and generate revenue.To streamline and optimize all business processes for
efficiency and growth.
Customer Interaction Primarily customer-facing (B2C, B2B, C2C). Includes both customer-facing and internal business
processes (e.g., HR, finance, supply chain).
Examples of Processes - Product listing.
- Online payments.
- Order tracking.
- Inventory management.
- Employee training.
- Online collaboration.
- CRM.
Revenue Model Direct revenue generation through sales. Indirect revenue generation through improved efficiency,
cost savings, and customer retention.
Dependency on Internet Fully dependent on the internet for transactions. Partially dependent on the internet; some processes may
still operate offline.
Key Benefits - Convenience for customers.
- Global reach.
- Lower operational costs.
- Improved business efficiency.
- Better integration of processes.
- Enhanced decision-making through data analytics.
Challenges - Security risks (e.g., fraud, data breaches).
- Intense competition.
- Logistics issues.
- High implementation costs.
- Requires skilled personnel.
- Integration challenges.
Objective To facilitate online transactions and generate revenue.To streamline and optimize all business processes for
efficiency and growth.
Customer Interaction Primarily customer-facing (B2C, B2B, C2C). Includes both customer-facing and internal business
processes (e.g., HR, finance, supply chain).
Examples of Processes - Product listing.
- Online payments.
- Order tracking.
- Inventory management.
- Employee training.
- Online collaboration.
- CRM.
Revenue Model Direct revenue generation through sales. Indirect revenue generation through improved efficiency,
cost savings, and customer retention.
Dependency on Internet Fully dependent on the internet for transactions. Partially dependent on the internet; some processes may
still operate offline.
Key Benefits - Convenience for customers.
- Global reach.
- Lower operational costs.
- Improved business efficiency.
- Better integration of processes.
- Enhanced decision-making through data analytics.
Challenges - Security risks (e.g., fraud, data breaches).
- Intense competition.
- Logistics issues.
- High implementation costs.
- Requires skilled personnel.
- Integration challenges.
Types of E-Commerce
B2C – Business to consumer:
•B2C businesses sell to their end-user. The B2C model is the most common business
model, so there are many unique approaches under this umbrella.
•Anything you buy in an online store as a consumer-think wardrobe, household supplies,
entertainment is done as part of a B2C transaction.
•The decision-making process for a B2C purchase is much shorter than a business-to-
business (B2B) purchase, especially for items that have a lower value.
•Examples: Daraz, Sastodeal, Gyapu, Foodmandu, MetroTarkari etc.
B2C – Business to consumer:
•B2C businesses sell to their end-user. The B2C model is the most common business
model, so there are many unique approaches under this umbrella.
•Anything you buy in an online store as a consumer-think wardrobe, household supplies,
entertainment is done as part of a B2C transaction.
•The decision-making process for a B2C purchase is much shorter than a business-to-
business (B2B) purchase, especially for items that have a lower value.
•Examples: Daraz, Sastodeal, Gyapu, Foodmandu, MetroTarkari etc.
Types of E-Commerce (Contd.)
B2B – Business to business:
•In a B2B business model, a business sells its product or service to another business.
Sometimes the buyer is the end user, but often the buyer resells to the consumer.
•B2B transactions generally have a longer sales cycle, but higher order value and more
recurring purchases.
•Examples: Business Software (e.g., HR, ERP, Content Marketing Software) and
Business Supplies (e.g., Alibaba, Pahilo (Nepal))
B2B – Business to business:
•In a B2B business model, a business sells its product or service to another business.
Sometimes the buyer is the end user, but often the buyer resells to the consumer.
•B2B transactions generally have a longer sales cycle, but higher order value and more
recurring purchases.
•Examples: Business Software (e.g., HR, ERP, Content Marketing Software) and
Business Supplies (e.g., Alibaba, Pahilo (Nepal))
Types of E-Commerce (Contd.)
C2B – Consumer to business:
•C2B businesses allow individuals to sell goods and services to companies.
•In this e-commerce model, a site might allow customers to post the work they want to be
completed and have businesses bid for the opportunity. Affiliate marketing services would
also be considered C2B.
•Elance (now Upwork) was an early innovator in this model by helping businesses hire
freelancers.
•Examples: Upwork, Fiverr, PeoplePerHour etc.
