E-commerce: A Comprehensive Guide.

E-commerce: A Comprehensive Guide

E-commerce: A Comprehensive Guide.

The world has recently witnessed an increasing interest in e-commerce, which is an inevitable and necessary result of the advancements and innovations in the field of information technology and communications.

The international information network has played and continues to play a fundamental role as a mediator for conducting modern and contemporary business transactions. There has been a significant shift from traditional commerce to modern electronic commerce, making e-commerce a tangible reality in the current environment.

Many countries today are striving to maximize the role of e-commerce, especially in light of global changes and new challenges. It is expected that its role will continue to grow shortly.

In this article, we will discuss the following elements:

Definition of e-commerce.
History of e-commerce.
Areas of e-commerce.
Categories of e-commerce.
Characteristics of e-commerce.
Features of e-commerce.
Benefits of e-commerce.
Advantages of e-commerce.
Disadvantages of e-commerce.
Trends in modern e-commerce marketing.
Types of transactions in e-commerce.

Definition of e-commerce:

The term e-commerce refers to any type of commercial transaction that involves the transfer of information over the Internet. It covers a wide range of business activities that are conducted using the Internet as a platform for exchanging information and currencies. E-commerce is relied upon daily for buying, selling, and receiving payments. It has become one of the most prevalent practices in recent times.

E-commerce can be defined as the buying and selling of goods electronically over the Internet. It has gained popularity due to the numerous benefits it offers, such as online business, internet marketing, electronic fund transfers, and mobile commerce.

It can be divided into two categories: online retail shopping, which directly caters to consumers through mobile applications, websites, voice assistants, chatbots, and more; and the second category represents sellers who are part of online marketplaces where many third-party sales take place.

History of E-commerce:

The history of e-commerce dates back to the invention of the telephone in the past century when data exchange became widespread. Large institutions began developing electronic data interchange in the 1960s, although it initially faced resistance and acceptance did not come until the 1980s. Over the past thirty years, significant advancements and noticeable developments have taken place in e-commerce.

Initially, e-commerce was defined as the facilitation of electronic data exchange and electronic fund transfers. Many companies started sending electronic business documents, which simplified the process.

In the 1980s, examples of e-commerce included purchase orders, invoices, credit card acceptance, ATMs, and other phone banking services. Additionally, e-commerce encompassed online reservations for airlines and railways. The United States adopted this system in the automotive industry and other developments, making it a fundamental aspect of modern trade.

In the 1990s, further advancements occurred in e-commerce, such as storing data and conducting consultations via the Internet. The online information market emerged early on, with the exchange of information starting in 1991. Tim Berners-Lee created the World Wide Web in 1990, transforming it into a global daily communication system for individuals. E-commerce gained more popularity in 1994 with the beginnings of Internet marketing. It took several developments for the system to evolve into its current form.

By the end of 2000, many American and European companies began offering a wide range of services through the World Wide Web. This marked the beginning of linking the term e-commerce to the ability to purchase various goods via the Internet, relying on secure protocols and electronic payment services.

E-commerce fields:

E-commerce encompasses all commercial transactions involving the buying and selling of goods and services. Economic analysts consider it a new engine for economic development due to its efficient and rapid means of conducting transactions, selling products and services, and promoting them.

The term "e-commerce" is a modern concept that refers to the buying, selling, and exchanging of goods, services, and information through computer networks and the Internet.

E-commerce is not limited to online buying and selling of goods and services. From its inception, it has always included transactions, purchases, and online financial transfers. However, it goes beyond that and has expanded to include the buying and selling of information itself, in addition to goods and services. Furthermore, e-commerce is not a single type but encompasses various degrees and forms.

Categories of E-commerce:

E-commerce applications can be divided into three categories:

The first category is the buying and selling of products and services, also known as the e-marketplace.
The second category involves facilitating and streamlining the flow of information and collaboration between individuals, companies, and different parts of a single company.
The third category includes providing services to customers.

E-commerce markets:

The market serves as the venue for transactions, interactions, and relationships, facilitating the exchange of products, services, goods, information, and money. The market is the center of commerce and acts as a virtual hub that contains commercial transactions for all participants, including sellers and buyers who are not physically located in the same place and often have no prior acquaintance. Communication methods vary from one individual to another.

