E-Commerce Introduction PDF

**INTRODUCTION TO E-- COMMERCE** **electronic commerce (e-commerce)** remains a relatively new, emerging and constantly changing area of business management and information technology. 'Electronic commerce is sharing business information, maintaining business relationships and conducting business t...

**INTRODUCTION TO E-- COMMERCE** **electronic commerce (e-commerce)** remains a relatively new, emerging and constantly changing area of business management and information technology. 'Electronic commerce is sharing business information, maintaining business relationships and conducting business transactions by means of telecommunications networks. electronic commerce has existed for over 40 years, originating from the electronic transmission of messages during the Berlin airlift in 1948. From this, **electronic data interchange (EDI)** was the next stage of e-commerce development. **EDI** is the electronic transfer of a standardized business transaction between a sender and receiver computer, over some kind of private network or value-added network (VAN). Both sides would have to have the same application software and the data would be exchanged in an extremely rigorous format. In sectors such as retail, automotive, defense and heavy manufacturing, EDI was developed to integrate information across larger parts of an organization's value chain from design to maintenance so that manufacturers could share information with designers, maintenance and other partners and stakeholders.EDI system was very expensive to run mainly because of the high cost of the private networks. **With the advent of the Internet, the term e-commerce began to include:** - Electronic trading of physical goods and of intangibles such as information. - All the steps involved in trade, such as on-line marketing, ordering payment and support for delivery. - The electronic provision of services such as after sales support or on-line legal advice. **Some of the definitions of e-commerce often heard and found in publications and the media are:** ▪ Electronic Commerce (EC) is where business transactions take place via telecommunications networks, especially the Internet.▪ Electronic commerce describes the buying and selling of products, services, and information via computer networks including the Internet.▪ Electronic commerce is about doing business electronically.▪ E-commerce, ecommerce, or electronic commerce is defined as the conduct of a financial transaction by electronic means. **E-commerce or Electronic commerce is a process of buying, selling, transferring, or exchanging products, services, and information via electronic networks and computers.** E-Commerce is, comes from the so-called 5-C-model (Zwass 2014). It defines E-Commerce by five activity domains whose denominationsstart with the letter "C":**1. Commerce**: there is a matching of customers and suppliers, an establishing of the transaction terms, and the facilitation of exchange transactions. With the broad move to the Web-enabled enterprise systems with relatively uniform capabilities as compared to the legacy systems, a universal supply-chain linkage has been created. **2. Collaboration**: The Web is a vast nexus, or network, of relationships among firms and individuals. More or less formal collaborations are created or emerge on the Web to bring together individuals engaged in knowledge work in a manner that limits the constraints of space, time, national boundaries, and organizational affiliation.**3. Communication**: As an interactive medium, the Web has given rise to a multiplicity of media products.This universal medium has become a forum for self-expression (as in blogs) and self-presentation.The rapidly growing M-Commerce enables connectivity in context, with location-sensitive products and advertising **4. Connection**: Common software development platforms, many of them in the open-source domain, enable a wide spectrum of firms to avail themselves of the benefits of the already developed software, which is, moreover, compatible with that of their trading and collaborating partners.The Internet, as a network of networks that is easy to join and out of which it is relatively easy to carve out virtual private networks, is the universal telecommunications network, now widely expanding in the mobile domain.**5. Computation**: Internet infrastructure enables large-scale sharing of computational and storage resources, thus leading to the implementation of the decades-old idea of utility computing **E-BUSINESS (electronic business)** One of the first to use the term was IBM, in October 1997, when it launched a campaign built around e-business. ▪ E-business is the conduct of business on the Internet, not only buying and selling but also servicing customers and collaborating with business partners.▪ E-business includes customer service (e-service) and intra-business tasks. ▪ E-business is the transformation of key business processes through the use of Internet technologies. An e-business is a company that can adapt to constant and continual change.▪ The development of intranet and extranet is part of e-business.▪ E-business is everything to do with back-end systems in an organization. electronic commerce can be broadly defined as the exchange of merchandise (whether tangible or intangible) on a large scale between different countries using an electronic medium -- namely the Internet. The implications of this are that e-commerce incorporates a whole socio-economic, telecommunications technology and commercial infrastructure at the macro-environmental level. Business, on the other hand, is defined as 'a commercial enterprise as a going concern'. E-business can broadly be defined as the processes or areas involved in the running and operation of an organization that are electronic or digital in nature. These include direct business activities such as marketing, sales and human resource management but also indirect activities such as business process re-engineering and change management, which impact on the improvement in efficiency and integration of business processes and activities. **KEY DRIVERS OF E-COMMERCE** these key drivers can be measured by a number of criteria that can highlight the stages of advancement of e-commerce in each of the respective countries **1 Technological factors** -- The degree of advancement of the telecommunications infrastructure which provides access to the new technology for business and consumers. **2 Political factors** -- including the role of government in creating government legislation, initiatives and funding to support the use and development of e-commerce and information technology. **3 Social factors** -- incorporating the level and advancement in IT education and training which will enable both potential buyers and the workforce to understand and use the new technology. **4 Economic factors** -- including the general wealth and commercial health of the nation and the elements that contribute to it. **key drivers of e-business are also identified.