ILO- DBM Prof.

Sneha Sankhe

Chapter 2: Overview of E-Commerce

E-Commerce- Meaning, Retailing in e-commerce-products and services, consumer behavior,
market research and advertisement B2B-E-commerce-selling and buying in private e-markets,
public B2B exchanges and support services, e-supply chains, Collaborative Commerce, Intra
business EC and Corporate portals Other E-C models and applications, innovative EC System-
From E government and learning to C2C, mobile commerce and pervasive computing EC
Strategy and Implementation-EC strategy and global EC, Economics and Justification of EC,
Using Affiliate marketing to promote your ecommerce business, Launching a successful online
business and EC project, Legal, Ethics and Societal impacts of EC

E-Commerce- Meaning, Retailing in e-commerce-products and services, consumer behavior,

market research and advertisement B2B-E-commerce-selling and buying in private e-
markets, public B2B exchanges and support services, e-supply chains, Collaborative
Commerce, Intra business EC and Corporate portals Other E-C models and applications,
innovative EC System-From Egovernment and learning to C2C, mobile commerce and
pervasive computing EC Strategy and Implementation-EC strategy and global EC,
Economics and Justification of EC, Using Affiliate marketing to promote your ecommerce
business, Launching a successful online business and EC project, Legal, Ethics and Societal
impacts of EC

E-Commerce

E-commerce (electronic commerce) is the buying and selling of goods and services, or the
transmitting of funds or data, over an electronic network, primarily the internet. These
business transactions occur either as business-to-business (B2B), business-to-consumer
(B2C), consumer-to-consumer or consumer-to-business. The terms e-commerce and e-
business are often used interchangeably. The term e-tail is also sometimes used in reference
to the transactional processes that make up online retail shopping.
In the last decade, widespread use of e-commerce platforms such as Amazon and eBay has
contributed to substantial growth in online retail. In 2007, e-commerce accounted for 5.1% of
total retail sales; in 2019, e-commerce made up 16.0%.

How does e-commerce work?

E-commerce is powered by the internet, where customers can access an online store to
browse through, and place orders for products or services via their own devices.
As the order is placed, the customer's web browser will communicate back and forth with
the server hosting the online store website. Data pertaining to the order will then be relayed to
a central computer known as the order manager -- then forwarded to databases that manage
inventory levels, a merchant system that manages payment information (using applications
such as PayPal), and a bank computer -- before circling back to the order manager. This is to
make sure that store inventory and customer funds are sufficient for the order to be processed.
After the order is validated, the order manager will notify the store's web server, which will
then display a message notifying the customer that their order has been successfully

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processed. The order manager will then send order data to the warehouse or fulfillment
department, in order for the product or service to be successfully dispatched to the customer.
At this point tangible and/or digital products may be shipped to a customer, or access to a
service may be granted.
Platforms that host e-commerce transactions may include online marketplaces that sellers
simply sign up for, such as Amazon.com; software as a service (SaaS) tools that allow
customers to 'rent' online store infrastructures; or open source tools for companies to use in-
house development to manage.

Types of e-commerce
Business-to-business (B2B) e-commerce refers to the electronic exchange of products,
services or information between businesses rather than between businesses and consumers.
Examples include online directories and product and supply exchange websites that allow
businesses to search for products, services and information and to initiate transactions
through e-procurement interfaces.

In 2017, Forrester Research predicted that the B2B e-commerce market will top $1.1 trillion
in the U.S. by 2021, accounting for 13% of all B2B sales in the nation.

Business-to-consumer (B2C) is the retail part of e-commerce on the internet. It is when

businesses sell products, services or information directly to consumers. The term was popular
during the dot-com boom of the late 1990s, when online retailers and sellers of goods were a
novelty.

Today, there are innumerable virtual stores and malls on the internet selling all types of
consumer goods. The most recognized example of these sites is Amazon, which dominates
the B2C market.

Consumer-to-consumer (C2C) is a type of e-commerce in which consumer’s trade products,

services and information with each other online. These transactions are generally conducted
through a third party that provides an online platform on which the transactions are carried
out.

Online auctions and classified advertisements are two examples of C2C platforms, with eBay
and Craigslist being two of the most popular of these platforms. Because eBay is a business,
this form of e-commerce could also be called C2B2C -- consumer-to-business-to-consumer.

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Consumer-to-business (C2B) is a type of e-commerce in which consumers make their

products and services available online for companies to bid on and purchase. This is the
opposite of the traditional commerce model of B2C.

