Managing Businesses Electronically PDF

# Managing Businesses Electronically - Keep in touch with all relevant parties, such as clients, vendors, and others, to provide information and solicit feedback on how to enhance operations. - Businesses can make money and build a reputation via an E-Commerce Website by using some unique ways ment...

# Managing Businesses Electronically - Keep in touch with all relevant parties, such as clients, vendors, and others, to provide information and solicit feedback on how to enhance operations. - Businesses can make money and build a reputation via an E-Commerce Website by using some unique ways mentioned in Figure 1.8. ## Strategies to approach consumers - Win Referrals - Add Subscribers - Automated Process - Onboard Resellers - Social Media - Blogging - Web Promotion - Google Ads - Email Marketing - SEO for Organic Sale - Video Marketing - Dropshipping & Logistics Commission ## Role of E-commerce Website The emergence of new technologies like AI and IoT on top of the Internet offers many creative new business models for the existing firms and gives rise to previously unimagined businesses. The company should succeed by being quick to adopt these technologies. # MBAFT 7501 MANAGING E-BUSINESS ## 1.11 Emerging Technologies for E-Business Solutions The E-Commerce sector has experienced a transformation because of emerging technologies. Emerging technology have made it possible for businesses to deliver more individualised experiences to customers as well as gain deeper information from their customers. There are two sides to the new technological trends in e-commerce: one that is driven by marketing intelligence and consumer wants, and another that we generate with creative uses of brand-new innovations borrowed from other fields. Both have shown to be equally crucial to e-commerce's development. Listed here are a few of the cutting-edge technologies that are already popular or will become well-known in the near future. - **Integrated E-commerce CRMs**, not only helps connect the dots for everything related to customer and relationship management, it also provides a single central repository for data and data-driven insights that can be used for marketing, targeting, inventory control, order fulfilment, dispatch, and grievance management. - **Gamification to boost sales** is quickly catching up. In addition to making shopping more enjoyable, inspiring, and participatory, it also makes it far more satisfying. This is one of the more recently created efficient strategies for retaining users of your e-commerce software. - **Contextual and Programmatic Advertising** utilises data sets to choose the kind of content, target market, timing of advertising, and re-targeting, in order to draw in more customers and increase ROI. The fact that social media companies are already updating their designs to meet this demand is extremely encouraging. - **Augmented Reality for Product Visualization** is one of the specialised trends that will shape e-commerce in the future. With the use of AR, VR, and MR, you would be able to virtually shop by "experiencing" the product. This is supported by phones from iOS, Android, and Google, and in the near future, the use of smart devices with AR/VR capabilities will soar. - **No codes** are quickly catching up since many mid-level and smaller firms cannot afford custom-built e-commerce platforms, which are expensive to construct and complex to operate. All a SME or start-up needs are simplicity, friendliness, and affordability. - **Multi-Cloud hosting** grew in popularity throughout the pandemic. This cutting-edge cloud strategy maximises cloud hosting's benefits while coordinating numerous corporate functions like security, interoperability, data access, and IT operations. Amazon would lose $220,318.80 each minute of downtime without reliable and quick hosting, while Costco.com would lose $11,082.00. - **Social payments** is another technology breakthrough that is significantly increasing the ROIs of e-commerce companies. It functions like a virtual bank account where users of social media can make purchases from online merchants who accept these payment methods or from the networks themselves. Although it is still in its early stages, companies like Twitter Buy, PayPal, Apple Pay, Google Wallet, Facebook Payments, etc. are working on it and are sure to fill the gap more successfully. - **Headless and API-driven e-commerce** enables complete decoupling of the frontend presentation layer from e-commerce systems, allowing for continuous innovation. More e-commerce companies are utilising headless because of the flexibility on the backend and the improved SEO, content marketing, and digital experience capabilities. - **Shopping through Voice, personalized Chatbots, Cameras, barcodes, and images** are going to expand their consumer base, particularly because they overcome the language barrier and the problems that result from it. ## IN-TEXT QUESTIONS 7. E-commerce technologies provide a unique, many-to-many model of mass communication. - (a) True 8. ______ is the virtual representation of physical market. 