** **1.Organizational culture** -- attitudes to research and development (R&D); its willingness to innovate and use technology to achieve objectives.**2.Commercial benefits** -- in terms of cost savings and improved efficiency that impact on the financial performance of the firm.**3. Skilled and committed workforce** -- that understands, is willing and able to implement new technologies and processes.**4. Requirements of customers and suppliers** -- in terms of product and service demand and supply.**5. Competition** -- ensuring the organization stays ahead of or at least keeps up with competitors and industry leaders**.** **e-business and e-commerce impact on many areas of business and disciplines of business management studies. For example:Marketing** -- issues of on-line advertising, marketing strategies and consumer behavior and cultures. One of the areas in which it impacts particularly is direct marketing. **Computer Sciences** -- development of different network and computing technologies and languages to support e-commerce and e-business. **Finance and Accounting** -- on-line banking; issues of transaction costs; accounting and auditing implications where 'intangible' assets and human capital must be tangibly valued in an increasingly knowledge-based economy. **Economics** -- the impact of e-commerce on local and global economies; understanding the concepts of a digital and knowledge-based economy and how this fit into economic theory.**Production and operations management** -- the impact of on-line processing has led to reduced cycle times. It takes seconds to deliver digitized products and services electronically; similarly, the time for processing orders can be reduced by more than 90 per cent from days to minutes. **Production and operations management (manufacturing)** -- moving from mass production to demand-driven, mass customization customer pull rather than the manufacturer push of the past. **Management information systems** -- analysis, design and implementation of e-business systems within an organization; issues of integration of front-end and back-end systems. **Human resource management** -- issues of on-line recruiting, home working and 'intrapreneurs' working on a project by project basis replacing permanent employees.**Business law and ethics** -- the different legal and ethical issues that have arisen as a result of a global 'virtual' market. Issues such as copyright laws, privacy of customer information, legality of electronic contracts, etc **What are the Benefits of E-commerce?** **Benefits of e-commerce to organizations:** **International marketplace.** By becoming e-commerce enabled, businesses now have access to people all around the world. In effect all e-commerce businesses have become virtual multinational corporations. **Operational cost savings.** The cost of creating, processing, distributing, storing and retrieving paper-based information has decreased.**Mass customization.** E-commerce has revolutionized the way consumers buy goods and services. The pull-type processing allows for products and services to be customized to the customer's requirements. **Enables reduced inventories and overheads** by facilitating 'pull'-type sup-ply chain management -- this is based on collecting the customer order and then delivering through JIT (just-in-time) manufacturing. **Lower telecommunications cost.** The Internet is much cheaper than value added networks (VANs) **Digitization of products and processes.** Particularly in the case of software and music/video products, which can be downloaded or e-mailed directly to customers via the Internet in digital or electronic format. **Benefits of e-commerce to consumers:24/7 access.** Enables customers to shop or conduct other transactions 24 hours a day, all year round from almost any location **More choices** **Price comparisons.** Customers can 'shop' around the world and conduct comparisons either Directly by visiting different sites, or by visiting a single site where prices are aggregated from a number of providers and compared **Improved delivery processes**. immediate delivery of digitized or Electronic goods such as software or audio-visual files by downloading via the Internet, to the on-line tracking of the progress of packages being delivered by mail or courier. **An environment of competition** where substantial discounts can be found or value added, as different retailers vie for customers. **Benefits of e-commerce to society:Enables more flexible working practices,** which enhances the quality of life for a whole host of people in society, enabling them to work from home. reduces environmental pollution as fewer people have travel to work regularly.**Connects people**. Enables people in developing countries and rural areas to enjoy and access products, services, information and other people which otherwise would not be so easily available to them. **Facilitates delivery of public service** **Limitations of E-commerce** **Limitations of e-commerce to organizations:Lack of sufficient system security, reliability, standards and communication protocols**. There are numerous reports of websites and databases being hacked into, and security holes in software. **Rapidly evolving and changing technology,** so there is always a feeling of trying to 'catch up' and not be left behind.**Under pressure to innovate and develop business models** to exploit the new opportunities which sometimes leads to strategies detrimental to the organization. **Facing increased competition from both national and international competitors** often leads to price wars and subsequent unsustainable losses for the organization. **Problems with compatibility of older and 'newer' technology.** There are problems where older business systems cannot communicate with web-based and Internet infrastructures, leading to some organizations running almost two independent systems where data cannot be shared. **Limitations of e-commerce to consumers** **Computing equipment is needed for individuals to participate in the new 'digital' economy,** which means an initial capital cost to customers.**A basic technical knowledge** is required of both computing equipment and navigation of the Internet and the World Wide Web.**Cost of access to the Internet,** whether dial-up or broadband tariffs.**Cost of computing equipment.** Not just the initial cost of buying equip-ment but making sure that the technology is updated regularly to be compatible with the changing requirement of theInternet, websites and applications. **Lack of security and privacy of personal data**. There is no real control of data that is collected over the Web or Internet. Data protection laws are not universal **Physical contact and relationships are replaced by electronic processes.