C2B – Consumer to business:
•C2B businesses allow individuals to sell goods and services to companies.
•In this e-commerce model, a site might allow customers to post the work they want to be
completed and have businesses bid for the opportunity. Affiliate marketing services would
also be considered C2B.
•Elance (now Upwork) was an early innovator in this model by helping businesses hire
freelancers.
•Examples: Upwork, Fiverr, PeoplePerHour etc.
Types of E-Commerce (Contd.)
C2C – Consumer to consumer:
•A C2C business - also called an online marketplace - connects consumers to exchange
goods and services and typically make their money by charging transaction or listing fees.
•C2C businesses benefit from self-propelled growth by motivated buyers and sellers, but
face a key challenge in quality control and technology maintenance.
•Examples: Hamrobazar (Nepal), eBay (India), Facebook Marketplace etc.
C2C – Consumer to consumer:
•A C2C business - also called an online marketplace - connects consumers to exchange
goods and services and typically make their money by charging transaction or listing fees.
•C2C businesses benefit from self-propelled growth by motivated buyers and sellers, but
face a key challenge in quality control and technology maintenance.
•Examples: Hamrobazar (Nepal), eBay (India), Facebook Marketplace etc.
M - Commerce
•In Simple terms:
▪M – Commerce = E – Commerce + Wireless Web
•M-commerce is also known as Mobile Commerce.
•M-commerce is the buying and selling of goods and services through wireless hand held
devices like smartphones, tablets, etc.
•It is a process of paying for services using a mobile phone or personal organizer.
•In Simple terms:
▪M – Commerce = E – Commerce + Wireless Web
•M-commerce is also known as Mobile Commerce.
•M-commerce is the buying and selling of goods and services through wireless hand held
devices like smartphones, tablets, etc.
•It is a process of paying for services using a mobile phone or personal organizer.
Attributes of M commerce
•Ubiquity – Access services anytime, anywhere.
•Convenience – Easy shopping and transactions on mobile devices.
•Personalization – AI-driven recommendations and targeted marketing.
•Location-Based Services (LBS) – GPS-enabled offers and local business discovery.
•Security & Privacy – Encryption, biometrics, and secure payment methods.
•Instant Connectivity – Real-time chats, push notifications, and chatbot support.
•Multiple Payment Options – Mobile wallets, UPI, QR codes, and digital banking.
•Interactive & Engaging UX – AR/VR shopping, voice search, and AI assistants.
•Omni channel Integration – Seamless transition between mobile, web, and
physical stores.
•Scalability & Global Reach – Supports multiple currencies, languages, and
international markets.
•Ubiquity – Access services anytime, anywhere.
•Convenience – Easy shopping and transactions on mobile devices.
•Personalization – AI-driven recommendations and targeted marketing.
•Location-Based Services (LBS) – GPS-enabled offers and local business discovery.
•Security & Privacy – Encryption, biometrics, and secure payment methods.
•Instant Connectivity – Real-time chats, push notifications, and chatbot support.
•Multiple Payment Options – Mobile wallets, UPI, QR codes, and digital banking.
•Interactive & Engaging UX – AR/VR shopping, voice search, and AI assistants.
•Omni channel Integration – Seamless transition between mobile, web, and
physical stores.
•Scalability & Global Reach – Supports multiple currencies, languages, and
international markets.
Scope of M commerce
•Retail and Shopping – Online shopping, personalized recommendations, QR-based purchases.
•Mobile Banking & Financial Services – Fund transfers, mobile wallets, stock trading.
•Mobile Payments & Digital Transactions – UPI, QR codes, NFC-based secure payments.
•On-Demand Services – Ride-hailing, food delivery, online bookings.
•Social Commerce – Buying and selling through social media platforms.
•Healthcare & Telemedicine – Online doctor consultations, medicine delivery, health monitoring.
•Education & E-Learning – Virtual classrooms, mobile courses, and certification programs.
•Entertainment & Digital Content – Streaming services, mobile gaming, e-books.
•Enterprise & Business Solutions – Mobile ERP, CRM, and cloud-based business management tools.
•Augmented Reality (AR) & Virtual Reality (VR) – Virtual try-ons, AR navigation, and immersive shopping
experiences.