A popular example of a C2B platform is a market that sells royalty-free photographs, images,
media and design elements, such as iStock. Another example would be a job board.

Business-to-administration (B2A) refers to transactions conducted online between

companies and public administration or government bodies. Many branches of government
are dependent on e-services or products in one way or another, especially when it comes to
legal documents, registers social security, fiscals and employment. Businesses can supply
these electronically. B2A services have grown considerably in recent years as investments
have been made in e-government capabilities.

Consumer-to-administration (C2A) refers to transactions conducted online between

individual consumers and public administration or government bodies. The government
rarely buys products or services from citizens, but individuals frequently use electronic
means in the following areas:

 Education. Disseminating information, distance learning/online lectures, etc.

 Social security. Distributing information, making payments, etc.

 Taxes. filing tax returns, making payments, etc.

 Health. Making appointments, providing information about illnesses, making health

services payments, etc.

Advantages and disadvantages of e-commerce

Benefits of e-commerce include its around-the-clock availability, the speed of access, the
wide availability of goods and services for the consumer, easy accessibility and international
reach.

 Availability. Aside from outages or scheduled maintenance, e-commerce sites are

available 24x7, allowing visitors to browse and shop at any time. Brick-and-mortar

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businesses tend to open for a fixed number of hours and may even close entirely on
certain days.

 Speed of access. While shoppers in a physical store can be slowed by crowds, e-

commerce sites run quickly, which is determined by compute
and bandwidth considerations on both consumer device and e-commerce site. Product
pages and shopping cart pages load in a few seconds or less. An e-commerce transaction
can comprise a few clicks and take less than five minutes.

 Wide availability. Amazon's first slogan was "Earth's Biggest Bookstore." They could
make this claim because they were an e-commerce site and not a physical store that had
to stock each book on its shelves. E-commerce enables brands to make a wide array of
products available, which are then shipped from a warehouse after a purchase is made.
Customers will likely have more success finding what they want.

 Easy accessibility. Customers shopping a physical store may have a hard time
determining which aisle a particular product is in. In e-commerce, visitors can browse
product category pages and use the site search feature the find the product immediately.

 International reach. Brick-and-mortar businesses sell to customers who physically visit

their stores. With e-commerce, businesses can sell to any customer who can access the
web. E-commerce has the potential to extend a business' customer base

 Lower cost. pure play e-commerce businesses avoid the cost associated with physical
stores, such as rent, inventory and cashiers, although they may incur shipping and
warehouse costs.

 Personalization and product recommendations. E-commerce sites can track visitors'

browse, search and purchase history. They can use this data to present useful and
personalized product recommendations, and obtain valuable insights about target
markets. Examples include the sections of Amazon product pages labeled "Frequently
bought together" and "Customers who viewed this item also viewed."

The perceived disadvantages of e-commerce include sometimes limited customer service,

consumers not being able to see or touch a product prior to purchase and the wait time for
product shipping.

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 Limited customer service. If a customer has a question or issue in a physical store, he or

she can see a clerk, cashier or store manager for help. In an e-commerce store, customer
service may be limited: The site may only provide support during certain hours of the
day, or a call to a customer service phone number may keep the customer on hold.

 Not being able to touch or see. While images on a webpage can provide a good sense
about a product, it's different from experiencing it "directly," such as playing music on
speakers, assessing the picture quality of a television or trying on a shirt or dress. E-
commerce can lead consumers to receive products that differ from their expectations,
which leads to returns. In some scenarios, the customer bears the burden for the cost of
shipping the returned item to the retailer.

 Wait time. If a customer sees an item that he or she likes in a store, the customer pays for
it and then goes home with it. With e-commerce, there is a wait time for the product to be
shipped to the customer's address. Although shipping windows are decreasing as next day
delivery is now quite common, it's not instantaneous.

 Security. Skilled hackers can create authentic-looking websites that claim to sell well-
known products. Instead, the site sends customers forfeit or imitation versions of those
products -- or, simply collects customers' credit card information. Legitimate e-commerce
sites also carry risk, especially when customers store their credit card information with
the retailer to make future purchases easier. If the retailer's site is hacked, hackers may
come into the possession of customers' credit card information.

E-commerce applications
E-commerce is conducted using a variety of applications, such as Email, online catalogs and
shopping carts, Electronic Data Interchange (EDI), the file transfer protocol, web services
and mobile devices. This includes B2B activities and outreach, such as using email for
unsolicited ads, usually viewed as spam, to consumers and other business prospects, as well
as sending out e-newsletters to subscribers and SMS texts to mobile devices. More companies
now try to entice consumers directly online, using tools such as digital coupons, social media
marketing and targeted advertisements.

