Electronic Commerce

Electronic commerce, frequently referred to as ecommerce, electronic marketing, or ecommerce, is a term used to describe the purchase or sale of goods or services over electronic networks like the Internet. Electronic trade has increased rapidly as a result of the Internet. Electronically conducted commerce has resulted in rapid technological advances is fields such as electronic funds transfer, online marketing, inventory management systems, supply chain management, and electronic data interchange (EDI). The Internet is nearly always responsible for the transfer of information at some point in the transaction.

A significant amount of ecommerce is conducted for the purpose of purchasing premium services or other virtual merchandise via the Internet. Most ecommerce, however results in the physical transfer of goods or services at some point in the exchange. In ecommerce, sellers are frequently referred to as e-tailers, and their business is sometimes referred to as e-tail.

Two primary types of electronic commerce is conducted via the WorldWideWeb. The first of these can be described as business-to-business, and is also referred to as B2B. In comparison, ecommerce between a buyer and retailer, is known as business-to-consumer, or B2C.

Origins of ecommerce

When this term first originated in the latter part of the 1970s, it was used to describe electronic commerce transactions, such as Electronic Funds Transfer (EFT) or Electronic Data Interchange (EDI). Purchase orders and invoices could now be sent electronically rather than by mail. Additional services, such as telephone banking, automated teller machines, or ATMs, and the rapid spread of credit card use, soon became available.

Internet shopping, through the efforts of inventor Michael Aldritch, was introduced in 1979. Internet buying became popular in the United Kingdom with the automobile industry, which also used the Aldritch method. Since broadband cable didn’t exist, transactions were conducted over telephone networks with dial-up Internet connections. In 1982, Boston Computer Exchange launched an online marketplace featuring the sale of used computers. Shareware and software could be purchased online via electronic merchant accounts in 1987. An online consulting business, known as the American Information Change, was founded in 1991.

Beginning in the 1990s, ecommerce also incorporated enterprise resource planning systems, or ERP, as well as companies offering data warehousing and data mining services. In 1991, however, Tim Berners-Lee revolutionized the computer world with the introduction of ecommerce to the WorldWideWeb. Previously, this had been solely an academic electronic communications network.

Internet popularity skyrocketed in 1994 with the introduction of online shopping. Netscape Navigator introduced the first web browser, an online bank opened, and items such as pizza, flower delivery, bikes, and adult materials were offered for sale through Internet shopping. The following year, Internet marketing giants Amazon.com and eBay arrived, and Dell and Cisco developed a strong online presence.

After the introduction of faster connection speeds with DSL and the creation of security protocols, increasing numbers of large retailers began to offer online services. ecommerce became an almost universally acknowledged and accepted method of transacting business. Despite the dot.com bust in 2000, e-retailers persevered, and in 2002, eBay purchased PayPal. The next year, Amazon.com posted its first annual profit. In 2008, American online retailers and ecommerce entrepreneurs boasted projected sales of $204 billion.

Retail Applications used in ecommerce

Since the first electronic transactions featuring email, EFT, and EDI, a number of additional ecommerce applications have developed. Some of these include enterprise content management, online office suits, electronic shopping cart software and electronic tickets. Through forums such as newsgroups, teleconferencing, and instant messaging, e-retailers have developed methods of conducting nearly every type of business over the Internet – even face-to-face communication!

Federal Regulations pertaining to ecommerce

The Federal Trade Commission or FTC, regulates a number of online retailing activities. Commercial mailings, customer privacy, and Internet advertising are all monitored closely by the FTC. In 2003, the CAN-SPAM Act was introduced, which delineated nationwide requirements for direct marketing via email. Online advertising falls under the umbrella of the Federal Trade Commission Act, which requires truth in advertising. This legislation also protects consumer privacy. Finally, Internet pharmacy companies are required to abide by the Controlled Substances Act as a result of the Ryan Haight Online Pharmacy Consumer Protection Act, passed in 2008.

Ecommerce Security

From ordering digital media to virtual products offered by websites, from purchasing physical goods to Internet banking, nearly every consumer service imaginable is processed, at least in part, through eCommerce. Consumers renew library books, pay bills, purchase homes, make travel reservations, and send money international through electronic commerce applications. Even large corporations and global finance companies transact daily business through the World Wide Web and face ecommerce security issues. As a result, researchers continue to develop new and more secure transactional methods each day. Data security and integrity remain matters of intense concern for all ecommerce users.