** Cus-tomers are unable to touch and feel goods being sold on-line or gauge voices and reactions of human beings.**A lack of trust** because they are interacting with faceless computers. **Limitations of e-commerce to societyBreakdown in human interaction** **Social division** **Reliance on telecommunications infrastructure, power and IT skills,** **Wasted resources** **Facilitates Just-In-Time manufacturing.** **Difficulty in policing the Internet** **macro-environmental perspective** This framework, first developed by Kalakota and Whinston, Professors of Information Systems and prolific authors on the subject, takes a holistic view and identifies the different components of business and technology that make up e-commerce. Kalakota and Whinston use the analogy of a traditional transportation company to describe the complexity of the network and how the different components that make up the technology infrastructure are interlinked. The network infrastructure is like the network of roads that are inter-connected and are of different widths, lengths and quality -- for example, the Internet, local area networks, intranets. Network infrastructures also take different forms such as telephone wires, cables, wireless technology (such as satellite or cellular technology). The publishing infrastructure (including the World Wide Web, Web servers) can be seen as the infrastructure of vehicles and warehouses, which store and transport electronic data and multimedia content along the network. Multimedia content is created using myriad tools such as HTML and JAVA. Messaging and information distribution infrastructure are the engines and fuel, which transport the data around the network. Once content and data can be created, displayed and transmitted, supporting business services are necessary for facilitating the buying, selling and other transactions safely and reliably. The next components which facilitate and enable e-commerce and which are built on the foundations of technology are: - Public policy, regulations and laws. - Universal agreement of technical standards dictates the format in which electronic data is transferred over networks and is received across user interfaces, and the format in which it is stored. - The interaction of people and organizations to manage and coordinate the applications, infrastructures and businesses are all necessary to make e-commerce work. **Business-to-Government (B-to-G)** The exchange of information, services and products between business organizations and government agencies on-line **Business-to-Peer Networks (B-to-P)** This would be the provision of hardware, software or other services to the peer networks. **Consumer-to-Business (C-to-B)** This is the exchange of products, information or services from individuals to business. A classic example of this would be individuals selling their services to businesses. **Consumer-to-Consumer (C-to-C)** In this category consumers interact directly with other consumers. They exchange information such as: ❖ Expert knowledge where one person asks a question about anything and gets an e-mail reply from the community of other individuals. ❖ Opinions about companies and products. **Consumer-to-Government (C-to-G)** Examples where consumers provide ser-vices to government have yet to be implemented. See Government-to-Business.**Consumer-to-Peer Networks (C-to-P)** This is exactly part of what peer-to-peer networking is and so is a slightly redundant distinction since consumers offer their computing facilities once they are on the peer network.**Government-to-Business (G-to-B)** Also known as e-government, is the exchange of information, services and products between government agencies and business organizations. **Government-to-Consumer (G-to-B)** (Also known as e-government). Government sites offering information, forms and facilities to conduct transactions for individuals, including paying bills and submitting official forms on-line such as tax returns. **Government-to-Government (G-to-G)** (Also known as e-government). Government-to-government transactions within countries linking local governments together and also international governments **Government-to-Peer Network (G-to-P)** **Peer--to-Peer Network (P-to-P)** This is the communications model in which each party has the same capabilities and either party can initiate a communication session. **Peer Network-to-Consumer (P-to-C)** offering services to consumers network. This is in effect peer-to-peer networking, who are an integral part of the peer**Peer Network-to-Government (P-to-G)** This has not yet been used, but if it was, it would be used in a similar capacity to the P-to-B model, only with the government as the party accepting the transaction.**Peer Network-to-Business (P-to-B)** Peer-to-peer networking provides resources to business. **Degree of digitization** **Traditional e-commerce,** where products or services are physical, the process of the transaction is physical and the delivery agent is physical. **Pure e-commerce**, where products or services are digital, the process of the transaction is digital and the delivery agent is digital. **Partial e-commerce,** where either one or two of the dimensions are physical. **What are the Barriers to E-commerce?**1. The issue of cybersecurity2. Customer experience 3\. Maintaining customer loyalty 4\. Product returns and refunds\\ 5\. Online identity verification **IMPORTANT INFRASTRUCTURE DECISIONS** Every company requires an infrastructure to support its buyers and operations. This includes facilities, equipment, and processes to support all the functional areas of your business. Choosing the correct infrastructure to match your companies strategy enables your operations to run powerfully. Here are seven important infrastructure decisions that eCommerce businesses face. **1. Facilities** A key competitive advantage that eCommerce businesses have over brick-and-mortar stores is the lower investment in their physical offices and warehouses. In many cases, you can host your business out of a home office and your basement or garage. If you drop ship or outsource fulfillment, you may be able to do that for a long period of time. **2. Information Technology** Choosing the right eCommerce solution is one of the most important decisions you will make in your business. Information technology enhances infrastructure decisions by enabling data analysis, smart technology integration, improved communication, risk management, and project efficiency. It supports informed decision-making and optimizes planning, resource use, and security in critical infrastructure projects. **3.Human Resources** Many small-business owners avoid the human resources to keep costs low. Recruiting, setting up compensation, maintaining compliance and other HR activities are costly, specialized and