The rise of e-commerce has forced IT personnel to move beyond infrastructure design and
maintenance to consider numerous customer-facing aspects, such as consumer data

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privacy and security. When developing IT systems and applications to accommodate e-

commerce activities, data governance-related regulatory compliance mandates, personally
identifiable information privacy rules and information protection protocols must be
considered.

E-commerce platforms and vendors

An e-commerce platform is a tool that is used to manage an e-commerce business. E-
commerce platform options exist for clients ranging in size from small businesses to large
enterprises. These e-commerce platforms include online marketplaces such as Amazon and
eBay, that simply require signing up for user accounts, and little to no IT implementation.
Another e-commerce platform model is SaaS, where store owners can subscribe to "rent"
space in a cloud-hosted service that does not require in-house development or on-premises
infrastructure. Other e-commerce platforms may come in the form of open source platforms
that require a hosting environment (cloud or on premises), complete manual implementation
and maintenance.

A few examples of e-commerce marketplace platforms include:

 Amazon

 eBay

 Walmart Marketplace

 Chewy

 Wayfair

 Newegg

 Alibaba

 Etsy

 Overstock

 Rakuten

Vendors offering e-commerce platform services for clients hosting their own online store
sites include:

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 Shopify

 WooCommerce

 Magento

 Squarespace

 BigCommerce

 Ecwid

 Salesforce Commerce Cloud (B2B and B2C options)

 Oracle SuiteCommerce

five value delivery methods for an ecommerce

The five value delivery methods for an ecommerce store are as follows:

1. D2C – Direct to Customer

Many new generation consumer brands have built loyal followings with rapid growth, by
cutting out the middlemen. Many online retailers have set a standard for vertical disruption,
but some new brands are showing us how D2C can continue to be an area for innovation and
growth. When the goods are sold directly to the customer, a sense of attachment is built with
the brand.

2. White Label and Private Label

Using a “white label” means applying your name and brand to a specific product purchased
from a distributor or wholesaler. While using private labels, a retailer creates a unique
product for them to sell exclusively either by themselves or by hiring a manufacturer. With
the help of both white labelling and private labelling, you can save on your investments in
design and production and look for a cutting edge in technology and marketing.

3. Wholesaling
In a wholesaling approach, the retailer offers products in bulk at a discounted price. The
concept of wholesaling was traditionally B2B, but nowadays, many retailers offer it to
budget-conscious customers in a B2C mode.

4. Drop Shipping
Drop shipping is one of the fastest growing and most efficient methods of ecommerce. The
typical drop shippers sell items fulfilled by a third-party supplier. Drop shippers usually act
as a middle man by connecting buyers to manufacturers. Easy-to-use tools allows users to
integrate inventory from suppliers around the world for their storefronts.

5. Subscription Service

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Even back in the early 1600s, publishing companies in England used a subscription model to
deliver books to their regular customers monthly. With the help of ecommerce, businesses are
going beyond just periodicals and groceries. In this technologically advanced era, each and
every industry out there is offering subscription services to bring convenience and savings to
its customers.

What Is Market Research?

Market research is the process of gathering, analyzing, and interpreting information to help a
company or individual assess the viability of a product or service and make sound business
decisions. It is of immense importance to entrepreneurs and startup companies to evaluate the
feasibility of a business before committing further resources to the venture.

Market research is critical in accomplishing the following tasks:

 Building a picture of consumer behavior

 Establishing how well a product or service meets the needs of the market
 Evaluating the size of the market for a particular product or service
 Helping with the business planning process
 Devising a marketing strategy for the business
 Solving marketing challenges that an enterprise faces
 Identifying major competitors
 Establishing a unique value proposition that sets a company apart from competitors
 Identifying opportunities for business growth

How to Conduct Market Research

The starting point for any market research endeavor is to gather data on the relevant market
sector. This involves two types of data:

 Primary information. This is information you gather yourself or hire someone else to
obtain for you. Primary research can be of an exploratory or specific nature. Exploratory
research helps to build up a broad picture of your market and identify any specific
opportunities for market growth. Specific research is more focused and usually used to
assess the market potential of an opportunity that exploratory research has uncovered.
Primary research can be conducted via email, social media, telephone, or personal
interviews.
 Secondary information. This is information that has already been compiled and can often
be accessed through online research. Research conducted via internet browsers or public
sources is free and is a good place to start; however, you may have to access studies done
by commercial associations and educational institutions to get the right information, which
may involve a cost.

