Introduction to E-Commerce The Internet has opened up a new horizon for commerce, namely electronic commerce (ecommerce).

The Internet, through

advanced mechanisms of data transfer networks, establishes global linkages between customers and suppliers regardless of geographic location. E-commerce entails the use of the Internet in the marketing, identification, payment and delivery of goods and services. It involves order processing at company Websites and securing Electronic Fund Transfer (EFT) payment systems. 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. This is an effective and efficient way of

communicating within an organization and one of the most effective and useful ways of conducting business.

E-commerce can be divided into:

E-tailing or "virtual storefronts" on websites with online catalogs, sometimes gathered into a "virtual mall"

Buying

or

Selling

on

various

websites

and/or

online

marketplaces

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

TABLE OF CONTENTS No Topics Page No.

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Introduction Definition of E-Commerce Dimensions of E-Commerce Objective of the Study Major Constraints to E-Commerce How does an e-commerce store work? How do shopping carts work? Transaction Privacy and Security: How does e-commerce affect my privacy? What is an electronic wallet? How does a person-to-person payment work? Telecommunications: An Integral Part of ECommerce

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Definition of E-Commerce Electronic commerce is commonly known as (electronic

marketing) E-commerce or E-Commerce, consists of buying and selling of products or services over electronic systems such as the Internet and other computer networks. The meaning of electronic commerce has changed over the last 30 years. Originally electronic commerce meant the facilitation of commercial transaction electronically, Using technology such as Electronic Data Interchange (EID) and Electronic Fund Transfer (EFT). Dimensions of E-Commerce The Four Dimensions of e-commerce are B2C (business-to-consumer) e-commerce typical ecommerce activities that the typical Web surfer enjoys C2C (consumer-to-consumer) includes online auctions and rummage sales B2B (business-to-business) e-commerce involves one enterprise buying goods and services from another enterprise B2G (business-to-government) e-commerce aims to help businesses sell to governments

Objective of the Study E-commerce facilitates the very process of international

transaction; this involves securing and finalizing a contract, delivery of the product, and finally payment for performance of the contract. The movement of goods and services, as well as the payment mechanisms within a country and more so outside a country, are governed by regulatory and legal issues. Hence, the regulatory environment is at the core of e-commerce

development. This paper aims to highlight the status, statutes, potential and constraints of e-commerce development in Bangladesh. Both the statutory laws as well as the challenges in implementing them will be attempted. The paper shall also list specific policy changes aimed at bringing improvements to the legal and regulatory environment affecting ecommerce.

Major Constraints to E-Commerce This paper highlights various constraints to commerce and trade in general and e-commerce in particular. Too few telephone connections Absence of a strong independent regulatory body for the telecommunication sector Absence of encryption law that precludes acceptance of digital signature. Strong dependence on Letter of Credit (L/C) to conduct international transactions. Non-issuance of international credit cards for cross border transactions. Interest rate ceiling on export loans.

How does an e-commerce store work?

How do shopping carts work? Shopper browses Web site, and then adds products using a Buy or Add to Cart button Uses cookies to store information about your activities on Web site 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 agencies. growth Generally, in e-

commerce, bookshops and travel

larger

firms 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. Individual or business involved in e-commerce whether buyers or sellers rely on Internet-based technology in order to accomplish their transactions. Ecommerce is recognized for its ability to allow business to communicate and to form transaction anytime and anyplace. Whether an individual is in the US or overseas,

business can be conducted through the internet. The power of ecommerce allows geophysical barriers to disappear, making all consumers and businesses on earth potential customers and suppliers. E-bay is a good example of e-commerce business individuals and businesses are able to post their items and sell them around the Globe. Distribution channels E-commerce has grown in importance as companies have adopted Pure-Click and Brick and Click channel systems. We can distinguish pure-click and brick and click channel system adopted by companies. Pure-Click or Pureplay companies are those that have launched a website without any previous existence as a firm. Bricks-and-Clicks companies are those existing companies that have added an online site for ecommerce.

Transaction Privacy and Security: How does e-commerce affect my privacy? Spy ware is often used to gather information secretly and relay it to advertisers or other interested parties Ad-serving cookies track your activities at any site containing banner ads from the third party (who supplied the cookie)

How does a person-to-person payment work? Customer opens an account Some services require you to deposit some money into your account Customer receives user ID and password Money can be sent to anyone who has an e-mail account

What is an electronic wallet?

Telecommunications: An Integral Part of E-Commerce Access, pricing, and the quality of Internet services are critically dependent on the status and performance of the

telecommunications sector. The telecommunication sector of Bangladesh is characterized by poor level of penetration (0.4 telephone for every 100 persons, Graph 1), high cost to access, $341 connection fees for each telephone, one of the highest in the world, and a lengthy waiting period -- average waiting period for a new telephone connection varies from three months to ten years.

Advantages of electronic commerce All the advantages of electronic commerce for businesses can be summarized in one statement: Electronic commerce can increase sales and decrease costs. Advertising done well on the web can get even a small firms promotional message out to potential consumers in every country in the world. A firm can use electronic commerce to reach narrow market segments that are geographically scattered. The web is particularly useful in creating virtual communities that become ideal target markets for specific types of products or services. A virtual community is a gathering of people who share a common interest, but instead of this gathering occurring in the physical world, it takes place on the internet. Advantages: A business can reduce the costs of handling sales inquiries, providing price quotes, and determining product availability by using electronic commerce in its sales support and order-taking processes. Electronic commerce provides buyers with a wider range of choices than traditional commerce.

