History of E–Commerce


Definition

The buying and selling of products and services by businesses and consumers through an electronic medium, without using any paper documents. E-commerce is widely considered the buying and selling of products over the internet, but any transaction that is completed solely through electronic measures can be considered e-commerce. E-commerce is subdivided into three categories: business to business or B2B (Cisco), business to consumer or B2C (Amazon), and consumer to consumer or C2C (eBay). also called electronic commerce.

 

 

E-Commerce Advantages for Customers

  • Convenience. Every product is at the tip of your fingers on the internet, literally. Type in the product you are looking for into your favorite search engine and every option will appear in a well organized list in a matter of seconds.
  • Time saving. With e-commerce there is no driving in circles while looking and digging in hopes of finding what you need. Stores online offer their full line as well as use warehouses instead of store fronts—products are easy to locate and can be delivered to your door in just days.
  • Options, options, options! Without driving from store to store the consumer can easily compare and contrast products. See who offers the best pricing and have more options to choose from. While a physical store has limited space, the same store on the internet will have full stock.
  • Easy to compare. Side by side comparisons are readily available and easy to do. When products are placed online, they come with all the specifics, and they want you to compare them with others, know they have the best options and come back for more!
  • Easy to find reviews. Because the competition is high, companies online want you to look at other consumer reviews. Good and bad reviews are on every site, not only can you see if the product is liked, you can also see the reasons behind the thumbs up or down.
  • Coupons and deals. With every online business wanting you, more and more coupons and deals can’t be avoided, which are totally great for customers. With major sites that act as department store, you may find items up to 80% off! Take advantage of the competition and find the best price available.

E-Commerce Advantages for Businesses

  • Increasing customer base. The customer base is every business’s main concern, online or off. When online, a business doesn’t have to worry about getting the best property in town, people from around the world have access to their products and can come back at anytime.
  • Rise in sales. By not managing a storefront, any business will have more sales online with a higher profit margin. They can redistribute money to make the consumer shopping experience faster and more efficient. While being available to international markets, more products will sell.
  • 24/7, 365 days. If it’s snowing and the roads are closed, or it’s too hot and humid to even step outside in the summer, or a holiday that every store in town closes, your online business is open for consumers 24/7 every day of the year. The doors never close and profits will keep rising.
  • Expand business reach. A great tool on the internet is…translation! A business online does not have to make a site for every language. With the right marketing, every consumer around the globe can find the business site, products and information without leaving home.
  • Recurring payments made easy. With a little research, every business can set up recurring payments. Find the provider that best suits your needs and billing will be done in a consistent manner; payments will be received in the same way.
  • Instant transactions. With e-commerce there is no more waiting for the check to clear, or a 30-day wait for certain other types of payment. Transactions are cleared immediately or at most two to three days for the money to clear through the banking system.

 

E-Commerce Disadvantages

E-Commerce Disadvantages for Customers

  • Privacy and security. Before making instant transactions online, be sure to check the sites certificates of security. While it may be easy and convenient to shop, no one wants their personal information to be stolen. While many sites are reputable, always do your research for those with less than sufficient security.
  • Quality. While e-commerce makes everything easily accessible, a consumer cannot actually touch products until they are delivered to the door. It is important to view the return policy before buying. Always make sure returning goods is an option.
  • Hidden costs. When making purchases, the consumer is aware of the product cost, shipping, handling and possible taxes. Be advised: there may be hidden fees that won’t show up on your purchasing bill but will show up on your form of payment. Extra handling fees may occur, especially with international purchases.
  • Delay in receiving goods. Although delivery of products is often quicker than expected, be prepared for delays. A snow storm in one place may throw off the shipping system across the board. There is also a chance that your product may be lost or delivered to the wrong address.
  • Need access to internet. Internet access is not free, and if you are using free wifi, there is the chance of information theft over an unsecure site. If you are wearing of your public library, or cannot afford the internet or computer at home, it may be best to shop locally.
  • Lack of personal interaction. While the rules and regulations of each e-commerce business is laid out for you to read, there is a lot to read and it may be confusing when it comes to the legalities. With large or important orders, there is no one you can talk to face to face when you have questions and concerns.

