Electronic commerce, commonly known as e-commerce, is a type of industry where buying and selling of product or service is conducted over

electronic systems such as the Internet and other computer networks. Electronic commerce draws on technologies such as mobile commerce, electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at one point in the transaction's life-cycle, although it may encompass a wider range of technologies such as e-mail, mobile devices social media, and telephones as well. Electronic commerce is generally considered to be the sales aspect of e-business. It also consists of the exchange of data to facilitate the financing and payment aspects of business transactions. E-commerce can be divided into:

E-tailing or "virtual storefronts" on websites with online catalogs, sometimes gathered into a "virtual mall" The gathering and use of demographic data through Web contacts and social media Electronic Data Interchange (EDI), the business-to-business exchange of data E-mail and fax and their use as media for reaching prospective and established customers (for example, with newsletters) Business-to-business buying and selling The security of business transactions

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Teleconferencing Electronic tickets

Governmental regulation
In the United States, some electronic commerce activities are regulated by the Federal Trade Commission (FTC). These activities include the use of commercial e-mails, online advertising and consumer privacy. The CAN-SPAM Act of 2003 establishes national standards for direct marketing over e-mail. The Federal Trade Commission Act regulates all forms of advertising, including online advertising, and states that advertising must be truthful and non-deceptive.[18] Using its authority under Section 5 of the FTC Act, which prohibits unfair or deceptive practices, the FTC has brought a number of cases to enforce the promises in corporate privacy statements, including promises about the security of consumers personal information.[19] As result, any corporate privacy policy related to e-commerce activity may be subject to enforcement by the FTC. The Ryan Haight Online Pharmacy Consumer Protection Act of 2008, which came into law in 2008, amends the Controlled Substances Act to address online pharmacies.[20]

Internationally there is the International Consumer Protection and Enforcement Network (ICPEN), which was formed in 1991 from an informal network of government customer fair trade organisations. The purpose was stated as being to find ways of co-operating on tackling consumer problems connected with cross-border transactions in both goods and services, and to help ensure exchanges of information among the participants for mutual benefit and understanding. From this came econsumer, as an initiative of ICPEN since April 2001. www.econsumer.gov is a portal to report complaints about online and related transactions with foreign companies. There is also Asia Pacific Economic Cooperation (APEC) was established in 1989 with the vision of achieving stability, security and prosperity for the region through free and open trade and investment. APEC has an Electronic Commerce Stearing Group as well as working on common privacy regulations throughout the APEC region. In Australia, Trade is covered under Australian Treasury Guidelines for electronic commerce,[21] and the Australian Competition and Consumer Commission[22] regulates and offers advice on how to deal with businesses online,[23] and offers specific advice on what happens if things go wrong.[24] Also Australian government ecommerce website[25] provides information on ecommerce in Australia. In the United Kingdom, The FSA (Financial Services Authority)[26] is the competent authority for most aspects of the Payment Services Directive (PSD). The UK implemented the PSD through the Payment Services Regulations 2009 (PSRs), which came into effect on 1 November 2009. The PSR affects firms providing payment services and their customers. These firms include banks, non-bank credit card issuers and non-bank merchant acquirers, e-money issuers, etc. The PSRs created a new class of regulated firms known as payment institutions (PIs), who are subject to prudential requirements. Article 87 of the PSD requires the European Commission to report on the implementation and impact of the PSD by 1 November 2012.[27]

Forms
Contemporary electronic commerce involves everything from ordering "digital" content for immediate online consumption, to ordering conventional goods and services, to "meta" services to facilitate other types of electronic commerce. On the institutional level, big corporations and financial institutions use the internet to exchange financial data to facilitate domestic and international business. Data integrity and security are very hot and pressing issues for electronic commerce.

Global trends

In 2010, the United Kingdom had the biggest e-commerce market in the world when measured by the amount spent per capita, even higher than the USA. At the time, the internet economy in the UK was expected to grow by 10% between 2010 to 2015.[28] Amongst emerging economies, China's e-commerce presence continues to expand. With 384 million internet users, China's online shopping sales rose to $36.6 billion in 2009 and one of the reasons behind the huge growth has been the improved trust level for shoppers. The Chinese retailers have been able to help consumers feel more comfortable shopping online.[29] eCommerce is also expanding across the Middle East. Having recorded the worlds fastest growth in internet usage between 2000 and 2009, the region is now home to more than 60 million internet users. Retail, travel and gaming are the regions top eCommerce segments, in spite of difficulties such as the lack of region-wide legal frameworks and logistical problems in cross-border transportation.[30] E-Commerce has become an important tool for businesses worldwide not only to sell to customers but also to engage them.[31]

Impact on markets and retailers

Economists have theorized that e-commerce ought to lead to intensified price competition, as it increases consumers' ability to gather information about products and prices. Research by four economists at the University of Chicago has found that the growth of online shopping has also affected industry structure in two areas that have seen significant growth in e-commerce, bookshops and travel agencies. Generally, larger firms have grown at the expense of smaller ones, as they are able to use economies of scale and offer lower prices. The lone exception to this pattern has been the very smallest category of bookseller, shops with between one and four employees, which appear to have withstood the trend.[32]

Distribution channels
E-commerce has grown in importance as companies have adopted Pure-Click and Brick and Click channel systems. We can distinguish between pure-click and brick and click channel system adopted by companies.

