Assignment

On

“Electronic Business”

Submitted To: Submitted By:

Prof. Manoj Bhatia Mohit Malviya

E-Business: Electronic business, commonly referred to as "eBusiness" or "e-

business", or an internet business, may be defined as the application of information

and communication technologies (ICT) in support of all the activities of business.

Commerce constitutes the exchange of products and services between businesses,

groups and individuals and can be seen as one of the essential activities of any

business. Electronic commerce focuses on the use of ICT to enable the external

activities and relationships of the business with individuals, groups and other

businesses.

E-Commerce: Electronic commerce, commonly known as e-

commerce or eCommerce, consists of the buying and selling

of products or services over electronic systems such as the Internet and

other computer networks.

There is no major difference between E-Business and E-Commerce.

TYPES OF E-COMMERCE

Business to business

Business to consumer

Consumer to consumer

Consumer to business

Business to employee

LIST OF 3 SUCCESFUL AND 3 FAILED E-COMMERCE COMPANIES

3 SUCCESFUL COMPANIES

1. Amazon.com: Hugh variety2. Dell: Customization3. Apple: Innovation

3 FAILED COMPANIES

1. MVP.com: MVP.com was a website devoted to selling sporting goods on the strength of endorsements from legends like Michael Jordan and Wayne Gretzky. The company’s prospects seemed bright at the onset, backed by $65 million in venture funding and an equity sharing partnership with CBS Sports that promised MVP free advertising during games. The $85 million deal was ill-fated, however, as MVP reneged on its promise to pay CBS the promised $10 million per year. Soon after, CBS squashed the agreement and MVP.com was benched for good. The lesson to entrepreneurs everywhere: celebrity endorsements mean nothing without a product or service people really, truly want. Today, Sports Business Journal refers to MVP as “a sobering lesson from the dot com bust, showing the need for business fundamentals no matter the names behind the venture.”

2. Thought Inc: Thought was written up in a Forbes piece entitled “When Startups Become Blowups.” Apparently, they were a maker of customized server software that sounded a lot better in theory than it proved to be in practice. Unfortunately, their tale is symptomatic of many Internet startups that aren’t founded around a viable business strategy. The article goes on to tell the story of Hugh Carrol, a man who left a steady job in the Valley for a sales on comission job at Thought. Sadly, the software was difficult to sell and the company’s cash flow problems caused them to skip Carrol’s paychecks. When she investigated, she was told that she would get a lump sum “when revenues started coming in.” Predictably, that revenue never did come in – and neither did Carrol’s pay.

“It was a very disillusioning experience that left me cynical”, is all Carrol had to say about the Thought, Inc. fiasco.

3. Channel A: The same Forbes piece recounts the tale of Channel A, a website dedicated to Asian-American issues and entertainment. The new venture was appealing enough to lure 27 year old Pamela Yoon away from a secure job and get down in the trenches working for them, instead. “Why not take a chance?”, she offered as her reason. She soon had an all-too-painful answer. Despite Asian investors sinking millions into the Channel A site (and its many favorable mentions in the San Francisco newspapers), their target market in Asia ceased to care about what the site had to offer them. Consequently, the plug was pulled in Channel A in 1997, not even a year after Yoon came aboard.“It sucked afterword”, Yoon said, adding that she was also unemployed for two and a half months after Channel A closed its doors.

FACTORS THAT HOLD BACK THE GROWTH OF E-COMMERCE IN INDIA

Shift from traditional advertising to internet marketing Changes in Consumer behaviour Growth of video advertising Growth of Mobile advertising Rapidly increasing Internet user base Technology advancements such as VOIP (Voice-over-IP) have bridged the

gap between buyers and sellers online The emergence of blogs as an avenue for information dissemination and

two-way communication for online retailers and eCommerce vendors Improved fraud prevention technologies that offer a safe and secure business

environment and help prevent credit card frauds, identity thefts and phishing Bigger web presence of SME’s and Corporates because of lower marketing

and infrastructure costs. Longer reach - Consumers in the Tier II & Tier III cities are fast realizing

the potential of the Internet as a transacting medium The young population find online transactions much easier.

