Which Of The Following Is The Practice Of Buying And Selling Products And Services Via The Internet?

Wesley Chai,
Brian Holak, Site Editor
Ben Cole, Executive Editor

Due east-commerce (electronic commerce) is the buying and selling of goods and services, or the transmitting of funds or data, over an electronic network, primarily the internet. These business transactions occur either as business-to-business organisation (B2B), business concern-to-consumer (B2C), consumer-to-consumer or consumer-to-business. The terms e-commerce and eastward-concern are oftentimes used interchangeably. The term e-tail is likewise sometimes used in reference to the transactional processes that make up online retail shopping.

In the concluding decade, widespread utilise of eastward-commerce platforms such as Amazon and eBay has contributed to substantial growth in online retail. In 2007, e-commerce deemed for 5.1% of total retail sales; in 2019, e-commerce fabricated up xvi.0%.

How does eastward-commerce work?

E-commerce is powered past the net, where customers can access an online store to browse through, and place orders for products or services via their own devices.

Equally the order is placed, the customer's web browser will communicate back and forth with the server hosting the online store website. Information pertaining to the order will then be relayed to a cardinal computer known as the club director -- then forwarded to databases that manage inventory levels, a merchant system that manages payment information (using applications such as PayPal), and a bank computer -- before circumvoluted back to the order manager. This is to brand certain that store inventory and customer funds are sufficient for the guild to be processed. Afterward the order is validated, the order manager will notify the store'due south spider web server, which will so display a message notifying the customer that their order has been successfully processed. The order manager volition then send lodge data to the warehouse or fulfillment department, in order for the product or service to be successfully dispatched to the customer. At this point tangible and/or digital products may be shipped to a customer, or access to a service may be granted.

Platforms that host east-commerce transactions may include online marketplaces that sellers simply sign upward for, such as Amazon.com; software as a service (SaaS) tools that permit customers to 'rent' online store infrastructures; or open source tools for companies to use in-business firm development to manage.

Types of due east-commerce

Concern-to-business (B2B) e-commerce refers to the electronic exchange of products, services or data betwixt businesses rather than between businesses and consumers. Examples include online directories and product and supply exchange websites that allow businesses to search for products, services and information and to initiate transactions through due east-procurement interfaces.

In 2017, Forrester Research predicted that the B2B e-commerce market will elevation $1.i trillion in the U.S. past 2021, accounting for 13% of all B2B sales in the nation.

Business organization-to-consumer (B2C) is the retail role of e-commerce on the internet. It is when businesses sell products, services or data directly to consumers. The term was pop during the dot-com boom of the late 1990s, when online retailers and sellers of goods were a novelty.

Today, there are innumerable virtual stores and malls on the cyberspace selling all types of consumer goods. The nigh recognized example of these sites is Amazon, which dominates the B2C market.

Consumer-to-consumer (C2C) is a blazon of e-commerce in which consumers trade products, services and information with each other online. These transactions are generally conducted through a third party that provides an online platform on which the transactions are carried out.

Online auctions and classified advertisements are ii examples of C2C platforms, with eBay and Craigslist being two of the virtually popular of these platforms. Because eBay is a business, this class of e-commerce could also exist chosen C2B2C -- consumer-to-business-to-consumer.

Consumer-to-business (C2B) is a blazon of east-commerce in which consumers brand their products and services bachelor online for companies to bid on and purchase. This is the reverse of the traditional commerce model of B2C.

A popular example of a C2B platform is a market place that sells royalty-free photographs, images, media and design elements, such as iStock. Some other case would be a job lath.

Business-to-administration (B2A) refers to transactions conducted online betwixt companies and public administration or government bodies. Many branches of government are dependent on e-services or products in i way or some other, particularly when information technology comes to legal documents, registers, social security, fiscals and employment. Businesses tin can supply these electronically. B2A services accept grown considerably in recent years as investments have been made in e-government capabilities.

Consumer-to-administration (C2A) refers to transactions conducted online between individual consumers and public assistants or government bodies. The government rarely buys products or services from citizens, but individuals oft use electronic means in the following areas:

Instruction. Disseminating information, distance learning/online lectures, etc.
Social security. Distributing information, making payments, etc.
Taxes. filing tax returns, making payments, etc.
Health. Making appointments, providing data near illnesses, making health services payments, etc.