Pure-Click companies are those that have launched a website without any previous existence as a firm. It is imperative that such companies must set up and operate their ecommerce websites very carefully. Customer service is of paramount importance.

Brick and Click companies are those existing companies that have added an online site for ecommerce. Initially, Brick and Click companies were skeptical whether or not to add an online ecommerce channel for fear that selling their products might produce channel conflict with their off-line retailers, agents, or their own stores. However, they eventually added internet to their distribution channel portfolio after seeing how much business their online competitors were

generating.

Electronic commerce or ecommerce is a term for any type of business, or commercial transaction, that involves the transfer of information across the Internet. It covers a range of different types of businesses, from consumer based retail sites, through auction or music sites, to business exchanges trading goods and services between corporations. It is currently one of the most important aspects of the Internet to emerge.

Ecommerce allows consumers to electronically exchange goods and services with no barriers of time or distance. Electronic commerce has expanded rapidly over the past five years and is predicted to continue at this rate, or even accelerate. In the near future the boundaries between "conventional" and "electronic" commerce will become increasingly blurred as more and more businesses move sections of their operations onto the Internet. Business to Business or B2B refers to electronic commerce between businesses rather than between a business and a consumer. B2B businesses often deal with hundreds or even thousands of other businesses, either as customers or suppliers. Carrying out these transactions electronically provides vast competitive advantages over traditional methods. When implemented properly, ecommerce is often faster, cheaper and more convenient than the traditional methods of bartering goods and services. Electronic transactions have been around for quite some time in the form of Electronic Data Interchange or EDI. EDI requires each supplier and customer to set up a dedicated data link (between them), where ecommerce provides a cost-effective method for companies to set up multiple, ad-hoc links. Electronic commerce has also led to the development of electronic marketplaces where suppliers and potential customers are brought together to conduct mutually beneficial trade. The road to creating a successful online store can be a difficult if unaware of ecommerce principles and what ecommerce is supposed to do for your online business. Researching and understanding the guidelines required to properly implement an e-business plan is a crucial part to becoming successful with online store building. New E-commerce is still in its formative stage. The business-to-business and intra-organizational segments currently dominate e-commerce. Many major digital retailers are as yet in the investment and brand-building mode and show no profits; yet many established retailers realize profits from the new selling channel. Buoyant growth is apparent throughout. The hierarchical framework presented above offers an opportunity to separate concerns and analyze the specific aspects of this enterprise. The technological infrastructure currently imposes several limitations on the development of a global market-space and on the personal convenience of the participants. An integrated consumer-oriented transaction space is yet to emerge. The consumer marketplace is being developed by a large number of entrepreneurial initiatives, many of them experimenting on the frontiers. Moving the links of supply chains and products into market-space offers a major promise in raising economic efficiency of both manufacturing and service industries. As these moves take place and as the supply chains are reconfigured, many new firms may be expected to emerge and specialize around newly redefined core capabilities. The business models of many existing firms will be threatened. Although several intermediary roles are threatened by E-commerce, others are not, and new intermediary opportunities emerge. The capabilities of the new marketplace that combines the properties of a medium with that of a global location will be exploited to redefine many products and marketplaces. Notable are the possibilities to provide customized products, in the process moving ever larger segments of the

supply chains to the Internet, branding through bonding to a Web site and thus to its sponsor, the advantages of virtual auctions, and the possibility to create large reverse markets. New E-commerce will present over time countless opportunities and challenges to our economies and societies. Expansion of commerce and technological innovations are two of the levers of economic growth. These forces are combined in the progress of E-commerce. The macroeconomics effects of E-commerce on the national and regional economies, and on the international trade and its terms will need to be assessed and analyzed. The prevailing judgment at this stage of E-commerce development is to allow free-market forces to assert themselves unhampered by excessive government regulation. The traditional institutions, such as banks of issue, commercial banks, universities, established business intermediaries, media and publishing companies, would find a need to redefine their roles in the new environment. The taxability of products traded globally over the Internet is as yet an open issue. Intellectual property that can be converted to on-line content may find itself reevaluate in the global marketplace. The tension between the transactional efficiency of spot purchasing facilitated by electronic markets and the need for long-term relationships of trust and forbearance, enabled by electronic hierarchies, will persist and call for much study. The geographical limitations that have bound the place of residence to the place of work, and that have already been eroded by the growth of telework, may be expected to be even less binding. Indeed, the possibilities of the loss of rural space to the new ex-urbanites are already causing environmental alarms. A number of countries that had been marginalized by their geographical position take extremely active interest in Ecommerce as the means to move to the center of the virtual geography. The redistribution work has to be studied from multiple perspectives. E-commerce has entered a stage of rapid and sustained development. A large number of business models have been enabled by it. A number of questions have been posed here. All of these and many others will require further experimentation, experience, observation, analysis, and research.