Increasing popularity of E-commerce
Description:
Electronic Commerce over the Internet is a new way of conducting business. It involves electronic funds transfer, supply chain management, e-marketing, online marketing, online transaction processing, electronic data interchange (EDI), automated inventory management systems, and automated data collection systems. E-commerce is often described as being one of three varieties – business-to-business (B2B), business-to-consumer (B2C) or business-to-government (B2G). In order to perform e-business, the enterprise has to include suppliers, service providers, government agencies, customers and even other competing businesses as partners. E-commerce requires the integration and alignment of technology, strategic intent, processes and human performance.
In the era of New Economy triggered by IT technology, e-commerce is undergoing an explosion. It has the potential to radically change economic activities and even social environment. Already, e-commerce affects large sectors as communications, finance and retail trade (altogether, about 30 per cent of GDP); and it holds promise in areas such as education, health and government (about 20 per cent of GDP).
While electronic commerce is playing an ever greater role in the global economy, problems such as security issues and the lack of reliable and internationally comparable data appear which can not be ignored.
Enablers:
1. New Economy
2. Information technology development, such as WiFi, Web 2.0
3. Low cost of technology
4. Globalization
5. Rising demand for an open, integrated and interconnected market
6. Companies’ expectation to be efficiency in management and reduce operational cost
Inhibitors:
1. Organized crime over internet, including identity theft, service attacks, etc
2. Pressure and competition from traditional business
3. Fluctuation in oil price
4. Difficulty in posing regulation and establish standards over e-business
Paradigms:
1. E-commerce redefines virtually every business process and function.
2. E-commerce changed conventional concepts and rules about strategic alliances, outsourcing, competition, industry specialization, and customer relationships.
3. A wealth of information about customers was created due to the introduction of e-commerce.
4. E-commerce provides a platform for convergence, by doing which companies can capture more business opportunities. As a consequence, the lines between industries were blurred.
Timing:
1984: EDI, or electronic data interchange, was standardized through ASC X12. This guaranteed that companies would be able to complete transactions with one another reliably.
1992: Compuserve offers online retail products to its customers. This gives people the first chance to buy things off their computer. 1994: Netscape arrived. Providing users a simple browser to surf the Internet and a safe online transaction technology called Secure Sockets Layer.
1995: Two of the biggest names in e-commerce are launched: Amazon.com and eBay.com.
1998: DSL, or Digital Subscriber Line, provides fast, always-on Internet service to subscribers across California. This prompts people to spend more time, and money, online.
1999: Retail spending over the Internet reaches $20 billion, according to Business.com.
2000: The U.S government extended the moratorium on Internet taxes until at least 2005.
2003: According to Forrester Research (as cited in Kessler, 2003), electronic commerce in the United States generated sales worth US $12.2 billion.
Web Resources:
1. http://newmedia.medill.northwestern.edu/courses/nmpspring01/brown/Revstream/history.htm