Electronic commerce, commonly known as e-commerce, eCommerce or e-comm, consists of

the buying and selling of products or services over electronic systems such as the Internet and
othercomputer networks. It is more than just buying and selling products online. It also includes
the entire online process of developing, marketing, selling, delivering, servicing and paying for
products and services. The amount of trade conducted electronically has grown extraordinarily
with widespread Internet usage. The use of commerce is conducted in this way, spurring and
drawing on innovations in electronic funds transfer, supply chain management, Internet
marketing, online transaction processing, electronic data interchange (EDI), inventory
management systems, and automated data collection systems. Modern electronic commerce
typically uses the World Wide Web at least at some point in the transaction's lifecycle, although it
can encompass a wider range of technologies such as e-mail, mobile devices and telephones as
well.

A large percentage of electronic commerce is conducted entirely electronically for virtual items
such as access to premium content on a website, but most electronic commerce involves the
transportation of physical items in some way. Online retailers are sometimes known as e-
tailers and online retail is sometimes known as e-tail. Almost all big retailers have electronic
commerce presence on the World Wide Web.

Some common applications related to electronic commerce are the following:

 Document automation in supply chain and logistics

 Domestic and international payment systems
 Enterprise content management
 Group buying
 Automated online assistants
 Instant messaging
 Newsgroups
 Online shopping and order tracking
 Online banking
 Online office suites
 Shopping cart software
 Teleconferencing
 Electronic tickets
Benefits Of Ecommerce

E Commerce is one of the most important facets of the Internet to have emerged in
the recent times. Ecommerce or electronic commerce involves carrying out business
over the Internet with the assistance of computers, which are linked to each other
forming a network. To be specific ecommerce would be buying and selling of goods
and services and transfer of funds through digital communications.

The benefits of Ecommerce:

• Ecommerce allows people to carry out businesses without the barriers of time
or distance. One can log on to the Internet at any point of time, be it day or
night and purchase or sell anything one desires at a single click of the mouse.
• The direct cost-of-sale for an order taken from a web site is lower than
through traditional means (retail, paper based), as there is no human
interaction during the on-line electronic purchase order process. Also,
electronic selling virtually eliminates processing errors, as well as being faster
and more convenient for the visitor.
• Ecommerce is ideal for niche products. Customers for such products are
usually few. But in the vast market place i.e. the Internet, even niche
products could generate viable volumes.
• Another important benefit of Ecommerce is that it is the cheapest means of
doing business.
• The day-to-day pressures of the marketplace have played their part in
reducing the opportunities for companies to invest in improving their
competitive position. A mature market, increased competitions have all
reduced the amount of money available to invest. If the selling price cannot
be increased and the manufactured cost cannot be decreased then the
difference can be in the way the business is carried out. Ecommerce has
provided the solution by decimating the costs, which are incurred.
• From the buyer’s perspective also ecommerce offers a lot of tangible
advantages.
1. Reduction in buyer’s sorting out time.
2. Better buyer descisions
3. Less time is spent in resolving invoice and order discrepancies.
4. Increased opportunities for buying alternative products.
• The strategic benefit of making a business ‘ecommerce enabled’, is that it
helps reduce the delivery time, labour cost and the cost incurred in the
following areas:
1. Document preparation
2. Error detection and correction
3. Reconciliation
4. Mail preparation
5. Telephone calling
6. Credit card machines
7. Data entry
8. Overtime
9. Supervision expenses
• Operational benefits of e commerce include reducing both the time and
personnel required to complete business processes, and reducing strain on
 other resources. It’s because of all these advantages that one can harness the
power of ecommerce and convert a business to ebusiness by using powerful
turnkey ecommerce solutionsmade available by ebusiness solution providers.

Current trends

The Internet has created a new economic ecosystem, the e-commerce marketplace, and it has become the

virtual main street of the world. Providing a quick and convenient way of exchanging goods and services

both regionally and globally, e-commerce has boomed. Today, e-commerce has grown into a huge industry

with US online retail generating $175B in revenues in 2007,[1] with consumer-driven (B2C) online

transactions impacting industries from travel services to consumer electronics, from books and media
distribution to sports & fitness. With more than 70% of Americans using the Internet on a daily basis for

private and/or business use and the rest of the world also beginning to catch on, e-commerce's global

growth curve is not likely to taper off anytime soon. However, the US recession has taken its toll on online

sales. Although early 2008 estimates by Forrester Research were very strong with 2008 revenues upwards

of $204B (a 17% growth rate),[2] 2008 holiday sales showed the first decrease in the last 7 years. Research

by ComScore shows sales declining by 1% for the first 49 days of the holiday season.[3]

In the last decade, many startup e-commerce companies have rapidly stolen market share from traditional

retailers and service providers, pressuring these established traditional players to deploy their own

commerce websites or to alter company strategy in retaliation. This effect is most pronounced in travel

services and consumer electronics. According to comScore, online leisure travel bookings reached about

$51B in 2005, or 44% of all online sales, which were around $122B in the same year. Roughly 30% of all

travel bookings currently occur online. Consumer electronics, which includes the purchase of digital

cameras, mobile phones, and home PC's, accounted for nearly $26B of worldwide e-commerce sales

occurring in 2006, according to the NPD Group. As traditional brick and mortar firms continue to lose market

share to e-commerce players, they will likely see continued declines in their revenues, operating margins,

and profits. It is important to note that most e-commerce players are at a competitive advantage to retailers.