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Market research may sound like a lot of work, but it is essential to enable you to get an
accurate portrayal of your market. In this guide, we discuss the types of marketing research
that can be used and the resources that marketers can employ for this process.

Types of Marketing Research

There are several methods that can be used to conduct market research, depending on the
company’s objectives and marketing strategy. They can be used in isolation for a specific
purpose or in combination to build up a more comprehensive picture of the market:

 Competitor analysis
 Interviews
 Focus groups
 Surveys

Types of Marketing Research

Competitor Analysis
No business can operate in a vacuum. To reap success, a business has to deal and interact
with all sorts of people, including customers, suppliers, and competitors within its market
sector. Competitors are defined as companies that meet at least one of the following criteria:

 Offer the same product or service

 Offer a similar product or service
 Have the potential to offer the same or similar product or service in the future
 Have the potential to develop a product or service that poses a considerable threat to the
survival of your offering

Conducting competitor analysis to know your competitors’ good and bad points will enable
you to exploit their weaknesses, undermine their strengths, and anticipate their next moves. In
analyzing each of your competitors, you need to gather the following information:

 The needs and preferences of customers you are competing to meet

 The similarities between the competitor’s products and services and yours
 The strengths and weaknesses of each of the competitor’s products and services
 How the competitor’s prices compare with yours

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 The competitor’s market performance

 The level of customer satisfaction with the competitor’s products and services

Having gathered this information, you need to formulate a plan that outlines how you intend
to compete with each competitor. Do you offer…

 Lower prices?
 Better support?
 Better service quality?
 Easier access to services?

Competitor analysis will enable you to identify your unique value proposition (UVP). This is
generally a unique aspect of your product or service offering that sets you apart from your
competitors. A UVP can be a powerful tool in future marketing campaigns, especially if it
meets a customer need that you may have identified through other marketing research
endeavors.

Competitor analysis forms a critical part of the competitive intelligence process, which uses
the information gathered during analysis to strategize and formulate long-term plans for the
business. Management can also use competitor analysis to decide how to counter a
competitor’s ascendancy, head off perceived threats to the company’s market share, and
develop strategies to achieve a greater competitive advantage in the future.

Interviews
Interviews are classified as a qualitative method of market research involving a one-on-one
interaction between an interviewer and a participant. Interviews are used for exploratory
research, and there are a wide range of interviewing formats that can be used, depending on
what you want to achieve.

Interviews are a form of primary research to learn more about customer needs and opinions.
They are particularly useful for the following tasks:

 Developing a new product

 Getting feedback after a product launch
 Evaluating a new market segment

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 Updating customer needs and opinions

 Finding out the reason for the loss in market share

Interviews can be conducted telephonically, online, or face-to-face. They can be entirely

open-ended or structured with specific questions to elicit responses that help you to determine
opinions and market trends. Interviews can also provide a picture of how market needs
change according to demographics or location. Face-to-face interviews generally produce the
most accurate results, but they are time consuming, and the cost may be prohibitive.

Focus Groups
The goal of a focus group is to get participants to interact and bounce ideas off each other or
discuss a topic. This can be costly, as you need to hire a neutral venue to host the group, and
participants are usually rewarded in some way for taking part in the session.

A focus group moderator, in collaboration with marketing staff, should prepare for the event
by taking the following actions:

 Identify the main objective of the session

 Develop specific questions to ask the group
 Determine the demographics required of the group
 Identify relevant members of the focus group
 Send out an agenda to focus group members

During the session, the moderator should encourage participation from everyone in the group
and control the meeting so that the process doesn’t stall. It is often a good idea to have a
roundtable meeting, which usually prevents one person from trying to dominate proceedings.

Surveys
Surveys are probably one of the easiest ways to generate information for market research.
They can benefit a business by enabling you to accomplish the following goals:

 Reach a specific audience

 Understand your customers better
 Research and analyze a target market
 Measure brand awareness

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 Gauge opinions about an existing or future product

 Assess where you stand compared with your competitors
 Devise social media strategies and build marketing campaigns
 Delve deeper into customer demographics
 Conduct market segmentation
 Decide which creative assets to employ in future campaigns
 Test branding and positioning
 Use customer feedback for marketing testimonials

Surveys can be conducted by telephone or by mail. Whichever avenue is chosen, a survey

needs to be correctly designed to generate enough interest to ensure participation and to elicit
responses that are in line with the survey objectives.

