E-Business and impact of innovations on the growth

of E-business

SUBMITTED BY:
Muhammad Hassan Waqar
Registration Number:
BAF05193088
BS-6th-B

BS Accounting and Finance

INSTRUCTOR: DR. AMJAD ALI

29 August 2022
 E-Business and impact of innovations on the growth
of E-business

INTRODUCTION

The term e-business signifies a business management method using IT communication,

mainly Internet applications. E-business refers, among other things, to sending documents,
exchanging data between a producer, distributor and trade partner, winning new customers,
conquering markets, and holding teleconferences.
E-business is a young industry in the world. First online stores were set up in the second half
of the nineties of the 20th century. The concept of e-business is mainly understood as online
stores and Internet platforms. According to Central Statistical Office (CSO), e-business
includes transactions conducted via networks, based on IP (Internet Protocol) and via other
computer networks. Goods and services are ordered by these networks but payment and final
delivery of the order goods or service can be made in or outside the network. Transactions
can be carried out between enterprises, with individuals, government or other private and
public institutions. Orders received by telephone, fax or e-mail are excluded from e-business.
E-Business, although it is a young industry in the world, has already developed.
There are distinguished sales platforms. An interesting example are price comparison sites
such as: Amazon , E-bay, which have been a supporting tool recently and now they form one
of the giants in the e-business segments.
E-business also includes the reservation system, e.g. Booking.com. E-business is supported
by a significant group of service providers, among others, hosting companies, marketing
agencies, design companies, supporting sales and specialists in the process design i.e. data
analysis.
E-business also functions in all business models, i.e. B2B (Business to Business), B2C
(business-to consumer), C2C (Consumer-to-Consumer) and C2B (Consumer to Business).
However, the concept of e-business is most frequently understood as e-stores. Their
advantage over traditional retail stores are: availability, wide range of assortment, prompt
access to unlimited amount of information along with the possibility of selecting the form of
payment, which is the most convenient for the client. The main advantage of e-stores is the
possibility of learning the preferences of Internet users by using tools to track and analyze
their behavior. This information helps to respond quickly to the market needs and adapt
quotations to client expectations.

PROBLEM STATEMENT

In the past ten years, the “e-business” has become an increasingly important segment of the
market. Most of the young people are engaging in e-business arrangements instead of
traditional businesses. Although, research on the reasons for and consequences of e-business
on objective measures of income, working hours and employment conditions has been done
extensively, but there has been a very little work on exploring the impact of innovations on
the growth of e-business.

OBJECTIVE OF THE STUDY

 To investigate the impact of innovations on the growth of e-business

RESEARCH QUESTION

 Does innovations impact on the growth of e-business?

RESEARCH HYPOTHESIS

Based on the problem statement, research question and objective, following null and
alternative hypothesis will be constructed:

 HOA: Innovations does not impact on the growth of e-business

 H1A: Innovations does impact on the growth of e-business

SIGNIFICANCE AND CONTRIBUTION OF THE STUDY

E-business has changed the shopping experience from the point of view of customers and
facilitated the whole world as connected business platforms. Numerous innovations are
helping to drive this growth and ease the process of setting up shop and selling online, and in
turn, building a successful e- business.
In the proposal, there is presented the condition and potential of the e-business sector. Their
advantage over traditional retail stores: availability, wide range of assortment, prompt access
to unlimited amount of information along with the possibility of selecting the form of
payment, which is the most convenient for the client. The main advantage of e-business is the
possibility of learning the preferences of Internet users by using tools to track and analyze
their behavior. This information helps to respond quickly to the market needs and adapt
quotations to client expectations. This allows for the presentation of all characteristics of the
e-business sector and the attitudes of those buying online towards online shopping.

LITERATURE REVIEW

The immense popularity of the internet in recent years has been fuelled largely by the
prospect of performing business online. With the rapid global growth in electronic commerce,
businesses are attempting to gain a competitive advantage by using e-business to interact with
customers.
E-business refers primarily to the buying and selling activities over the Internet, which
includes transactions such as placing orders, making payments, and tracking delivery of
orders on the Internet and people immediately think of consumer retail purchases from
companies such as Amazon and E-Bay.
E-business is exponentially increasing the availability of information, giving customers
access to more knowledge, of better quality and faster than before. Technological
advancement led an explosive development in electronic commerce, the causes of that are the
internet end the World Wide Web (WWW), which are making electronic commerce much
more accessible. Internet e-business includes electronic trading of physical goods and of
intangibles such as information. This encompasses all the trading steps such as online
marketing, ordering, payment and support for delivery.
E-business is used everywhere in everyday life. Now a days it is utilized for everything from
credit card authorization, travel reservation over a network, wire fund transfers across the
world, point of sale transactions in retailing, electronic banking. It helps in generate demand
for the products and services and improves order management, payment and other support
functions.
Similarly, e-business decreases the cost of creating, processing, distributing and retrieving
paper based information. Further facilitates the benefits which include improved image,
improved customer service, simplified processes, compressed cycle and delivery time,
eliminating paper work and increased flexibility.
E-business has become very popular because of the benefits and convenience it brings along
as it is no longer an alternative, it is an imperative. E-business is generally based on monetary
transaction and e-services are the part of electronic commerce.
E-business, commonly known as e-business, is the buying and selling of product or service
over electronic systems such as the Internet and other computer networks.
E-business 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 and telephones as well.
E-business is generally considered to be the sales aspect of e-business. It also consists of the
exchanging of data to facilitate the financing and payment aspects of business transactions.
Even today, some considerable time after the so called ‘dot com/Internet revolution’,
electronic commerce (e-business) remains a relatively new, emerging and constantly
changing area of business management and information technology.
There has been and continues to be much publicity and discussion about E-business. Library
catalogues and shelves are filled with books and articles on the subject.
However, there remains a sense of confusion, suspicion and misunderstanding surrounding
the area, which has been exacerbated by the different contexts in which electronic commerce
is used, coupled with the myriad related buzzwords and acronyms.
In the emerging global economy, e-business and e-business have increasingly become a
necessary component of business strategy and a strong catalyst for economic development.
The integration of Information and Communications Technology in business has
revolutionized relationships within organizations and those between and among organizations
and individuals.
Specifically, the use of ICT in business has enhanced productivity, encouraged greater
customer participation, and enabled mass customization, besides reducing costs. With
developments in the Internet and Web-based technologies, distinctions between traditional
markets and the global electronic marketplace-such as business capital size, among others-are
gradually being narrowed down.
The name of the game is strategic positioning, the ability of a company to determine
emerging opportunities and utilize the necessary human capital skills to make the most of
these opportunities through an e-business strategy that is simple, workable and practicable
within the context of a global information milieu and new economic environment.
With its effect of leveling the playing field, e-business coupled with the appropriate strategy
and policy approach enables small and medium scale enterprises to compete with large and
capital-rich businesses.
On another plane, developing countries are given increased access to the global marketplace,
where they compete with and complement the more developed economies.
Most, if not all, developing countries are already participating in e-business, either as sellers
or buyers. However, to facilitate e-business growth in these countries, the relatively
underdeveloped information infrastructure must be improved.
It is recognized that in the Information age, Internet commerce is a powerful tool in the
economic growth of developing countries. While there are indications of e-business
patronage among large firms in developing countries, there seems to be little and negligible
use of the Internet for commerce among small and medium sized firms.
E-business promises better business for SME’s and sustainable economic development for
developing countries. However, this is premised on strong political will and good
governance, as well as on a responsible and supportive private sector within an effective
policy framework. This primer seeks to provide policy guidelines toward this end.
The environment of an e-business, just as in the case of a traditional enterprise, can be
divided into:
Near environment, or micro-environment, which consists of suppliers of materials or raw
materials, intermediaries, competitors and customers.
Far environment, or macro-environment, which includes factors that are independent from an
enterprise and affect its operation in technical, standardization, legal, social, economic,
political and educational aspects.
In the case of an e-business, contrary to traditional enterprises, there are no boundaries
connected with the environment. Customers, suppliers and intermediaries may be located at
any place across the world, in different time zones; they may speak different languages and
pay in different currencies. What is more important from the e-business environment
perspective, is relationships between the different entities of e-business. The most popular of
them include:
B2B – business to business, i.e. relationships between two businesses taking place during
wholesale and trade between different companies and within one company, between its
branches. B2B development requires increasing integration of business processes between
entities.
B2C – business to consumer, i.e. relationships between an enterprise and its consumers in the
area of offering information, goods and services online to individuals through online
shopping centers. They may also include online banking services via which customers make
bank wire transfers.
C2C – consumer to consumer, relationship based on business connections between end
consumers of a service or product, such as auctions, classified ads or exchange of new and
second-hand things.
B2A – business to administration, i.e. relationships between business and administration,
understood as companies' actions towards public sector organizations, aimed at using
electronic technology for information exchange between a company and public
administration, e.g. in the area of taxes or employment. This form also includes electronic
reporting systems. x C2A – citizen to administration – communication between citizens and
public authorities allowing the former to settle important or obligatory matters through
electronic contact, e.g. online submission of tax returns, submission of an application for a
passport or an identity card.
C2B – consumer to business, i.e. a model that is the opposite of B2C, used by portals that
allow an individual person to publish an offer addressed to multiple sellers. Sellers may view
offers and take responsibility for them.
F2B – finance to business, i.e. offering by financial institutions of their services to companies
using the Internet; and F2C – finance to consumer – relationships between financial
institutions and individual customers.
B2E – business to employee – use of electronic means of communication to communicate
with employees - e.g. the Intranet, remote working

