LESSON 2: E-Commerce: Mechanisms, ● Payment Gateways: These secure
Platforms, and Tools systems process online payments,
ensuring that transactions are safe
Electronic Commerce (EC) Activities and and secure.
Processes ● Shipping and Delivery: These
services ensure that products are
Electronic commerce, also known as shipped to customers in a timely and
e-commerce, refers to the buying and efficient manner.
selling of goods and services over the ● Customer Relationship
internet. The major electronic commerce Management (CRM): This system
activities and processes include: helps businesses manage customer
interactions, including order
● Online Shopping: This involves processing, customer service, and
customers browsing through a marketing.
website, selecting products, and
making payments online. E-Marketplaces and their Components
● Online Payment: This involves the
use of secure payment gateways to An e-marketplace is an online platform that
process credit card or other payment connects buyers and sellers to facilitate
transactions. the exchange of goods and services. The
● Order Processing: This involves components of an e-marketplace include:
the processing of orders, including
order confirmation, shipping, and ● Buyers: These are individuals or
delivery. businesses that purchase products
● Customer Service: This involves or services from the e-marketplace.
providing customer support through ● Sellers: These are individuals or
various channels such as email, businesses that list their products or
phone, or live chat. services for sale on the
● Marketing and Advertising: This e-marketplace.
involves promoting products and ● Product Listings: These are the
services through various online descriptions of products or services
channels such as social media, that sellers list on the e-marketplace.
email marketing, and search engine ● Search and Navigation: These
optimization. tools help buyers find the products
or services they are looking for on
The mechanisms that support these the e-marketplace.
activities include: ● Payment and Shipping: These
services ensure that transactions are
● Websites: These are the primary secure and that products are
platform for e-commerce activities, shipped to buyers in a timely
providing a virtual storefront for manner.
customers to browse and purchase ● Customer Service: This provides
products. support to buyers and sellers,
ensuring a smooth and efficient Bartering and Negotiating Online
transaction process.
Bartering and negotiating online involve
Benefits and Limitations of E-Auctions the exchange of goods or services without
E-auctions are online auctions that allow the use of money. This can be done through
buyers to bid on products or services in various online platforms, including:
real-time. The benefits of e-auctions include ● Online Marketplaces: These
platforms allow buyers and sellers to
● Increased Competition: E-auctions negotiate prices and terms of sale
allow multiple buyers to bid on the for products or services.
same product or service, increasing ● Social Media: Buyers and sellers
competition and driving down prices. can connect through social media
● Transparency: E-auctions provide a platforms to negotiate prices and
transparent bidding process, terms of sale for products or
allowing buyers to see the current services.
highest bid and make informed ● Online Forums: Buyers and sellers
decisions. can connect through online forums
● Convenience: E-auctions can be to negotiate prices and terms of sale
accessed from anywhere with an for products or services.
internet connection, making it easy
for buyers to participate in auctions. Virtual Communities
However, there are also limitations to Virtual communities are online groups of
e-auctions, including: people who share common interests,
hobbies, or goals. These communities can
● Limited Control: Buyers have be found on various online platforms,
limited control over the bidding including:
process, as they cannot see the bids
of other participants. ● Social Media: Virtual communities
● Risk of Fraud: E-auctions can be can be formed through social media
vulnerable to fraud, as buyers may platforms such as Facebook, Twitter,
not be able to verify the authenticity and LinkedIn.
of the products or services they are ● Forums: Virtual communities can be
bidding on. formed through online forums where
● Technical Issues: Technical issues members can discuss common
such as slow internet connections or interests and share information.
website downtime can disrupt the ● Blogs: Virtual communities can be
bidding process and lead to lost formed through blogs where
bids. members can share their thoughts
and ideas on a particular topic.
Virtual communities provide a
platform for members to connect
with each other, share information,
and support each other in achieving ● Good discounts / lower prices.
their goals. ● Get detailed information about the
product.
LESSON 3: Ecommerce Application ● Easy comparison of various
models/brands.
