What is Commerce? “Seller” “Buyer” Transaction Basic Computer Concepts Ø Commerce, or doing business, is a negotiated exchange of valuable objects or services between at least two parties and includes all activities that each of the parties undertake to complete the transaction. Commerce is the activities of buying and selling. Transaction Process “Seller” Trends and Issues - Ecommerce “Buyer”

Defining E-Commerce communications perspectives Basic Computer Concepts Defining E-Commerce (EC) Ø Electronic commerce is an emerging concept that describes the process of buying and selling or exchanging of products, services and information via computer networks including the Internet. E-Commerce can be defined from these perspectives: communications perspectives business process perspective service perspective online perspective v Trends and Issues - Ecommerce * Property of STI Page 2 of 14

Origins and Growth Basic Computer Concepts of E-Commerce Ø Electronic funds transfers (EFTs or wire transfers): electronic transmissions of account exchange information over private networks. Electronic data interchange (EDI): occurs when one business transmits computer-readable data in a standard format to another business. Trends and Issues - Ecommerce * Property of STI Page 3 of 14

Basic Computer Concepts Features of E-Commerce Technology Unique of E-commerce Technology and their Business Significance: Ø is ubiquitous has global reach operates according to universal standards provides information richness is interactive increases information density permits personalization Trends and Issues - Ecommerce * Property of STI Page 4 of 14

Basic Computer Concepts Advantages of E- Commerce E-Commerce benefits to merchants: Increase sales opportunities for the seller Reduce operational costs Increase purchasing opportunities for the buyer Provide wide range of choices Use the web to target their offers to a niche market "The store is always open!" Establish better relationships with customers Low cost information distribution Increased speed to market Expanded delivery channels Global exposure and reach ü Trends and Issues - Ecommerce * Property of STI Page 5 of 14

Basic Computer Concepts Advantages of E- Commerce E-Commerce benefits to consumers: Convenience Informative Value presented upfront: Demo and free download No long wait times Easy flow and navigation Search capabilities Engaging presentation Constant updates Easy to buy ü Trends and Issues - Ecommerce * Property of STI Page 6 of 14

Disadvantages of Basic Computer Concepts E-Commerce Cost and Justification Security and Privacy Lack of trust and user resistance Other limiting factors û Trends and Issues - Ecommerce * Property of STI Page 7 of 14

Major Types of Business-to-Consumers (B2C) Business-to-Business (B2B) Basic Computer Concepts Major Types of E-Commerce Market relationships § Business-to-Consumers (B2C) Business-to-Business (B2B) Consumer-to-Consumer (C2C) § “Seller” Business Consumer Transaction Process B2B B2C C2B C2C “Buyer” Business Consumer Technology-based § Peer-to-Peer (P2P) Mobile Commerce (M-Commerce) § Trends and Issues - Ecommerce * Property of STI Page 8 of 14

B2B E-Commerce Basic Computer Concepts Electronic means for business to business interaction Examples: Ø Online purchasing Online supplier integration Online information services v Ø Largest form of e-commerce Ø Other models have developed § e-distributors § infomediaries § B2B service providers Trends and Issues - Ecommerce * Property of STI Page 9 of 14

B2C E-Commerce Basic Computer Concepts Ø Electronic means for business to customer interaction Examples: • online shopping • online service • online technical support Most commonly discussed type Online businesses attempt to reach individual consumers Trends and Issues - Ecommerce * Property of STI Page 10 of 14

C2B E-Commerce Basic Computer Concepts Ø Electronic means for customer to business interaction Examples: • Answering to surveys • Sharing/selling customer’s preferences • Providing reviews, ratings, etc. Trends and Issues - Ecommerce * Property of STI Page 11 of 14

C2C E-Commerce Basic Computer Concepts Electronic means for customer to customer interaction Examples: Ø • Online auctions (with intermediary?) • Online classified ads • Online communities Ø Provide a way for consumers to sell to each other Ø Consumer: § prepares the product for market § places the product for auction or sale § relies on market maker to provide catalog, search engine, and transaction clearing capabilities Trends and Issues - Ecommerce * Property of STI Page 12 of 14

P2P E-Commerce Basic Computer Concepts Ø Peer-to-Peer technology enables Internet users to share resources without going through a central server Ex: Napster: uses P2P to find and share online music Trends and Issues - Ecommerce * Property of STI Page 13 of 14

M-Commerce Wireless digital devices enable transactions on the Web Basic Computer Concepts M-Commerce Wireless digital devices enable transactions on the Web Uses personal digital assistants (PDAs) to connect Used most widely in Japan and Europe Ø Trends and Issues - Ecommerce * Property of STI Page 14 of 14