They have lower operating expenses and better inventory management due to operating in a virtual

commerce environment. For example,Amazon.com (AMZN) has revenue per employee of nearly $850k

while its retail counterpart, Best Buy (BBY), generates revenue per employee of only $270k. Clearly, e-

commerce vendors will have the most to gain if they successfully disrupt retail customer acquisition,

disintermediate distributors/resellers, and under-price retail establishments. As a consequence of e-

commerce vendor gains, financial transaction processors and parcel shipping companies are among

ancillary vendors who will gain.

 E- Commerce in India

Electronic commerce (or e-commerce) encompasses all business conducted by

means of computer networks. Advances in telecommunications and computer
technologies in recent years have made computer networks an integral part of the
economic infrastructure. More and more companies are facilitating transactions
over web. There has been tremendous competition to target each and every
computer owner who is connected to the Web. Although business-to-business
transactions play an important part in e-commerce market, a share of e-
commerce revenues in developed countries is generated from business to
consumer transactions. E-commerce provides multiple benefits to the consumers
in form of availability of goods at lower cost, wider choice and saves time. People
can buy goods with a click of mouse button without moving out of their house or
office. Similarly online services such as banking, ticketing (including airlines, bus,
railways), bill payments, hotel booking etc. have been of tremendous benefit for
the customers. Most experts believe that overall e-commerce will increase
exponentially in coming years. Business to business transactions will represent the
largest revenue but online retailing will also enjoy a drastic growth. Online
businesses like financial services, travel, entertainment, and groceries are all
likely to grow.

For developing countries like India, e-commerce offers considerable opportunity.

E-commerce in India is still in nascent stage, but even the most-pessimistic
projections indicate a boom. It is believed that low cost of personal computers, a
growing installed base for Internet use, and an increasingly competitive Internet
Service Provider (ISP) market will help fuel e-commerce growth in Asia’s second
most populous nation. Amongst the Asian nations, the growth of e-commerce in
India between 1997 and 2003 was highest in India. Cridit Lyonnais forecasts that
India will have 30 million Internet users by 2004 and that the potential Internet
market will reach 47 million households in 2005. According to a McKinsey-
Nasscom report by the year 2008, e-commerce transactions in India are expected
to reach $100 billion. Indian middle class of 288 million people is equal to the
entire U.S. consumer base. This makes India a real attractive market for e-
commerce. To make a successful e-commerce transaction both the payment and
delivery services must be made efficient. There has been a rise in the number of
companies' taking up e-commerce in the recent past. Major Indian portal sites
have also shifted towards e-commerce instead of depending on advertising
revenue. Many sites are now selling a diverse range of products and services from
 flowers, greeting cards, and movie tickets to groceries, electronic gadgets, and
computers. With stock exchanges coming online the time for true e-commerce in
India has finally arrived. On the negative side there are many challenges faced by
e-commerce sites in India. The relatively small credit card population and lack of
uniform credit agencies create a variety of payment challenges unknown in the
United States and Western Europe. Delivery of goods to consumer by couriers and
postal services is not very reliable in smaller cities, towns and rural areas.
However, many Indian Banks have put the Internet banking facilities in place for
the up coming e-commerce market. The speed post and courier system has also
improved tremendously in recent years. Modern computer technology like secured
socket layer (SSL) helps to protect against payment fraud, and to share
information with suppliers and business partners. With further improvement in
payment and delivery system it is expected that India will soon become a major
player in the e-commerce market.

While many companies, organizations, and communities in India are beginning to

take advantage of the potential of e-commerce, critical challenges remain to be
overcome before e-commerce would become an asset for common people.

our main categories: B2B, B2C, C2B, and C2C.

• B2B (Business-to-Business)
Companies doing business with each other such as manufacturers selling to
distributors and wholesalers selling to retailers. Pricing is based on quantity of
order and is often negotiable.

• B2C (Business-to-Consumer)
Businesses selling to the general public typically through catalogs utilizing
shopping cart software. By dollar volume, B2B takes the prize, however B2C
is really what the average Joe has in mind with regards to ecommerce as a
whole.

Having a hard time finding a book? Need to purchase a custom, high-end

computer system? How about a first class, all-inclusive trip to a tropical
island? With the advent ecommerce, all three things can be purchased literally
in minutes without human interaction. Oh how far we've come!

• C2B (Consumer-to-Business)
A consumer posts his project with a set budget online and within hours
companies review the consumer's requirements and bid on the project. The
consumer reviews the bids and selects the company that will complete the
project. Elance empowers consumers around the world by providing the
meeting ground and platform for such transactions.
 • C2C (Consumer-to-Consumer)
There are many sites offering free classifieds, auctions, and forums where
individuals can buy and sell thanks to online payment systems like PayPal
where people can send and receive money online with ease. eBay's auction
service is a great example of where person-to-person transactions take place
everyday since 1995.

Companies using internal networks to offer their employees products and services
online--not necessarily online on the Web--are engaging in B2E (Business-to-
Employee) ecommerce.

G2G (Government-to-Government), G2E (Government-to-Employee), G2B

(Government-to-Business), B2G (Business-to-Government), G2C (Government-
to-Citizen), C2G (Citizen-to-Government) are other forms of ecommerce that
involve transactions with the government--from procurement to filing taxes to
business registrations to renewing licenses. There are other categories of
ecommerce out there, but they tend to be superfluous.