Session-5: E-Commerce

Models
Course: Science and technology in Business
Introduction to E- Commerce
• E-commerce, also known as electronic commerce or internet
commerce, refers to the buying and selling of goods or services using
the internet, and the transfer of money and data to execute these
transactions.
• Importance of E –Commerce
• Wide variety of products.
• Lower Cost than traditional shopping and selling.
• Less time consuming and faster consumer consumption.
• Faster business expansion.
• Online Business or E-Business is any kind of business or commercial
transaction that includes sharing information across the internet.
 Difference between E-Commerce & E- Business
E Commerce E- Business
E-commerce involves commercial transactions done E-business is conduct of business processes on the
over internet internet
E-Commerce is subset of E business E-business is superset of E-Business
E-Commerce usually requires the use of just a E-business involves the use of CRM’s, ERPs that
website connect different business processes
E-Commerce just involves buying and selling of E-business includes all kinds of pre-sales and post-
products and services sales efforts
E-Commerce is restricted to buying and selling E-Business involves market surveying, supply chain,
logistics management and data mining
E-Commerce involves the mandatory use of internet E-business involves the use of internet, intranet or
extranet
Example: Buying pen drive from amazon.com Example: Use of internet by dell for business
processes like, online customer support, email
marketing and supply chain management
Functions of E-Commerce
• Centralize management
of production creation.
• Analyze sales across
channels
• Set rules for Web order
fraud
• Manage order
fulfillment better
• Third-party interface
Concept of E-Business models
• The E-Business model, like any business model, describes how a company makes a plan to
generate revenue and make a profit from operations. The model includes the components
and functions of the business, as well as the revenues it generates and the expenses it incurs.

Components of E-Business models

• Value Proposition: How a company’s product or services fulfills the needs of customer.
• Revenue Model: Defines how the company will generate profits.
• Market Opportunity: The revenue potential within a company’s intended market space.
• Competitive Environment: Other competitors selling same product in the same market space.
• Market Strategy: How a company intends to enter a new market and attract strategy.
• Competitive Advantage: How a company will differentiate it’s business from the competitors.
• Management Team: Employees team responsible for company’s growth.
Types of E-Business Models
1. Business to Business (B2B)
2. Business to Consumer (B2C)
3. Consumer to Consumer (C2C)
4. Consumer to Business (C2B)
5. Government-to-Citizen (G2C)
6. Citizen-to-Government (C2G)
7. Government to Business (G2B)
8. Business to Government (B2G)
1. Business-to-Business (B2B)
• B2B stands for business-to-business. A website following the B2B
business model sells its products to an intermediate buyer who then
sells the product to the final customer.
• Indiamart is one of the best examples of B2B e-commerce business.
• Founded in 1999, the company’s mission is ‘to make doing business easy’.
• It is India’s largest B2B marketplace.
• India mart has 60% market share of the online B2B Classified space in India
• The channel focuses on providing a platform to Small & Medium Enterprises
(SMEs), Large enterprises as well as individuals.
2. Business-to-Consumer (B2C)
• B2C stands for business-to-consumer. A website following B2C business
model sells its products directly to a customer, the end user. A customer
can choose the products shown on the website and place an order for
them. They may use banking channels or payment on delivery options.
• There are two broad categories under this model – Direct selling and
market place model.
• Direct selling refers to the manufacturer or wholesaler of the product/brand
selling their goods directly to the customers on their own website.
• Market place model refers to an intermediary website where several sellers list
their products. The businesses use this as their market place instead of having
their own website. The customers may by a wide range of heterogeneous products
at comparative rates under this model.
• In a Market Place Model
• Various business and service providers list themselves on the E-commerce platform
advertising their services/goods.
• The E commerce site professional. verifies the businesses who intend to be listed and
advertises their offering on their website.
• The payment is received by the E commerce site, charges a commission for the online
market place and pays the supplier for his product.
• The E commerce site verifies the orders placed and dispatches goods from its
warehouse/supplier’s warehouse/ connects the customer to the relevant professional
• Urban Clap
• Urban Clap is a company that provides a variety of services of professionals and blue
collar workers at the convenience of customers’ home.
• Flipkart
• Flipkart started off with a direct-to-consumer model selling books and some other
products, before turning to a marketplace model which connect sellers and buyers and
expanding its catalogue. The sources of income to Flipkart include seller commission,
advertisements, logistics and convenience fees.
3. Customer-to-Customer (C2C)
• Customer to customer (C2C) is a business model, whereby customers
can trade with each other, typically, in an online environment. C2C
businesses are a new type of model that has emerged with e-commerce
technology and the sharing economy. A website following the C2C
business model helps consumers to sell their assets by publishing their
information on the website. Website may or may not charge the
consumer for its services. Another consumer may opt to buy the product
of the first customer by viewing the post/ advertisement on the website.
• OLX is a best example for C2C e-commerce business model
• It works according to above mentioned process
• These websites even rate the sellers and buyers on basis of their past
transactions, from which a new buyer can easily identify the genuine sellers.
4. Customer-to-Business (C2B)
• Consumer-to-business (C2B) is a business model in which consumers
(individuals) create value and businesses consume that value. In this
model, a consumer approaches a website for a particular service. The
consumer places an estimate of amount he/she wants to spend for a
particular service.
• Freelancer.com
• Freelancer is an Australian crowd sourcing marketplace website, which allows
potential employers to post jobs that freelancers can then bid to complete.
• Where the freelancers are mostly individuals who provides personalized jobs
to the business organizations for some consideration. This is one of the best
examples for C2B e-commerce business model.
5. Government-to-Citizen (G2C):
• This model is a part of e-governance. Example: Aadhar, AMC property tax, RTO
• The objective of this model is to provide good and effective services to each citizen and
reduce the average time for fulfilling citizen’s requests for various government services.
6. Citizen-to-Government (C2G):
• It enables the citizens to post feedback or request information regarding public sectors
directly. Example: Right to Information, Anti Corruption drive etc
7. Government-to-Business (G2B):
• Is a business model that refers to government providing services or information to business
organization.
• Government uses B2G model website to approach business organizations.
• Such websites support auctions, tenders and application submission functionalities.
8. Business-to-Government (B2G):
• Is a business model that refers to businesses selling products, services or information to
governments or government agencies.
Advantages of E-Commerce Disadvantages of E-Commerce
To the Organization Technical Disadvantages
• Improvisation of brand image of the
company • Rapidly changing software’s
• Faster and efficient • Network Bandwidth
• Less paper work
• Lack of system security
To the Customers
• 24*7 customer support
Non-Technical Disadvantages
• Quicker delivery
• Organizations provide substantial discounts • Initial cost
to customers
• Lack of product presence
To the Society • User resistance
• Less traffic resulting in low pollution
• Public services delivered at low costs.