time-consuming. You may choose to bring the resources in-house to manage those activities. **4.Customer Service** There are many choices today for delivering high-quality customer service. You can manage those activities in-house or outsource them to a third party. **5. Fulfillment** Another key decision is whether you will manage your own inventory or outsource those activities to a fulfillment house or through drop shipping arrangements with your suppliers. Managing your own inventory will provide you with a high level of control. **6. Finance and Administration** As with other business operations you will need to decide if you want to manage your finance and administration activities in-house, outsource, or a hybrid of the two. **7.Marketing** All of the infrastructure elements, marketing may be the most important. To succeed, your ShopFactory online shop must be found. Once visitors are on your site, you need to keep them there find ways of compelling them to buy from you. That's the job of your marketing team. Whether it is shop design, social media, search marketing, merchandising, email, or other forms of advertising - it\'s all about marketing. To effectively manage marketing activities in-house is very challenging. **BUILD AN E-COMMERCE WEBSITE** For an e-commerce business, your website is a virtual storefront for your customers. Just like a store you\'d visit in real life; your e-commerce website should reflect the tone and voice of your brand. You\'ll want to make sure the user experience is intuitive. A website displays your product offering and brand identity, linking to social media and digital content to boost sales. **How to build an e-commerce website** From entering your site to purchasing items, your customer's e-commerce experience should be enjoyable and seamless. Here\'s a step-by-step guide on how to build a website. **1. Define your e-commerce business model.** Consider your business. Perhaps you're pivoting from a brick-and-mortar store. What do you sell? Who is your target market? Begin by defining your business model: Business-to-customer (B2C): The most common model, in which a business sells products or services directly to consumers. Business-to-business (B2B): Businesses sell products or services to other businesses. Customer-to-customer (C2C): Online marketplaces that connect consumers to exchange and sell goods or services. Customer-to-business (C2B): Individuals sell their goods or services to companies. Direct-to-consumer (D2C): Sell your own products directly to customers, without the help of wholesalers or retailers. Drop shipping: Set up a storefront (website) so customers can pay by credit card or PayPal, sourcing from a supplier that manages inventory and packaging. Drop ship businesses are quick and inexpensive to start. Wholesaling: Purchase products in bulk at a discounted rate from a retailer. White label: Put your name and brand on a generic product that you purchase from a distributor. Private label: Hire a manufacturer to create a product to be sold exclusively by you. Subscription: Deliver products, such as pet food or fresh vegetable boxes, on a monthly or weekly basis to loyal customers who prioritize convenience. **2. Choose an e-commerce platform.** Next, you\'ll want to choose an e-commerce platform to host your website. Here are three popular e-commerce website builders to consider: Shopify: Shopify is the most popular software-as-a-service (SaaS) platform because it\'s robust and easy to use. Wix: As a website builder, Wix has an easy drag-and-drop method that offers many customizable templates and design features. To use it as an e-commerce platform, you\'ll need to upgrade to a paid plan. BigCommerce: This e-commerce platform is used by enterprise-level software companies, offering plenty of customization to suit your needs. It also enables powerful features such as SEO tools and international selling. **3. Start customizing your website.** Now, choose a template for your website. Different template styles, colors, and font styles will change your customer\'s experience of the website, so keep this in mind as you design your site. You may want to hire a web developer or graphic designer to build your site to get the most professional aesthetic and functionality, though this often costs much more than building a site yourself. Consider including these elements in your roadmap: Homepage (what customers will see first) Category pages, including a product page for browsing and selecting Shopping cart and checkout pages About us (who you are, what you sell, your brand's mission) Contact information Search engine within your site Email subscription form Legal information, such as terms and conditions and privacy policy **4. Set up your online store.** It's time to load your products onto the page. High-quality product photos and brand-consistent product descriptions will help your products stand out from the competition. If you have a broad offering, you may want to separate the page into product categories, such as by color, design, or product type. You may want to allow customers to sort or filter by price, new arrivals, or rating.Assuming you have your initial launch products ready, you'll want to prepare shipping and payment methods to ensure accurate and convenient customer service. Your inventory should match what's available on the website, and the payment method should be connected to your business bank account. You can easily set up a payment processor on sites like Shopify or with external add-ons like Square or Stripe. **5. Launch your website.** After you've finalized your website, it\'s ready to launch! Experiment with digital marketing to attract customers. Create social media platforms to post lifestyle images of your product or service. This is your chance to share with the world what you\'ve been creating. A launch promotion using sponsored posts or ads can help to boost your brand awareness and penetrate your target audience. **ECOMMERCE SELLING STATISTICS** In the ever-evolving world of retail, e-commerce has become a dominant force. The shift towards online shopping has transformed how businesses reach consumers and how people buy products. Understanding e-commerce selling statistics is crucial for grasping the scope of this change. These figures highlight the rapid growth of online transactions, the rise of mobile payments, and the influence of social commerce. As digital platforms continue to reshape the retail landscape, these statistics provide valuable insights into current trends and future directions in e-commerce. COVID-19 PANDEMIC STATISTICS Ecommerce sales exploded during the 2020's pandemic. With most people spending more time at home, online shopping became a common pastime around the world. Ecommerce soared to new heights for both consumers and businesses as millions of people spent more time online during COVID-19.1. FROM PHYSICAL SHOPS TO ONLINE SHOPS: In recent years, there has been a major shift from physical stores to online shops. More people are buying products online than ever before. For instance, around 2.64 billion people globally are now shopping online, which makes up more than a third of the world\'s population. This significant increase shows how e-commerce is becoming a central part of the retail experience.2. THE BOOM OF MOBILE PAYMENT: With the surge in online shopping, mobile payments---where you pay using your smartphone---have also become much more popular. The number of people using mobile payments has grown by 22% annually since 2020. 