Characteristics of e-commerce:

E-commerce, as applied on the Internet, is described by several important characteristics:

Elimination of paper-based documents: There is no use of physical paper documents in conducting and executing these business transactions. Interactions and exchanges between parties are conducted electronically, without the need for any paper-based materials. Therefore, electronic messages serve as legally recognized records in case of disputes between the parties.
Multiple-party transactions: Through e-commerce applications, it is possible to engage with more than one party simultaneously. Each party can send electronic messages to a large number of recipients at the same time, eliminating the need for resending them.
Interaction through communication networks: Interaction between the parties involved in e-commerce takes place via communication networks. What distinguishes this method is the high degree of interactivity, even if the parties are not present on the network at the same time.
Lack of unified international regulations: There is no common format or specific legislation governing e-commerce in all countries. Each country has its laws, taking into consideration the laws of other countries. This hinders the comprehensive implementation of e-commerce.
Purchase and sale of intangible goods: Non-material goods can be purchased or sold directly through the Internet. This sets e-commerce apart from traditional methods of buying and selling, such as research, reports, studies, and images.

Characteristics of e-commerce:

Among the most important characteristics of e-commerce are the following:

Wide availability: E-commerce is widely spread and accessible everywhere. It eliminates the limitations of physical space in traditional markets, allowing consumers to shop from their computers. This contributes to reducing product prices and making them available to consumers at any time, regardless of their location.
Easy cross-border access: E-commerce enables businesses to easily access global markets more conveniently and efficiently compared to traditional trade. Companies expand their operations using e-commerce, which leads to increased profits and business results on a global scale. As a result, the potential market size for e-commerce merchants is approximately equal to the population size online.

Benefits provided by e-commerce:

E-commerce has provided us with numerous benefits, including:

Quick purchasing process
Creation of product lists
Lower costs
Cost-effective advertising and marketing
Flexibility with customers
Reach to a larger customer base
Multiple payment methods
Overcoming geographical boundaries
Reduced travel time and costs
Product comparisons
Providing detailed information about products
Offering deals, coupons, and discounts
Open 24/7
Product Diversity
Visual and detailed product displays.

The purchasing process is quick:

We can spend less time shopping to buy what we want. We can easily browse multiple items at once and purchase what we like. When connected to the internet, we can find items available in distant physical stores or those not available in our area.

Creating a product list:

The product list is what we see when searching for a particular item. This is one of the features of e-commerce tailored for sellers, as it allows us to customize our product list after creating it.

Lower costs:

One of the biggest advantages of e-commerce for businesses that makes sellers interested in online selling is cost reduction. Many sellers may have to spend a lot to maintain their store and may require upfront additional costs such as repairs, store design, inventory, and more. In many cases, even after these costs, sellers do not achieve the desired profits and return on investment.

With an e-commerce store, sellers can reduce the amount spent on store maintenance. It is also cost-effective and requires lower investments compared to a physical store. This is also a good opportunity for individual sellers and small-scale businesses who want to earn income but don't have the required capital to start operations.

Affordable advertising and marketing:

Sellers do not have to spend a lot of money to promote their products. The world of e-commerce offers many fast and cost-effective ways for online marketing. E-commerce markets are visual channels, and sellers can effectively showcase their products.

Flexibility with customers:

One of the important advantages of e-commerce in business is that sellers can provide flexibility to customers. One prominent aspect is that products and services are available 24/7. Therefore, sellers can showcase their products anywhere and at any time. Sellers can benefit from this customer flexibility to increase their revenue and can confidently sell in the online market, knowing that there are many buyers.

Reaching a larger customer base:

A physical store owner may only be able to reach a limited number of buyers. While they can deliver to customers' homes, distance may be a barrier. However, many e-commerce markets have a system that allows them to deliver their products to customers in multiple ways.

Multiple payment methods:

E-commerce markets allow for multiple payment methods, including UPI, cash on delivery, card on delivery, net banking, EMIs on credit or debit cards, and later payment credit facilities.

Overcoming geographical boundaries:

In the past, store owners could only sell their goods in the geographical location where the physical store was located. Now, with the spread of shipping to other countries, the situation has improved somewhat.

However, through e-commerce, there are no boundaries in terms of location. A person can sit at home and order, for example, clothes from China, which will arrive in a few days and be shipped to the nearest location to them.

Reduced travel time and cost:

Some customers may travel from one country to another to visit their favorite store (this may apply more to women traveling to buy clothes). Through e-commerce, a person can open and browse the latest products from their favorite brand and place an order without having to move from their location.

Product comparison:

One of the prominent advantages is the ability for a person to open different pages and compare the quality, real reviews, and prices of products. This feature is not available in traditional commerce.

Providing comprehensive product information:

A person can gather almost 100% information about the product they want to purchase online by browsing multiple websites. In traditional commerce, it is difficult to inquire about the finest details, and there are no employees who can explain every product in detail to all customers because it requires a great deal of energy. However, through e-commerce, the description is very precise and effortless.