E-Commerce Disadvantages for Businesses

  • Security issues. While businesses make great efforts to keep themselves and the consumer safe, there are people out there that will break every firewall possible to get the information they want. We have all seen recently how the biggest and most renown business can be hacked online.
  • Credit card issues. Many credit card businesses will take the side of the consumer when there is dispute about billing—they want to keep their clients, too. This can lead to a loss for e-commerce business when goods have already been delivered and the payment is refunded back to the consumer.
  • Extra expense and expertise for e-commerce infrastructure. To be sure an online business is running correctly, money will have to be invested. As an owner, you need to know transactions are being handled properly and products are represented in the most truthful way. To make sure you get what you need, you will have to hire a professional to tie up any loose ends.
  • Needs for expanded reverse logistics. The infrastructure of an online business must be on point. This will be another cost to the business because money will need to be invested to ensure proper handling of all aspects of buying and selling, especially with disgruntled consumers that want more than a refund.
  • Sufficient internet service. Although it seems that everyone is now on the internet all the time, there are still areas in which network bandwidth can cause issues. Before setting up an e-commerce business, be sure your area can handle the telecommunication bandwidth you will need to run effectively.
  • Constant upkeep. When a business has started as e-commerce, they must be ready to make changes to stay compatible. While technology grows, the systems that support your business must be kept up to date or replaced if needed. There may be additional overhead in order to keep data bases and applications running.

 

Emergence of World Wide Web

In the Beginning, ARPA created the ARPANET.

And the ARPANET was without form and void.

And darkness was upon the deep.

And the spirit of ARPA moved upon the face of the network and ARPA said, ‘Let there be a protocol,’ and there was a protocol. And ARPA saw that it was good.

And ARPA said, ‘Let there be more protocols,’ and it was so. And ARPA saw that it was good.

And ARPA said, ‘Let there be more networks,’ and it was so.”    –Danny Cohen

This Internet Timeline begins in 1962, before the word ‘Internet’ is invented. The world’s 10,000 computers are primitive, although they cost hundreds of thousands of dollars. They have only a few thousand words of magnetic core memory, and programming them is far from easy.

Domestically, data communication over the phone lines is an AT T monopoly. The ‘Picturephone’ of 1939, shown again at the New York World’s Fair in 1964, is still AT&T’s answer to the future of worldwide communications.

But the four-year old Advanced Research Projects Agency (ARPA) of the U.S. Department of Defense, a future-oriented funder of ‘high-risk, high-gain’ research, lays the groundwork for what becomes the ARPANET and, much later, the Internet.

By 1992, when this timeline ends,

  • the Internet has one million hosts
  • the ARPANET has ceased to exist
  • computers are nine orders of magnitude faster
  • network bandwidth is twenty million times greater

 

In simple WWW is:

The “Web”, short for “World Wide Web” (which gives us the acronym www), is the name for one of the ways that the Internet lets people browse documents connected by hypertext links.

 

The concept of the Web was perfected at CERN (European Council for Nuclear Research) in 1991 by a group of researchers which included Tim-Berners Lee, the creator of the hyperlink, who is today considered the father of the Web.

 

The principle of the Web is based on using hyperlinks to navigate between documents (called “web pages”) with a program called a browser. A web page is a simple text file written in a markup language (called HTML) that encodes the layout of the document, graphical elements, and links to other documents, all with the help of tags.

 

Besides the links which connect formatted documents to one another, the web uses the HTTP protocol to link documents hosted on distant computers (called web servers, as opposed to the client represented by the browser). On the Internet, documents are identified with a unique address, called a URL, which can be used to locate any resource on the Internet, no matter which server may be hosting it.

 

 

Transition to e–commerce in India

The e-commerce stores that have made shopping extremely easy have a serious business of stocking up behind the e-gateways. The juggle between marketplace and inventory-led business models has been going on for a long time now. E-commerce in India is gradually shifting to the marketplace-led model from the inventory-led business model. How feasible is the hybrid marketplace in India?
“The future lies in the hybrid marketplace-led model where the seller is also selling his own labels as well as provides a platform for merchants and sellers to sell their products. If a seller has to make available large merchandise to his buyers, it has to adopt a marketplace-led model. The real use of internet would be if the small merchandisers get a chance to sell their products to a wider range of audience,” said Vivek Gaur, CEO, Yepme.com

Myntra recently announced its own soon-to-be-launched marketplace within the next few months, thus converting into the hybrid marketplace model. It will provide a platform for merchants and sellers to sell their products through the Myntra website. This strategic move aims at increasing the profit margins and expanding its reach to smaller Indian cities and towns. But in contrast to the shift, a Myntra spokesperson said, “For a market like India where customers have very low faith in shopping online, the first thing to be ensured is customer satisfaction. With inventory-led model we can ensure speedier delivers, quality checks, and an overall better customer experience especially in the fashion and lifestyle segment.” Currently, Myntra operates on an inventory model.

There have been enough reasons for inventory-led model to lose the battle to the new hybrid marketplace. The inventory led e-commerce models have almost the same economic characteristics as the traditional brick-and-mortar model when it comes to inventory risk exposure, warehousing, and sourcing. It is highly unlikely to achieve profitability and extremely large scale merchandise. For a 30 per cent gross margin business, they spend about 45-50 per cent on operating expenses.