•Smart Cities & IoT Integration – Smart home automation, digital ticketing, and IoT-enabled services.
•Growth in Rural & Emerging Markets – Expansion of digital payments, microfinance, and agricultural
e-commerce.
•Retail and Shopping – Online shopping, personalized recommendations, QR-based purchases.
•Mobile Banking & Financial Services – Fund transfers, mobile wallets, stock trading.
•Mobile Payments & Digital Transactions – UPI, QR codes, NFC-based secure payments.
•On-Demand Services – Ride-hailing, food delivery, online bookings.
•Social Commerce – Buying and selling through social media platforms.
•Healthcare & Telemedicine – Online doctor consultations, medicine delivery, health monitoring.
•Education & E-Learning – Virtual classrooms, mobile courses, and certification programs.
•Entertainment & Digital Content – Streaming services, mobile gaming, e-books.
•Enterprise & Business Solutions – Mobile ERP, CRM, and cloud-based business management tools.
•Augmented Reality (AR) & Virtual Reality (VR) – Virtual try-ons, AR navigation, and immersive shopping
experiences.
•Smart Cities & IoT Integration – Smart home automation, digital ticketing, and IoT-enabled services.
•Growth in Rural & Emerging Markets – Expansion of digital payments, microfinance, and agricultural
e-commerce.
Location-based commerce (L-commerce)
⚫ It is refers to the use of location-finding systems such as GPS-enabled
devices or similar technologies (e.g cell-based stations) to find where
a customer with a mobile device or an object is located and provide
relevant services, such as an advertisement or vehicle route
optimization.
⚫LBC is also known as LBS (location-based systems).
⚫LBS is "a software application for an IP-capable mobile device that
requires knowledge about where the mobile device is located.
⚫L-commerce offers convenient services to consumers such as
connections with friends, the ability to receive relevant and timely
sales information, safety features (e.g. emergency assistance), and
convenience (a user can locate what facility needed is nearby without
consulting a directory or a map).
⚫Sellers get the opportunity to advertise and provide or meet a
customer's needs in real time.
⚫In essence, LBC is the delivery of m-commerce transactions to
individuals who are in a known specific location, at a specific time.
⚫ It is refers to the use of location-finding systems such as GPS-enabled
devices or similar technologies (e.g cell-based stations) to find where
a customer with a mobile device or an object is located and provide
relevant services, such as an advertisement or vehicle route
optimization.
⚫LBC is also known as LBS (location-based systems).
⚫LBS is "a software application for an IP-capable mobile device that
requires knowledge about where the mobile device is located.
⚫L-commerce offers convenient services to consumers such as
connections with friends, the ability to receive relevant and timely
sales information, safety features (e.g. emergency assistance), and
convenience (a user can locate what facility needed is nearby without
consulting a directory or a map).
⚫Sellers get the opportunity to advertise and provide or meet a
customer's needs in real time.
⚫In essence, LBC is the delivery of m-commerce transactions to
individuals who are in a known specific location, at a specific time.
Location-based commerce (L-commerce) Cont..
L-Commerce: Location based commerce
⚫ E-commerce applications provided to customers based on
a user’s specific location Location-based technologies
⚫Global positioning systems (GPS): a wireless system that
uses satellites to enable users to determine their position
anywhere on the earth.
⚫Geographical information systems (GIS): relates longitude
and latitude of GPS into place or address (mapinfo.com)
⚫Location Based Mobile System (LBMS): Real time
location tracking feature of the smartphone.
L-Commerce: Location based commerce
⚫ E-commerce applications provided to customers based on
a user’s specific location Location-based technologies
⚫Global positioning systems (GPS): a wireless system that
uses satellites to enable users to determine their position
anywhere on the earth.
⚫Geographical information systems (GIS): relates longitude
and latitude of GPS into place or address (mapinfo.com)
⚫Location Based Mobile System (LBMS): Real time
location tracking feature of the smartphone.
L-Commerce Infrastructure
Location finder (positioning) component
⚫ Mobile Positioning Center
⚫User
⚫Mobile devices
⚫Mobile communication network
⚫Service or application providers
⚫Data or content provider
⚫Geographical Information System (GIS)
Location finder (positioning) component
⚫ Mobile Positioning Center
⚫User
⚫Mobile devices
⚫Mobile communication network
⚫Service or application providers
⚫Data or content provider
⚫Geographical Information System (GIS)
Social commerce
•Social commerce is a form of e-commerce that leverages social media
platforms to facilitate the buying and selling of products and services.
