e-commerce & m-commerce: Buying & Selling on the Web & Mobile Devices

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  • 0:06 What is E-Commerce?
  • 1:49 Four Basic Categories…
  • 4:02 What is M-Commerce?
  • 4:58 How Does the…
  • 6:31 Lesson Summary
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Lesson Transcript
Instructor: Jill Heaney

Jill has taught college-level business and IT. She has a Doctorate in Business Administration and an M.S. in Information Technology & Leadership.

E-commerce and m-commerce have transformed the way that organizations and consumers conduct business. Additional topics discussed in this lesson include B2B, B2C, C2C, and e-government.

What is E-commerce?

It is a Saturday morning. Peggy is sitting at her computer in her pajamas. She is sipping her morning cup of coffee as she browses online for a dress and a pair of shoes that she needs for an upcoming wedding. In the other room, her husband, Bob, is pricing fishing equipment for his camping trip next weekend. He wants to ensure he gets the best prices possible for all the equipment he needs. Upstairs, Peggy and Bob's daughter, Jennifer, is using her iPhone to bid on a designer handbag on eBay. These are all examples of consumers using e-commerce or m-commerce.

Electronic commerce, or e-commerce, is the buying, selling, marketing, servicing, delivery, and payment of goods and services over computer networks such as the Internet. E-commerce is made possible through the use of Hypertext Markup Language (HTML), Hypertext Transfer Protocol (HTTP), and server applications that enable the purchase to take place.

Have you made a purchase online or sold an item you no longer had a use for? If so, you were engaging in e-commerce. Amazon.com and eBay.com are two very successful e-commerce vendors. Most likely, you have engaged in e-commerce activities with one of these vendors or, at the very least, visited their website.

An example of an e-commerce website
e Commerce Website Example

E-commerce improves market efficiency through several means. First, it can eliminate the middleman, or the suppliers and distributors. It enables consumers to purchase products directly from the manufacturer, thus eliminating added costs. Second, it provides an easy and effective way to acquire pricing information. Consumers can easily search and compare prices on the Web. Third, e-commerce provides sellers with price elasticity information. This means that sellers can gauge the demand for a product based on fluctuations in price.

Four Basic Categories of E-Commerce

There are four basic categories of e-commerce: business-to-consumer (B2C), business-to-business (B2B), consumer-to-consumer (C2C), and e-government.

B2C is the sale of merchandise or services between the supplier and the customer. An electronic storefront is used for customers to select, order, and pay for products over the Internet. Electronic storefronts are webpages that represent a specific store. Buyers can browse products and make purchases through the storefront. Many times they are an extension of the physical store.

B2B refers to selling merchandise between businesses. Raw material suppliers sell to manufacturers. Manufacturers sell to distributors. Distributors sell to retailers. An example is Dell selling computers to BestBuy. Dell is a manufacturer and BestBuy is a retailer. BestBuy sells the computers they obtain from Dell to consumers.

This diagram shows the process of businesses selling products to each other.
Business to Business Flow Chart

C2C refers to one individual selling a product or service to another individual. This often occurs through online auctions or clearinghouses. Auctions match buyers and sellers that engage in a competitive bidding processes over the Internet. The highest bidder wins the product. eBay.com is an example of an online auction Web site that enables individuals as well as businesses to sell to other individuals. Clearinghouses arrange for the purchase and delivery of goods from a third party. They act as an intermediary to facilitate the purchase of an item. Amazon.com is an example. Individuals and used book stores can sell their products through the Amazon.com website. Amazon.com takes a commission since it matches the seller and buyer and conducts the purchasing transaction.

Electronic government, or e-government, is the use of the Internet and e-commerce to deliver information and public services to citizens, businesses, and suppliers. E-government is an efficient and effective way to conduct transactions with citizens and businesses. For example, G2C, or government-to-citizen, e-commerce can occur through the transfer of benefits such as electronic deposit of a social security check. All levels of government have websites where citizens and business can find information, download tax forms, and contact government officials. Costs are reduced and processes are streamlined.

What is M-Commerce

Mobile commerce, or m-commerce, refers to e-commerce conducted in a wireless environment over the Internet. Buying, selling, marketing, servicing, delivery, and payment of goods and services, are all completed over mobile technologies such as smart phones, tablets, or other wireless devices.

There are a number of factors driving m-commerce. These factors include the widespread availability and popularity of wireless devices like smart phones, the declining cost of wireless technology, the convenience of instant connectivity from any location, and bandwidth improvements that increase the speed of data transmission.

M-commerce has experienced growing popularity in financial services, telecommunications, services and retail, and information services. Users today bank online, purchase goods and services, adjust their cell phone plans, pay bills, obtain directions, look up traffic, and much more all from their wireless devices.

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