Offering deals and coupons:

Online offers are very useful and attractive to customers. We cannot deny that offers are available in physical stores, but not to the extent of online stores. For example, imagine a person wins a discount at a store located in Turkey without shipping, and they live in another country. It would be difficult for them to travel to obtain the voucher they won. However, through the internet, the prize can be delivered to their home.

Product diversity:

One of the most important benefits of e-commerce is its ability to expand product availability. A buyer living in Saudi Arabia can purchase books from Britain, clothes from the United States, and electronics from Japan. No one can calculate the quantity of products available online.

Visually detailed product presentation:

A person shopping online can spend a long time searching for products on different pages and reading reviews to make an informed decision about the best product to purchase. For example, if a person wants to buy an electrical device, they can learn through the internet:

Read reviews from real customers about the product's quality, which is genuine and not paid advertising.
Accurate product descriptions.
Videos demonstrating how to use the product.
Browse other products and compare their prices.

In contrast, if they were searching in physical markets, the seller may not provide them with a detailed description like the one available online. Even their opinion may not be trustworthy, as it may be biased to sell the merchandise. It would not be possible for them to accurately compare multiple products.

In addition to all of the above, there are specialized websites for comparing products based on prices and quality. A person can make an informed decision and choose the most suitable option for them.

The benefits and opportunities of e-commerce can be divided into three main levels:

1. Benefits for society:

E-commerce creates new opportunities for self-employment through small and medium-sized projects that can connect to global markets with low investment costs. Service commerce is also a key element of e-commerce.
It contributes to increasing the number of individuals working from home, reducing the need to leave the house for shopping, which in turn reduces the number of cars on the roads.
It enables the sale of goods at lower prices, allowing individuals to purchase larger quantities and improve their standard of living.
It provides access to products and services in developing countries that were previously unavailable, including opportunities for vocational education and obtaining a university degree in e-commerce.

2. Benefits for companies:

Low cost is one of the most important advantages of e-commerce, allowing companies to increase their profits while reducing transaction costs through electronic data interchange.
E-commerce provides several advantages for companies, including more effective marketing and increased profitability through adopting digital marketing strategies. It allows companies to showcase their products and services globally and provides more opportunities to increase profits.
It reduces administrative costs, shipping costs, and advertising expenses.
It lowers the costs of obtaining design and manufacturing information and reduces company expenses.

3. Establishment of global specialized companies:

E-commerce provides competitive advantages for product manufacturers through customization, where additional specifications can be added to products.
It reduces the time between capital expenditure and receiving products and services.

4. Benefits for consumers:

E-commerce helps in providing pre-sale and after-sale services, as well as improving product quality due to increased competition.
It allows customers to shop and complete transactions at any time throughout the day.
It helps in offering products and services at lower prices for customers.
It creates new job opportunities and introduces new products and services, meeting consumer demands quickly.

Advantages of E-commerce:

Adaptation to the Information Age:

In the era of information, business models must align with the characteristics and behaviors of the time. E-commerce has enabled innovative patterns in managing business activities, such as electronic sales and e-commerce in various sectors.

Access to Global Markets and Higher Returns:

The global nature of e-commerce has eliminated boundaries and restrictions, allowing businesses to enter international markets and achieve higher returns compared to traditional trade. The world has transformed into an open market for consumers and sellers, regardless of their geographical location.

- Easy and Convenient Consumer Choices: E-commerce has enabled companies to understand customer needs and provide shopping options that are easy and convenient for consumers.

Development of Business and Service Performance:

E-commerce, with its technological infrastructure and strategies, provides opportunities for enterprise development and the provision of major services. Its growth stimulates research to discover new methods and approaches in the field.

The key advantages of e-commerce can be summarized as follows:

Companies can access a larger customer base through e-commerce.
Companies incur lower operating costs in marketing.
Shopping from home is more convenient for consumers.
Consumers can easily compare shopping options across different brands.
Consumers have access to a wide range of products and can easily make choices among them.

Disadvantages of E-commerce:

Despite the numerous benefits of e-commerce and its superiority over traditional brick-and-mortar stores in many aspects, every aspect has its positives and negatives. The disadvantages of e-commerce include:

Inability to physically examine and try products.
Delayed delivery.
Lack of human interaction.
Dependence on internet access.
Security concerns.
Difficulty in integrating e-commerce.

Inability to physically examine products:

This is considered one of the major drawbacks of e-commerce, especially when it comes to items like clothing. Customers may discover that the quality or size of the product they purchased online does not match their expectations.

Delayed delivery:

This is also a common issue faced by buyers, especially when ordering from countries with complex and challenging trade logistics.