Mobile e-commerce (M-commerce) is a type of east-commerce on the rising that features online sales transactions made using mobile devices, such as smartphones and tablets. M-commerce includes mobile shopping, mobile cyberbanking and mobile payments. Mobile chatbots also provide e-commerce opportunities to businesses, allowing consumers to complete transactions with companies via voice or text conversations.

Advantages and disadvantages of e-commerce

Benefits of e-commerce include its around-the-clock availability, the speed of access, the wide availability of goods and services for the consumer, easy accessibility and international reach.

Availability. Bated from outages or scheduled maintenance, e-commerce sites are available 24x7, allowing visitors to scan and shop at any time. Brick-and-mortar businesses tend to open for a fixed number of hours and may fifty-fifty close entirely on certain days.
Speed of access. While shoppers in a physical store can be slowed by crowds, eastward-commerce sites run quickly, which is determined by compute and bandwidth considerations on both consumer device and due east-commerce site. Product pages and shopping cart pages load in a few seconds or less. An e-commerce transaction can comprise a few clicks and take less than 5 minutes.
Wide availability. Amazon'southward starting time slogan was "Earth'south Biggest Bookstore." They could make this claim because they were an east-commerce site and not a physical store that had to stock each book on its shelves. Eastward-commerce enables brands to brand a broad array of products available, which are then shipped from a warehouse later on a purchase is made. Customers volition probable have more success finding what they want.
Easy accessibility. Customers shopping a physical store may have a hard time determining which aisle a particular product is in. In due east-commerce, visitors can scan product category pages and use the site search feature the notice the product immediately.
International attain. Brick-and-mortar businesses sell to customers who physically visit their stores. With e-commerce, businesses tin can sell to whatever customer who tin access the spider web. E-commerce has the potential to extend a concern' client base of operations
Lower cost. pure play eastward-commerce businesses avert the cost associated with physical stores, such as hire, inventory and cashiers, although they may incur shipping and warehouse costs.
Personalization and product recommendations. East-commerce sites can runway visitors' browse, search and purchase history. They tin can use this data to present useful and personalized production recommendations, and obtain valuable insights about target markets. Examples include the sections of Amazon product pages labeled "Frequently bought together" and "Customers who viewed this item also viewed."

The perceived disadvantages of e-commerce include sometimes limited customer service, consumers not being able to see or touch a product prior to purchase and the wait fourth dimension for product shipping.

Limited customer service. If a customer has a question or issue in a physical shop, he or she can come across a clerk, cashier or store managing director for help. In an e-commerce store, customer service may be limited: The site may but provide support during sure hours of the twenty-four hour period, or a call to a customer service phone number may keep the customer on hold.
Not being able to touch or see. While images on a webpage can provide a good sense about a production, it's different from experiencing it "directly," such every bit playing music on speakers, assessing the motion-picture show quality of a television or trying on a shirt or dress. E-commerce can lead consumers to receive products that differ from their expectations, which leads to returns. In some scenarios, the customer bears the burden for the price of shipping the returned item to the retailer.
Wait time. If a customer sees an item that he or she likes in a store, the client pays for it and so goes home with it. With e-commerce, there is a wait time for the product to be shipped to the customer'south accost. Although aircraft windows are decreasing as next 24-hour interval delivery is now quite common, it'south not instantaneous.
Security. Skilled hackers can create authentic-looking websites that claim to sell well-known products. Instead, the site sends customers forfeit or simulated versions of those products -- or, just collects customers' credit card data. Legitimate due east-commerce sites besides deport take chances, particularly when customers store their credit card information with the retailer to brand hereafter purchases easier. If the retailer's site is hacked, hackers may come into the possession of customers' credit card information.

E-commerce applications

E-commerce is conducted using a variety of applications, such equally Electronic mail, online catalogs and shopping carts, Electronic Data Interchange (EDI), the file transfer protocol, web services and mobile devices. This includes B2B activities and outreach, such as using e-mail for unsolicited ads, usually viewed as spam, to consumers and other business organisation prospects, as well as sending out e-newsletters to subscribers and SMS texts to mobile devices. More companies now try to entice consumers directly online, using tools such every bit digital coupons, social media marketing and targeted advertisements.