9. Warranty, services etc. are ______ activities. ## 1.12 Summary With everything discussed above, businesses have many possibilities to increase their online sales. However, it is their responsibility to be conscious that the more technologies they incorporate into their operations, the more data they will also be gathering. Retailers must be able to use the data wisely while abiding by all legal requirements. The needs of customers, merchants, marketers, and enterprises are continually being met by e-commerce technology, which also helps to improve customer experiences, boost sales, and eventually benefit businesses' bottom lines. To stay competitive as technology develops, organisations must keep up with the most recent trends. E-commerce technologies will undoubtedly continue to influence how we shop and connect with companies online as we move to the future. ## 1.13 Answers to In-Text Questions 1. (a) Consumer to Business 2. (d) Business to Consumer 3. (d) All of the above 4. (b) Online Direct Marketing 5. (b) Click-through 6. (a) Using electronic-medias 8. Electronic Market 9. After sales ## 1.14 Self-Assessment Questions 1. What are the features of E-commerce? 2. What is the difference between E-commerce and Traditional Commerce? 3. What are the different e-commerce business models? 4. Explain the components of E-Business. 5. What is meant by E-marketing? Explain how it is playing a vital role in the success of electronic Business. ## 1.15 References/Suggested Readings - Bhanver, J., & Bhanver, K. (2017). Click! The Amazing Story of India's E-commerce Boom and where it's headed. Hachette. - Bhaskar, B. (2009). Electronic commerce: Framework, technologies and applications (3rd Ed.). New Delhi: Tata McGraw Hill Education. - Chaffey, D. (2007). E-Business and e-commerce management (3rd Ed.). Pearson Education. - Erisman, P. (2017). Six Billion Shoppers: The Companies Winning the Global E-Commerce Boom. Macmillan. - Kalakota R. & Whinston, A. B. (2009). Electronic commerce: A manager's guide. New Delhi: Pearson Education - Vaitheeswaran, K. (2017). Failing to Succeed: The Story of India's First E-Commerce Company. India: Rupa Publications # LESSON 2 ## Introduction to E-commerce ### 2.1 Learning Objectives 1. Know the fundamentals of e-commerce: The learner should be able to define e-commerce and comprehend its history. Understand the benefits and drawbacks of e-commerce. 2. The learner should be able to recognize the various roles of EDI in e-commerce. 3. The learner should be able to explain how E-commerce businesses are adjusting to the digital age and utilizing technology and Emerging Paradigms of E-Commerce to improve customer experience, streamline operations, and generate income. 4. Understanding the idea of knowledge management in the context of e-commerce includes being able to define the term and explain how it might be used, as well as the function of data, information, and knowledge in e-commerce operations. ### 2.2 Introduction of E-Commerce The term “e-commerce,” which stands for “electronic commerce," describes the exchange of products and services over the Internet. E-commerce has grown rapidly in recent years and is now a crucial component of contemporary business. This growth can be attributed to a number of things, including the widespread use of mobile devices, technological advancements, and the Internet's global reach. Purchasing goods and services from anywhere in the world is now simpler and more convenient thanks to e-commerce, which has completely changed how we buy and conduct business. Additionally, it has given entrepreneurs and small businesses new opportunities, enabling them to reach a larger audience and engage in global competition. ### 2.3 History of E-Commerce Most of us have participated in e-commerce because we have all done some sort of online shopping. It follows that e-commerce is prevalent everywhere. However, very few people might be aware that e-commerce has a history that predates the creation of the Internet. E-commerce has its roots in the Electronic Data Interchange, a method that businesses utilised to make document transfers easier in the 1960s. The very first transaction did not happen until 1994. This included friends buying and selling a CD online using the retail website NetMarket. Since then, the industry has undergone a tremendous lot of change, leading to significant evolution. As businesses like Alibaba, Amazon, eBay, and Etsy became well-known, traditional brick-and-mortar retailers were compelled to adopt new technology in order to survive. These businesses established an easily accessible virtual market place for products and services. People's ability to shop online is being facilitated by new technology. By downloading applications, customers may engage with businesses via smartphones and other devices and make transactions. The advent of free shipping, which lowers prices for customers, has also contributed to the ecommerce sector's rise in popularity. ### 2.4 Definition of E-Commerce Electronic commerce, or e-commerce, is the term used to describe the exchange of data and money necessary to carry out online transactions for the purchase and sale of goods and services. It entails the use of digital technology, including websites, mobile applications, social media platforms, and other