Lack of human interaction:

Some customers prefer human interaction when conducting transactions and may not prefer to do all their business online. This is especially important when ordering large quantities of products or engaging in high-value transactions.

Dependence on Internet access:

This is self-evident, as e-commerce relies on Internet connectivity and cannot function without it.

Security concerns:

Consumers need to have trust and confidence in payment providers in e-commerce, as fraud, hacking, or forgery can break consumer trust.

Low bandwidth:

In many countries, network issues can cause problems due to low bandwidth.

Difficulty in integrating e-commerce:

Integrating e-commerce software or websites with existing applications and databases can be challenging. Sellers need dedicated web servers to handle integration issues, in addition to network servers.

Not all customers have Internet access: Internet access is not globally available. Therefore, a significant amount of effort does not reach consumers who live in remote villages without internet connectivity.

Trends in modern e-commerce marketing:

Marketing through digital platforms:

One of the most important trends in e-commerce is marketing through digital platforms, which is gaining attention and helps increase company sales. Therefore, you will see the most important strategies worth trying yourself.
The Internet provides an opportunity for the success of e-commerce and a variety of means to communicate with current or potential customers.
Quality, interesting, informative, and tailored content can help customers make purchasing decisions and build loyalty.
Multichannel marketing is important, including digital messaging, social media, and video platforms, for communication between brands and customers.
To identify and target the company's audience on a wide scale.

Content marketing:

Content, words, and expressive sentences about products are important. Content remains paramount as consumers spend about one-third of their day interacting with digital content on multiple devices.
Recommendations are crucial. Let's assume a customer is searching for product information on your website.
Provide them with images, a description of the product, and some details, especially if there is a video clip.
Always try to help customers visualize the importance of your product through interactive content and a good content strategy for the appropriate product.

Webinars and their role in marketing:

Webinars and their role in e-commerce marketing are crucial. Webinars are online seminars that help reach a larger audience and provide verified information through e-books.
Publishing webinars on your website is important for increasing traffic to your site and is one of the key trends in modern e-commerce marketing.
Be aware of the importance of social media, email marketing, blogs, and videos. Millions of people use social media platforms, making it a great target market. Popular networks like Facebook, Instagram, and YouTube attract around 65% of users.
Demographics such as location, age, gender, and education should be considered on the platform.
One in four consumers in the United States, aged 25 to 34, use the "Shop Now" option on Facebook.
Companies that make their "digital media" easily accessible enable customers to complete purchases smoothly, eliminating friction by redirecting customers to an online shopping site to make a purchase.
Integration of various e-commerce platforms with multiple social media channels is also part of a comprehensive strategy.
Personalization has become a new standard. Amazon and Netflix have set high expectations by providing recommendations related to personalization.
Not only do two-thirds of consumers believe that brands should personalize their content, but 42% feel annoyed when presented with irrelevant information.
Personalization involves providing a unique experience for your audience and utilizing all marketing methods in e-commerce.
Understanding customers, their interests, and priorities is crucial, and social media platforms provide opportunities to do so.

Using Traffic for E-commerce:

Traffic is the most important source of income for e-commerce websites and commercial marketing, whether for a service or a product, alongside providing currency and language services to reach a larger audience.
An example of this is the brand "LARQ," which focuses on how it responds to the requirements of its global audience by offering customers the option to access its website in multiple languages such as English, French, and Spanish.
The e-commerce platform should have the ability to greet visitors if they are new or returning after a certain period, so they can be welcomed with a specific greeting, such as "welcome back."
It is important to track browsing and purchasing records to personalize supported behaviors for interacting with customers.

Communicating with Customer Service for E-commerce:

Customers need full support from the owners of the products through good customer service, which contributes to the important factors of trust and confidence in your products or services.

Many customers spend time searching for support, especially through phone customer service, as well as through messaging platforms and applications like Facebook Messenger and WhatsApp.

Companies are now turning to digital messaging to communicate with customers to maintain them.

This strategy is known as "conversational commerce," using digital instant messaging to provide personalized and responsive customer service.

Often, conversational commerce takes the form of automated chatbots that act as virtual assistants for customers on your site or pages.

Successful conversational commerce strategies are built on customer loyalty and increasing customer retention rates, which can be achieved through effective customer service management before and after purchase. Nearly one-third of buyers use chat and messaging as a test for companies' support and credibility to determine if they are trustworthy.

Types of Transactions in E-commerce:

Different types of e-commerce respond to different dynamics between the buyer and seller. Generally, when we think of e-commerce, we think of online commercial transactions between a supplier and a customer.

