T 3.6

Electronic commerce is defined as, “conducting business activities (e.g. distribution, buying, selling, marketing, and servicing of products or services) electronically over computer networks”(1). E-commerce has changed consumer markets all over the world. Traditional shopping venues do not offer the advantages that e-commerce does of comparing prices quickly, picking out simple details, while shopping in the luxury of your own home, and many other added bonuses at the cost of shipping. Specifically business to consumer commerce (also known as B2C) is an interesting study, because it has changed the shopping market drastically in the past decade.

            In the late 1990’s there was a lot of hype surrounding business to consumers because stock prices on websites like amazon.com and eBay grew drastically (2). These sales were large enough to pose a threat to traditional shopping venues. These new companies changed businesses forever. Websites like amazon and eBay could have millions of customers at a time without the expenses of maintaining physical stores, did need to have tons of inventory, and also have unlimited access to capital and little concern about actual earnings. In fact, Amazon has a market capitalization of $25 billion, exceeding those of established companies shortly after its release in 1999 (2). This shows how the business to consumer e-commerce really changed the industry. Online shopping offers so many conveniences. The dotcoms websites had such success that retails like Kmart and Wal-Mart spun off separate companies to run their e-commerce operations (2.)

            Interestingly enough, many companies never cashed in on the initial e-commerce frenzy. In fact a source explains how, “Almost as quickly as the dotcom phenomenon took over, the hype over B2C e-commerce dissipated along with the crumbling Nasdaq. Funding for Internet ventures started to dry up and major companies started to reel in their spinoffs, bringing e-commerce initiatives back under the corporate fold,” (2.) The history of e-commerce shows us that it was not always for big corporations to cash in on the trend. Now however, Amazon and eBay may still be the leading, but not by much. This past holiday season more sales were made online than ever before. Now Wal-Mart is the third most popular site, trailing Amazon and eBay, with Target, Best Buy and Circuit City close behind. The online shopping trend is because more and more popular.

            Other sources explain the reason these sites are so popular, “Some sources say that the popularity of purchasing over the Internet is growing rapidly as consumers find out there are many advantages to shopping online. Most sites provide shoppers with a stress free way to buy products without the hassle of driving in traffic or of standing in long lines. Other advantages include cheaper prices, easy ways to pay, and fast delivery. Business ecommerce solution helps businesses to create a presence on the Internet while reducing their operating costs and gaining consumer confidence with quality sites that make shopping experiences easy and fun,” (3.) Purchasing online allows us access to items we cannot find online and gives us so many benefits. This industry just continues to grow with the evolution of technology, and with outbreak in smartphones and wireless technologies.

Sources:

1.) Stair, Ralph M., and George Walter Reynolds. Fundamentals of Information Systems. Boston: Thomson/Course Technology, 2003. Print.

2.) http://www.cio.com/article/40298/E_Commerce_Definition_and_Solutions?page=2#3

3.) http://www.christianet.com/ecommerce/businesstoconsumerecommerce.htm