What is e-commerce?
E-commerce means doing business through electronic means such as the Internet, telephone, television, and computers.
E-commerce was first introduced in the 1960s through electronic data interchange (EDI) on value-added networks (VANs) and grew with the rise of Internet access and the emergence of popular online retailers in the 1990s and early 2000s.
The Amazon website, for example, started in 1995 in Jeff Bezos’s garage as a book shipping business. Or the eBay website, which allows consumers to buy and sell online, introduced online auctions to the world in 1995. In 1997, the popularity of Beanie Babies dolls became very popular. With the increase in Internet users, many believe that e-commerce will soon become the main way of doing business.
Like any digital technology or consumer-centric shopping market, E-commerce has evolved over the years. As mobile devices become more popular, the mobile phone business has also found its market. With the advent of sites like Facebook and Pinterest, social media has become an important driver for e-commerce. For example, according to Paymill, since 2014, in sales on Shopify due to ads on social networks, 85% of shoppers have used ads on Facebook to use the platform. They have been guided.
The changing market provides a great opportunity for businesses to improve their customer relationship and expand their market in the online world. According to Statista Global, e-commerce sales reached $ 1.2 trillion by 2013, and mobile phone sales in the United States were $ 38 billion; more than 40% of Internet users (1 billion people) have purchased goods online. These figures will continue to grow as mobile and internet usage expands, both in the United States and in emerging markets worldwide.
E-Commerce Categories
In e-commerce, as in traditional commerce, there are four categories: B2B, B2C, C2B, and C2C.
- B2B (Business to Business) – Includes companies that do business with each other. For example, manufacturers sell their products to distributors and wholesalers who sell products to retailers.
- B2C (Consumer Business) – Includes businesses that sell goods to the public through online stores without any human interaction. This is what most people think of e-commerce. An example is the Amazon Online Store.
- C2B (Consumer to Business) – In C2B e-commerce, consumers submit projects with specified budgets online, and companies bid on the project. The consumer then reviews the price offers and selects the company. Website Elance is an example of this type of e-commerce.
- C2C (Consumer To Consumer) – This type of business is done in categorized online advertising, forums, or markets where people can buy and sell goods together. Craigslist, eBay, and Etsy are examples of this type of e-commerce.
Benefits of eCommerce
1. The benefits of e-commerce for customers
- Comfort
Any product you want can be seen on the internet with just a click. Just type the name of the product you want in your favorite search engine so that all the options appear organized and orderly after just a few seconds.
- Saving time
With e-commerce, you no longer have to drive for hours and browse the shops in hopes of finding what you are looking for. Online stores offer you the full line of their products and use warehouses instead of the shop to present their products. You will find the products easily, and they will reach your door in a few days.
- There is a wide range of different options.
In e-commerce, the customer can easily compare products without going from store to store and finding out which vendor offers the best price and has more options to choose from. Every store has limited space in the real world, but the same store can offer all the inventory on the internet.
- Convenience compared
In e-commerce, two-way comparisons are easy to do. When goods are offered online, all their specifications and features are stated, and online stores ask you to compare their goods with other goods to find out that they offer the best options and go back to that store to buy.
- Ease of finding reviews and comments
Due to the high level of competition, companies are asking you to look at the opinions and reviews of other consumers. There are positive and negative reviews on every website, and in addition to seeing positive reviews and comments about each product, you will also find out the reasons for those who did not like that product.
- Coupons and discounts
There are plenty of coupons and discounts for every online business you are looking for, which is great for customers. With sites that act like department stores, you can find items up to 80% off! Make the most of this competition and find the best price available.
2. The Benefits of E-Commerce for Businesses
- Increase customer base
Customer base is one of the main concerns of all online and offline businesses. Online businesses do not have to worry about having the best features in their city because people from all over the world have access to their products and can come back to them to shop.
