E Commerce File.docx

E-commerce’ and ‘online shopping’ are often used interchangeably but at its core e-commerce is much broader than this – it embodies a concept for doing business online, incorporating a multitude of different services e.g. making online payments, booking flights etc.

Why Do People Buy ‘Online’? 1. Lower Prices: Managing an online storefront is far cheaper than an offline, brick and mortar store. Typically less staff are required to manage an online shop as web-based management systems enable owners to automate inventory management and warehousing is not necessarily required (as we discuss later). As such, e-commerce business owners can afford to pass operational cost savings on to consumers (in the form of product or service discounts) whilst protecting their overall margin. Furthermore, with the rise of price comparison websites, consumers have more transparency with regard to prices and are able to shop around, typically purchasing from online outlets instead. 2. Accessibility and Convenience: Unlike many offline stores, consumers can access e-commerce websites 24 hours a day. Customers can read about services, browse products and place orders whenever they wish. In that sense, online shopping is extremely convenient and gives the consumer more control. Furthermore, those living in more remote areas are able to order from their home at a touch of a button, saving them time travelling to a shopping centre.

3. Wider Choice: For the past twenty years, the growth of online shopping has to a large extent been based around increased choice. With an almost endless choice of brands and products to choose from, consumers are not limited by the availability of specific products in their local town, city or country. Items can be sourced and shipped globally. Interestingly, one recent study found that consumers are actually starting to become frustrated by ecommerce sites that offer too much choice. Whichever way you look at it though, more choice has likely been a good thing over the long term.

Why Do Businesses Sell ‘Online’? 1. Higher Margins: Setup costs and ongoing operational costs such as rent, heating, electricity, warehousing (if operating a drop-ship model) and inventory management are often significantly reduced or otherwise eliminated. Further, customer service and other administrative tasks can be automated or outsourced at a relatively low-cost. As such, higher margins can usually be achieved when selling via an online store compared to operating an offline business. 2. Scalability: With a brick and mortar business, the owner is often limited by the amount of people who can physically be in the store at any one time. There is no limit when trading online. Running an e-commerce business means tapping into a truly global market.Furthermore, online platforms enable rapid scaling. With the emergence of social media and content marketing as well as the option of generating traffic and conversions through payper-click (PPC), expanding into new regions or markets can happen quickly. A great example of this in practice

is Choxi, a business that experienced 1,023% growth in revenue in just one year. 3. Consumer Insight / Technology: E-commerce businesses typically collate a tremendous amount of customer data. With every element of consumer behaviour being tracked, e-commerce business owners are able to understand, tweak and improve the customer shopping experience for customers – making data-led decisions to increase conversion rates and sales. With technology rapidly evolving, it is important that online retailers use tools such as Google Analytics correctly to understand their customers’ buying habits, unlocking insight from this data presents a unique advantage, not available to offline stores. Those who leverage the right systems and technology can see their businesses grow extremely quickly. Having understood the benefits of running an e-commerce business, it’s time to turn attention towards the different types of e-commerce businesses available.

1. Ubiquity- The traditional business market is a physical place, access to treatment by means of document circulation. For example, clothes and shoes are usually directed to encourage customers to go somewhere to buy. E-commerce is ubiquitous meaning that it can be everywhere. E-commerce is the worlds reduce cognitive energy required to complete the task. 2. Global Reach- E-commerce allows business transactions on the cross country bound can be more convenient and more effective as compared with the

traditional commerce. On the e-commerce businesses potential market scale is roughly equivalent to the network the size of the world’s population. 3. Universal Standards- E-commerce technologies is an unusual feature, is the technical standard of the Internet, so to carry out the technical standard of ecommerce is shared by all countries around the world standard. Standard can greatly affect the market entry cost and considering the cost of the goods on the market. The standard can make technology business existing become more easily, which can reduce the cost, technique of indirect costs in addition can set the electronic commerce website 10$ / month. 4. Richness- Advertising and branding are an important part of commerce. E-commerce can deliver video, audio, animation, billboards, signs and etc. However, it’s about as rich as television technology. 5. Interactivity- Twentieth Century electronic commerce business technology is called interactive, so they allow for two-way communication between businesses and consumers. 6. Information Density- The density of information the Internet has greatly improved, as long as the total amount and all markets, consumers and businesses quality information. The electronic commerce technology, reduce the information collection, storage, communication and processing cost. At the same time, accuracy and timeliness of the information technology increases greatly, information is more useful, more important than ever.