E –Commerce opportunities for Industries

1. Customers want to order online. The survey found a shift toward web-based research and purchasing. More than 63 percent of industrial supply buyers said they made purchases online, and half of those purchasers spend at least 50 percent of their annual budget with e-commerce suppliers.

“One of the most important findings is that buyers prefer online channels, not only to research but to purchase and to do follow-up. That’s what they are doing, and that’s what they want to do,” says Simon Bhadra, a UPS senior marketing manager.

Buyers expect quality in their e-commerce experiences, and most sites are delivering it. The majority said their experience with their vendors’ e-commerce sites was the same (56 percent) or better (37 percent) than the consumer sites they used for personal purchases.

“They want a rich experience,” Bhadra says. “The online bar is set high. They want detailed product descriptions and tons of functionality – embedded shipping capability, rating, transit times and returns. They want shipping information embedded into the online store.”

When asked what features were important when making purchases online, customers said:

  • Shipping costs prior to placing an order
  • Real-time product availability
  • Purchase history
  • Estimated delivery date

2. Ability to buy online is key, but still just one part of buyers’ overall experience. Buyers of industrial supplies want a better online experience, but that’s only part of the many ways they want to connect with the distributor. There are situations where they need more personal service, such as by phone. And online purchasers still want catalogs and access to a sales representative. As a matter of fact, the study indicated that 47 percent of buyers still used catalogs in some cases. Therefore, it is important for distributors to provide a rich online experience as part of their broad omni-channel strategy.

3. Online buyers are open to new suppliers. Another interesting finding is that not all online buyers are loyal to their existing suppliers. Thirty-three percent of online buyers didn’t have an offline relationship with their current online distributor. Industrial supply distributors who can reach these online buyers can tap into this growth opportunity by catering to online buyer preferences.

“B2B buyers are very sophisticated and have high expectations. A distributor can’t just throw up a static web page with a web form that gets printed somewhere in the distributor’s back office. That’s not going to fly anymore,” Bhadra says. If buyers can’t find the product, price and delivery date they need, they can easily click to another vendor’s website.

 

E –Commerce opportunities for Industries

1. Customers want to order online. The survey found a shift toward web-based research and purchasing. More than 63 percent of industrial supply buyers said they made purchases online, and half of those purchasers spend at least 50 percent of their annual budget with e-commerce suppliers.

“One of the most important findings is that buyers prefer online channels, not only to research but to purchase and to do follow-up. That’s what they are doing, and that’s what they want to do,” says Simon Bhadra, a UPS senior marketing manager.

Buyers expect quality in their e-commerce experiences, and most sites are delivering it. The majority said their experience with their vendors’ e-commerce sites was the same (56 percent) or better (37 percent) than the consumer sites they used for personal purchases.

“They want a rich experience,” Bhadra says. “The online bar is set high. They want detailed product descriptions and tons of functionality – embedded shipping capability, rating, transit times and returns. They want shipping information embedded into the online store.”

When asked what features were important when making purchases online, customers said:

  • Shipping costs prior to placing an order
  • Real-time product availability
  • Purchase history
  • Estimated delivery date

2. Ability to buy online is key, but still just one part of buyers’ overall experience. Buyers of industrial supplies want a better online experience, but that’s only part of the many ways they want to connect with the distributor. There are situations where they need more personal service, such as by phone. And online purchasers still want catalogs and access to a sales representative. As a matter of fact, the study indicated that 47 percent of buyers still used catalogs in some cases. Therefore, it is important for distributors to provide a rich online experience as part of their broad omni-channel strategy.

3. Online buyers are open to new suppliers. Another interesting finding is that not all online buyers are loyal to their existing suppliers. Thirty-three percent of online buyers didn’t have an offline relationship with their current online distributor. Industrial supply distributors who can reach these online buyers can tap into this growth opportunity by catering to online buyer preferences.

“B2B buyers are very sophisticated and have high expectations. A distributor can’t just throw up a static web page with a web form that gets printed somewhere in the distributor’s back office. That’s not going to fly anymore,” Bhadra says. If buyers can’t find the product, price and delivery date they need, they can easily click to another vendor’s website.

UPS can help industrial supply distributors compete and make their online presence comparable to leading online sites. “The UPS Developer Kit allows you to embed shipping, rating, transit time and returns functionality into your online platform or you can use one of many UPS Ready® solutions providers to provide you with a turnkey solution,” Bhadra says.

UPS offers specialized services that are the backbone of great e-commerce sites, including:

  • Contract logistics, including inventory management
  • Shipping, visibility and returns solutions
  • Online service and support solutions