online channels, to carry out business operations including online payments, advertising, and purchasing. E-commerce has transformed how we conduct business and created new chances for entrepreneurs and small enterprises to connect with a larger audience and contend on a global level. To make your document look professionally produced, Word provides header, footer, cover page, and text box designs that complement each other. For example, you can add a matching cover page, header, and sidebar. Click Insert and then choose the elements you want from the different galleries. ### 2.5 Benefits and Drawbacks of E-Commerce #### 2.5.1 Benefits of e-Commerce 1. Expanded Audience: E-commerce gives businesses the ability to sell their goods and services outside of their local markets, which can improve sales and present prospects for expansion. 2. E-commerce eliminates the need for physical shops, which saves money on staffing, rent, and other overhead expenses. Businesses may experience substantial cost savings as a result, which they may then pass along to customers in the form of lower prices. 3. Convenience: Customers no longer need to visit actual stores in order to shop online from anywhere, at any time. This element of convenience has the potential to draw more clients and boost revenue. 4. Personalization: To deliver personalised recommendations and offers, e-commerce platforms can gather and analyse client data. This can increase customer loyalty and happiness. 5. Data gathering: To enhance marketing tactics and product development, e-commerce platforms can gather useful information on consumer behaviour, preferences, and purchasing habits. #### 2.5.2 Drawbacks of e-Commerce 1. Concerns about security include the transmission of sensitive data during e-commerce transactions, including financial and personal data that is susceptible to hackers and identity theft. This can undermine client confidence and harm a company's reputation. 2. Lack of Personal Interaction: E-commerce removes the personal interaction that consumers may enjoy in traditional shopping experiences, such as the capacity to touch, feel, and try on things before making a purchase. 3. Technical Problems: Technical problems with e-commerce platforms, such as website crashes or issues with payment processing, can lead to lost sales and disgruntled clients. 4. E-commerce companies may have problems with shipping and delivery, such as delays, lost products, and damage during transportation. These problems can lead to unhappy customers. 5. Regulatory Compliance: It can be difficult and expensive for e-commerce companies to negotiate the different regulations that pertain to data privacy, consumer protection, and taxation. Legal repercussions and reputational harm to a company may follow failure to comply with these requirements. ### 2.6 E-Commerce Applications - Online marketing strategies are used by several retail e-commerce apps to entice users to the platform. Email, online shopping carts and catalogues, EDI, file transfer protocol, web services, and mobile applications are some of them. - Both B2C and B2B operations as well as other forms of outreach use these strategies. They include sending mobile devices SMS texts and targeted emails with advertisements and e-newsletters to subscribers. - Sending unwanted emails and SMS is typically referred to as spam. With the use of tools like digital discounts, social media marketing, and customised adverts, more businesses are now making an effort to attract customers online. - Security is another issue on which e-commerce enterprises are concentrating. When creating e-commerce systems and applications, developers and administrators should take into account consumer data privacy and security, data governance-related regulatory compliance mandates, personally identifiable information privacy rules, and information protection protocols. - While some security features are incorporated into an application's design, others need to be updated frequently to address evolving threats and discovered vulnerabilities. ### 2.7 Types of e-Commerce The Common Types of e-Commerce Business Models - B2C (Business-to-Consumer) - B2B (Business-to-Business) - B2B2C (Business-to-Business-to-Consumer) - B2G (Business-to-Government) - C2B (Consumer-to-Business) - D2C (Direct-to-Consumer) - C2C (Consumer-to-Consumer) ### 2.8 Example of E-Commerce In the world of online shopping, Amazon is a giant. In actuality, it is the biggest online store in the world and is still expanding. As a result, it is a significant disruptor for the retail sector, prompting some of the biggest merchants to reconsider their plans and change their priorities. Sales of the company, company's operating income rose more than 30% from the prior year in 2020. By the end of 2020, net income had also increased. E-commerce seized the chance to further separate itself from in-store shopping as the world adjusted to the COVID-19 restrictions. Amazon's net income increased to $33.4 billion in 2021, and the company finished the year with more than $42 billion in cash on hand. According to Amazon, the pandemic caused the company to realise three years' worth of projected growth in just 15 months. Gaurav