However, when considering setting up an e-commerce business, it is important to be more specific and take into account the different types of suppliers and customers or business models that generate income. Therefore, we can categorize e-commerce in two ways: based on the type of seller and buyer, and based on the business model.

Let's take a look at each of them.

E-commerce B2B:

B2B stands for Business-to-Business, where transactions are conducted solely between online businesses, without consumer intervention. This type of e-commerce is carried out online between companies and is usually prevalent when selling in large quantities or distributing components or raw materials used by other industries. There are three approaches:

Controlled marketplace that only accepts sellers looking for buyers.
A marketplace where buyers are looking for suppliers.
A marketplace where intermediaries aim to facilitate trade agreements between sellers and buyers.

To participate in this type of e-commerce, it is strongly recommended to have market experience. The main objective of the relationship between companies online is to sell spare parts, raw materials, and services that will assist consumers in obtaining the desired end product or service. However, there is another type we will discuss later.

In this level of e-commerce, errors are minimized, and efficiency in sales and business relationships is increased.

B2C E-commerce:

This is a type of e-commerce, also known as Business-to-Consumer, which is the most common type used by most online stores. It involves transactions between an online company or virtual store and an individual customer interested in purchasing a product or obtaining a service. If you have your online store and loyal customers who purchase your products, you belong to this type. Some of the key advantages include:

Customers can access the online store from anywhere using an electronic device, making the purchasing process convenient and fast.
Offers and prices are continuously updated for the convenience of the customer.
Customer support can be provided directly through various means, such as live chat, social media, email, or Skype.
Live chats and direct communication have become standard and are increasingly sought after by consumers who are accustomed to social networks and their direct communication dynamics.
Specifically for this purpose, Shopify has created specific tools to help your online store support these communication channels in real-time.
This is where online intermediaries come in, and all e-commerce platforms, including Shopify, are included.
It is primarily dealt with when companies facilitate purchasing processes between customers and virtual stores, rather than between businesses.
Companies make it easier for users to interact in similar fields of interest, and it also includes a payment system.

E-commerce B2E:

The relationship between a company and its employees is primarily focused on the company and its workforce. This type of e-commerce, known as "Business-to-Employee," is commonly used by large companies that deal with different lines of business under the same parent company.

A simplified way to see B2E commerce in stores that do not belong to giant corporations is through the offers that the company itself can provide directly to its employees from its online store or electronic portal, with attractive discounts that serve as an incentive for performance improvement. This type of e-commerce is a new trend among companies to motivate their employees to compete with their performance and gain additional benefits.

In general, B2E commerce is manifested through departments with exclusive control over employee access, which are connected to regular online stores that are visible to the public. The employee can access internal procedures within this small-scale business site, which will reach the manager as soon as it connects to the network. Some advantages of B2E commerce include:

Cost and time reduction in internal activities.
Internal e-commerce with unique opportunities for employees.
Employee motivation and retention in the company.
Instant and online communication for consultation at any time.

E-commerce C2C:

When someone stops using a product and seeks to sell it, they can use e-commerce as a method to execute that transaction with another consumer. This type is known as "Consumer-to-Consumer" commerce. It is an evolution of traditional and well-known garage sales that gained momentum online.

The end consumer benefits from the initial consumer products they no longer want or need, and they can give them a new life by selling them at easily affordable prices. The same process of traditional purchasing applies to C2C e-commerce. Some advantages of C2C commerce include:

Product reuse.
Shopping at low prices and unique offers in the middle ground.
Overcoming the limitations of a garage or yard sale.

It's important to note that most online platforms that offer these services are not considered online stores by consumers but are properly presented as a type of classified advertisement, where you can buy or sell products from another party.

E-commerce G2C:

When a municipality, state, or federal government allows citizens to carry out their procedures online through a portal, it is known as Government-to-Consumer (G2C) e-commerce. It is a type of commerce where transactions, information, and access can be done online at any time. Some advantages of G2C e-commerce include:

Time savings.
Faster and more secure procedures.
Electronic backups.
Cost reduction.

In countries like Spain, access to these services is usually linked to digital identity authentication mechanisms, such as electronic ID or digital treasury certificates.

Without them, access to many Spanish government services is not possible.

This significantly limits the effectiveness of these platforms.

In conclusion, dear reader, it is important to note that our era is characterized by digitization and keeping up with modern developments. Embracing e-commerce projects will be a significant leap, and statistics strongly indicate the dominance of this leading field in global commerce in the next two decades. Therefore, if you wish to enter the market strongly and compete, this is the best time to do so. There are plenty of golden opportunities, so don't miss out.

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E-commerce: A Comprehensive Guide

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