3\. SOCIAL MEDIA PUSHED SALE: Social commerce, which involves selling directly through social media platforms like Facebook and Instagram, has been rapidly growing. In 2020, social commerce made up 3.4% of all online retail sales. This segment is expected to grow significantly, from \$492 billion in 2021 to \$1.2 trillion by 2025. ECOMMERCE TREND STATISTICSMOBILE ECOMMERCE Over 90% of shoppers say that their experience on mobile ecommerce could be better. Clearly, the vast majority of online shoppers say that there is huge room for the mobile ecommerce world to improve. The 2 biggest issues that people say are hindering their experience with mobile shopping are: Links/buttons that are too small to clickSecurity -- people don't feel their info are "safe"People need to feel comfortable that their data is protected in order to shop online without worry. But despite that, experts predict that they will be 199.50 million mobile shoppers in the United States by 2026. DIGITAL PAYMENT Digital payments are becoming increasingly popular. Many people appreciate the convenience of buying products and services online without needing to physically use their card. Currently, 49% of people around the world frequently use digital payments for their online shopping and purchases.CONSUMER BEHAVIOUR As ecommerce becomes the normal way to shop, there is an expectation that products should come with free shipping. But there are lots of other reasons to shop online too. If you are an ecommerce store looking to increase sales, pay attention to the following ecommerce statistics. These are the top reasons why people choose to shop online today: SOCIAL MEDIA & INFLUENCERS In the US, most consumers will look at social media content when they want to compare two similar items. They want to hear the opinions of others to help them make buying decisions.While buying on social media is increasing as a trend, 57% of people still prefer to complete their transactions through the online retailer's site. Just 18.7% of people completed the transaction through the social media app. These numbers are expected to change significantly over the next 3 years. ECOMMERCE STATISTICS BY COUNTRY E-commerce selling statistics by country reveal significant differences in how online retail is developing around the world. ECOMMERCE STATISTICS BY INDUSTRYFASHION Fashion is one of the top ecommerce markets. It's expected that the average online shopper will spend \$921 on fashion-related items in 2022. Fashion isn't just a stable ecommerce sector -- it's one of the fastest-growing sectors. Ecommerce clothing and apparel growth rates between 2017 and 2021 were:8.1% in the United States, 8.7% in Europe, 14.1% in China BEAUTY & PERSONAL CARE Beauty and personal care is another hugely popular industry for online ecommerce. And it's only going to get bigger. The beauty and personal care online market is predicted to increase by 48% by 2023. ENTERTAINMENT Online purchases for entertainment are predicted to grow significantly over the next 5+ years.Allied Market Research estimated the value of online entertainment to be \$183 billion in 2019. By 2027, they say it is estimated to reach \$652.5 billion. HOUSEHOLD GOODS DIY home projects grew in popularity during the pandemic. So it makes sense that the tools and products needed to complete those projects did too. Home repair tools and online equipment retailers saw an 8% growth rate in sales in 2020.The outdoor home landscape niche also saw decent growth. In 2020, outdoor living furnishings and gardening equipment sales grew by 9%. ECOMMERCE MARKET LEADER STATISTICSECOMMERCE PLATFORMS Ecommerce platforms provide solutions for anyone to set up an online store and start selling products.Shopify- 79% of all Shopify traffic comes from mobile devices and their mobile experience is one of the best of any ecommerce platform in the world. Shopify also has a huge app store. ECOMMERCE MARKETPLACE All of the ecommerce platform statistics might seem pretty big. But they are tiny compared to the huge ecommerce marketplaces that dominate the online shopping world. Here is a table of the most visited ecommerce stores by monthly traffic: **Why create an E-commerce website?** E-commerce websites have revolutionized the way we think about retail and commerce. At this core commerce or electronic commerce refers to the buying and selling of goods and services using the internet. E-commerce sale is not just trend its and integral part of modern business practice when you shop online youre participating in E-commerce. Digital market place, AKA ecommerce websites allows consumers and businesses to interact in virtual space providing convenience and accessibility with just a few clicks you can purchase an item from half way across the world, a testament to the power and reach of e-commerce websites. **Tips for an outstanding e-commerce website design**. 1\. Keep it simple: One of the top rules you should keep in mind during the ecommerce design process is "KISS"---keep it simple, silly!2. Make branding a priority: When it comes to shopping online, people want to buy from established brands---not faceless ecommerce sites that look like a front for trying to steal your credit card information.3. Think like a website visitor: If you want your ecommerce website design to connect with your audience, you need to think like your audience. Ultimately, there are just a few things your potential customers want in an ecommerce experience---a site that's easy to navigate, well-designed, and makes the process of shopping easy, straightforward, and hassle-free.4. Use color to your advantage: Choosing the colors for your ecommerce site is about more than just saying "Well, red is my favorite color, so...let's make all the things red!" Color is an extremely powerful tool---and if you understand the psychology behind color, you can use it to your advantage (and drive some serious sales in the process).5. Use high-quality: images In the world of web design, it's common knowledge that images increase conversions (for example, one recent case study showed that incorporating more relevant images into a website design increased conversions by over 40%). And that's even more true when it comes to ecommerce. 