Agrawal, Co-Founder & CTO, TATA 1 MG Stated that, they plan to grow 80-85% year by year and they are well on track to achieve these goals. ### 2.9 How does E-Commerce Works - The Internet is what drives e-commerce. Customers use their own devices to access an online store to browse the selection and place orders for goods or services. - The customer's web browser will communicate back and forth with the server hosting the e-commerce website as the order is placed. The order manager, a central computer, will receive information about the order. - It will then be sent to databases that control inventory levels, a merchant system that controls payment data using tools like PayPal, a bank computer, and a merchant system. - It will then return to the order manager. This is done to ensure that there is enough stock in the store and money in the customer's account to fulfil the order. - The order manager will alert the store's web server once the order has been confirmed. The customer will see a notice stating that their order has been successfully handled. - The order manager will then notify the warehouse or fulfilment department that the goods or service can be delivered to the customer by sending order data to those departments. A customer may receive actual or digital goods at this moment, or access to a service may be granted. - Online marketplaces where sellers register, like Amazon, software as a service (SaaS) tools that let users “rent” online store infrastructures, or open-source tools that businesses run using their in-house developers are some examples of platforms that host e-commerce transactions. ### 2.10 Introduction to EDI (Electronic Data Interchange) A computer-to-computer exchange of business documents in a common electronic format known as Electronic Data Interchange (EDI) takes place between two or more commercial partners. It makes it possible for businesses to exchange data electronically in a structured fashion, doing away with the need for human data entry and cutting down on the time and expense of paper-based transactions. EDI was first developed in the 1960s as a mechanism for businesses to electronically exchange commercial papers. Businesses have been able to integrate their internal systems with those of their trading partners over time thanks to the standardisation of EDI formats and protocols, which has increased efficiency and decreased errors. Purchase orders, invoices, shipping notifications, and other company papers can all be exchanged electronically. The format and content of these documents are specified by the EDI standard, guaranteeing that both the sender and the receiver can easily understand them. Many businesses, especially those in the supply chain and logistics sectors, now heavily rely on EDI. Transactions may be processed more quickly and accurately thanks to this, which boosts customer happiness and revenues. **For Example:** Can you do image chatting with your friend while writing a letter to them every time? Since people can easily communicate with one another in this day and age thanks to the Internet. Imagine a situation where businesses constantly need to communicate and exchange very important documents. If this were done the old-fashioned way, it would take an eternity for the messages to reach the other party, and the documents would also pile up because there would be a lot of information that needed to be kept and stored. It is a time-consuming and difficult process, and this is where EDI comes in. ### 2.11 The Most Typical EDI Data Transferred are: - Invoices - Procurement Orders - letters with financial information - Transfer Bills - Shipping notifications and requests - Recognition and comments - Transcripts - Claims - Letters of business correspondence ### 2.12 How EDI Works? The Above Figure 2.3 helps us to understand the Working of EDI: - The steps of an EDI system are listed below. - A programme creates a file with the edited document in it. - The paper is formatted in accordance with a predetermined standard. - The document is transmitted electronically via the network in a file. - The file is delivered to the trading partner. - A document of acknowledgement is created and delivered to the organisation that initiated the request. The information or data that one company provides to another is first prepared for transmission before being converted into EDI format. The connection is direct and point-to-point, and the document is then connected and sent to the other company. ### 2.13 Role of EDI (Electronic Data Interchange) 1. **Efficiency:** By automating data interchange, EDI helps organisations streamline their supply chain procedures. This cuts down on errors and frees up time. As a result, orders are processed more quickly, lead times are cut down, and customers are happier. 2. **Cost Savings:** Since EDI does not require paper documents or manual data entry, printing, postage, and labour costs are also decreased. 3. **Correctness:** By removing human data entry and the accompanying inaccuracies, EDI ensures the correctness of data, resulting in better data quality and fewer conflicts. 