Retail is the process of selling consumer
goods or services to customers through Electronic Retailing (E-Tailing) and its
multiple channels of distribution to earn a Characteristics:
profit. Retailers satisfy demand identified
through a supply chain. The term "retailer" Electronic retailing (E-tailing) is the sale
is typically applied where a service provider of goods and services through the Internet.
fills the small orders of many individuals, It can include business-to-business (B2B)
who are end-users, rather than large orders and business-to-consumer (B2C) sales of
of a small number of wholesales, corporate products and services. It requires
or government clientele. Thus, Retail is the companies to tailor their business models to
sale of goods on a physical location where capture Internet sales, which can include
the seller and the buyer meet in person. building out distribution channels such as
Whereas etail is the sale of goods on the warehouses, internet webpage, and product
internet where the transaction happens in a shipping centers.
digital environment. Various popular players
of E-tailing are Amazon, Flipkart, Zomato, Business-to-Consumer (B2C) E-Tailing
Swiggy, etc. and for retailers are
Walmart, 7-11 etc. Business-to-consumer retailing is the
most common of all e-commerce companies
E-tailing stands for E-retailing also known and the most familiar to most Internet users.
as e-retail as “sales of goods and services This group of retailers includes companies
via the internet or other electronic sources, selling finished goods or products to
for personal and household use by consumers online directly through their
consumers”. websites. The products could be shipped
and delivered from the company's
The term E-Retailing was first developed in warehouse or directly from the
the European countries. manufacturer. One of the primary
It has both passive and interactive retail requirements of a successful B2C retailer is
system while all e-tailing is maintaining good customer relations.
generally limited to passive, air ticketing and
other entertainment Business-to-Business (B2B) E-tailing
booking is designed in interactive system
mostly. Business-to-business retailing involves
companies that sell to other companies.
E-tailing has various features as stated Such retailers include consultants, software
below: developers, freelancers, and wholesalers.
● Saves time and efforts. Wholesalers sell their products in bulk from
● Convenience of shopping at home. their manufacturing plants to businesses.
● Wide variety/range of products. These businesses, in turn, sell those
products to consumers. In other words, a anytime.
B2B company, such as a wholesaler might 5. Feedback: It’s easy to manage
sell products to a B2C company. customer relationship management in
etailing on the basis of feedback of
Primary E-Tailing Business Models: consumers.
There are many types of E-tailers most Disadvantages of E-tailing for retailers
popular of these two are:
1. Lack to infrastructure: The issues of
1. Pure Play (Virtual) e-retailers- Retailers accessibility and connectivity of internet
that only do the electronic transactions and causes problems in functioning of e-tailing
do not have any physical outlet for the activities. Also, the initial investment cost is
customers. For example, Ebay very high in e-tailing.
2. Brick and click (Click-and-mortar) 2. Lack of technological expertise: To
e-retailers- Retailers who do the both start an online retailing project it is important
online and offline transactions i.e. through to have technological expertise and not all
internet and physical outlets. For example, retailers have it.
Walmart 3. Complex logistic management: Intrinsic
and extrinsic challenges increase the
Advantages of E-tailing for retailers: complexities in e-tailing logistics. Like cash
on delivery increases the operational cycle,
1. Location utility: Location is utmost managing high rates of returns, poor logistic
important for the conventional management in rural areas and problems in
retailing process to provide convenience cross-nation shipments.
utility to its consumers. However, in e-tailing 4. Customers’ expectations: In terms of
location is not important. Retailers and flexibility in delivery, detailed product
customers need internet for e-tailing and descriptions, cost and security of delivery,
transaction can happen from anywhere from flexible payment options sets high
within the country or overseas. expectations of customers.
2. Less expensive: As compare to 5. Lack of personal touch: The lack of
organized retailing, e-tailing is less face-to-face interaction, persuasion and
expensive as it saves wages of salesmen handling the customers’ query is a major
and premises cost and disadvantage in e-tailing.
maintenance. These expenditures are low 6. High competition: E-tailers have to
as compare to internet cost. compete with other e-tailers as well as the
3. High Reach: Integration with customers organized and unorganized retailers in the
is high in e-tailing as customers can be market that increase the competitions for
local, national and international. Through them.
internet, e-tailers can reach to large
audience.