•It integrates social interactions, user-generated content, and community
engagement into the shopping experience, allowing users to discover,
research, and purchase products directly within social media environments.
•Social commerce is transforming the traditional online shopping experience
by making it more interactive, personalized, and community-driven.
•As social media continues to evolve, its integration with e-commerce is
expected to deepen, offering new opportunities for both consumers and
businesses.
•Social commerce is a form of e-commerce that leverages social media
platforms to facilitate the buying and selling of products and services.
•It integrates social interactions, user-generated content, and community
engagement into the shopping experience, allowing users to discover,
research, and purchase products directly within social media environments.
•Social commerce is transforming the traditional online shopping experience
by making it more interactive, personalized, and community-driven.
•As social media continues to evolve, its integration with e-commerce is
expected to deepen, offering new opportunities for both consumers and
businesses.
Key features
•Seamless Shopping Experience: Users can browse, inquire, and purchase
products without leaving their preferred social media platforms.
•Enhanced Trust through Social Proof: Customer reviews, ratings, and
recommendations from peers or influencers build credibility and influence
purchasing decisions.
•Increased Engagement: Interactive content such as live streams, stories,
and reels fosters real-time interaction between brands and consumers.
•Targeted Marketing: Brands can utilize user data to deliver personalized
advertisements, increasing the relevance and effectiveness of marketing
efforts.
•Community Building: Brands can cultivate communities around their
products, encouraging user participation and loyalty.
•Seamless Shopping Experience: Users can browse, inquire, and purchase
products without leaving their preferred social media platforms.
•Enhanced Trust through Social Proof: Customer reviews, ratings, and
recommendations from peers or influencers build credibility and influence
purchasing decisions.
•Increased Engagement: Interactive content such as live streams, stories,
and reels fosters real-time interaction between brands and consumers.
•Targeted Marketing: Brands can utilize user data to deliver personalized
advertisements, increasing the relevance and effectiveness of marketing
efforts.
•Community Building: Brands can cultivate communities around their
products, encouraging user participation and loyalty.
Pure vs. partial e-commerce
•Pure E-Commerce
•A business that operates entirely online. All transactions, from
browsing to purchasing, are conducted digitally.
•Characteristics:
•No physical store or offline presence.
•Products or services are sold exclusively through an online platform (website,
app, or marketplace).
•Examples: Digital products (e.g., eBooks, software), online-only retailers (e.g.,
Amazon for certain products), or subscription-based services (e.g., Netflix).
•Pure E-Commerce
•A business that operates entirely online. All transactions, from
browsing to purchasing, are conducted digitally.
•Characteristics:
•No physical store or offline presence.
•Products or services are sold exclusively through an online platform (website,
app, or marketplace).
•Examples: Digital products (e.g., eBooks, software), online-only retailers (e.g.,
Amazon for certain products), or subscription-based services (e.g., Netflix).
•Partial E-Commerce
•A business that combines both online and offline operations. It has a
physical presence (e.g., brick-and-mortar stores) but also offers online
sales or services.
•Characteristics:
•Operates both online and offline channels.
•Customers can choose to shop in-store or online.
•Examples: Traditional retailers with online stores (e.g., Walmart, Target),
restaurants with online ordering, or service providers with both physical and
digital offerings.
•A business that combines both online and offline operations. It has a
physical presence (e.g., brick-and-mortar stores) but also offers online
sales or services.
•Characteristics:
•Operates both online and offline channels.
•Customers can choose to shop in-store or online.
•Examples: Traditional retailers with online stores (e.g., Walmart, Target),
restaurants with online ordering, or service providers with both physical and
digital offerings.
