ENTREPRENEURSHIP AND INNOVATION

GSP 2211
E-COMMERCE
E-COMMERCE

 E-commerce has emerged as a search engine

for success in the territory of free enterprises.
 In simple words, E-commerce is an electronic
business it is the capability of exchanging
value electronically. E-commerce relates to
the electronic exchange of all trading
relationships external to the enterprises. E-
commerce involves exchange of money,
good, services as well as information.
 According to Bharat Bhaskar (2010)
 ``electronic commerce means the capability to buy and
sell goods services and information online through public
network.
 Bajaj and Nag (2008) have define E-commerce as
``paperless exchange of business information using
electronic data interchange, electronic mail, electronic
bulletin boards, electronic fund transfer, world wide web
and other network based technologies. Among the few
definitions of E-commerce so far given the most widely
accepted and used is one given by the world trade
organization (wto)
 E-commerce according to the world trade
organization (WTO) ‘production distribution,
marketing sale or delivery of goods and
services by electronic means.
 Transaction can be divided into three main
stages:
 Advertising and searching stage
 Ordering and payment stage
 Delivery stage
BENEFIT OF E-COMMERCE BRAND

 Transaction cost economizing

 Efficient channel alternative
 Provides better buying options
 Reduce inventory cost
 Widens market coverage
 Improves customer services
 Interactivity
 Adaptation to the external market
CHARACTERISTICS OF E-COMMERCE

 The business tools are electronic and the

application is commerce i.e profit motive.
 Business is externally focused on those with
whom business is conducted
 Most of the transaction are processed
automatically.
 Use a gamut of business support services
such as inter-organizational e-mail and online
directories
CATEGORIES OF E-COMMERCE

 Business to Business E-commerce

 Business to Consumer E-commerce
 Business processes
 Consumer to Consumer E-commerce
 Business to Government E-commerce
 BUSINESS TO BUSINESS E-COMMERCE
 Among the various categories of E-
commerce business to business (B2B)
commerce is the largest category this
involves companies conducting E-
procurement supply chain management,
network alliance, and negotiating purchase
transaction over the internet or web.
 BUSINESS TO CONSUMER E-COMMERCE
 Business to consumer (B2C) E-commerce is
the second largest category and involved
business introducing products and services to
consumers via internet technologies.
 BUSINESS PROCESS
 Refers to the use of E-commerce to tailor the
internet activities of a business in order to
maximize their efficiency and effectiveness
through the use of E-commerce business can
fine- tune supply chain, provides advanced
consumer relations management systems
and reduce transaction cost.
 CONSUMER TO CONSUMER E-COMMERCE
 Consumer to consumer (C2C) E-commerce is
concerned with the use of E-commerce by
individual to trade and exchange information
with other individual there has been a huge
growth in consumer to consumer auctions
sites such as E-bay and sites enabling
consumer to offer goods and services to
other consumer on and individual basis.
 BUSINESS TO GOVERNMENT E-
COMMERCE
 Business to government (B2G) E-commerce
is concerned with the need for business to sell
goods or services to government or
government agencies such activities include
supply the Army, police force, hospital and
schools with products and services.
DIFFERENCE BETWEEN
TRADITIONAL AND E-COMMERCE
TRADITIONAL COMMERCE
 Direct integration between buyer
and seller is present in traditional
commerce
 It is suitable for products needed
to convince to the customer
 In tradition commerce customer
can verify the identity of the seller
and their physical locations
 Transaction are process manually
 The scope of business is generally
limited to particular region
 The level of competition is
generally low
E-COMMERCE
 Interaction between buyer and seller
is indirect through internet or web
 It is suitable for the standard product
low value product intangible
products
 In case of E-commerce customer
cannot identify the seller his or her
location.
 Business transaction are processed
automated
 The scope of business is world wide
 Because of the wide scope of
business the level of competition is
relatively high
ADVANTAGES OF E-COMMERCE
 (Schneider 2007) draw various advantages of E-commerce as
 To consumer
 Consumer have a much wider choice available on the cyber
market
 They bear lower cost for production due to increase on line
competition among sellers.
 Because of wide-scale information dissemination, consumer
can compare products, features, prices and even look up
reviews before they select what they want
 They enjoy wider access to assistance and to advices from
experts and peers
 They enjoy saving in shopping time and money.
 To suppliers
 It minimizes inventory cost
 It can improve customer services
 It reduce distribution cost as well
 It help business globalize
 It help market product more quickly
DISADVANTAGES
 Return on investment is difficult to calculate.
 Many firm have had trouble recruiting and retaining
employees with the technological design and
business process skill needed to create an effective
electronic commerce presence.
 Difficulty in integrating existing data bases and
transaction processing software designed for
traditional commerce into the software that enable
electronic commerce.
 Many business face cultural and legal obstacles to
conducing electronic commerce.
CHALLENGES

 Infrastructural problems.
 Absence of cyber laws.
 Privacy and security concern.
 Payment and tax related issues.
 Digital illiteracy and consumer psyche.
 Virus problem.
 7. English specific.
THE 4-ECOMMERCE MARKETING PRINCIPLES

 Trust
 Price
 Scarcity
 Agency
TRUST
 Trust is a significant banner to overcome for a first time buyer,
even if you are a huge name brand such as Dangote, however,
Dangote does a great job in building consumer trust through
content and social interaction.
 HOW TO BUILD TRUST
 This is done with audience through content marketing influencer
marketing as well as social media a blow of all these works best
 Here are some examples.
 Information blog post that are highly shareable on social media
 Sharing social media post that others have made that include
your products.
 Showcasing your reviews and testimonials on your website and
throughout your social media marketing webs.
PRICE
 Price is the amount of money fixed for a particular
product. A lot sellers worry about whether or not
their pricing is too high for their consumers, the
answer is price does not matter, its how you position
the need and benefits of the products that counts.
 HOW TO GET THE FOCUS OFF OF PRICE
 If you don’t want buyers to focus on price you need
to focus on the value. Does your product save time?
Does it provide a lifestyle? Your consumer wants that
is what the consumer will focus on.
SCARCITY
 Is the shortage or less supply of product when
consumer demand is high and product is less?
 HOW TO CREATE SCARCITY
 If you run e-commerce store add quantity to your
items. If you have a product and there are only five left
let buyers know, this will also create urgency and quick
respond by consumers.
 URGENCY
 Is a quick need of product by consumers the fear of
missing out a product due to limit days or hours make
users to quickly purchase to avoid missing the product.
THANK YOU