4. 24*7 businesses: The time utility for
customers is high in e-tailing
as customers can buy the products and
services from anywhere and
Benefits of the online employment
market include
● Accessibility: Job seekers and
employers can access job
opportunities and talent from
anywhere with an internet
connection.
● Efficiency: The online employment
market streamlines the recruitment
process, making it faster and more
cost-effective for both job seekers Impact of E-Tailing on Retail
and employers. Competition:
● Global Reach: Employers can E-tailing has significantly impacted retail
reach a larger pool of candidates competition by introducing new dynamics
from around the world, while job into the marketplace:
seekers can explore job
opportunities beyond their local ❖ Increased Competition: E-tailing has
area. intensified competition among retailers as
businesses compete for customers in the
Marketplace based model online space by offering competitive prices
and unique value propositions.
According to the FDI policy guideline, ❖ Market Disruption: E-tailing has
“Marketplace model of e-commerce means disrupted traditional retail models by
providing of an information technology providing consumers with more choices and
platform by an e-commerce entity on a convenience, leading to shifts in consumer
digital and electronic network to act as a behavior and preferences.
facilitator between buyer and seller.” This ❖ Price Transparency: E-tailing has
model provides a platform where buyers increased price transparency as consumers
and sellers do the transactions in efficient, can easily compare prices across different
transparent and trusted environment. Here, e-tailers, putting pressure on retailers to
buyers can compare the prices and offer competitive pricing.
accordingly place the orders to the ❖ Innovation: E-tailing has driven
authorized sellers on the website. Majorly, innovation in retail by encouraging
e-tailers like Amazon, Patym mall and businesses to adopt new technologies and
Flipkart practice the marketplace-based strategies to enhance the customer
model. For example, when buyer login to experience and stay competitive in the
Amazon India and place an order to a digital marketplace
registered seller, Amazon India act as a
mediator here. Subsequently, the registered LESSON 4: B2B ECOMMERCE
seller takes care of logistics and dispatching
of the products to the customers. The B2B field, short for
"business-to-business," encompasses
transactions and interactions between ● Benefits: Manufacturers have more
businesses rather than between a business control over branding and pricing,
and individual consumers. B2B transactions while retailers can offer exclusive
are common in supply chains, where products.
companies procure raw materials or
components for manufacturing processes. 3. Manufacturer-Wholesaler Model
Unlike business-to-consumer (B2C) Description: Manufacturers sell
transactions, B2B transactions involve products directly to wholesalers, who
business entities exchanging goods and then sell them to retailers or other
services. The B2B market is vast, with businesses.
companies specializing in different
industries like software as a service (SaaS), ● Examples: Commonly used in the
marketing, and supply chain management. food, beverage, and agricultural
industries.
Major Types of B2B Models
● Benefits: Manufacturers can sell
Business-to-business (B2B) models products in bulk at lower prices,
encompass various structures through increasing profit margins for both
which companies engage in transactions parties.
and interactions with other businesses.
4. Service Provider-Client Model:
1. Manufacturer-Distributor Model: Description: Service providers offer
Description: In this model, manufacturers services to clients who require them.
create products and rely on distributors to
market, sell, and deliver the products to ● Examples: Commonly used in
end-users. consulting, legal services, and
● Examples: Commonly used in marketing industries.
industries like electronics,
automotive, and pharmaceuticals. ● Benefits: Service providers offer
● Benefits: Manufacturers focus on specialized services, while clients
product development and benefit from tailored solutions.
production, while
distributors handle sales and distribution. SELL-SIDE E-MARKETPLACE
2. Manufacturer-Retailer Model Sell-side eCommerce often involves using
Description: Manufacturers sell Internet technologies to market products or
products directly to retailers, who services. The products are not necessarily
then sell them to end-users. physical ones like books or clothes. Spotify,
for example, does not sell concrete music
● Examples: Commonly used in CDs but music streaming services.
