Questions and Answers
Which of the following factors differentiates e-business from traditional business?
What is one benefit of e-business?
What is a common application of e-business?
Which of the following best describes a type of transaction in e-business?
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What is a primary risk associated with data storage in e-business?
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What distinguishes e-commerce from e-business?
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Which of the following accurately describes B2C in e-business?
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What is a limitation of electronic business models?
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Which statement reflects a common transaction challenge in e-business?
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What is another benefit of e-business?
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Study Notes
Differences Between E-Business and Traditional Business
- Formation: E-business can be established with lower initial investment and fewer regulatory hurdles compared to traditional businesses, which often require physical locations and extensive permits.
- Setting of Cost: E-business generally has lower operating costs due to reduced overhead expenses, while traditional businesses incur higher costs related to physical storefronts and utilities.
- Risk Involved: E-business faces unique risks such as cybersecurity threats and data breaches, whereas traditional businesses encounter risks like theft, property damage, and market competition.
Applications of E-Business
- Online Retail: Enables consumers to shop for products and services from anywhere, leading to a wider market reach.
- Digital Marketing: Helps businesses promote their products through various online channels, fostering a more targeted audience engagement.
Data Storage and Transmission Risk in E-Business
- E-business relies heavily on cloud storage and online data transfer, making it susceptible to data breaches, cyberattacks, and loss of sensitive information.
- Regular security upgrades and the implementation of encryption protocols are essential to mitigate these risks.
Factors for the Growing Importance of E-Business
- Rapid technological advancements and increased internet penetration have made it easier for businesses to go online.
- Changing consumer behaviors favor online shopping, leading to a significant shift in marketing and sales strategies.
Steps Involved in Online Trading (Order Placement)
- Customer browses the online catalog and selects desired products.
- Customer adds items to the shopping cart and proceeds to checkout.
- Payment information is entered, and the order is confirmed.
- Order details are sent to the seller for processing and shipment.
Types of E-Business Models
- B2C (Business-to-Consumer): Involves businesses selling products directly to consumers via online platforms.
- C2C (Consumer-to-Consumer): Facilitates transactions between consumers, typically through online marketplaces.
- B2B (Business-to-Business): Involves transactions between businesses, often for supplies or services.
Limitations of Electronic Mode of Doing Business
- Security Concerns: High risk of data breaches and fraud can deter consumers from engaging in online transactions.
- Technical Issues: System downtimes or software failures can disrupt operations and affect customer trust.
- Lack of Personal Connection: Absence of face-to-face interaction can hinder customer relations and brand loyalty.
Benefits of E-Business
- Global Reach: Businesses can access a wider audience across various geographic locations.
- 24/7 Availability: E-business operates around the clock, enhancing customer convenience.
- Reduced Costs: Lower operational expenses compared to traditional models.
- Scalability: Easier to scale operations based on demand fluctuations.
- Data Analysis: Businesses can gather and analyze customer data for improved decision-making.
Types of Transactions in E-Business
- Online Purchases: Customers buy goods or services directly through websites.
- Digital Services: Offering services such as consulting or tutorials via digital platforms.
- Subscription Models: Consumers pay for ongoing access to products or services online.
Difference Between E-Commerce and E-Business
- E-Commerce focuses specifically on online transactions involving buying and selling goods and services.
- E-Business encompasses all aspects of running a business online, including supply chain management, customer service, and marketing strategies.
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Description
Test your knowledge on the differences between e-business and traditional business, including factors like formation, costs, and risks. Explore the applications of e-business and the risks associated with data storage and transmission. Understand why e-business is considered an emerging mode of business and the strengths contributing to its rise.