6\. Make your content scannable: You can spend days crafting long descriptions for the products onyour ecommerce site, but we've got news for you---no one is going to read it.7. Make it look professional: The basis of an ecommerce site is that you are asking your website visitors to purchase something from you. And, as a result, you're asking them to turn over sensitive information, like their credit card information. Which they're not going to feel comfortable doing if your website doesn't look profesh. 8\. Use social proof: Another way to build that oh-so-important trust? Social proof.9. Make categories easy to navigate: Nothing---and we mean nothing---will kill a sale faster than clunky product pages. If your website visitors have to click around ten different menus before they find the product they're looking for, they're going to hightail it out of there fast---and click their way right to a competitor's site.10. Make checkout a breeze: Remember how we said nothing kills a sale faster than clunky product pages? Well, a clunky checkout is definitely a close second. 11.) Make it responsive: Making a website responsive means creating a design that automatically adjusts to provide an optimal viewing experience across a wide range of devices, from large desktop monitors to small smartphones. This involves using fluid grid layouts, where elements resize proportionally rather than at fixed dimensions, ensuring content remains accessible and visually appealing on any screen size 12.) Use the right Platform: Selecting the right platform for your e-commerce website is essential for ensuring that your site functions effectively and grows with your business. The ideal platform should offer the necessary features, such as product management, payment processing, and inventory control, tailored to your specific needs. Choosing the right e-commerce platform ensures a seamless user experience, efficient site management, and the flexibility to support your business's growth 13.) Have Empathy: Having empathy in e-commerce design means understanding and addressing the needs, preferences, and pain points of your users. It involves creating a user experience that feels personalized and considerate. For instance, ensuring the website is accessible to users with disabilities, providing clear navigation, and offering responsive customer support demonstrates empathy 14.) Accessible Design: Accessible design in e-commerce is essential for ensuring that all users, including those with disabilities, can effectively navigate, interact with, and benefit from your website. Prioritizing accessible design not only meets legal and ethical standards but also broadens your audience, improves user satisfaction, and strengthens your brand's reputation by demonstrating a commitment to inclusivity.15.) Customer Reviews and Ratings: Incorporating customer reviews and ratings effectively into your e-commerce website design is essential for building trust and driving conversions. To achieve this, place reviews and ratings prominently on product pages, ensuring they are easily visible to potential buyers. Provide detailed review sections where users can read individual reviews, view ratings, and see user-generated photos or videos for added authenticity. 16.) Analytics and tracking: A vital components of outstanding e-commerce website design because they provide insights into user behavior and site performance, enabling data-driven decisions to enhance the user experience and drive business growth. Integrating robust analytics tools allows you to monitor key metrics such as traffic sources, conversion rates, bounce rates, and average order values. 17.) SEO optimization: It is essential for an outstanding e-commerce website design as it enhances visibility in search engine results and drives organic traffic. 18.) Personalization: Personalization in e-commerce involves tailoring the shopping experience to individual users based on their behavior, preferences, and characteristics. By analyzing data such as browsing history, previous purchases, and demographic information, businesses can deliver customized product recommendations, personalized promotions, and relevant content that align with each user's interests. 19.) Clear Calls to Action (CTAs): For outstanding e-commerce website design, incorporating clear calls to action (CTAs) is crucial. To ensure effectiveness, use action-oriented language that directly tells users what to do, such as "Buy Now" or "Sign Up for 10% Off." Make CTAs visually distinct by employing contrasting colors and prominent placement so they stand out from other elements on the page. 20.) Fast load times: Outstanding e-commerce website design, ensuring fast load times is crucial for a positive user experience. To achieve this, start by optimizing images through compression and resizing while using modern formats like WebP for better efficiency. **ONLINE SECURITY AND PAYMENT SYSTEM** Securing online payments relies on various essential measures: **1. Encryption [[Technology]](https://sabpaisa.in/blog/leverage-technology-for-e-commerce-operations/)** To ensure online payment security, encryption is vital. This technology transforms sensitive information like credit card numbers into unreadable code during transmission, stopping unauthorized access by hackers. **2. SSL and TLS Protocols** SSL (Secure Sockets Layer) and its successor, TLS (Transport Layer Security), establish secure communication channels between usersweb browsers and website servers. This secure connection is crucial for safeguarding data during online transactions. SSL encryption ensures that your data is transmitted securely between your device and the payment platform, while secure payment gateways add an extra layer of protection. **3. Tokenisation** Involving the replacement of sensitive data with unique tokens, tokenisation enhances the security of stored payment information. Even if a hacker intercepts the token, it doesnt remain very sensible without the corresponding decryption key. **4. Two-Factor Authentication (2FA)** Adding an extra layer of security, 2FA mandates users to provide two forms of identification before completing a transaction. This often involves a password and a temporary code sent to a mobile device. **5. PCI DSS Compliance** Payment Card Industry Data Security Standard (PCI DSS) is a set of security standards designed to ensure that all companies that accept, process, store, or transmit credit card information maintain a secure environment. Adhering to industry standards like the Payment Card Industry Data Security Standard (PCI DSS) ensures that businesses meet specific security requirements in handling payment information. **6. Biometric Authentication** Biometric methods, such as fingerprint or facial recognition, add an extra layer of security by using unique physiological or behavioural characteristics to verify a users identity. This can be used in conjunction with other authentication methods. **7. Secure Payment Gateways** Acting as intermediaries between a merchants website and financial institutions, secure payment gateways ensure the secure transmission and storage of sensitive data. **8. Device Authentication** Device authentication can improve security by identifying and validating the device being used for the transaction. This could entail employing device-based authentication [[techniques]](https://sabpaisa.in/blog/which-blockchain-initiatives-are-taking-off-first-and-why/) or examining the devices distinctive features. **9. Regular Software Updates** Crucial for maintaining robust security, regular updates for software, including operating systems and payment processing applications, often include patches addressing vulnerabilities. **10.