E-commerce

CSE, 7th sem.

Unit 1

 Overview
 Definition
 Advantage and Disadvantage of E-commerce
 Indian readiness for ecommerce
 E-transition
 Challenge for Indian corporate
 The information Technology act 2000
Overview of E-commerce

 E-commerce (electronic commerce or EC) is the buying and selling of goods and services,
or the transmitting of funds or data, over an electronic network, primarily the internet.
 E-Commerce or Electronics Commerce is a methodology of modern business, which
addresses the need of business organizations, vendors and customers to reduce cost and
improve the quality of goods and services while increasing the speed of delivery.
Ecommerce refers to the paperless exchange of business information using the following
ways
Electronic Data Exchange (EDI)
Electronic Mail (e-mail)
Electronic Bulletin Boards
Electronic Fund Transfer (EFT)
Other Network-based technologies
EDI

 EDI stands for Electronic Data Interchange. EDI is an electronic way of

transferring business documents in an organization internally, between its
various departments or externally with suppliers, customers, or any
subsidiaries. In EDI, paper documents are replaced with electronic documents
such as word documents, spreadsheets, etc.
Electronic bulletin boards

 Electronic bulletin boards (also known as message boards or computer forums)

are communication systems online where one can share, request, or discuss
information on just about any topic. While e-mail is a way to converse
privately with one or more people over the Internet, electronic bulletin
boards are totally public. Any message posted on one can be read (and
responded to) by anyone else in the world who has access to the Internet or
the particular online service that is providing the message board
Electronic Funds Transfer (EFT)

 Electronic Funds Transfer (EFT) is a system of transferring money from one

bank account directly to another without any paper money changing hands.
One of the most widely-used EFT programs is direct deposit, through which
payroll is deposited straight into an employee's bank account. However, EFT
refers to any transfer of funds initiated through an electronic terminal,
including credit card, ATM and point-of-sale (POS) transactions. It is used for
both credit transfers, such as payroll payments, and for debit transfers, such
as mortgage payments.
Overview of e-commerce
Definition:

 Ecommerce, also known as electronic commerce or internet commerce,

refers to the buying and selling of goods or services using the internet, and
the transfer of money and data to execute these transactions. Ecommerce
is often used to refer to the sale of physical products online, but it can
also describe any kind of commercial transaction that is facilitated through
the internet.
 Features:

E-Commerce provides the following features −

 Non-Cash Payment − E-Commerce enables the use of credit cards, debit cards, smart cards, electronic
fund transfer via bank's website, and other modes of electronics payment.
 24x7 Service availability − E-commerce automates the business of enterprises and the way they provide
services to their customers. It is available anytime, anywhere.
 Advertising / Marketing − E-commerce increases the reach of advertising of products and services of
businesses. It helps in better marketing management of products/services.
 Improved Sales − Using e-commerce, orders for the products can be generated anytime, anywhere
without any human intervention. It gives a big boost to existing sales volumes.
 Support − E-commerce provides various ways to provide pre-sales and post-sales assistance to provide
better services to customers.
 Inventory Management − E-commerce automates inventory management. Reports get generated
instantly when required. Product inventory management becomes very efficient and easy to maintain.
 Communication improvement − E-commerce provides ways for faster, efficient, reliable communication
with customers and partners.
 Advantages Of E-commerce
E-Commerce advantages can be broadly classified in three major
categories −