Pure vs. partial e-commerce
Aspect Pure E-Commerce Partial E-Commerce
PresenceOnline-only Both online and offline
Customer
Interaction
Digital-only Physical and digital
ExamplesAmazon (digital products),
Netflix
Walmart, Target, Best Buy
Cost
Structure
Lower overhead Higher overhead (dual operations)
Customer
Reach
Global Local and global
FlexibilityLimited to online Offers multiple shopping options
Aspect Pure E-Commerce Partial E-Commerce
PresenceOnline-only Both online and offline
Customer
Interaction
Digital-only Physical and digital
ExamplesAmazon (digital products),
Netflix
Walmart, Target, Best Buy
Cost
Structure
Lower overhead Higher overhead (dual operations)
Customer
Reach
Global Local and global
FlexibilityLimited to online Offers multiple shopping options
History of E-commerce
1. Invention (1970s–1995): The Birth of E-commerce
•Early Technologies:
•E-commerce emerged from technologies like Electronic Data Interchange
(EDI) and teleshopping in the 1970s.
•In 1979, Michael Aldrich developed online shopping using a modified TV
connected to a transaction-processing computer.
•First E-commerce Transactions:
•In 1994, Net Market completed the first secure online retail transaction.
•Rise of Early Platforms:
•Companies like Amazon (1994) and eBay (1995) were pioneers, starting as
online bookstore and auction sites respectively.
1. Invention (1970s–1995): The Birth of E-commerce
•Early Technologies:
•E-commerce emerged from technologies like Electronic Data Interchange
(EDI) and teleshopping in the 1970s.
•In 1979, Michael Aldrich developed online shopping using a modified TV
connected to a transaction-processing computer.
•First E-commerce Transactions:
•In 1994, Net Market completed the first secure online retail transaction.
•Rise of Early Platforms:
•Companies like Amazon (1994) and eBay (1995) were pioneers, starting as
online bookstore and auction sites respectively.
2. Consolidation (1995–2005): Expansion and Regulation
•Dot-Com Boom and Bust:
•A wave of startups entered the market, but many collapsed during the dot-com
bust of 2000–2001.
•Survivors like Amazon and eBay solidified their positions.
•Infrastructure Development:
•Growth in secure payment systems (e.g., PayPal) and improvements in
internet speed fueled consumer adoption.
•Emergence of Regulation:
•Governments began to create policies on data privacy, consumer protection,
and online taxation.
•Dot-Com Boom and Bust:
•A wave of startups entered the market, but many collapsed during the dot-com
bust of 2000–2001.
•Survivors like Amazon and eBay solidified their positions.
•Infrastructure Development:
•Growth in secure payment systems (e.g., PayPal) and improvements in
internet speed fueled consumer adoption.
•Emergence of Regulation:
•Governments began to create policies on data privacy, consumer protection,
and online taxation.
3. Reinvention (2005–Present): Mobile, AI, and Global Commerce
•Web 2.0 and Social Commerce:
•User-generated content and social media integrated with shopping (e.g., Facebook Shops,
Instagram Shopping).
•Mobile Commerce (M-commerce):
•Smartphones revolutionized e-commerce with apps and responsive websites.
•Platform Economy:
•Giants like Amazon, Alibaba, Shopify, and Walmart.com created ecosystems for third-party
sellers.
•AI, Personalization, and Logistics:
•Use of AI for recommendations, chatbots, real-time tracking, and automated warehouses
transformed the customer experience.
•Global Reach:
•Cross-border e-commerce expanded with better logistics and international payment systems.
•Web 2.0 and Social Commerce:
•User-generated content and social media integrated with shopping (e.g., Facebook Shops,
Instagram Shopping).
•Mobile Commerce (M-commerce):
•Smartphones revolutionized e-commerce with apps and responsive websites.
•Platform Economy:
•Giants like Amazon, Alibaba, Shopify, and Walmart.com created ecosystems for third-party
sellers.
•AI, Personalization, and Logistics:
•Use of AI for recommendations, chatbots, real-time tracking, and automated warehouses
transformed the customer experience.
•Global Reach:
•Cross-border e-commerce expanded with better logistics and international payment systems.
Understanding E-commerce:
•Technology,
•Business,
•Society Perspectives;
•Technology,
•Business,
•Society Perspectives;
Technology Perspective
•The technology dimension of e-commerce focuses on the tools and systems that make electronic transactions and
online interactions possible.
•Internet and Web Technologies:
•The foundation of e-commerce is the internet and World Wide Web (WWW), which enable the transfer of data and content.
•HTML, CSS, JavaScript, XML are used for creating interactive websites.