** **[[Fraud]](https://sabpaisa.in/blog/fraud-detection/) Detection and Prevention** Utilising advanced algorithms and machine learning, financial institutions and businesses can detect patterns indicative of fraudulent activities and take preventive measures. **11. Consumer Education** Enhancing overall online payment security involves educating users on safe practises, such as using strong passwords and avoiding public Wi-Fi for financial transactions. **12. Monitoring and Alerts** Real-time monitoring of transactions and implementing alerts for suspicious activities enable swift responses to potential security breaches. **Top 10 Payment Gateways in the Philippines** ---------------------------------------------- **1. PayPal:** PayPal is a global online payment system that allows users to send and receive money, make online purchases, and manage their finances. ------------------------------------------------------------------------------------------------------------------------------------------------------ **Features**: Known globally, PayPal offers robust security with anti-fraud technologies and buyer protection. Its user-friendly, making it ideal for startups. **Pricing**: 3.9% for domestic transactions; 4.4% for international transactions. **Supported Currencies**: 23 currencies, including PHP. **Approval Time**: 2-3 days. **eCommerce Integration**: Shopify, Magento 2, WooCommerce, Wix, Shopee. **2. Rapyd:** Rapyd is a global Fintech company that specializes in simplifying digital payments for businesses, particularly those operating in the e-commerce and technology sectors. --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- **Features**: Rapyd simplifies digital payments for global technology firms and e-commerce businesses. **Pricing**: 3.25% per transaction. **Supported Currencies**: Over 103 currencies, including PHP. **Approval Time**: Up to 30 days. **eCommerce Integration**: Shopify, Magento, Wix, WooCommerce, Ecwid, Prestashop. **3. DragonPay:** DragonPay is a leading online payment gateway in the Philippines, providing secure and convenient payment solutions for businesses and individuals. --------------------------------------------------------------------------------------------------------------------------------------------------------------------- **Features**: Offers a wide range of payment methods, including over-the-counter, online, and cash payments. **Pricing**: PHP 10 to PHP 20 per transaction. **Supported Currencies**: Around 20 international currencies. **Approval Time**: 2 working days. **eCommerce Integration**: EasyBuilder.Pro, AVON, Shopee, MetroDeal. **4. PayMongo:** PayMongo is a Philippine-based payment gateway that empowers businesses to accept online payments and build seamless payment experiences. It offers a robust suite of tools and features designed to simplify and streamline the payment process for both businesses and customers. ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- **Features**: Ideal for online sellers, PayMongo charges no setup or monthly fees and supports multiple payment methods. **Pricing**: 3.5% for credit/debit cards; 2.9% for eWallets. **Supported Currencies**: PHP. **Approval Time**: 7 working days. **eCommerce Integration**: Shopify, Prosperna. **5. 2C2P:** 2C2P is a leading payment gateway and technology company in Southeast Asia, offering a comprehensive suite of payment solutions for businesses of all sizes. ------------------------------------------------------------------------------------------------------------------------------------------------------------------------- **Features**: A Singapore-based payment platform providing global payment processing. **Pricing**: 3.75% to 4.20% per transaction. **Supported Currencies**: 45 currencies worldwide. **Approval Time**: 2 working days. **eCommerce Integration**: Shopify, WooCommerce, Magento, PrestaShop, OpenCart. **6. PesoPay:** PesoPay is a leading online payment gateway system in the Philippines, providing seamless electronic payment solutions for businesses of all sizes, from SMEs to large enterprises. **Features**: Provides secure online payment solutions with advanced fraud management. **Pricing**: Annual setup fees based on received payments. **Supported Currencies**: PHP. **Approval Time**: 7 business days. **eCommerce Integration**: EasyStore, Magento, OsCommerce, LiteCommerce, Drupal. **7. dLocal:** dLocal is a leading global payments platform specializing in facilitating seamless transactions for businesses entering emerging markets across Africa, Asia, and Latin America. **Features**: Facilitates cross-border payments for global merchants. **Pricing**: 2.7% to 7% per transaction. **Supported Currencies**: 35 currencies globally. **Approval Time**: 2 business days. **eCommerce Integration**: Shopify, Magento, Drupal. **8. PayMAya:** PayMaya, now known as Maya, is a Filipino financial services and digital payments company based in Metro Manila, Philippines. It was launched in December 2000 as Smart Money, powered by Smart E-Money, Inc., in cooperation with 1st E-Bank (formerly PDCP Bank; now BDO Unibank) and Mastercars. It was marketed as the world\'s first card linked to a wireless phone and was considered a major innovation in finance. **Features**: A leading fintech company in the Philippines, providing a wide range of digital payment solutions. **Pricing**: 1.5% to 3.5% per transaction. **Supported Currencies**: PHP. **Approval Time**: 1 to 2 working days. **eCommerce Integration**: Shopify, Magento, WooCommerce, Cafe24. **9. GCash:** GCash is a leading mobile payments platform in the Philippines, owned by Globe Fintech Innovations, Inc. and operated by its subsidiary, G-Xchange, Inc. It is a joint venture between Ant Group, Ayala Corporation, and Globe Group. GCash is more than just a mobile wallet; it\'s a comprehensive financial services platform offering features like sending and receiving money, paying bills, buying prepaid load, shopping online, investing, and taking out loans. **Features**: A popular e-wallet