4. **Greater Visibility:** EDI increases transparency and enables better decision-making by allowing businesses to track the status of orders, shipments, and payments in real-time. 5. **Improved Association:** By enabling organisations to communicate data electronically in a standardised manner, EDI improves collaboration between companies, resulting in improved communication and deeper relationships. 6. **Scalability:** By automating data sharing and lowering the need for manual intervention, EDI makes it simple for organisations to scale their operations. Overall, EDI is a crucial part of e-commerce because it helps companies to automate and optimise their supply chain operations, which boosts productivity, lowers costs, improves accuracy, and fosters better collaboration. ### 2.14 Emerging Paradigms of E-Commerce New paradigms are developing to keep up with the shifting trends and technologies as the e-commerce landscape changes regularly. The future of e-commerce is being shaped by these new paradigms, which are also changing how companies conduct themselves in the online market. In this Chapter we'll talk about some of the new e-commerce paradigms and give examples of how they're reshaping the industry. 1. **Mobile Commerce (m-commerce):** Also known as purchasing and selling goods and services sing mobile devices, mobile commerce has become more and more popular as smartphones and other mobile devices have become more widely used. M-commerce has a number of benefits over conventional e-commerce, including mobility, ease of use, and customised experiences. - **For Example:** Shopping at Amazon, Flipkart 2. **Social Commerce:** Social media and e-commerce are combined to create social commerce, a platform for users to shop, share, and purchase goods. Brands now frequently use social media sites like Facebook, Instagram, and Pinterest to promote their goods and interact with consumers. Social commerce makes use of these channels to give customers an immersive buying experience and enable marketers to more precisely target their audience. - **For Example:** Instagram Shopping is one instance of social commerce, allowing companies to tag things in their posts, making it simpler for consumers to find and buy products. Users can proceed to make direct purchases on Instagram by clicking on the tagged products to discover additional product details, including the price and description. 3. **Augmented Reality (AR) and Virtual Reality (VR):** Through immersive and interactive experiences, augmented reality (AR) and virtual reality (VR) technologies are revolutionising how consumers shop online. Businesses may build virtual showrooms using AR and VR, giving customers an exciting and realistic way to view and interact with products. - **For Example:** By placing a 3D model of the item over a live video feed of your space, the Ikea Place smartphone app lets you visualise Ikea furniture in your own home. 4. **Artificial Intelligence (AI) and Machine Learning (ML):** To enhance the shopping experience for customers, e-commerce is progressively utilising AI and ML technology. Businesses can use AI and ML to automate numerous steps in the e-commerce process, including order fulfilment and customer care, as well as to personalise product recommendations and price optimisation. - **For Example:** The most common uses of AI are Siri, intelligent humanoid robots, expert systems, online gaming, catboat customer service, and more. 5. **Internet of Things (IoT):** The Internet of Things, or IoT, is the name given to the rapidly expanding network of interconnected items that can exchange data in real time thanks to integrated sensors. - **For Example:** Appliances like refrigerators, vehicles, lights, and thermostats can all be connected to the Internet of Things. 6. **Blockchain:** A distributed ledger technology called blockchain makes it possible to conduct secure and open transactions without the use of middlemen. Blockchain technology is being applied to e-commerce to enhance payment processing, lower fraud, and enable secure data transmission - **For Example:** Healthcare providers can leverage blockchain to store their patients' medical records securely. When a medical record is generated and signed, it can be written into the blockchain, which provides patients with the proof and confidence that the record cannot be changed. These personal health records could be encoded and stored on the blockchain with a private key so that they are only accessible to specific individuals, thereby ensuring privacy. 7. **Omni-channel Commerce:** Creating a smooth purchasing experience for customers across all channels, including online, mobile, and brick-and-mortar locations, is the goal of omni-channel commerce, a comprehensive approach to e-commerce. Customers can shop for things online, in-store, and have them delivered to their homes thanks to omni-channel commerce. Customers will always have the same brand experience thanks to this strategy, regardless of how they choose to interact with the company. - **For Example:** Starbucks' mobile ordering app, which enables users to purchase drinks and pay for them using a mobile device, is one example of omni-channel commerce. Customers can then decide whether to have their orders delivered to them or picked up in-store. The seamless blending of online and offline channels has generated revenue and patronage for Starbucks. 