Submit Articles. Author Submission. Article Directory. Search Find Free Content  
Arts Business Communications Computers Fashion
Finance Health Family Online Business Politics
Education Auto Travel Food & Drink People
Login:  Password: 



:: Add To Favorites :: All Tags ::

 

 
 
 
 

What is the Electron Commerce?

Date: 21 January 2009

Global network Internet has made electron commerce accessible to firms of any scale. If earlier the organisation of electron data exchange required appreciable investments in a communication infrastructure and was on a shoulder to only large companies use Internet allows to join the ranks today of "electron dealers" and to boutiques. The electron show-window in World Wide Web gives the chance to any company to draw custom from all world. Similar on-line business forms the new channel for sales - "virtual", almost not requiring material investments. If the information, services or production (for example, the software) can be delivered through Web, all process of sale (including payment) can occur in on-line a regimen.

As definition of electron commerce qualify not only the systems focused on Internet, but also and "electron shops", using other communication mediums - BBS, VAN etc. At the same time procedures of the sales initiated by the information from WWW, but using for data exchange a fax, phone and so forth, can be only partially carried to a class of electron commerce. We will notice also, that in spite of the fact that WWW is technological base of electron commerce, in a number of systems other communication possibilities are used also. So, inquiries to the seller for clarification of parametres of the goods or for order veneering can be sent and through e-mail.

As of today dominating legal tender at on-line purchases are credit cards. However on a scene there are also new payment instruments: smart cards, digital money (digital cash), micropayments and electron checks.

Electron commerce includes not only on-line transactions. In the area covered by this concept, it is necessary to switch on and such kinds of activity as realisation of marketing researches, definition of possibilities and partners, support of communications with suppliers and consumers, the document circulation organisation and so forth Thus, electron commerce is complex concept and includes electron data exchange as one of components.

The market of electron commerce: today and tomorrow

One of the "measurements" characterising the multidimensional world of electron commerce, the type of the consumer of production is. The requests following from a problem of service private ("physical" - in domestic terminology) persons, hardly differ from the requests arising at job with corporate clients - firms and the companies. Corporate clients - business partners - should be defined beforehand, expansion of their circle - delicate enough process. (For a designation of the form of the electron commerce focused on corporate clients, in English-speaking sources the term business-to-business, in difference of sector business-to-consumer, activity-oriented with private persons) is used. At the same time the expediency of augmentation of number of private clients does not call doubts - the more, the better (it is final, in reasonable limits). So, the electron bookshop without any preconditions should accept orders from any who is capable to pay.

What volume of the market for electron commerce and what forecasts can be made today on the near future? The most reserved estimations give significances in 500 million dollars for 1996 and 6,6 billion dollars - in 2000 In spite of the fact that these volumes make rather small part from total amount of the retail market making 2 bln. of dollars, their absolute significances serve as a good cause for investments into electron commerce. By company Computer Intelligence estimations (California, the USA) by today about 2,7 million persons have made on-line purchases.

What types of the goods are sold today through Web? We will not make opening, having told, that the appreciable part in this list is taken by software products and computer aids. Really, WWW it is based on computer technologies, and the most modern are necessary for sanguineous job with multimedia Web-sections program and means. Takeoff of other sectors of the market, especially such, as travel and financing facility is represented to more unexpected. Table 1 illustrates ranging of sectors of the market according to two various criteria: a sales volume in money terms and quantity of the sold copies of these or those goods (or the served clients).

Table 1. Distribution of places of sectors of the market of electron commerce

Place Ranging on monetary volume Ranging by quantity of sales
1 real estate the software
2 computers and accessories sound-reproducing equipment
3 software a miscellaneous
4 tourist service computers and accessories
5 sound-reproducing equipment tourist service
6 financing facility financing facility

Let's notice, that the sector of the software mentioned in the table is made mainly not by the agents focused on the usual user, and hi-tech systems: complexes SAPR, programs for medicine and the industry, a software engineering agent.

What waits for us in the future? The researches spent Mentis Corporation (Northern Carolina, the USA) give the following (expected) picture of the sales bound with Internet (table 2).

Table 2. Estimations for the market of electron commerce in 2000 g

The characteristic of the market the Estimation
Total amount of Internet-sales of $4,5 mlrd - $6 mlrd
Sales volume on one buyer of $600 - $800
The average size of Internet-transaction of $25 - $30
Total of Internet-transactions of 130 million - 200 million
Share of sales on-line the goods of 60 % - 70 %
Share of sales of the goods of 30 % delivered to the buyer - 40 %

Use Web for attraction of buyers

Having considered market segments of electron commerce, we will try to find out, how the companies are going to to use Internet for attraction of buyers. Table 3 (a source: Forrester Research) illustrates corresponding intentions of corporations on use Internet. The majority (76 % in 1997) plans to make accessible in on-line a regimen the trading information, and about half assume to begin reception on-line orders.

Table 3. Plans of the companies on use Internet for attraction of buyers

Method of use 1995 1997
The trading information of 57 % of 76 %
Cooperation of 20 % of 45 %
Booking of 13 % of 48 %
Electron data exchange of 39 % of 8 %
Other 18 % of 17 %
Are not going to to use 46 % of 1 %

Results of other researches draw less iridescent picture of penetration of electron commerce on the market. Recent interrogation has shown casually chosen 375 subscribers Datamation, that 60 % of the companies presented in interrogation do not attend to electron commerce and do not plan it in a current of the next three years. About 35 % of respondents have already entered electron commerce into the practice, and 5 % assume to make it within three next years.

