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What Factors one should Keep in Mind while doing E-Commerce?

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  • Last Updated : 16 Nov, 2022
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Purchase or selling things, products, services, or goods over the internet is known as E-Commerce. Or in other words, running a business using an electronic medium is known as E-commerce. Using E-commerce, people can view(browse) the products, buy or sell them, i.e., a type of store that works online. People can add the final products to buy on a card and pay for them electronically via Debit/Credit cards or net banking or e-wallets. While placing the order, the server hosting the online shop will communicate with your web browser. If an order is placed successfully, the customer is usually notified via email and message. Also, your order can be seen in the order list when you log in to that website. This is how e-commerce works. Some of the e-commerce websites are Ajio – an online clothing store, Zerodha – an online trading store, Meesho – an online multi-products store, etc.

Types of E-commerce

E-commerce is of four types:

  • Business to Business: It is also known as B2B and in this type, buying and selling of goods or services are done between 2 businesses. Example: Fan mobile manufacturers may buy the screens online for different mobiles from a screen manufacturing business company.
  • Business to Consumer: When a business sells the products directly to their customer via the internet, it is called the B2C type of e-commerce. Example: Amazon lists the products of the sellers & the customers can directly buy them.
  • Consumer to Consumer: When the consumers can buy or sell the products directly to other consumers via the internet, it is called a C2C type of E-commerce. Example: olx allows you to sell your used products directly to the customers.
  • Consumer to Business: When the consumers can buy or sell the products directly to the business organizations via the internet, it is called a C2C type of E-commerce. Example: A market that sells royalty-free pictures, images, media, and design components.

Advantages of E-commerce

The advantages of E-commerce are:

  • Aside from regular maintenance or downtime, e-commerce sites are open 24 hours a day, seven days a week.
  • No requirement for the physical infrastructure to start a business.
  • Customers increase when you run a business online. You can reach a global audience for your product or service.
  • It is easy to search and get a product and a faster buying/selling process.
  • Customers can simply choose products from a variety of vendors without having to physically move around or travel.
  • Starting a business online & managing it is comparatively easier.

Disadvantages of E-commerce 

The disadvantages of E-commerce are:

  • Good or terrible, anyone may establish a business with ease and may fool people to earn black money.
  • Hackers may look for chances to earn money,  payment gateways used in e-commerce are all vulnerable to attacks.
  • There is no guarantee that the product will be of good quality.
  • Customer loyalty is always on the rise because there are few opportunities for direct customer-company connections.

What point should we keep in mind while doing e-commerce?

  • Security: We cannot 100% guarantee that the person making the payment through debit/credit cards or e-wallet is the correct owner of it, so the online transactions are insecure. So always choose a secure payment.
  • Privacy: For any e-commerce website or app, it is very easy to get the customer’s personal information like DOB, Aadhaar Card, Debit card details etc. One must be careful and go on only when the website is trustworthy. Also, one must read the terms and conditions of the website before sharing personal information.
  • Competitive Environment: When it comes to selling online, merchants who are used to selling in a store may realize that the market is quite competitive and they may earn less profit.
  • Extendibility: It is difficult to choose an e-business that runs over a long time due to constant changes in the customers needs. So one must choose the business with a long vision.
  • Availability: It is hard to gain the trust of the customers without doing any kind of direct conversation. Most of the trust depends on your presentation and policies.

Sample Questions

Question 1. What is EDI?


The computer-to-computer transmission of standard e-business documents between business partners through a secure, standardized connection is known as electronic data interchange (EDI). In its most basic form, EDI is a standard electronic format that substitutes paper-based records like purchase orders and invoices.

Question 2. List some e-commerce websites.


Some e-commerce websites are Amazon India, Flipkart, Swiggy, Mamaearth, Alibaba. Jabong, RelianceMart, Ajio, etc.

Question 3. Explain the advantages of E-cards.


Some advantages of e-cards are:

  • No paper is required, so it is eco- friendly.
  • It costs less than hard copies.
  • The delivery of an e-card is instant.
  • As we do not have to go physically to a shop and purchase, time is saved.

Question 4. Why do you think e-commerce is famous?


E-commerce is famous because:

  1. Cheaper products are found.
  2. No need to travel or move to buy or see a product.
  3. Quick payment & home delivery.
  4. Website Can be browsed anywhere.
  5. Comparisons of the product can be done easily(ratings can also be seen).

Question 5. Due to which reasons an E-commerce website may fail?


E-commerce may fail due to:

  • Constant technical issues.
  • Unfriendly interface.
  • Customer help is improper.
  • Policies are not according to customer need.
  • Poor presentation etc.
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