Market Research Analytics

Data analysis in market research can be a daunting task, depending on the amount of
information gathered. Data organization and data reduction are two techniques that are often
necessary to enable meaningful interpretation of the information. There are several statistical
methods that are used by marketers to interpret research results:

 Multidimensional Scaling. This is an array of techniques used to provide perceptual

maps of competing brands or products. This method produces a visual display of
competing items in which the distance between two items represents either similarity or
dissimilarity; the closer they are to each other, the more similar they are.
 Multiple Regression. This procedure works on the “best fit” principle and analyzes how
the value of a dependent variable changes according to changes in various independent
variables. An example would be how sales revenue of a product changes in relation to
demographics, location, and season.
 Discriminant Analysis. This statistical technique classifies products, people, or other
variables into categories. For instance, it can be used to determine the demographics of
customers for different products.
 Cluster Analysis. This method separates items into a specified number of groups that are
similar yet mutually exclusive. This technique approximates what occurs in market
segmentation, where a market researcher is able to see the similarities between different
segments of consumers while observing the attributes that make each segment distinct.
 Factor Analysis. Factor analysis enables a researcher to identify the strongest relations
among many variables. It therefore enables the researcher to eliminate from consideration
the variables that are of least interest to the consumer and concentrate on those aspects that
have the most consumer appeal.
 Conjoint Analysis. This technique is most often used to analyze the results of different
marketing offers. For example, it can be used to analyze the usefulness of each product
attribute and grade the relative importance of these attributes to consumers.

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Target Audience and Segmentation

Target Audience
In marketing, it is essential to understand your target audience; otherwise, you don’t know
which channels to use for your advertising campaigns. You need to know how to reach and
resonate with your audience by targeting the demographic that is most likely to be attracted
by your product or service.

The best way to find a target audience is to analyze the specific needs that your product or
service caters to. The more generally used your product would be, the easier it is to advertise
and formulate a marketing campaign. It is essential to evaluate the success of any marketing
campaign by monitoring the following aspects:

 Sales
 New customers
 Phone inquiries
 Requests for information
 Web traffic
 Click-throughs

If these results are not satisfactory, you need to alter your advertising message or amend your
marketing campaign to target other channels.

Market Segmentation
Every company should be striving to gain an edge over its competitors by providing a better
level of service. In this way, it can gain a competitive advantage and target new customers.
Market segmentation is all about identifying different segments of your market that cater to
different types of customers and then tailoring your marketing campaign to each segment
accordingly.

Good market segmentation will result in the identification of segments where each one
contains similar customers but is as different from the next segment as possible. There are
different types of segmentation, based on different elements:

 Geography
 Demographics

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 Psychographic —based on social class, lifestyle, and personality

 Behavior
 Industrial market

Each of these types can be divided further into segments.

Consumer Behavior in the Marketing Research Process

Consumer behavior is the study of customers and organizations to determine how they select
and use products and services:

 How consumers choose from various alternatives

 What customers think about different alternatives
 What mechanism consumers use to select from different options
 How consumers behave when shopping and researching
An understanding of these aspects will enable a company to adapt its marketing campaign in
a bid to increase its influence over the consumer. Consideration is also given to three kinds of
factors:

 Personal factors. These include demographics such as age, gender, profession, culture,
and background. A consumer’s personal interests and opinions also play a major part.
 Psychological factors. These include a consumer’s perceptions and attitudes.
 Social factors. The influence of family, friends, peer groups, and social media has to be
taken into account. Social class, education level, and income also play a part.
for collecting data on consumer behaviour. The following channels are the most useful:

 Surveys
 Focus groups
 Customer reviews
 Google Analytics
 Competitor analysis
 Blog comments
 Q&A sites
 Social media

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Resources for Marketers to Conduct Market Research

For startup companies and entrepreneurs about to launch a new business, it is vital that you
source as much information as possible about your market. This will enable you to get a
handle on your target market, as well as collect information about geographical locations and
recent business trends.

It would be very costly to resort to market research companies to do the work for you;
however, there are a number of resources that are either free to use or reasonably priced to
access.