fashion, beauty, and consumer
goods industries. Also, in many cases, the websites are not
for the sake of financial transactions but for
branding and other marketing activities. It is Characteristics of the Sell-Side
thus possible to classify the online presence E-Marketplace:
of sell-side eCommerce, or eCommerce
websites, into 4 main types: ● Sell-side e-marketplace – a
web-based marketplace in which
1. Transactional eCommerce sites: one company sells to many business
The main contribution of these sites buyers,
is through onlinepurchases of ● Facilitation of Transactions:
products. They can be retail sites Connects sellers with multiple
(Amazon), travel sites (Air BnB), business buyers for efficient
andonline banking services transactions.
(www.hsbc.com). ● Payment Options: Offers various
payment methods to facilitate secure
2. Services-oriented transactions between parties.
relationship-building websites: ● Fulfillment Support: Provides
These sites mainly serve as services like warehousing,
theplace where people come to get packaging, and delivery to
information about the business. streamline order fulfillment.
They stimulate offlinesales and ● Value-Added Services:
general inquiries or leads from Repackages data for sale, enhances
potential customers. transparency, and aids
decision-making for marketplace
3. Brand-building sites: Products are participants.
not typically available for online ● Efficiency and Revenue: Enhances
purchase on these sites. They sales and revenue by combining
support branding, and they are efforts of different parties for mutual
typically suitable for low-value, benefit.
high-volume fast-moving consumer ● Platform Requirements: Must
goods (FMCG brands). Some support features for managing
examples of this type are listings, inventory, storefronts, and
Tango(www.tango.com), fulfillment services.
(www.guinness.com). ● Marketplace Efficiency: Combines
efforts of sellers and buyers for
4. Portal, publisher, or media sites: improved efficiency in sales and
NYTimes, Forbes, The Guardian, fulfillment processes.
and similarwebsites for news and
entertainment are also regarded as Characteristics of Auctions in the
eCommerce sites. These Sell-Side Marketplace:
sitesgenerate revenue through
advertising, commission-based ● Forward Auctions: Sellers offer
sales, or the sale of customerdata. products to multiple buyers, with
prices increasing until the highest
bid wins.
● Negotiated Contracts: Long-term Active participation in social media and Web
agreements between sellers and 2.0 platforms can enhance search engine
buyers for specific products or visibility for B2B companies.Engaging with
services. the audience and sharing relevant content
● Efficient Selling: Enables sellers to can improve website ranking in search
reach multiple buyers engine results pages.Backlinks from these
simultaneously, increasing sales platforms can further enhance a company's
opportunities. website authority and ranking
● Customer Service: Focus on
providing excellent customer service 4. Market Research and Insights:
to enhance buyer satisfaction and Social media platforms provide valuable
loyalty. data and analytics that help B2B firms better
understand their audience. By analyzing this
B2B can benefit from social networking data, companies can adjust their marketing
and Web 2.00. strategies, tailor content to meet audience
needs, and improve overall engagement.
Business-to-business (B2B) entities can
benefit significantly from social networking 5. Global Reach and Networking:
and Web 2.0 in various ways: Social networking sites offer B2B
companies the opportunity to connect with a
1. Enhanced Customer Engagement: global audience and expand their network.
Social media platforms provide a space for By leveraging these platforms, businesses
B2B companies to engage with their target can reach a wider audience, build
audience in a more personal and interactive relationships, and establish themselves as
manner. By sharing valuable content, industry experts
interacting with followers, and promoting
products or services, B2B firms can build
brand loyalty and increase customer
retention.
2. Improved Customer Interaction:
Web 2.0 marketing offers tools and
platforms for B2B businesses to actively
engage with customers.Through social
media networks, blogs, and online
communities, companies can encourage
discussions, gather feedback, and address
customer queries directly. This two-way
communication fosters a stronger
connection with the audience, enhances
customer satisfaction, and builds trust and
credibility in the brand.
3. Increased Brand Visibility:
