E-Commerce

The world largest computer network is the internet. With the astonishing growth of the Internet nowadays, many companies are finding new ways to expand their business opportunities. One can even say that thereЎЇre almost all companies used computers in their everyday business. Thus, E-commerce is emerging as an increasingly important way for businesses to reach potential customers.

Introduction

What exactly is e-commerce? Most casual internet users think that e-commerce is just buying and selling online. Yet this is not the case. Simply put, e-commerce is the electronic exchange of business information between two or more organizations. There are e-commerce conducted between businesses and those that carried out between a business and its consumers. Business-to-business e-commerce take place in electronic data interchange over private networks. Companies that regularly do business together will setup an automated and fast info exchange such as stock deliver and receive confirmation. For business-to-consumer e-commerce, the Web has become the dominant pipeline. It includes buying and selling any item over the Internet, electronic fund transfer, shipment tracking, and all other methods of conducting business over digital networks. Also, there is consumer-to-consumer e-commerce that involves consumers selling products directly to each other using the internet. A good example will be the auction site eBay. Clearly, E-commerce will change the face of business forever. Companies that are thousands of miles away can complete business transactions in a matter of seconds as well as exchange information.

Advantages of E-commerce

The first advantage that e-commerce possesses is the speed. With the Internet, businesses could exchange messages or complete transactions almost instantaneously even with slowest connection. Business owners now have the ability to change and inform the customers of their services and offers over the internet. This also allows for you to update marketing and promotional materials as often and as frequently as you would like. With increased speeds of communication, the delivery time is expedited and that makes the whole transaction from start to finish more efficient.

The second advantage of the electronic commerce is the opportunity to cut costs. By using the Internet, marketing, distribution, personnel, phone, postage and printing costs, among many others, can be reduced. Companies could use the internet to search for lowest price materials for their products. With the extra funding from cutting cost, the company could maximize their advertising and marketing strategies. ÐŽoOnline advertising has been growing steadily since early 2003 and is on track to surpass the $10 billion annual spending level for the first time in history. Research firm eMarketer predicts that more than $12 billion will be spent this year, double 2004 levels. By 2009, that's expected to reach $22 billion.ÐŽ± (Keith Regan, E-Commerce Times)

The internet was also known as no boundaries. Compare to a physical store, you can start doing business in the cyberspace with low models. Unlike a physical store, you could do your business over the world with only a few computers. To maximize profits, companies could distribute newsletters and enhance customer services over the internet. With good customer services, trust and reliability could be build and strength among the companies and the customers. No matter what business you are involved in, an online-help feature is an extraordinary advantage to have.

ÐŽoOn a not adjusted basis, the estimate of U.S. retail e-commerce sales for the second quarter of 2005 totaled $19.8 billion, an increase of 3.5 percent (ЎА0.8%) from the first quarter of 2005. The second quarter 2005 e-commerce estimate increased 25.7 percent (ЎА3.6%) from the second quarter of 2004 while total retail sales increased 8.1 percent (ЎА0.5%) in the same period.ÐŽ± (U.S Census Bureau) This statistic proved the growth potential of the e-commerce.

Disadvantages of E-commerce

ÐŽoDarknets, Greynets. Dark traffic. The words are frightening. The reality behind them is even more frightening. Increasingly clever hackers, thieves and scoundrels are using the Internet, peer-to-peer products, instant messaging and e-mail to wreak havoc, in ways and for purposes never before seen. Their motivation is clear: They want money, and lots of it. Worst of all, they prey on human nature - and business infrastructure - to do their dirty work for them.ÐŽ± (Tanya Candia, TechNewsWorld)

The main concern about e-commerce is the privacy and security. As the internet is very public, anything sent over the Internet could be intercept by the third party before it reaches the destination. There are serious issues on personal credit card information that have been stolen to commit fraud over the internet. Personal info such as user account and password are also targets of the hackers. All of these made a lot of people feel uncomfortable and unsafe with the internet. To solve these problems, companies use encrypted data while transferring date via the internet. One of the strongest encryption methods around is the Secure Sockets Layer (SSL); it creates a secure connection