List of Resources for Marketing Research (For examples)

1. Census.gov. The U.S. government collects census data every 10 years and targets the
general population. A database search will yield information on:
 Population numbers and trends
 Household information, including the average number of people per household, income,
and dwelling type
 Education
 Health insurance coverage
 Economic indicators, by state and county

2. USA.gov. This is another government website that is free to use. It also links to various
trade and industry organizations where you can get information on the type of business you
intend to start. On USA.gov, you can access information on:
 Labor statistics and earnings data
 Wages by area and occupation
 Employment data by state and metro area
 Economic indicators by state

3. SBA.gov. This is the Small Business Administration website, which contains great
information and advice on starting your own business, including:
 Licensing information
 Loans and financing
 Interest rates

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4. FedStats.gov. This federal government site provides access to information on a wide range
of topics:
 Population trends

 Economic trends
 Crime statistics
 Education
 Health care
 Aviation safety
 Energy use
 Agricultural production

5. ExonomicIndicators.gov. This site updates its information daily, sourced from the Bureau
of Economic Analysis and the Census Bureau. You can access information on:
 Retail sales

 Durable goods
 Manufacturing
 Construction
 New home sales

6. SurveyMonkey.com. SurveyMonkey enables you to set up your own survey, which is

very user friendly for both the facilitator and the participant. It allows you to include
multiple-choice, true/false and essay-type questions, and it enables you to include ratings
scales. The responses can be formatted in a number of ways, including graphs and charts.
SurveyMonkey also sells target audiences if you don’t have your own email target list.

7. Think with Google. This free website enables you to access its Shopping Insights, Google
Trends, and Consumer Barometer to gather information on consumer behavior and product
trends.
8. Amazon. This is a great place to access information by filtering data on markets, new
products, competitors, and pricing.
9. Social Mention. This platform provides a free service to search and analyze social media
content across a wide range of social media platforms, including Facebook, Twitter,

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YouTube, and Google. You can track what consumers are saying about your company, a new
product, or any other topic.
10. Facebook Audience Insights. This tool enables you to learn what matters to Facebook
followers through information about their locations, interests, and behaviors.
11. BizStats. BizStats provides all kinds of information on small businesses in the United
States.
12. Up Close & Persona. This free tool enables you to create an image of customer types
and what motivates them to buy.
These are some of the free resources that are available to marketers to conduct market
research. There are many others, such as Followerwonk, Proved, UsabilityTools, and
Typeform that provide free basic services but charge a premium to use upgraded service
plans.

E-marketplaces connect buyers and sellers together on a single platform for

commercial activity. When you talk about marketplaces, you definitely hear terms like

B2C, B2B, C2C or peer-to-peer. So, what are they and how they differ from each

other?

The way how they are connected and how the services or products are being sold on

the platform categories the marketplace into different types. These marketplaces are

also often defined under the term multi-vendor marketplace and sharing economy

platforms. Here are some marketplace basics to help you decide what kind of multi -

vendor store is the right business model for you.

5 Types of E-marketplace
1. Product Online Marketplace
This type is what we typically call as an ecommerce marketplace, where people buy
and sell products. The platform brings together all types of sellers into a one-stop-
shop that is convenient for consumers to not only check prices for the best deals but
do so all under one electronic roof. Also, with features like auction and fixed price
sale, the seller lists a product and sets a deadline; buyer with the highest bid gets the
item.
Usually, this type of marketplace is owned by an operator who enables third-party
sellers to sell products alongside the marketplace owner's regular offerings. Examples
include Amazon, Flipkart, eBay, etc. Here, the vendor business model plays a major
role that determines the profit for marketplace owners. Hence, it is wise to choose

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the right multi-vendor software that has a flexible model and suits your
requirements.

2. Online Service Marketplace

The online marketplace is no longer restricted to just selling products. You can even cater to
the service industry. For a startup business that wants to launch a marketplace with minimal
input, it is good to offer different services that people search for.
In a services marketplace, the discovery of services forms the basis of its offering to
customers and opportunities for paid work form the basis of its offering to
freelancers. Platforms like Fiverr, Upwork are freelance services marketplaces.
With the service business, all you have to do is to offer a robust & reliable online platform
to connect service seekers with service providers. The platform acts as a bridge
connecting both these ends. You can earn a commission on each successful transaction.

3. Online Rental Marketplace

When it comes to online rental marketplace, the transportation and fashion
industry are popular among investors and aspiring entrepreneurs. However, in the past
few years, the rental marketplace for home appliances, electronic accessories, gears, is
not too far behind to become famous.
Mobile apps like Uber, Ola are fantastic examples of this model , which are giving
a huge rise to peer-to-peer marketplaces that are renting through online mediums. As
an aspiring entrepreneur, you can focus on niche-based online rental marketplaces
such as vacation rental, car rental, bike rental and equipment rental with the help of
rental ecommerce platform.

4. Hybrid Model in Ecommerce

There can be two types of hybrid online marketplaces. One category is where people
expect to sell and buy both services and products on the same platform. The online
marketplace like Olx fits into this category.
Another one is where people want to get the combined benefits of buying from the
online and offline stores. In this model, the customer first books the products online.
After that, they walk down to the nearby physical store to buy those products.
Currently, ticket booking websites like BookMyShow works based on this model.
As per the latest update, big retailers like Reliance Trends and Myntr a foray into the
ecommerce segment with a hybrid online-offline model. This model creates
shared profitability by integrating offline stores via the online platfo rm. As such
you can launch hybrid online marketplaces to bring local merchants to sell their
products through its website.

5. Hyperlocal Marketplace
The concept of hyperlocal came into the picture when people start to look for
the nearby options while searching for shops, restaurants, etc. through search
engines. In this marketplace model, the aim is to provide facilities and services within
the shortest possible time from local vendors.
The hyperlocal ecommerce marketplace is quite similar to marketplaces like Amazon.
The main difference is that the customers will be only able to buy products from
vendors who can ensure delivery within 24 hours. Examples for this marketplace
model includes Urbanclap, Bigbasket, ClickYourMed, etc. Also, the food delivery
marketplaces like Zomato and Swiggy comes under this category with little bit tweaks
in their workflow.

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Benefits of e-marketplaces

The potential advantages to be gained by joining an e-marketplace will vary between

industries and businesses, and indeed between buyers and sellers. Some of the potential
benefits are summarised below.

General business benefits

 There are greater opportunities for suppliers and buyers to establish new trading
partnerships, either within their supply chain or across supply chains.
 E-marketplaces can provide greater transparency in the purchasing process since
availability, prices and stock levels are all accessible in an open environment.
 Time constraints and problems with different office hours for international trade are
removed as it is possible to operate on a round-the-clock basis.
Benefits for the buyer

 Updated information on price and availability makes it easier to secure the best deal.
 E-marketplaces offer a convenient way to compare prices and products from a single
source rather than spending time contacting each individual supplier.
 Established e-marketplaces provide a level of trust for the buyer as they are dealing
exclusively with suppliers who are members.
Benefits for the seller

 Regular requests for quotations from both new and current customers are possible.
 It provides an additional sales channel to market and sell products.
 E-marketplaces can offer reduced marketing costs when compared with other sales
channels.
 The use of international e-marketplaces can provide opportunities for overseas sales
that you would not otherwise be aware of.

E-Supply chain management (E-SCM)

E-Supply chain management is practiced in manufacturing industries. E -SCM involves

using internet to carry out value added activities so that the products produced by the

manufacturer meets customers’ and result in good return on investment.

E-SCM is the effective utilization of internet and business processes that help in delivering
goods, services and information from the supplier to the consumer in an organized and
efficient way.

Players of E-Supply Chain Management

ESCM chain consists of the following players — manufacturer, logistics companies,
distributors, suppliers, retailers and customers. E-Supply Chain Management concentrates on

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the coordination between the various players in the chain. Coordination is very essential for
the success of the organization. E-SCM focuses on reducing the inventory cost.
Supply Chain Management flow
SCM flows can be divided into three main activities

1. Product flow,
2. Information flow and
3. Financial flow.
1. Product Flow: The product flow includes the movement of goods from a supplier to a
customer, and also any goods returned by customers.
2. Information flow: The information flow involves transmitting orders and updating the
status of delivery.
3. Financial flow: The financial flow consists of credit terms, payment schedules,
consignment and title ownership arrangements.

Issues dealt by Supply Chain Management

Supply chain management deals with three issues:

1. Coordinating all the order processing activities that originate at the customer level, such as
the process of order generation, order acceptance, entry into order processing system,
prioritization, production, and material forecast.

2. Material related activities such as scheduling, production, distribution, fulfillment and

delivery and

3. Financial activities such as invoicing, billing, fund transfer and accounting.

SCM involves counter checks of materials, information and finances as they move in a
process from supplier to manufacturer to wholesaler to retailer to consumer. It involves
coordinating and integrating these flows both within and among companies.

Extranet, intranet, Internet are used in e-supply chain. Extranet helps to connect the
participating companies. It may be the supplier or the customer. A customer can check the
order status. Likewise, a supplier can collect data about inventory to know about the
replenishment of the inventory.

With the help of internet, a company can advertise about the product and accept online
orders. With the help of intranet, an organization can maintain communication within the
boundaries of the company. It is said that the ultimate goal of any effective SCM is to reduce
inventory.

