What is E-commerce?

Posted on June 22nd, 2012 by admin in Basics | Comments Off

E-commerce, or electronic commerce, is the buying, selling, or trade of products and services over any electronic system. Today, the vast majority of e-commerce occurs over the Internet. E-commerce is most commonly used by e-businesses, that is, businesses that are run in part, or completely, on the Web. Some of the largest e-businesses include Amazon and eBay.

There are a number of components necessary in order to operate a successful e-business. Like any business, a way to accept payment, as well as deliver the product or service, is needed. Depending on the business, the ability to accept returns and/or provide customer service may also be needed. And of course, an e-business requires a “place” to sell a product or service. This place generally comes in the form of an e-commerce website that includes an online store where a potential customer can browse items and place them in a virtual “shopping cart.” When they’re done shopping, a customer can then add or remove items from their cart before making a purchase.

E-businesses can provide advantages over a typical brick and mortar store. One major advantage is that an e-business can save its owner money in regards to the physical space required to run the business. Another enormous advantage of running an e-business is having the ability to reach millions, or even billions, of customers internationally. Additionally, e-businesses are not subject to normal time restrictions and can keep their business open all day and all night.

E-commerce Solutions

Starting or expanding a business on the Internet comes with a host of issues that must be addressed in order to achieve success. Firstly, owners and customers alike need a way to transfer money and goods while both providing legitimate credentials that prove they are who they say they are, and keeping their information secure from third parties. A high standard in regards to security is essential for running an e-business. Most e-commerce sites employ Secure Socket Layer (SSL) technology to help protect information at the point of purchase.
Additional concerns for an e-business include the endless sea of possibilities for site design, as well as the plethora of marketing strategies which are available on the Web. The correct site design and/or marketing campaign can make or break an e-business. And of course, search engine optimization (SEO) is extremely important for any e-business. If customers do not find an e-business site while searching for the products or services said business offers, the business is not likely to be successful.

There are a number of free and/or inexpensive tools a business owner can use to set up an e-business. However, a business owner will generally have many other things to focus on and there are a many online companies (e-businesses themselves) that offer e-commerce solutions. These companies can help a business owner do anything from reliably host an e-commerce site, design the site with a specific business in mind, provide a secure shopping cart to process orders, develop marketing plans that fit the business model, use techniques to improve the business site’s search ranking, provide customer service, and more.

Ultimately, a business owner should be sure to conduct a fair amount of research before deciding whether or not to start an e-business or expand an existing business to the Internet. Not all businesses will benefit from the Web (for example, a business that makes most of its profit from a loyal, local following may waste money by attempting to expand to the Internet). Likewise, if a business owner decides that creating an e-business will provide him or her with advantages, he or she should be knowledgeable enough to know whether creating and managing the site on their own will be more or less beneficial than hiring one of the many e-commerce solutions companies that are available online.