Definition Of E-commerce
E-commerce can be defined as a modern business methodology that addresses the needs of organizations, merchants, and consumers to cut costs while improving the quality of goods and services and the increasing speed of service delivery, in which transactions take place over networks, mostly the Internet. It is the process of electronically buying and selling goods, services and information. Certain E-commerce applications, such as buying and selling stocks and airline tickets on the internet, are growing very rapidly, exceeding non-Internet trading.
E-commerce is not just about buying and selling, it also is about electronically communicating, collaborating, and discovering information (sometimes referred to as e-business). It is about e-learning, e-government, social networks, and much more. E-commerce will have an impact on a significant portion of the world, affecting businesses, professions, and, of course, people.
History Of E-commerce
The history of E-commerce basically starts in the 1960s.History of E-commerce dates back to the invention of the very old notion of “sell and buy”, electricity, cables, computers, modems, and the Internet. E-commerce became possible in 1991 when the Internet was opened to commercial use. Since that date thousands of businesses have taken up residence at web sites. At first, the term E-commerce meant the process of execution of commercial transactions electronically with the help of the leading technologies such as Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT) which gave an opportunity for users to exchange business information and do electronic transactions. The ability to use these technologies appeared in the late 1970s and allowed business companies and organizations to send commercial documentation electronically. Evolution Of E-commerceThe evolution of e-commerce can be attributed to a combination regulatory reform and technological innovation. Through Internet (which played an important role in the evolution) appeared in the late 1960s, e-commerce now took off with the arrival of the World Wide Web and browsers in the 1990s.
E-Commerce were first developed in the early 1970s with innovations like:
- Electronic Funds Transfer (EFT) - funds can be routed electronically from one organization to another.
- Electronic Data Interchange (EDI) – used to electronically transfer routine documents, that expanded electronic transfers from financial transactions to other types of transaction processing.
- Inter Organizational System (IOS) – a system which allows the flow of information to be automated between organizations in order to reach a desired supply-chain management system, which enables the development of competitive organizations.
Since 1995, many innovative applications, ranging from direct online sales to e-learning experiences had been developed. Almost every organization in the world has a Web site. In 1999, the emphasis of e-commerce shifted from B2C to B2B.
In 2001, from B2B to B2E, e-government, e-learning, and m-commerce.
In 2005, social networks started to rise and so did l-commerce and wireless applications.
E-commerce will undoubtedly continue to shift and change in the future.
Year | Event |
| 1984 | EDI, or electronic data interchange, was standardized through ASC X12. This guaranteed that companies would be able to complete transactions with one another reliably. |
| 1992 | Compuserve offers online retail products to its customers. This gives people the first chance to buy things off their computer. |
| 1994 | Netscape arrived. Providing users a simple browser to surf the Internet and a safe online transaction technology called Secure Sockets Layer. |
| 1995 | Two of the biggest names in e-commerce are launched: Amazon.com and eBay.com. |
| 1998 | DSL, or Digital Subscriber Line, provides fast, always-on Internet service to subscribers across California. This prompts people to spend more time, and money, online. |
| 1999 | Retail spending over the Internet reaches $20 billion, according to Business.com. |
| 2000 | The U.S government extended the moratorium on Internet taxes until at least 2005. |
2001
| E-commerce was adapted by almost every major retail company such as Wal-Mart. The transactions that took place between the businesses where recorded at around $700billion. |
2002
| eBay acquires PayPal for $1.5 billion. Niche retail companies CSN Stores and Netscape are founded with the concept of selling products through several targeted domains ratherthan a central portal.
|
2003
| Amazon.com posts first yearly profit |
2005
| The U.S. government extended the moratorium on Internet taxes until this year. |
2007
| Business.com acquired by R.H. Donnelley for $345 million.Fortune magazine have ranked Dell as the 34th largest company in the Fortune 500 list and 8th on its annual Top 20 list of the most successful and admired companies in the USA in recognition of the company’s business model. |
2008
| The U.S. E-commerce and Online Retail sales projected to reach $204 billion, an increase of 17% over year 2007. |
Early Adopters Of E-commerce
History of ecommerce is unthinkable without Amazon and Ebay which were among the first Internet companies to allow electronic transactions. Thanks to their founders we now have a handsome ecommerce sector and enjoy the buying and selling advantages of the Internet.
Amazon.com, Inc. is one of the most famous ecommerce companies and is located in Seattle, Washington (USA). It was founded in 1994 by Jeff Bezos and was one of the first American ecommerce companies to sell products over the Internet. After the dot-com collapse Amazon lost its position as a successful business model, however, in 2003 the company made its first annual profit which was the first step to the further development.
At the outset Amazon.com was considered as an online bookstore, but in time it extended a variety of goods by adding electronics, software, DVDs, video games, music CDs, MP3s, apparel, footwear, health products, etc. The original name of the company was Cadabra.com, but shortly after it become popular in the Internet Bezos decided to rename his business “Amazon” after the world’s most voluminous river. In 1999 Jeff Bezos was entitled as the Person of the Year by Time Magazine in recognition of the company’s success. Although the company’s main headquarters is located in the USA, WA, Amazon has set up separate websites in other economically developed countries such as the United Kingdom, Canada, France, Germany, Japan, and China. The company supports and operates retail web sites for many famous businesses, including Marks & Spencer, Lacoste, the NBA, Bebe Stores, Target, etc.
Amazon is one of the first ecommerce businesses to establish an affiliate marketing program, and nowadays the company gets about 40% of its sales from affiliates and third party sellers who list and sell goods on the web site. In 2008 Amazon penetrated into the cinema and is currently sponsoring the film “The Stolen Child” with 20th Century Fox.
According to the research conducted in 2008, the domain Amazon.com attracted about 615 million customers every year. The most popular feature of the web site is the review system, i.e. the ability for visitors to submit their reviews and rate any product on a rating scale from one to five stars. Amazon.com is also well-known for its clear and user-friendly advanced search facility which enables visitors to search for keywords in the full text of many books in the database.
eBay allows just about anyone to be an online merchant. Founder Pierre Omidyar started eBay when he developed AuctionWeb, a site from which he offered a broken laser pointer. It sold – to a collector of broken laser pointers. The idea was that the Internet was the great leveler. Since its beginnings in 1995, eBay has developed a sophisticated system that allows anyone to set up a storefront and sell merchandise.
Currently there are 5 largest and most famous worldwide Internet retailers: Amazon, Dell, Staples, Office Depot and Hewlett Packard. According to statistics, the most popular categories of products sold in the World Wide Web are music, books, computers, office supplies and other consumer electronics.
Related links:
- http://www.ecommerce-land.com/history_ecommerce.html
- http://newmedia.medill.northwestern.edu/courses/nmpspring01/brown/Revstream/history.htm
- http://www.bestshoppingcartreviews.com/content/history-of-ecommerce.html
- http://ecommercesite.wordpress.com/2008/06/11/the-history-evolution-of-e-commerce/
- http://ecommerze.wordpress.com/2008/06/12/the-history-and-evoltion-of-e-commerce/
Online advertising tends to play an important role in eBay's revenue. On the trasaction fees revenue, eBay offers PayPal where enabling the holders of PayPal to exchange money over the Internet .