7. Personalization- E-commerce technology allows for personalization. Business can be adjusted for a name, a person’s interests and past purchase message objects and marketing message to a specific individual. The technology also allows for custom. Merchants can change the product or service based on user preferences, or previous behavior. Conclusion

In e-commerce we can see that these seven kinds of unique features in the function of the website. The seven unique features function is very important if no one function will make your site there are loopholes in the website, so an indispensable. The seven unique features were Ubiquity: available everywhere and all the time; Global Reach: users or customers can obtain total enterprise electronic commerce; Universal Standards: is shared by all countries around the world standard; Richness: complexity and message content; Interactivity: which allows for two-way communication between businesses and consumers, provide the quantity and quality of information in general; Information Density: to all market participants; Personalization: for marketing message to a specific person, by adjusting the news of interest, the name of a person and past purchases. E-commerce technology, allows customers to learn more and more consumers, more efficient use of the information. Online businesses can use this information to develop new information asymmetry, enhance their brand products, to charge higher prices, quality service and market segmentation of many groups, each of the different prices.

Main Categories for E-Commerce Payment Methods Online payments options generally fall into one of six meta-categories: Credit/Debit/Prepaid card payments: Cards represent the most popular worldwide payment method in the United States, Canada, Mexico, China, Korea, and most of Western Europe.  Bank transfers: Some e-commerce websites prefer to instruct their customers to make bank transfers directly their accounts, often using an IBAN number.  E-Wallets: E-wallets require customers and merchants to sign up and create accounts, then deposit and withdraw money from linked bank accounts. E-wallets like Paypal and AliPay are very popular in the United States and China, respectively.  Cash: In India, Romania, Russia, and many other parts of the world, cash remains king – even for ecommerce. Not offering a cash-on-delivery service is a surefire way to miss out on these markets.  Cryptocurrencies: Cryptocurrencies are rapidly gaining interest as a payment method for online transactions, particularly among young, moneyed professionals with IT expertise.  Direct carrier payments: For some products and services, the ability to bill customers directly through their existing telephone or utility carrier is the most efficient way to effectuate paymen 

ntroduction The e-commerce has transformed the way business is done in India. The Indian ecommerce market is expected to grow to US$ 200 billion by 2026 from US$ 38.5 billion as of 2017. Much growth of the industry has been triggered by increasing internet and smartphone penetration. The ongoing digital transformation in the country is expected to increase India’s total internet user base to 829 million by 2021 from 560.01 million as of September 2018. India’s internet economy is expected to double from US$125 billion as of April 2017 to US$ 250 billion by 2020, majorly backed by ecommerce. India’s E-commerce revenue is expected to jump from US$ 39 billion in 2017 to US$ 120 billion in 2020, growing at an annual rate of 51 per cent, the highest in the world.

Market Size Propelled by rising smartphone penetration, the launch of 4G networks and increasing consumer wealth, the Indian e-commerce market is expected to grow to US$ 200 billion by 2026 from US$ 38.5 billion in 2017 Online retail sales in India are expected to grow by 31 per cent to touch US$ 32.70 billion in 2018, led by Flipkart, Amazon India and Paytm Mall. During 2018, electronics is currently the biggest contributor to online retail sales in India with a share of 48 per cent, followed closely by apparel at 29 per cent.

Investments/ Developments Some of the major developments in the Indian e-commerce sector are as follows: 

Flipkart, after getting acquired by Walmart for US$ 16 billion, is expected to launch more offline retail stores in India to promote private labels in segments such as fashion and electronics. In September 2018, Flipkart acquired Israel based analytics start-up Upstream Commerce that will help the firm to price and position its products in an efficient way.

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Paytm has launched its bank - Paytm Payment Bank. Paytm bank is India's first bank with zero charges on online transactions, no minimum balance requirement and free virtual debit card

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As of June 2018, Google is also planning to enter into the E-commerce space by November 2018. India is expected to be its first market.

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E-commerce industry in India witnessed 21 private equity and venture capital deals worth US$ 2.1 billion in 2017 and 40 deals worth US$ 1,129 million in the first half of 2018.

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Google and Tata Trust have collaborated for the project ‘Internet Saathi’ to improve internet penetration among rural women in India

Government initiatives Since 2014, the Government of India has announced various initiatives namely, Digital India, Make in India, Start-up India, Skill India and Innovation Fund. The timely and effective implementation of such programs will likely support the ecommerce growth in the country. Some of the major initiatives taken by the government to promote the e-commerce sector in India are as follows: 

In order to increase the participation of foreign players in the ecommerce field, the Indian Government hiked the limit of foreign direct investment (FDI) in the E-commerce marketplace model for up to 100 per cent (in B2B models).