 Electronic commerce provides buyers with an easy way to customize the level of detail in the information they obtain about a prospective purchase. Electronic payments of tax refunds, public retirement, and welfare support cost less to issue and arrive securely and quickly when transmitted over the internet. Electronic payments can be easier to audit and monitor than payments made by cheque, providing protection against fraud and theft losses. Electronic commerce can also make products and services available in remote areas. Disadvantages of electronic commerce Some businesses are less suitable for electronic commerce. Such businesses may be involved in the selling of items which are perishable or high-cost, or which require inspection before purchasing. Most of the disadvantages of electronic commerce today, however, stem from the newness and rapidly developing pace of the underlying technologies. These disadvantages will disappear as electronic commerce matures and becomes more available to and accepted by the general population.

Disadvantages: Return-on-investment is difficult to calculate. Many firms have had trouble recruiting and retaining employees with the technological, design, and business process skills needed to create an effective electronic commerce presence. Difficulty of integrating existing databases and transactionprocessing software designed for traditional commerce into the software that enables electronic commerce. Many businesses face cultural and legal obstacles to conducting electronic commerce

Swot Analysis Of E-Commerce Many people with a business education have had experience with a SWOT analysis - strengths, weaknesses, opportunities, threats. Unfortunately, applying these types of analyses tend to go the way of trigonometry something you learn once and never really use again. But we shouldnt lose sight of the benefits of a SWOT analysis: the ability to offer a concrete, realistic audit of a company and a visual representation of its standing among competitors. Strengths and weaknesses are measured internally and are benchmarked based on pre-determined standards. Opportunities and threats are external. Opportunities are calculated based on superior offerings over competing companies. Threats are direct challenges from competitors. It is clear just from these brief overviews that these analyses are necessary for a competitive advantage. SWOT Debrief The objective of a SWOT analysis is to build on your strengths and minimize your weaknesses. Implementation from your

SWOT analysis will allow you to take advantage of opportunities while also mitigating the threats from competitors. In an industry

as competitive as eCommerce, a thorough SWOT analysis should be done at least annually. A thorough SWOT analysis can and should take a considerable amount of time. One of the key factors for a good analysis is an objective view, which is why we suggest bringing in an outside consultant. Keep in mind that customers are a good source of information for key areas of success for your company and where you have room for improvement. Tapping this valuable

information can be as simple as an online survey or as in-depth as a focus group. When doing a SWOT analysis for an eCommerce company, it is important to remember to include both online and brick-andmortar retailers as consumers will often use both mediums for purchasing. This can make your analysis more complicated, but in the end the detail will pay off. The online marketplace is constantly shifting and evolving, so changes can happen quickly. What was once an opportunity can quickly become unavailable due to shifts in online platforms or purchasing habits of consumers. For example, when eCommerce was in its infancy, they were able to offer 24/7 global shipping while brick-and-mortar vendors couldnt. Today almost every

retailer has an online version of their stores that compete with web-only sellers. Strengths What do you do better than others in your industry? Do you offer a unique comparison method? Do you have less expensive shipping? Are you able to offer cheaper products of the same quality as your competitors? Do you offer niche products that arent available elsewhere? competitive advantages. A typical eCommerce strength is having lower operational costs than a brick-and-mortar retailer. Weaknesses Unlike a typical retail store, eCommerce must take into account shipping times. Because of this, there is no immediate These are your

satisfaction from the customer. Shipping also creates additional headaches with heavy, perishable and awkward items. Online payments still cause some hesitation with some

customers, so security and fraud concerns may make people reluctant to make purchases. PayPal is a widely-accepted form of secure online transactions and may help minimize this concern.

A typical eCommerce weakness is the customers inability to touch the products. This can include proper fit for clothing, the functionality of an electronic device, the size of an item, etc. Opportunities You should always be asking yourself What new methods can I utilize to help grow my business and maintain an advantage over my competitors? and Where are my competitors vulnerable? The rate of change for eCommerce has seen a steady incline over the years. New technologies and features have made it easier for brick-and-mortar retailers to compete with online-only merchants. Fortunately for online-only retailers, software

improvements have made shopping cart technology faster, more secure, and more user-friendly. Live chat options for customer service have revolutionized instant-gratification for customer concerns and questions. Social media now provides a free platform for promotions and advertising and customer relations. In order to take advantage of these eCommerce opportunities, the online merchant needs to stay current and be willing to adopt new features as they arise.

Threats Any good business owner knows how important it is to keep upto-date on industry shifts that may affect growth. Often we think of these shifts as new technologies, consumer behavior, etc. What can get overlooked are legal and regulatory changes. For example,AODA compliance may affect online retailers in Ontario starting in 2014. The ease with which companies can start an eCommerce site is a constant threat. People can now sell via Facebook, eBay, Etsy all without setting up a whole website at all. The big names in eCommerce like Amazon will always have more room for undercutting their competition on price. Thankfully, there are up-and-coming technologies that make cheaper shipping and lower costs available for online merchants so they can compete with the big players. Offering niche products are also a way to diminish the threat from sites like Amazon. E-Commerce SWOT Conclusion Conducting a SWOT analysis at a minimum of once a year will give you a solid look at trends in E-commerce, show you where you stand among your competition, and provide insight into how you might mitigate your weaknesses by building on your strengths.