E-supply chain enables to link the supplier with the customer by exchanging information
instantaneously. The organization has sufficient inventory when required. There will not be
any shortage or surplus of inventory. Shortage of inventory brings down the reputation of the
firm. Likewise, excess inventory blocks the funds of the firm unnecessarily.

Advantages of e-supply chain management

Companies implementing E-SCM can enjoy the following advantages:

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1. It improves efficiency

2. It reduces inventory

3. It reduces cost

4. It helps to take competitive advantage over competitors.

5. It increases ability to implement just-in-time delivery, increases on-time deliveries, which

enhances customer satisfaction.

6. It reduces cycle time, increases revenue, by providing improved customer service.

7. It improves order fulfillment, order management, decision making, forecasting, demand

planning, and warehouse/distribution activities.
8. It reduces paperwork, administrative overheads, inventory build-up, and the number of
hands that handle goods on their way to the end-user i.e., the customer.

Collaborative commerce (C-commerce)

It describes electronically enabled business interactions among an enterprise's internal
personnel, business partners and customers throughout a trading community. The trading
community could be an industry, industry segment, supply chain or supply chain segment.
Collaborative Commerce is all about teaming up with customers, suppliers, channel partners,
and even competitors to deliver more value to your customers.
Collaborate with partners
Sell directly to customers by teaming up with your network of distributors, dealers, or
franchisees to offer frictionless buying.
Collaborate with suppliers
Enable drop-ship partnerships and launch your own online marketplace to sell third-party
products that drive incremental revenue without inventory overhead.
Collaborate with competitors
Sell on marketplaces like Amazon or get competitors to sell on your own online marketplace
to give buyers even more purchase options.

Understanding Collaborative Commerce (C-commerce)

Collaborative commerce (C-commerce) is a new focus for organizations attempting to
become more profitable and competitive. Collaboration promotes fresh views of suppliers,
competitors, and customers. A goal of collaborative commerce is for a business to move
away from production and sales, shifting towards the integration of various businesses.

Companies may use or share the same technological platforms or transact business with each
other and at times may integrate vertically to some degree. Collaborative commerce involves
companies transacting business with other companies through electronic channels.

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C-commerce vs. E-commerce

Electronic commerce is the buying or selling of products and services online. When it comes
to shopping, c-commerce is when consumers get everything they need from each other.
Examples of this type of c-commerce, also known as peer-to-peer commerce, include
companies that allow consumers to rent things from each other, or marketplaces, such as
Meta (formerly Facebook) Marketplace, that allow the sale of used goods.

Companies are embracing this form of c-commerce as well, however. Patagonia has teamed
up with eBay to buy and sell used gear, while REI also takes and resells used
equipment.Meanwhile, companies like Apple offer trade-in programs for their products.

Luxury brand Burberry integrates suppliers with customers to allow greater influence by
shoppers on product design and marketing ads but connecting their sales day and social
media activities. Yet another example of c-commerce is 3D printing; 3D printers can custom
print things for themselves or for others, ultimately selling them on venues like Etsy.

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E-Government
The Transformation to E-Government
1. government-to-Citizen (G2C)
2. government-to- Business (G2B)
3. government-to-government (G2G)
4. government-to-employees (G2E)

Issues with E-Government

• Wireless and mobile networks and related infrastructure, as well as software, must be
developed.
• Mobile phone numbers and mobile devices are relatively easily hacked and wireless
networks are vulnerable
• Many countries have not yet adopted legislation for data and information practices
that spell out the rights of citizens and the responsibilities of the data holders
(government)

Mobile Government
The Benefits of M-Government
1. Cost reduction
2. Efficiency
3. Transformation/modernization of public sector organizations
4. Added convenience and flexibility
5. Better services to the citizens
e-learning
Advantages of e-Learning
1. Reduces travel cost and time to and from school.
2. Learners may have the option to select learning materials that meets their level of
knowledge and interest.
3. Learners can study wherever they have access to a computer and Internet.
4. Flexibility to join discussions remotely in chat rooms.
5. Development of computer and Internet skills that are transferable to other facets of
learner’s lives.
Disadvantages of e-Learning
1. Unmotivated learners or those with poor study habits may fall behind
2. Lack of familiar structure and routine may take getting used to
3. Students may feel isolated or miss social interaction thus the need to understanding
different learning styles and individual learner needs.
4. Instructor may not always be available on demand
5. Slow or unreliable Internet connections can be frustrating
6. Managing learning software can involve a learning curve
7. Some courses such as traditional hands-on courses can be difficult to simulate
e-Learning platforms
 Coursera
 Udemy
 NPTEL
 Edx

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