- sales increase
Online businesses do not need to run a store and can have more online sales with higher profit margins. They can receive money from the customer in various ways to make the purchase faster and easier for the customer. These businesses can sell more products by being available internationally.
- 24-hour access 365 days a year
If the weather is snowy and the roads are closed, or the weather is so hot and humid that we can not even leave the house, or it is a holiday, and all the shops in the city are closed, your online business is still open 24 hours a day, 365 days a year for customers. It is open. Doors never close, and profits continue to rise.
- Expanding the field of trade
The translation is one of the great tools available on the internet! So an online business does not have to create a site for every language. With the right marketing, customers worldwide can find the business website, products, and information of that business without having to leave home.
- Simplification of periodic payments
With a little research, any business can create periodic payments for itself. Find the provider that best suits your needs so that invoices can be issued consistently and payments can be received in the same way and a consistent manner.
- Instant transactions
In e-commerce, you no longer have to wait for a check to be cashed or wait 30 days for other types of payments. Transactions are done immediately, or you need a maximum of 2 or 3 days for the money to enter your account through the banking system.
Disadvantages of e-commerce
1. Disadvantages of e-commerce for customers
- Privacy and security
Before conducting transactions online, first, check the security certificates (such as the e-Trust symbol and…) of that website. True, online shopping is easy, but no one likes to have their personal information stolen. Many sites are trustworthy, but you should still research and identify sites that are not secure enough.
- Quality
Although in e-commerce, everything is easily accessible, the customer can only really see and touch the products after receiving them. Therefore, before buying, you must check the method of returning the product if you are not satisfied with it. Always make sure that there is an option to return the goods before buying.
- Hidden costs
The customer is informed of the price of the goods, shipping costs, shipping, and taxes at purchase. But you should be careful because there may be hidden costs that are not listed on your purchase invoice but appear on the payment form. There may be additional handling fees for moving and loading at the seller’s location (especially in the case of international purchases).
- Delay in receipt of goods
Although, in most cases, the delivery of products is faster than expected, you should also be prepared to delay the receipt of goods.
For example, a snowstorm at one point can disrupt the entire transportation system in the area. There is also a possibility that your product will be lost or delivered to the wrong address.
- Requires internet
Using the internet is not free, and if you use free Wi-Fi, your data may be stolen on an unsafe website. If you do not want to use the internet for free or you can not have internet or a computer in your home, it is better to do your shopping in person.
- Lack of personal interaction
Although the rules and regulations of every e-commerce business are available for your study, there is a lot to read, and legal issues may be confusing to you. There is no one to talk to about your questions or concerns about large or important orders.
2. Disadvantages of e-commerce for businesses
- security issues
While businesses are doing a lot to keep themselves and their customers safe, some people can go through any firewall and get the information they want. In recent years, we have all seen that even the biggest and most famous businesses may be hacked.
- Payment and financial issues
Many financial institutions take the customer’s side when it comes to bill payment disputes because they want to retain their customer. This causes damage to the e-commerce business when the goods have already been delivered to the customer, but the amount paid has been returned to the customer’s account.
- We need to spend more on e-commerce infrastructure
You need to pay to ensure that your online business is well run. As the owner of that business, you need to ensure that the transactions are done properly and that the products are displayed in the best way. To ensure this, you need to hire a professional to fix the existing shortcomings.
- Referral of goods and after-sales service
The online business infrastructure must be complete and flawless. This also creates other costs for the business because customers are not satisfied with the quality of the goods after delivery and refer the goods. In particular, some consumers want more than just a refund.
- Existence of sufficient internet services
Today all people can always use the internet, but you should know that there are still areas where network bandwidth can be a problem. Before starting your e-commerce business, ensure your area has the telecommunications bandwidth needed to run your business effectively.
- Continuous maintenance
Once a business has started as an e-commerce business, it must be prepared to change to stay compatible. As technology grows, the systems used in your business will also need to be kept up to date or replaced as needed. Or there may be total costs to keep the databases and software running.