How to attract Indian “Online Customers”?

Goods should have value for the customer along with quality. Security is promised. Selling Brand articles. Establishing trust and winning confidence. Providing easy guidance. Clear information regarding delivery time. Articles ordered and the article delivered should not vary. Giving discount offer and other gift items. Limited personal information. Providing value added service at lower prices. Full information regarding the product is simple words. Innovative products. Social shopping phenomenon. Providing price comparison. Transparent information regarding the product. Indian customers want to buy things that do not cost them much.

DATA AND GROWTH OF E COMMERCE IN INDIA

India ranks third biggest e-shopping nation As per Assocham, e-commerce is likely to grow by 150% to Rs 5500 crores this fiscal year. The total e-commerce sales for last year were Rs 2200 crores. Delhi and Mumbai contributed 20% and 24% respectively of the total e shopper population in 2006-2007. For 2007-2008 their contribution is expected to reach 30% and 40% respectively.

Here is an assumed data…1. In 2006-2007, Delhi and Mumbai contributed 20% and 24% of the e shopper population2. In 2007-2008, Delhi and Mumbai are estimated to contribute 30% and 40% of the e shopper  population3. Chennai and Bangalore contributed 7% and 6% of the e shopper populations in 2006-20074. In 2007 -2008, Chennai and Bangalore will likely contribute 12% and 9% of the online shopping population5. 28% of shoppers are in the 18-25 age group, 48% in 26-35, 15% in the 36-45 age group and 9% in 45-60 age group6. 88% of online shoppers in India were male, with 86% having at least a bachleor’s degree7. Electronic gadgets, apparel, railways, air and movie tickets were most shopped items last year8. Products likely to gain popularity this year include jewellery, books, apparel, gift products, music, movies, hotel bookings

According to eMarketer Asia Pacific E Commerce Rises every year and it has been predicted by them that the Ecommerce market may make a hike from &59.1 billion at 2006 TO $168.7 billion by 2011

the statistics of Ecommerce usage for India

2006 : $800 million2007 : $1.2 billion2008 : $1.9 billion2009 : $2.8 billion2010 : $4.1 billion2011 : $5.6 billion

In a 250 million Urban population in India, 65 million are PC literate. Out of them, 46 million claim to be internet users though only 32 million are active.The growth of the claimed internet user base:

2000 : 4.9 million2001 : 8.7 million2003 : 11.9 million2004 : 16.4 million2006 : 32.2 million2007 : 46 million

However, the growth of the active user base shows the following numbers:

2000 : 2.2 million2001 : 4.3 million2003 : 7.5 million2004 : 11.2 million2006 : 21.1 million2007 : 32 million

E-commerce industry has touched 9210 crore, online classifieds: 820 crores, online travel: 7000 crores (30% jump from Rs 7,080 crore in ’07) as per the survey conducted by the IAMAI and IMRB

Online Travel Industry: growth rate of 30% to Rs 7,000 crore by end FY08 (from 5500 crores in ‘07)

Online Classifieds: reached Rs 820 crore by end FY08 Online retailing/auction (eTailing): Rs 1,105 crore industries by end FY08

(from Rs 850 crore in FY07. Digital downloads (i.e. downloading from Internet to mobiles using wap

phones or web) and paid content (research/exclusive videos/articles etc) for the rest of 285 crores.

THE MAJOR TRIGGERS OF E-COMMERCE IN INDIA ARE:

Saves time and efforts Convenience of shopping at home Wide variety / range of products are available Good discounts / lower prices Get detailed information of the product You can compare various models / brands

MAJOR BARRIERS AT PRESENT ARE:

Not sure of product quality Cannot bargain/Negotiate Not sure of security of transactions / Credit card misuse Need to touch and feel the product Significant discounts are not there Have to wait for delivery