 Advantages to Organizations

 Advantages to Consumers

 Advantages to Society
 Advantages to Organizations

 Using e-commerce, organizations can expand their market to national and international markets with
minimum capital investment. An organization can easily locate more customers, best suppliers, and suitable
business partners across the globe.
 E-commerce helps organizations to reduce the cost to create process, distribute, retrieve and manage the paper
based information by digitizing the information.
 E-commerce improves the brand image of the company.
 E-commerce helps organization to provide better customer services.
 E-commerce helps to simplify the business processes and makes them faster and efficient.
 E-commerce reduces the paper work.
 E-commerce increases the productivity of organizations. It supports "pull" type supply management. In "pull"
type supply management, a business process starts when a request comes from a customer and it uses just-in-
time manufacturing way.
 Advantages to Consumers
 It provides 24x7 support. Customers can enquire about a product or service and place orders
anytime, anywhere from any location.
 E-commerce application provides users with more options and quicker delivery of products.
 E-commerce application provides users with more options to compare and select the cheaper
and better options.
 A customer can put review comments about a product and can see what others are buying, or
see the review comments of other customers before making a final purchase.
 E-commerce provides options of virtual auctions.
 It provides readily available information. A customer can see the relevant detailed
information within seconds, rather than waiting for days or weeks.
 E-Commerce increases the competition among organizations and as a result, organizations
provides substantial discounts to customers.
Advantages to Society
 Customers need not travel to shop a product, thus less traffic on road and low air
pollution.
 E-commerce helps in reducing the cost of products, so less affluent people can also
afford the products.
 E-commerce has enabled rural areas to access services and products, which are
otherwise not available to them.
 E-commerce helps the government to deliver public services such as healthcare,
education, social services at a reduced cost and in an
Disadvantage

The disadvantages of e-commerce can be

broadly classified into two major categories

 Technical disadvantages

 Non-Technical disadvantages
Technical Disadvantages

 There can be lack of system security, reliability or standards owing to poor

implementation of e-commerce.
 The software development industry is still evolving and keeps changing rapidly.
 In many countries, network bandwidth might cause an issue.
 Special types of web servers or other software might be required by the vendor,
setting the e-commerce environment apart from network servers.
 Sometimes, it becomes difficult to integrate an e-commerce software or
website with existing applications or databases.
 There could be software/hardware compatibility issues, as some e-commerce
software may be incompatible with some operating system or any other
component.
Non-Technical disadvantages

 Initial cost − The cost of creating/building an e-commerce application in-house may be

very high. There could be delays in launching an e-Commerce application due to
mistakes, and lack of experience.
 User resistance − Users may not trust the site being an unknown faceless seller. Such
mistrust makes it difficult to convince traditional users to switch from physical stores to
online/virtual stores.
 Security/ Privacy − It is difficult to ensure the security or privacy on online transactions.
 Lack of touch or feel of products during online shopping is a drawback.
 E-commerce applications are still evolving and changing rapidly.
 Internet access is still not cheaper and is inconvenient to use for many potential
customers, for example, those living in remote villages
 Indian readiness of e-commerce
Indian readiness of e-commerce

 Following are some problem in India for e-commerce.

 The backbone of Indian economy has come from village areas and these areas are
not aware of e-commerce and online transaction.
 Some areas of India is not connected to the internet and most of the area is suffering
from slow internet speed in this situation the only e-commerce will be a problem.
 E-commerce sector is not very reliable we cannot trust online shopping store
completely, some of them are reliable but there are many cases where peoples are
cheated online.
 Cyber security of India is not advance there a chance that with an increase of E-
transaction, cyber-attack will be increased.
 There is a number of people who are not well in using digital apps and computers
first we have to start the campaign to improve people’s understanding of computers.
Indian readiness of e-commerce

 Following factors will strengthen e-commerce in India:

 Cash-On-Delivery
 Increasing internet penetration
 Rising incomes
 A large number of youth who are open to new technologies
 Lack of time for traditional shopping
 Wider product/service range
 Lower prices vis-à-vis traditional stores
Indian readiness of e-commerce

 India is not only ready for e-commerce; e-commerce has already become quite popular in
India too.
 