•E-commerce Infrastructure:
•Web servers, cloud computing, database systems, and payment gateways (e.g., Stripe, PayPal).
•Platforms like Shopify, Magento, and WooCommerce provide end-to-end solutions.
•Security and Encryption:
•SSL/TLS, firewalls, and multi-factor authentication protect data and transactions.
•Compliance with standards like PCI DSS is vital.
•Emerging Technologies:
•AI & Machine Learning for personalization and fraud detection.
•Blockchain for transparent and secure transactions.
•IoT (Internet of Things) for automated reordering (e.g., smart fridges).
•Augmented Reality (AR) and Virtual Reality (VR) for immersive shopping experiences.
•The technology dimension of e-commerce focuses on the tools and systems that make electronic transactions and
online interactions possible.
•Internet and Web Technologies:
•The foundation of e-commerce is the internet and World Wide Web (WWW), which enable the transfer of data and content.
•HTML, CSS, JavaScript, XML are used for creating interactive websites.
•E-commerce Infrastructure:
•Web servers, cloud computing, database systems, and payment gateways (e.g., Stripe, PayPal).
•Platforms like Shopify, Magento, and WooCommerce provide end-to-end solutions.
•Security and Encryption:
•SSL/TLS, firewalls, and multi-factor authentication protect data and transactions.
•Compliance with standards like PCI DSS is vital.
•Emerging Technologies:
•AI & Machine Learning for personalization and fraud detection.
•Blockchain for transparent and secure transactions.
•IoT (Internet of Things) for automated reordering (e.g., smart fridges).
•Augmented Reality (AR) and Virtual Reality (VR) for immersive shopping experiences.
Business Perspective
•From the business view, e-commerce is about leveraging digital tools to optimize
commercial transactions, reach customers, and gain a competitive advantage.
•Business Models in E-commerce:
•B2C (Business-to-Consumer)
•B2B (Business-to-Business)
•C2C (Consumer-to-Consumer)
•C2B (Consumer-to-Business)
•Revenue Models:
•Sales Revenue Model: Selling goods/services directly.
•Subscription Model: Recurring payments (e.g., Netflix, Amazon Prime).
•Transaction Fee Model: Earning from each transaction (e.g., eBay).
•Advertising Model: Revenue from ads (e.g., Google, Facebook).
•Affiliate Model: Commissions from referrals (e.g., Amazon Associates).
•From the business view, e-commerce is about leveraging digital tools to optimize
commercial transactions, reach customers, and gain a competitive advantage.
•Business Models in E-commerce:
•B2C (Business-to-Consumer)
•B2B (Business-to-Business)
•C2C (Consumer-to-Consumer)
•C2B (Consumer-to-Business)
•Revenue Models:
•Sales Revenue Model: Selling goods/services directly.
•Subscription Model: Recurring payments (e.g., Netflix, Amazon Prime).
•Transaction Fee Model: Earning from each transaction (e.g., eBay).
•Advertising Model: Revenue from ads (e.g., Google, Facebook).
•Affiliate Model: Commissions from referrals (e.g., Amazon Associates).
Business Perspective
•Digital Marketing Strategies:
•SEO & SEM, email marketing, influencer partnerships, social media
advertising, and content marketing.
•Customer Relationship Management (CRM):
•Managing and analyzing customer interactions to improve retention and
loyalty.
•Supply Chain & Fulfillment:
•Efficient inventory management, logistics, warehousing, and last-mile
delivery.
•Digital Marketing Strategies:
•SEO & SEM, email marketing, influencer partnerships, social media
advertising, and content marketing.
•Customer Relationship Management (CRM):
•Managing and analyzing customer interactions to improve retention and
loyalty.
•Supply Chain & Fulfillment:
•Efficient inventory management, logistics, warehousing, and last-mile
delivery.
Society Perspective
•E-commerce impacts society in both empowering and challenging ways.
•Positive Impacts:
•Increased access to goods and services for rural or underserved communities.
•Convenience and time-saving for consumers.
•New job opportunities in tech, logistics, and digital services.
•Empowerment of small businesses through global reach.
•Negative Impacts:
•Digital divide: Not all populations have equal access to internet or tech literacy.
•Job displacement in traditional retail sectors.
•Privacy concerns and surveillance capitalism.