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In the Union Budget of 2018-19, government has allocated Rs 8,000 crore (US$ 1.24 billion) to BharatNet Project, to provide broadband services to 150,000 gram panchayats

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As of August 2018, the government is working on the second draft of ecommerce policy, incorporating inputs from various industry stakeholders.

Achievements Following are the achievements of the government in the past four years: 

Under the Digital India movement, government launched various initiatives like Udaan, Umang, Start-up India Portal etc.

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Under the project ‘Internet Saathi’, the government has influenced over 16 million women in India and reached 166,000 villages

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Udaan, a B2B online trade platform that connect small and medium size manufacturers and wholesalers with online retailers and also provide them logistics, payments and technology support, has sellers in over 80 cities of India and delivers to over 500 cities.

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According to the UN’s eGovernance index, India has jumped 11 positions to 107 in 2016 from 2018 in 2014.

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The government introduced Bharat Interface for Money (BHIM), a simple mobile based platform for digital payments.

Road Ahead The e-commerce industry been directly impacting the micro, small & medium enterprises (MSME) in India by providing means of financing, technology and

training and has a favourable cascading effect on other industries as well. The Indian e-commerce industry has been on an upward growth trajectory and is expected to surpass the US to become the second largest e-commerce market in the world by 2034. Technology enabled innovations like digital payments, hyper-local logistics, analytics driven customer engagement and digital advertisements will likely support the growth in the sector. The growth in e-commerce sector will also boost employment, increase revenues from export, increase tax collection by ex-chequers, and provide better products and services to customers in the long-term.

What does it take to build a great online store?

No successful store was ever built on luck and marketing alone. Top online retailers got where they are selling great products at great prices, delivering fast and making sure that customers are well rewarded for their choice. That takes a lot of work in areas most of us never notice, areas such as: 1. Suppliers and supply chain management

You are or plan to be a retailer in an increasingly competitive market. It means a lot to come up with a great idea, drive good traffic and convert it to sales but you can’t do that without the right products, delivered at the right time, with a price the market is willing to pay. Suppliers meant a whole lot when ecommerce was not around. Now – even more so. When it comes to ecommerce, suppliers can provide you with the right merchandise but they can also take the stocks burden off your shoulders. Amazon, for example, relies heavily on its marketplace partners to increase listed products number, without buying stocks for those products.

Key take away: before starting an ecommerce operation make sure:    

you have enough and the right merchandise suppliers they are financially and operational safe they are able to provide real-time stock inventory they are able to deliver purchased products fast [Read more Supply Chain Management in Omnichannel Retail] 2. Warehouse operations

Post brick-and-mortar retail relies on electronic communication and product display. But when a product is bought it has to come from somewhere, right? Seal the deal with the suppliers and it’s off to the Warehouse, that magical place where online retailers pick products from the shelf, pack them neatly and prepare those products to be delivered. Sounds simple? Well, usually, it is not. A decent store with its own warehouse operations has thousands of products at any time on its inventory, employs at least a couple of dozens of people to store products, pick and pack, and prepare for delivery. That’s why so many large companies choose to outsource their fulfillment operations to “third party logistics” suppliers such as Anchor 3PL or the ever-growing Fulfillment by Amazon so they can focus on what they do best (usually purchase the best assortment of merchandise, service customers and marketing). Key Take Aways: A much larger post regarding 3PL/YPL (third party logistics) will soon be available on Netonomy.NET but until then, let’s have a look at things

to consider when developing your own warehouse operations: 

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technology is the key – all 3PL service providers use technology (warehouse management systems) to know at all times where the products are, what’s the most efficient way to pick those products, who should be the person in charge for each package and others think about the season – some seasons (such as the Holidays) are more operationally intensive then others. Be ready to employ temporary workforce to fulfill your orders everything needs to be tracked and monitored – security and accountability are the key to handling large numbers of orders and workforce 3. Shipping and returns

Just as mentioned above your merchandise may be displayed and marketed online but it has to be packed and reach its destination in the real world. That’s why you need a good warehouse management and that’s why you need a great shipping service. Shipping is usually an outsourced service. The best thing to do, unless you’re swimming in cash and you want to start competing the likes of FedEx and DHL, is employ one of the shipping providers and negotiate your way to a marketable shipping cost. Such a cost is likely to be, in the future, one you will be paying yourself – so pay attention. Once you’ve contracted these shipping providers integrate their system with yours so you can streamline packaging and delivery.