8. **Voice commerce:** Making purchases with voice assistants like Alexa and Google Assistant is known as voice commerce. Voice commerce is becoming more and more popular since it gives customers a hands-free shopping experience and makes it simpler for them to make purchases on the go. - **For Example:** The voice ordering assistant from Domino's Pizza, which enables customers to purchase pizza through Alexa, is one example of speech commerce. It is easy and convenient for customers to place their orders by simply speaking to the assistance. The digital marketplace is changing as a result of the new e-commerce paradigms, and businesses now have more ways than ever to interact with customers and increase sales. A few of the new paradigms influencing the future of e-commerce include social commerce, omni-channel commerce, AI and ML in e-commerce, voice commerce, and subscription-based e-commerce. ### 2.15 Knowledge Management in the E-Commerce Era Knowledge management is crucial for organisations to prosper in the age of e-commerce. The act of gathering, compiling, and distributing knowledge inside a company in order to enhance decision-making and spur innovation is referred to as knowledge management. Knowledge management is essential for firms to remain competitive and react to the continuously shifting market environment in the context of e-commerce. Some of the most important elements of knowledge management in the e-commerce era are as follows: 1. **Data management:** To collect, store, and analyse the massive volumes of data generated by e-commerce, firms need to put in place efficient data management systems. Businesses may increase customer satisfaction and personalise the customer experience by analysing customer data to get insights into consumer behaviour, preferences, and needs. 2. **Collaboration:** In the age of e-commerce, collaboration is essential for successful knowledge management. Businesses can exchange information and best practises with staff, resulting in better decision-making and creativity. 3. **Continuous Learning:** In the era of e-commerce, companies must continuously learn from and adjust to the shifting market conditions. Businesses can remain ahead of the competition and foster innovation by funding staff training and development. 4. **Customer Feedback:** Businesses may learn a lot from the opinions of their customers. Businesses may increase customer satisfaction and spur growth by asking for input from customers and using that feedback to improve their goods and services. 5. **Technology:** In the age of e-commerce, technology is essential to knowledge management. Businesses may automate procedures, enhance decision-making, and spur innovation by utilising technologies like artificial intelligence, machine learning, and data analytics. 6. **Knowledge Sharing:** In the age of e-commerce, knowledge sharing is crucial for efficient knowledge management. Businesses may enhance collaboration, decision-making, and creativity by fostering a culture of information sharing and giving staff the tools and resources to do so. In general, knowledge management is crucial to a company's success in the e-commerce age. Businesses may improve decision-making, foster innovation, and stay one step ahead of the competition by utilising data, fostering collaboration, investing in continuous learning, requesting customer input, utilising technology, and supporting knowledge sharing. ### 2.16 Knowledge Management Process Any enterprise can use the knowledge management process. The tools and procedures utilised can occasionally be specific to the organisational environment. Six fundamental steps in the knowledge management process are supported by various technologies and methodologies. The data becomes knowledge when these stages are carried out in order. Let us understand the Knowledge Management Process with the help of Figure 2.4 - **Step 1: Gathering data:** The key phase in the knowledge management process is this one. It is possible that the knowledge you produce won't be the most accurate if you gather inaccurate or irrelevant facts. As a result, decisions that are based on such information may also be incorrect. The methods and resources used for data collection are numerous. Data collecting should be a step in the knowledge management process, to start. People involved in the data collection process should properly document and follow these procedures. - **Step 2: Planning:** The gathered data must be arranged. Typically, this organisation follows a set of rules. The organisation has established these guidelines. A database table could be used to record all staff-related data as well as all sales-related data, for instance. This kind of organisation aids in the accurate maintenance of data within a database. - **Step 3: Writing a summary:** The information is condensed at this step to get an essence of it. Enormous information is organised and stored properly before being presented in a tabular or graphical style. There are several instruments available for summarising, including software programmes, charts (Pareto, cause-and-effect), and various methodologies.