•Environmental issues from packaging and delivery emissions.
•Legal and Ethical Issues:
•Data privacy laws: GDPR (Europe), CCPA (California).
•Consumer rights: Return policies, warranties.
•Cybercrime: Phishing, identity theft, fake websites.
•Taxation and jurisdiction challenges in cross-border trade.
•E-commerce impacts society in both empowering and challenging ways.
•Positive Impacts:
•Increased access to goods and services for rural or underserved communities.
•Convenience and time-saving for consumers.
•New job opportunities in tech, logistics, and digital services.
•Empowerment of small businesses through global reach.
•Negative Impacts:
•Digital divide: Not all populations have equal access to internet or tech literacy.
•Job displacement in traditional retail sectors.
•Privacy concerns and surveillance capitalism.
•Environmental issues from packaging and delivery emissions.
•Legal and Ethical Issues:
•Data privacy laws: GDPR (Europe), CCPA (California).
•Consumer rights: Return policies, warranties.
•Cybercrime: Phishing, identity theft, fake websites.
•Taxation and jurisdiction challenges in cross-border trade.
Disadvantages / Limitations of e-commerce
•The disadvantages of e-commerce can be broadly classified into two major
categories
▪Technical disadvantages
▪Non-Technical disadvantages
•The disadvantages of e-commerce can be broadly classified into two major
categories
▪Technical disadvantages
▪Non-Technical disadvantages
Technical Disadvantages
•There can be lack of system security, reliability or standards owing to poor implementation
of e-commerce.
•The software development industry is still evolving and keeps changing rapidly.
•In many countries, network bandwidth might cause an issue.
•Special types of web servers or other software might be required by the vendor, setting the
e-commerce environment apart from network servers.
•Sometimes, it becomes difficult to integrate an e-commerce software or website with
existing applications or databases.
•There could be software/hardware compatibility issues, as some e-commerce software may
be incompatible with some operating system or any other component.
•There can be lack of system security, reliability or standards owing to poor implementation
of e-commerce.
•The software development industry is still evolving and keeps changing rapidly.
•In many countries, network bandwidth might cause an issue.
•Special types of web servers or other software might be required by the vendor, setting the
e-commerce environment apart from network servers.
•Sometimes, it becomes difficult to integrate an e-commerce software or website with
existing applications or databases.
•There could be software/hardware compatibility issues, as some e-commerce software may
be incompatible with some operating system or any other component.
Non Technical Disadvantages
•Initial cost: The cost of creating/building an e-commerce application in-house may be very
high. There could be delays in launching an e-Commerce application due to mistakes, and
lack of experience.
•User resistance: Users may not trust the site being an unknown faceless seller. Such
mistrust makes it difficult to convince traditional users to switch from physical stores to
online/virtual stores.
•Security/ Privacy: It is difficult to ensure the security or privacy on online transactions.
•Lack of touch or feel of products during online shopping is a drawback.
•E-commerce applications are still evolving and changing rapidly.
•Internet access is still not cheaper and is inconvenient to use for many potential customers,
for example, those living in remote villages.
•Initial cost: The cost of creating/building an e-commerce application in-house may be very
high. There could be delays in launching an e-Commerce application due to mistakes, and
lack of experience.
•User resistance: Users may not trust the site being an unknown faceless seller. Such
mistrust makes it difficult to convince traditional users to switch from physical stores to
online/virtual stores.
•Security/ Privacy: It is difficult to ensure the security or privacy on online transactions.
•Lack of touch or feel of products during online shopping is a drawback.
•E-commerce applications are still evolving and changing rapidly.
•Internet access is still not cheaper and is inconvenient to use for many potential customers,
for example, those living in remote villages.
History of E-Commerce Business in Nepal
•E-commerce was introduced in Nepal with an aim of letting Nepalese residing abroad
send gifts to their families, friends, and relatives living here. The shift from physical
stores to virtual ones began in the late 1990s.
•Online shopping in Nepal dates back to 2000s with the launch of Muncha and Thamel
Dot Com the same year.
•Muncha initially launched its online store to allow Nepalese living abroad to send
gifts to family and friends in Nepal.
•Thamel dot com used to sell Khasi (goats) online during Dashain. Nepalese living abroad
would order Khasi for their family back home and make payment (remit the money).
