Definition Of E-commerce

E-commerce refers to a list of commercial transactions performed on the Internet. Every year this type of commercial relationship occupies an increasing share of the market constantly increasing the volume of goods sold as well as connecting new areas and areas of activity.

E-commerce can mean booking and fulfillment of orders and transactions through banking services or electronic money systems.

Why choose E-commerce

Business is actively going online for many reasons. First of all entrepreneurs understand that such a direction of commerce gives wide coverage to the audience and therefore potential buyers. A significant number of people use home and mobile Internet which means that it becomes easier to convey your offer to them.

In addition it allows you to reach different audience segments. Also E-commerce requires less advertising and promotion costs. Finally the ability to interact via the Internet with banks has simplified the document management function.

Categories of online E-commerce

There are several main systems by which commercial activities are carried out on the Internet.

They are classified according to the types of actors involved on both sides.

B2B: Business to business (business to business) The form of relations in which the participants in transactions are commercial enterprises and organizations. 

In terms of the volume of funds in circulation B2B is the largest category of E-commerce.

B2C:  Business to consumers (business to consumer). Initially E-commerce was based on the provision of services to the end user, so this form has long been the largest in terms of turnover. A simple example of a B2C system is an online store where a customer can choose a product they like and pay for it using online payment options.

C2C. Consumer to consumers (consumer to consumer) This form implies commercial relations between individuals.

Through specially organized platforms individuals offer goods and services without the use of intermediaries.

B2G:  Business to government (business to the state) Rather young but rapidly developing the form of commercial relations.

It includes various tenders or public procurement services.

In addition there are business models that work in the opposite direction (C2B or G2B) aimed at supporting the business or offering its services to it.

These forms of relations do not yet have a large scope and are at the stage of development.

Ways to implement commercial relations

Conducting transactions on the Internet is impossible without the organization of specialized resources that simplify the work for both parties.

Depending on the form of E-commerce there are several main types of sites:

Online Shopping: One of the most extensive types of E-commerce. A company or individual provides a variety of products or services to choose from. For the convenience of buyers offers can be sorted by categories prices and other indicators.

Online stores may provide physical goods (shipping via postal services or self-delivery) or electronic goods to which download links are provided (music. films. books).

Ad Services: Platforms that focus on C2C relationships. Users create on the platform a product or service card indicating the terms of purchase defining them in one category or another by which buyers can find this offer.

Discount Sites: These sites collect offers from various companies and individuals with a prerequisite - providing a discount to the buyer in the form of a promotional code.

Online Auctions: On sites of this type lots are displayed the price of which is not fixed. A certain time is assigned for the sale of the lot during which there is an auction between potential buyers.

Online Payment Systems: Services that provide the ability to pay for utilities fines medical services and others.

Disadvantages Of Online E-Commerce

Difficulties in conducting e-commerce can rather be associated with a lack of proper training on the part of users.

The unpreparedness of some entrepreneurs for this way of doing business. This problem is less likely to affect the new generation of entrepreneurs who start working on the Internet from the very beginning of their activities.

E-commerce works according to slightly different rules from promotion to the sale of a product or service. Difficulties in the transition are associated with the organization of advertising logistics and feedback from customers.

Entrepreneurs often learn from their mistakes wasting time and potential buyers.

Lack of a clear legal framework. There are no special rules and regulations regarding the conduct of E-commerce in our country yet. Because of this difficulties often arise in matters of taxation intellectual property or personal data protection.

Also problems may arise when entering the world market and the discrepancy between legal norms and rules between different countries.

The growth of competition. Since the e-commerce industry is developing at a very fast pace it is necessary to constantly meet the current market requirements.

Advertising website promotion and the struggle for the attention of customers - are the main areas in which you need to work regularly to consistently achieve success.

Fight distrust Many users are still skeptical about offers on the Internet even if there are real companies behind them.

This is due to the large number of scammers who can take advantage of holes in the law.

Benefits Of Online E-Commerce

But the disadvantages of E-commerce are offset by its clear advantages. Moreover the positive aspects of commercial activities on the Internet relate to each of the parties in the relationship.

For the manufacturer of goods and services. Small medium and large businesses can benefit from E-commerce for the following reasons:

1. Large geographic coverage: Theoretically a company can sell its product worldwide. For stable operation well-functioning interaction with delivery services is necessary.

2. Cost reduction: To organize an online store you only need warehouse space and a small space for an office that will process orders.

3. The possibility of round-the-clock work: Applications from buyers can be received 24/7. You just need to get in touch with your customers.

For consumers of goods and services. At many points the benefits of E-commerce for producers and consumers overlap.

Customers can choose the product they like at any convenient time as well as order it from anywhere in the country and the world. In addition consumer benefits include:

1. The possibility of comparison: To choose the most advantageous offer you do not need to bypass a large number of stores - just use aggregator sites or personally compare products in several online stores.

2. Discounts and promotions: Very often many companies offer goods at discounted prices when shopping online. This is due to the high competition in the field of E-commerce and the struggle for each client.

3. Big choice On the Internet: you can find almost any product of interest ordering it even from another continent.

4. The possibility of fast delivery: Delivery services are also participants in e-commerce, offering their services on the Internet so prompt delivery of goods may be in their interest.

On a societal scale E-commerce makes it possible to facilitate the work of many social institutions (the possibility of registering in medical institutions for a certain time remote paperwork and other services) reducing queues and increasing the speed of service.

The current state of E-commerce

The first attempts to develop E-commerce technologies were made in the 1960 in the United States. It was an opportunity to book seats on flights. The development of the Internet in the 1990 allowed E-commerce to reach a global level.

Amazon and eBay websites were opened. Internet sales by 2012 exceeded $1 trillion and a third of this amount was in Europe.

E-commerce is one of the fastest-growing market segments. Due to its advantages as well as the constant improvement of the system of online trade in goods and services it attracts the attention of new buyers and manufacturers.