The rise of e-commerce has forced Information technology personnel to move beyond infrastructure design and maintenance to consider numerous customer-facing aspects, such as consumer data privacy and security. When developing IT systems and applications to adapt east-commerce activities, data governance-related regulatory compliance mandates, personally identifiable information privacy rules and information protection protocols must be considered.

East-commerce platforms and vendors

An e-commerce platform is a tool that is used to manage an eastward-commerce business. E-commerce platform options exist for clients ranging in size from small businesses to large enterprises. These e-commerce platforms include online marketplaces such as Amazon and eBay, that simply require signing up for user accounts, and lilliputian to no IT implementation. Another e-commerce platform model is SaaS, where shop owners tin can subscribe to "rent" infinite in a cloud-hosted service that does non require in-house development or on-bounds infrastructure. Other due east-commerce platforms may come in the grade of open up source platforms that require a hosting environment (cloud or on premises), complete transmission implementation and maintenance.

A few examples of e-commerce market place platforms include:

Amazon
eBay
Walmart Marketplace
Chewy
Wayfair
Newegg
Alibaba
Etsy
Overstock
Rakuten

Vendors offering eastward-commerce platform services for clients hosting their own online store sites include:

Shopify
WooCommerce
Magento
Squarespace
BigCommerce
Ecwid
Salesforce Commerce Cloud (B2B and B2C options)
Oracle SuiteCommerce

Government regulations for e-commerce

In the The states, the Federal Merchandise Commission (FTC) and the Payment Bill of fare Industry (PCI) Security Standards Council are among the primary agencies that regulate east-commerce activities. The FTC monitors activities such as online advertising, content marketing and customer privacy, while the PCI Security Standards Quango develops standards and rules, including PCI Data Security Standard compliance, which outlines procedures for the proper treatment and storage of consumers' financial data.

To ensure the security, privacy and effectiveness of due east-commerce, businesses should cosign concern transactions, control access to resources such as webpages for registered or selected users, encrypt communications, and implement security technologies, such as the Secure Sockets Layer and two-factor authentication.

History of e-commerce

The beginnings of e-commerce can exist traced to the 1960s, when businesses started using EDI to share business documents with other companies. In 1979, the American National Standards Institute developed ASC X12 every bit a universal standard for businesses to share documents through electronic networks.

After the number of private users sharing electronic documents with each other grew in the 1980s, the rising of eBay and Amazon in the 1990s revolutionized the e-commerce manufacture. Consumers tin now purchase endless amounts of items online, from e-tailers, typical brick-and-mortar stores with e-commerce capabilities. Now, near all retailer companies are integrating online business organisation practices into their business models.

Disruption to physical retail

Given the big rise in east-commerce in contempo years, many analysts, economists and consumers have debated whether the online B2C market will soon brand physical, brick-and-mortar stores obsolete. At that place is piddling question that online shopping is growing at a significant rate.

Graphic of e-commerce revenue gains — E-commerce continues to abound in 2020

Research from BigCommerce has constitute that Americans are about evenly split on online versus offline, traditional retail shopping, with 51% of Americans preferring east-commerce and 49% preferring physical stores. However, 67% of millennials adopt shopping online over offline. According to Forbes, forty% of millennials are besides already using vox assistants to brand purchases, with that number expected to surpass 50% by 2020.

An example of the impact due east-commerce has had on physical retail is the postal service-Thanksgiving Black Friday and Cyber Mon shopping days in the United States. According to Rakuten Marketing data, in 2017, Cyber Monday, which features sales that are exclusively online, saw 68% college revenues than Black Friday, which is traditionally the biggest brick-and-mortar shopping solar day of the yr.

Co-ordinate to data from ShopperTrak in 2017, concrete store traffic on Black Fri declined by 1% year over twelvemonth, and the two-twenty-four hour period Thanksgiving-Blackness Fri period saw a 1.6% decline in traffic. Nearly 40% of sales on Blackness Fri came via a mobile device, up nearly 10% from the previous yr, an indication that e-commerce is condign m-commerce. Along with physical retail, e-commerce is transforming supply chain management practices among businesses, as distribution channels become increasingly digitized.

This was last updated in Dec 2020

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