•After receiving the money, Thamel dot com would deliver the Khasi to the doorstep of
their family. Although this was limited to just Kathmandu Valley, this marked an start of
ecommerce business in Nepal.
•E-commerce was introduced in Nepal with an aim of letting Nepalese residing abroad
send gifts to their families, friends, and relatives living here. The shift from physical
stores to virtual ones began in the late 1990s.
•Online shopping in Nepal dates back to 2000s with the launch of Muncha and Thamel
Dot Com the same year.
•Muncha initially launched its online store to allow Nepalese living abroad to send
gifts to family and friends in Nepal.
•Thamel dot com used to sell Khasi (goats) online during Dashain. Nepalese living abroad
would order Khasi for their family back home and make payment (remit the money).
•After receiving the money, Thamel dot com would deliver the Khasi to the doorstep of
their family. Although this was limited to just Kathmandu Valley, this marked an start of
ecommerce business in Nepal.
History of E-Commerce Business in Nepal
•Gradually, many e-commerce companies came into operation. Such major companies
include NepBay.com, now changed into Thulo Market established in 2007 (as an online
directory of products and shops in Kathmandu), Foodmandu (2010), Sastodeal (2011),
Urban Girl, now changed into UG Bazaar (2012), Daraz (initially started as Kyamu in
2013 and acquired by Alibaba Group in 2018) and many more.
•With the launch of eSewa, the first payment gateway of Nepal, in 2009, and other
payment services like Khalti, IME Pay, and many more, a fertile ground has been laid for
the growth of e-commerce in Nepal.
•Today, there are about 40k+ registered commercial websites in Nepal. Sooner or later,
every small or big business venture will launch their e-commerce sites.
•Gradually, many e-commerce companies came into operation. Such major companies
include NepBay.com, now changed into Thulo Market established in 2007 (as an online
directory of products and shops in Kathmandu), Foodmandu (2010), Sastodeal (2011),
Urban Girl, now changed into UG Bazaar (2012), Daraz (initially started as Kyamu in
2013 and acquired by Alibaba Group in 2018) and many more.
•With the launch of eSewa, the first payment gateway of Nepal, in 2009, and other
payment services like Khalti, IME Pay, and many more, a fertile ground has been laid for
the growth of e-commerce in Nepal.
•Today, there are about 40k+ registered commercial websites in Nepal. Sooner or later,
every small or big business venture will launch their e-commerce sites.
Challenges of E-Commerce business in Nepal (Contd.)
•Nepalese have a lot of free time in hand. They can walk to the store and buy things anytime.
This is one of the major challenges of the E-Commerce business.
•Shopping is a group activity most of the time. Whenever one has to buy something, he/she
goes to the shop with a bunch of friends. This experience is also another challenge for
eCommerce sites.
•Technology and literacy of Technology.
•People are using eCommerce platforms merely to check the prices so that they can bargain
while buying the product from an offline vendor. So, they are used more as a reference tool
than a buying platform.
•Nepalese have a lot of free time in hand. They can walk to the store and buy things anytime.
This is one of the major challenges of the E-Commerce business.
•Shopping is a group activity most of the time. Whenever one has to buy something, he/she
goes to the shop with a bunch of friends. This experience is also another challenge for
eCommerce sites.
•Technology and literacy of Technology.
•People are using eCommerce platforms merely to check the prices so that they can bargain
while buying the product from an offline vendor. So, they are used more as a reference tool
than a buying platform.
Challenges of E-Commerce business in Nepal
•Lack of credit card and wallet system. However, this challenge is being reduced due to many
e-wallet providers such as esewa, khalti and imepay. Also, banks are attempting to increase
the use of credit cards.
•The global problem; missing the touch and feel of products you are buying. This problem
acts as a challenge in Nepal as well.
•Delivery is another huge challenge; lack of proper street maps is also another major challenge
for delivery.
•Lack of credit card and wallet system. However, this challenge is being reduced due to many
e-wallet providers such as esewa, khalti and imepay. Also, banks are attempting to increase
the use of credit cards.
•The global problem; missing the touch and feel of products you are buying. This problem
acts as a challenge in Nepal as well.
•Delivery is another huge challenge; lack of proper street maps is also another major challenge
for delivery.
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