E-Commerce

• 1. commerce


  Buying and selling of products and services using devices connected to an electronic network, such as the internet
• Requirements for e-commerce


  • A seller who has products and services that are displayed electronically
  • A buyer who has the equipment required to view the seller's products and services, and a means of paying for them
  • A network that enables information and payment to be exchanged by the buyer and seller
• Advantages of e-commerce


  • Attract customers across the globe
  • Sell at any time of the day or night
  • Receive payments immediately
  • Reduced overhead costs compared to running a physical shop
• Disadvantages of e-commerce

  • More competitors from across the globe, making it harder for the business to get noticed
  • Employees may need new skills, eg website maintenance
  • Procedures required for how products and services will be delivered and processing returns
  • A need to maintain and update technologies, including security software, which may be expensive
• Digital communication


  Sending and receiving information electronically
• Digital communication tools

  • Email
  • Mobile phones
  • Mobile applications
  • Websites
  • Social media
  • Web conferencing
  • Cloud services
  • Instant messaging
• How businesses use social media

  • Sales and marketing
  • Interacting with customers
  • Communicating with stakeholders
• Instant messaging

  Software that enables users to send instant messages, usually in the form of text, to each other
• Technology and business

  • Technology advances are getting faster
  • Businesses need to be aware of available technology
  • Technology can influence sales, costs and marketing
• 1. commerce

  The buying and selling of goods and services online
• Social media


  Interactive computer based technology that allows users to create and share information and ideas through virtual communities and networks
• Easier to contact a business


  More likely a customer is to trust that business and make a purchase
• Using digital communication effectively

  Can help a business increase its sales
• Positive impacts of e-commerce on sales

  • Businesses can attract customers across the world
  • Businesses can sell 24/7
  • A well-designed e-commerce site can help a business look professional, which may attract customers
  • Prices can be updated easily, making it possible to react to competitors
  • Customers can see which items are in stock
• Negative impacts of e-commerce on sales

  • More potential competition, as customers are not restricted to local businesses
  • The business must consider logistical issues around delivering orders to customers
  • Providing customer service to a large customer base may be challenging for a small business
  • Customers can compare prices with those of the business' competitors
  • Stock records will need to be kept up to date
• Marketing on social media


  Advertising, promoting and selling products and services online
• Having regular direct communication on social media


  Can help to build customer relationships, which can help to increase sales
• Poor responses to social media posts

  Can be very damaging to the reputation of a business and lead to a fall in sales
• Good responses to social media posts

  Can lead to increased popularity and sales
• Making it easy and convenient for customers to pay

  Customers are more likely to make a purchase
• Businesses that only accept cash

  May find it increasingly difficult to attract customers
• The speed at which technology advances is getting faster
• Businesses need to be aware of the technology that is available to them, and how it might influence their sales, costs and marketing
• Investment

  Money or capital put into a business for profitable returns, for example interest or income
• Investing in new technology

  Costs money, but businesses often undertake such investment because of the reduced costs that implementing new technology can bring in the long term
• Digital communication systems

  • Can help reduce costs for businesses
  • Employees can work remotely
  • Communications can be sent more cost-effectively in electronic format
  • Video conferencing can remove costs associated with travelling to face-to-face meetings
• 1. commerce

  • Requires fewer sales staff
  • Requires fewer and sometimes smaller premises
  • Avoids the need to be located in high streets, where rents and rates are expensive
  • Can automate tasks such as administration and record keeping
  • Incurs additional costs such as website hosting, online payment fees, and warehousing and distribution costs
• Social media

  • Provides a quick, cost-effective way for businesses to communicate and interact with customers
  • Enables even small businesses to reach a wide audience for a minimal cost
• Payment methods

  • Development of new payment technologies has enabled traditional businesses to take payments in a more secure and cost-effective way without needing to hold large amounts of cash on their premises
  • Real-time online transactions can take place, with a business receiving payment almost immediately
  • Businesses that handle card payments charge a small percentage fee for every transaction
• The speed at which technology advances is getting faster. Businesses need to be aware of the technology that is available to them, and how it might influence their sales, costs and marketing.
• Marketing mix

  The five basic elements of marketing - price, placement, product, promotion, people
• Technology has had a significant impact on the way that businesses market their products and services.
• Successful businesses need to be flexible and adapt to change, so that they can respond quickly to customers.
• Impact of digital communication systems on the marketing mix

  • Product: Products can be adapted and accessed easily in a format that is convenient to the customer
  • Price: Money saved by using digital communication can help a business to keep its prices low
  • Place: Customers can access services regardless of where they are, eg through mobile banking apps
  • Promotion: Businesses can email newsletters, track customer behaviours on social media and their website, and advertise online
• Impact of e-commerce on the marketing mix

  • Product: Customers can download digital products (eg music tracks or e-books) immediately after payment
  • Price: Customers can compare prices across online sellers easily, so prices need to be competitive
  • Place: Selling online provides another way for customers to make a purchase at any time, wherever they are
  • Promotion: Promotional offers or 'flash sales' are easy to implement through an e-commerce website
• Impact of social media on the marketing mix

  • Product: Product information can be shared using video demonstrations where appropriate
  • Price: Cost savings may enable a business to lower its prices
  • Place: Businesses can interact with customers around the world, regardless of location
  • Promotion: Social media is a cost-effective way of targeting promotions at specific groups of customers
• Impact of payment methods on the marketing mix

  • Product: Online payment methods allow digital products to be purchased easily
  • Price: Any fees incurred through the use of specific payment methods need to be accounted for when setting the price of a product
  • Place: New payment methods have facilitated the ability to sell products online
  • Promotion: Businesses can promote the fact that they offer a variety of ways for a customer to pay, eg cash, card, PayPal