, commonly known as e-commerce
, consists of the buying and selling of products
over electronic systems such as the Internet and other computer networks
. The amount of trade conducted electronically has grown extraordinarily since the spread of the Internet. A wide variety of commerce is conducted in this way, spurring and drawing on innovations in 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 some point in the transaction's lifecycle, although it can encompass a wider range of technologies such as e-mail
A large percentage of electronic commerce is conducted entirely electronically for virtual items such as access to premium content on a website, but most electronic commerce involves the transportation of physical items in some way. Online retailers are sometimes known as e-tailers and online retail is sometimes known as e-tail. Almost all big retailers have electronic commerce presence on the World Wide Web.
Electronic commerce that is conducted between businesses is referred to as Business-to-business or B2B. B2B can be open to all interested parties (e.g. commodity exchange) or limited to specific, pre-qualified participants (private electronic market).
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 the business transactions.
The meaning of electronic commerce has changed over the last 30 years. Originally, electronic commerce meant the facilitation of commercial transactions electronically, using technology such as Electronic Data Interchange
(EDI) and Electronic Funds Transfer
(EFT). These were both introduced in the late 1970s, allowing businesses to send commercial documents like purchase orders
electronically. The growth and acceptance of credit cards
, automated teller machines
(ATM) and telephone banking
in the 1980s were also forms of electronic commerce. Another form of e-commerce was the airline reservation system typified by Sabre in the USA and Travicom in the UK. Online shopping was invented in the UK in 1979 and during the 1980s it was used extensively particularly by auto manufacturers such as Ford,Peugeot-Talbot, General Motors and Nissan. From the 1990s onwards, electronic commerce would additionally include enterprise resource planning
systems (ERP), data mining
and data warehousing
Perhaps it is introduced from the Telephone Exchange Office, or maybe not.The earliest example of many-to-many electronic commerce in physical goods was the Boston Computer Exchange, a marketplace for used computers launched in 1982. The first online information marketplace, including online consulting, was likely the American Information Exchange, another pre-Internet online system introduced in 1991.
Although the Internet became popular worldwide in 1994, it took about five years to introduce security protocols and DSL allowing continual connection to the Internet. And by the end of 2000, a lot of European and American business companies offered their services through the World Wide Web. Since then people began to associate a word "ecommerce" with the ability of purchasing various goods through the Internet using secure protocols and electronic payment services.
- 1990: Tim Berners-Lee writes the first web browser, WorldWideWeb, using a NeXT computer.
- 1992: J.H. Snider and Terra Ziporyn publish Future Shop: How New Technologies Will Change the Way We Shop and What We Buy. St. Martin's Press. ISBN 0312063598.
- 1994: Netscape releases the Navigator browser in October under the code name Mozilla. Pizza Hut offers pizza ordering on its Web page. The first online bank opens. Attempts to offer flower delivery and magazine subscriptions online. Adult materials also becomes commercially available, as do cars and bikes. Netscape 1.0 is introduced in late 1994 SSL encryption that made transactions secure.
- 1995: Jeff Bezos launches Amazon.com and the first commercial-free 24 hour, internet-only radio stations, Radio HK and NetRadio start broadcasting. Dell and Cisco begin to aggressively use Internet for commercial transactions. eBay is founded by computer programmer Pierre Omidyar as AuctionWeb.
- 1998: Electronic postal stamps can be purchased and downloaded for printing from the Web.
- 1999: Business.com sold for US $7.5 million to eCompanies, which was purchased in 1997 for US $150,000. The peer-to-peer filesharing software Napster launches.
- 2000: The dot-com bust.
- 2002: eBay acquires PayPal for $1.5 billion . Niche retail companies CSN Stores and NetShops are founded with the concept of selling products through several targeted domains, rather than a central portal.
- 2003: Amazon.com posts first yearly profit.
- 2007: Business.com acquired by R.H. Donnelley for $345 million.
- 2008: US eCommerce and Online Retail sales projected to reach $204 billion, an increase of 17 percent over 2007.
Some common applications related to electronic commerce are the following:
- E-mail and messaging
- Content Management Systems
- Documents, spreadsheets, database
- Accounting and finance systems
- Orders and shipment information
- Enterprise and client information reporting
- Domestic and international payment systems
- On-line Shopping
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
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 consumer level, electronic commerce is mostly conducted on the World Wide Web. An individual can go online to purchase anything from books, grocery to expensive items like real estate. Another example will be online banking like online bill payments, buying stocks, transferring funds from one account to another, and initiating wire payment to another country. All these activities can be done with a few keystrokes on the keyboard.
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 these days.