 There are many reasons which make India a suitable market for e-commerce. Here are some
of the reasons:
1. The mind set of consumer has changed
2. Internet friendly users
3. Entry of big names in the Indian e-commerce market
4. The success of the some of the sectors in the e-commerce market
 E-transition
 The transition to e-commerce is all about translating everything
your offline customers love about you so that it will appeal to a
broader online audience. Start by creating an e-commerce
strategy that can be used to inform the development of a website
that reflects your brand values and is optimized to convert.
Offline to Online: Making the Transition to E-commerce
1-- Create an e-commerce strategy
1.1 Identify your online customers
1.2 Plan for future marketing initiatives
1.3 Create a content plan
2 --Build an effective e-commerce website
2.1 Brand storytelling
2.2 Mobile-ready
3 – Reassess your social presence
3.1 Create new content
3.2 Update messaging
3.3 Expand platforms
4 – Promote your website
4.1 Promotions
4.2 Paid advertising
4.3 In-store
5 – Maintain
Challenge for Indian corporate
 Cash on delivery
 Internet Penetration is Low
 Customers Return Much of Their Products
 Postal Addresses are not consistent
 Features Phones
 Absence of Cyber Laws:
 Privacy and Security Concern
 Virus Problem
 English Specific
 Touch & Feel Constraint
 Fear factor
 Logistics and Shipment Services
 Tax Structure
 Poor Knowledge and Awareness:
 Online Transaction.
Information Technology Act, 2000
Background of Information Technology Act 2000-
 United Nations Commission on International Trade Law (UNCITRAL)
adopted a model law on Electronic Commerce in 1996.
 The United Nations in 1997 recommended that all member countries should
give favorable consideration to that model law.
 In India the Information Technology Act was passed in 2000, based on the
model law. Date of commencement of the Act- 17.10.2000. It is a landmark
Act in the direction of boosting E-commerce in India.
Information Technology Act, 2000
 Salient Features-
 The Act simultaneously amended the following Acts-
1.The Indian Penal Code Act, 1860;
2.The Indian Evidence Act, 1872;
3. The Reserve Bank of India Act, 1934;
4.The Banker’s Book Evidence Act, 1891.
 Gave legal recognition to electronic records (Section 4 of the Act)
 Gave legal recognition to digital signatures (Section 5 of the Act)
 Provided for Certifying Authorities and Subscribers in connection with digital signature
(Section 17 to 42 of the Act)
 Made provision for penalties for cyber offences (Section 43 to 47 of the Act)
 Established Cyber Appellate Tribunal (Section 48 to 64 of the Act)
 Listed cyber offences (Section 65 to 78 of the Act).
Information Technology Act, 2000

 Digital signature has been replaced with electronic signature to make it a more technology neutral act.
 It elaborates on offenses, penalties, and breaches.
 It outlines the Justice Dispensation Systems for cyber-crimes.
 The Information Technology Act defines in a new section that cyber café is any facility from where the
access to the internet is offered by any person in the ordinary course of business to the members of the
public.
 It provides for the constitution of the Cyber Regulations Advisory Committee.
 The Information Technology Act is based on The Indian Penal Code, 1860, The Indian Evidence Act,
1872, The Bankers’ Books Evidence Act, 1891, The Reserve Bank of India Act, 1934, etc.
 It adds a provision to Section 81, which states that the provisions of the Act shall have overriding effect.
The provision states that nothing contained in the Act shall restrict any person from exercising any right
conferred under the Copyright Act, 1957.
Information Technology Act, 2000
 1.The act provides legal recognition to e-commerce, which facilities commercial e-
transactions.

2. It recognizes records kept in electronic form like any other documentary records. In
this way, at brings electronic transactions at per with paper transactions in documentary
form.

3. The act also provides legal recognition to digital signatures which need to be duly
authenticated by the certifying authorities.

4. Cyber law appellate tribunal has been set up to hear appeal against adjudicating
authorities.

5. The provisions of the I.T. Act have no application to negotiable instruments, power of
attorney, trust, will and any contract for sale or conveyance of immovable property.
References

1. http://kanoon.nearlaw.com/2017/10/28/information-technology-act-2000/
2. https://www.quora.com/What-are-the-salient-features-of-the-IT-Act-of-2000