It is interesting, that at the companies which have introduced electron commerce, communications with suppliers prevailed over communications with consumers - accordingly 91 % and 87 % a little. It testifies that, introducing electron commerce, the companies are guided thus not only by the retail market, but also on trading mutual relations business-to-business.

The market of electron commerce: sector business-to-business

Though, under forecasts, the retail market of electron commerce should reach to the beginning of a next millenium of volumes in some billions the dollars, the expected volumes bound to the market business-to-business, in 100 times more. While retail purchases usually are not bound to any restrictions and can occur in any form, the companies carry out purchases at suppliers and business partners in the volumes allowing them to receive economy at the expense of the control over acquisition process, possible at use Web.

The idea of the organisation of purchases at suppliers with use of technologies of computer communications is not new. The company on retail trade WalMart has realised information interchange in a real-time on communication networks between the computers and computers of suppliers, having supplied immediate fulfilment of orders received by it that has led to radical augmentation of incomes WalMart.

Even such usual activity as the order of office accessories and the office goods, can become the reason of financial losses if the serving companies are beyond corresponding expense items or carry out purchases at not planned suppliers. To prevent occurrence of these problems, Peter Rodin (Peter Roden) - the employee of the Massachusetsky Institute of technology - has developed the software for realisation of similar purchases. Employees do orders, using any Web a browser. The program checks, whether calls the order of excess of items of expenditure of the budget, whether the employee doing the order, for fulfilment of such operations is authorised and whether the order is addressed someone from the suppliers using preference. The suppliers giving the discounts and supplying immediate delivery concern them. For advancement of the system developed by it on the market Rodin has based company SupplyWorks (literally - Delivery Works). As such orders "for own needs" can make 40 % - 60 % of internal costs of the companies, a number of the companies from among Fortune 500, including such as American Express, IBM, Chase Manhattan Bank, consider possibility of acquisition of systems of such type.

From technologies on which the electron commerce can base, the most fulfilled as of today is electron data exchange - EDI (Electronic Data Interchange). This method of the coding of consecutive transactions and their processing in on-line a regimen is used 25 years and represents the industry in volume in 45 billion dollars. According to data Giga Information Group only the companies of the USA carry out in an electron regimen of purchases for the sum to 500 billion dollars a year.

EDI relieves of necessity of processing, mail transfer and repeated input for computers of paper documents - process which not only is rather noneffective, but can generate also and errors. So, in company Campbell Soups, 60 % of all acting demands for production delivery contained errors of such parentage. By estimations, to 40 % of operating time of sales managers of this company it was spent for liquidation of consequences of these errors. The company hopes essentially to normalise a situation by transition to electron document circulation - EDI. Besides, use EDI will allow to reduce time of processing of acting demands from 48 o'clock till 18 o'clock.

Reduction of costs - the most impressing result of introduction EDI. Processing of the demand, the entered form of the paper document, manages in $150, use EDI reduces this digit to $25. EDI essentially reduces the cost price, however initial investments in specialised commercial networks (VAN) and the software which is carrying out data transformation in an EDI-format and back, are great enough. Therefore only corporate giants could use benefits from introduction of technology EDI. However use Internet as a communication basis for EDI allows to eliminate a price barrier and opens to the small companies of a way to use of this technology.

Let's notice, that the companies attending to electron commerce, all in larger degree assotsiirujut EDI with Internet, instead of with VAN. By results of interrogation of journal Datamation, the mentioned above, 54,6 % of the companies-respondents mentioned above have introduced EDI, but only 17,7 % from them use VAN. The vice of networks VAN compressing market EDI, weakens as more and more the companies makes a choice in favour of Internet, that supplies reduction in expenditure and reduction of time of the response. And though Internet cannot supply the same level of the guaranteed delivery of the information as VAN, software allow to compensate it by means of processing of reports in a regimen of the double control and relaying in the end of business day of the deformed or lost reports.

(Continuation follows. From June, 23 till June, 25th 1997 in the middle Information technologies the course "Electron commerce will be read: methods and technologies" the LINK)

The dictionary

Electron commerce - such form of delivery of production at which the choice and the order of the goods is carried out through computer networks, and accounts between the buyer and the supplier are carried out with use of electron documents and-or instruments of payment. Thus as buyers of the goods (or services) the organisations can act both private persons, and.

Marketing researches

In the Anglo-American literature distinguish two concepts. Market research - the tax and the analysis of the information on the concrete market and marketing research
Research of all elements of a complex of marketing (the commodity policy, price policy, system of sales promotion, a control system of staff, the communication policy). In the Russian literature on marketing and advertising the term use both in that, and in other significance, spending differences basically depending on applied methods of research: quantitative and qualitative marketing researches.



Tags: Mass media, Online, Payment System, Internet Online Business

Similar Articles:
Boshnjatsi
Presentation of an article Internet in daily life
Iconographical Analysis: di Nardo, 'Adoration of the Magi'
Kazakhstan / History of Kazakhstan
© Fishku.com - Article Directory. You read the article: "What is the Electron Commerce?" ↑
Author: Paul




 

Terms of Use

 
Copyright © 2009 www.Fishku.com - Article Directory. All Rights Reserved.
[Privacy Policy | Terms of Use | Sitemap]