RESEARCH METHODOLOGY

Due to increasing number of e-businesses, it is more and more difficult to achieve success on
the Internet. Therefore, especially in e-business it is important to have an appropriate
business strategy - without it even the best idea cannot be implemented.
Errors that are most often made when developing strategies for e-business include incorrect
forecasts and analyses resulting from originators' and e-business creators' failure to check
whether their idea will attract interest of potential customers and incorrect estimate of
finances without taking into account additional financing sources that would allow the
company to develop in the initial period when it does not attract sufficient interest of
customers12. When developing a strategy for e-business it is important whether the brand
will be an entity operating only online or whether it will be an online representation of a
brand that functions on the market in the traditional form. Undoubtedly, the best strategies for
e-businesses will be those based on e-marketing, i.e. marketing operations conducted on the
Internet. For that purpose, e-business tools presented.
There are a great number of e-business tools, and selection of those that can be used by an
entrepreneur depends on specificity of a given e-business.
A website is now an obligatory investment of every company - not only one that operates
online. This is the best and fastest tool that can be used by an entrepreneur to inform and
educate customers, and present and sell its products and services to them. The most important
functions of a website include promotion of a company or its specific product, raising brand
awareness, activating new customers and building loyalty of the existing customers and main
or additional distribution channel.
Blog. i.e. a diary that is kept online and includes content of interest for readers, plays an
important role in providing possibility of commenting specific content and interaction
between a company and its customers. Blogs may also fulfil a role of image creator as they
present the institution as an industry leader, as well as an educational function (blogs
discussing financial issues run by financial institutions.
The aim of search engine positioning is to achieve the highest possible position in search
engine results, taking into account specific keywords. This tool is very effective and at the
same time relatively cheap, and a high position in search engine results in increased interest
in a given offer. This is because Internet users who search for a product or some information
on the Internet often click the first few links displayed in the search engine.
Another e-business tool is social media, which have been very popular recently. By
promoting their products or brands in such services as Facebook, Twitter, Google+ or
YouTube, companies can use social relations to strengthen their image. Social media users
often recommend interesting content to their friends and share their opinions about products
and services of a given brand.
An entrepreneur can create an advertisement by himself and select keywords related with its
company or its business profile. Once the advertisement is created, a sponsored link is
displayed in Google search results and on partner websites. The advertisement reaches a
customer when he searches the Internet for products related with the company's business and
indicated key words. This tool makes it possible to precisely plan the advertising campaign
budget and find out which elements of the advertisement work and which don't.
Viral marketing - takes advantage of the social character of the Internet and Internet users'
tendency to share with others what they find funny, interesting or shocking. The task of
marketing specialists is to prepare material that is interesting enough to be appealing to
Internet users - and the latter will spread it and "infect" their friends with it. A well-thought-
out viral campaign that uses a funny and surprising advertising material enables a permanent
image of brand to be built at a wide scale.
An appropriately prepared strategy for e-business and tools that are well-suited to the
specificity of this type of business, as well as their skillful use, have a positive impact on an
enterprise's success. Running a virtual enterprise entails both numerous advantages and
disadvantages. Unquestionable advantages include: flexibility of this type of an organization
and its ability to adapt itself o changeable situations, optimization of the value chain of
production and distribution, high productivity at low operating expenses, time savings and
increasingly smooth operation. Disadvantages of a virtual enterprise include possibility of
power abuse by the different partners, problems with employee identification or evolution
towards short-term contracts concluded between partners with very attractive competences.
A disadvantage may also be credibility of an institution which cannot be localized in the “real
world”, and lack of uniform customs and tax rules worldwide.

ECONOMETRIC METHODOLOGY

The appropriate econometric methodology will be applied to the nature of the data.

RESULTS AND DISCUSSIONS

It will be provided after data analysis.

CONCLUSION AND POLICY IMPLICATION

Conclusion will be drawn on the basis of Results and discussions.

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