Once in a while customers do not like what they’ve bought. You will need to handle the returns and reimburse customers for their purchase. Here you can team up with the shipping provider but your store has to handle all the communication. Key take aways: 

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hire a shipping provider – It’s probably not worth it to have a shipping service of your own pay attention to systems integrations when it comes to online store – warehouse – shipping flow handle your returns as gracefully as possible – it may mean the difference between an unsatisfied customer and a lifetime brand ambassador Before we skip to the next component I just wanted to make sure you’ve noticed I haven’t yet mentioned anything you would expect would be ecommerce related or innovative. So far – it’s just plain ol’ supply chain management and logistics. Got it? Great. Let’s move on to … 4. Client Relationship Management (CRM) – software and policies

Before even considering selling – you need to think about how are you going to treat your customer and keep him coming back. That’s where CRM comes in. While the term is usually used to describe a type of software, it is actually the term describing the whole policy on how are you going to handle interactions between you and your customer. CRM needs to be “customer-centric”. Big words – but what do they mean? It just means that everything you do needs to be done “for the customer, by the retailer”. You need to understand the customer purchase patterns so you

can recommend the most suited products. You need to record purchases, interests, preferred channels and basically all there is to it when it comes to understanding your customer. Then act on that – after you’ve analyzed data make sure customer care, warehouse operations, shipping providers and even your purchase operations – all know who the customer is and what it wants. Key Take Aways: 

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CRM is not just software – it’s a company policy on how to treat clients Profiling is a must – understand as much as possible about your customer so you can serve better “Customer-centric” is not a buzz-word – it’s common sense There is no “client service department” – everybody working in an ecommerce store needs to know who the client is, record interactions and treat customers accordingly 5. Ecommerce catalogue and product display

Here’s one you surely expected, maybe not so down the list: your online store catalogue. Of course – this one is important. Without one we would be back to mail orders and inventing the wheel. However, as you’ve probably seen so far – it is just a small part of the whole ecommerce store business. When it comes to it some things you really should be taking into account:

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make sure you don’t over-design your store – your products are the most important items. Make them shine. analyze and predict: predictive analytics is the practice of analyzing users behavior and predicting what would they rather buy at any given time. Read more about it here. search, search and let’s not forget search: most of your customers will be using a search engine to navigate to your store (1) . Make sure your store is optimized. Once there, when in doubt, they will want to search for products (2) – make sure your site search works. Finally – when their order was shipped they will want to search for its location (3). Show them. 6. Marketing and loyalty programs

I know, i know – one includes the other. But for the sake of the argument let’s just assume that maybe loyalty programs online are so important that they should be a separate item to marketing. Because they are. Loyalty is really hard to acquire these days. Especially when it comes to ecommerce. Most users will be searching for the lowest price and buy from whomever the seller is. But you can fight the trend with loyalty programs such as: 

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rewarding purchases – reward your users with points they can spend on your store. It’s really effective in keeping your customers tied to your brand, as well as making them feel great about it social shopping – make your customer feel like a king when he can give out discounts and freebies to its peers and friends reward social media – most online users have some kind of influence in their micro community of friends. Encourage them to take part in your story, share your products and

reward them with freebies, discounts and … well …sometimes “Thank you” is enough As for marketing at large – there is an increasing number of marketing solutions you an use to market your products and store but not all are alike. Not all are as efficient. Focus on:    

Search engine optimization and paid search results Email marketing Social media Branding They may not look like much but together the “incredible four of ecommerce” can mean the difference between a failed startup and the next Amazon. Last but not least … 7. Showroom and offline purchases

What – you thought that brick and mortar is all gone? Of course not. Online retail is still at just 7% of total retail but growing fast. One of the things that’s helping it grow is showrooming. That is the practice of checking a product instore and buying it (usually cheaper) – online. Don’t think about ecommerce as online-vs-offline. Think in terms of customer. The customer wants to feel the product before it makes the purchase. So you’ll need to show it to him. Even a small offline showroom can work miracles for your online store. So now you have it – online retail is a rather big iceberg. Most of it unseen. Check where others don’t look because that’s where you’ll find success in ecommerce.