in the Philippines with millions of users and merchants. **Pricing**: PHP 15 for bank transfers; 2% for cash-ins. **Supported Currencies**: PHP. **Approval Time**: 30 minutes. **eCommerce Integration**: Shopee, Magento, WooCommerce. **10. Directa24** Directa24 is a fast-growing payment solution in emerging markets, offering a variety of payment methods, including cash payments, credit cards, online banking, and market-specific popular solutions. **Features**: A fast-growing gateway that supports various payment methods. **Pricing**: No administration fee. **Supported Currencies**: 26 currencies, including PHP. **Approval Time**: 3 to 5 working days. **eCommerce Integration**: Wix, Magento, Shopify. **CONSUMER PROTECTION LEGISLATION** **Republic Act no. 7394** Also known as \"The Consumer Act of the Philippines\" was enacted primarily to protect the consumers against hazards to health and safety , and against deceptive, unfair and unconscionable sales and practices. - BASIC NEEDS - to be guaranteed of survival, adequate food, clothing, shelter, health care, education, and sanitation. - SAFETY - to be protected against the marketing of goods or the provision of services that are hazardous to health and life. - REPRESENTATION - to express consumer interests in the making and execution of government policies. - REDRESS - to be compensated for misenterpretation, shoddy goods, or unsatisfactory services. - INFORMATION - to be protected against fraudulent/dishonest or misleading advertising labelling/promotion. To be provided the facts and information needed to make an informed choice. - CHOOSE - to choose products at competitive prices with an assurance of satisfactory quality. - CONSUMER EDUCATION - to acquire the knowledge and skills necessary to be an informed consumer. - HEALTHY ENVIRONMENT - to live and work in an environment which is neither threatening nor dangerous, and which permits a life of dignity and well-being. **WHAT IS AN E-COMMERCE BUSINESS?** An **E-commerce Business** is a company that generates revenue from selling products or services online, or uses the internet to pursue sales leads. It involves online transactions, where customers purchase products or services through digital platforms such as websites, mobile apps, or social media. This can range from small operations run by individuals to large corporations and this could include tangible items like apparel or housewares, or intangible services such as software and design. E-commerce businesses can operate in various formats, such as Business-to-Consumer (B2C), Business-to-Business (B2B), Consumer-to-Consumer (C2C), and even Consumer-to-Business (C2B). Examples of E-commerce Business **1.** **Amazon** -- A global online marketplace offering a wide variety of products, from books to electronics. Amazon operates primarily as a B2C (business-to-consumer) marketplace. However, it also has B2B (business-to-business) operations through its Amazon Business division. Amazon Prime is a membership service that offers perks such as free shipping, access to Amazon Prime Video, music streaming, and more. **2.** **eBay** -- An online auction and shopping website where people can buy and sell new or used goods. It operates on both a fixed-price and auction-based model, allowing for a wide range of pricing flexibility. **3. Shopify** -- An e-commerce platform that enables individuals or small businesses to create their own online stores. It offers a built-in payment gateway called Shopify Payments, but it integrates with many other payment providers as well. **4. Etsy** -- An online marketplace focusing on handmade, vintage items, and craft supplies. **5. Alibaba** -- A Chinese e-commerce platform connecting global suppliers with buyers. Alibaba primarily operates as a B2B platform, connecting manufacturers and wholesalers. However, it also has B2C and C2C platforms, such as AliExpress and Taobao. **Benefits of E-commerce Businesses** **1. Convenience:** Customers can shop 24/7 from any location with an internet connection, making it easier to browse and purchase products without visiting a physical store. **2. Global Reach:** E-commerce enables businesses to sell to customers around the world, reaching a much larger audience than a traditional brick-and-mortar store. E-commerce platforms often provide tools for language translation, currency conversion, and region-specific shipping, making it easier for businesses to operate globally. **3. Lower Operational Costs:** With no need for physical retail space, businesses save on rent, utilities, and in-store staffing costs. **4. Wider Payment Options:** E-commerce businesses offer multiple payment methods such as credit cards, digital wallets (PayPal, Apple Pay), and cryptocurrency, providing convenience to a broader range of customers. **5. Eco-Friendly Options:** Reduced need for physical stores and transportation can lower carbon footprints and support sustainability. **Limitations of E-commerce Businesses:** **1.Lack of Physical Interaction:** Customers can't physically touch, try, or inspect the products before buying, which can lead to dissatisfaction or higher return rates. **2. Shipping Delays and Costs:** Delivering physical products can take time, especially for international orders, and shipping costs can sometimes be a barrier for consumers. In some regions, delivery services may be unreliable. **3. Security:** This is one of the most common issues that many ecommerce leads businesses and customers face. This may lead to numerous fraudulent activities and threaten the business. **4. Competition:** The online market is highly competitive, with numerous businesses vying for the same customers. Also, online businesses often engage in price wars to attract customers, which can squeeze profit margins. **5. Dependence on Technology:** E-commerce businesses rely heavily on technology, which means any disruptions can impact operations. **LEGAL ISSUES OF E-COMMERCE** - **Complex Laws:** The rules for e-commerce can be complicated and diverse, which can lead to misunderstandings or rule-breaking. Businesses must navigate these laws carefully to avoid mistakes that could result in legal issues or penalties. - **Global Operations:** Operating globally means dealing with different laws and rules, which can be hard to follow. Businesses need to know and follow the laws in each country to stay legal and avoid problems or fines. - **Data Protection:** It's very important to obey strict privacy laws when handling customer information to avoid legal trouble. This means protecting personal data to stop unauthorized access or misuse, which could lead to fines and lawsuits. - **Intellectual Property:** It's crucial to protect trademarks, copyrights, and patents in online business to avoid being accused of copying. This keeps original ideas and creations safe from being used or copied without permission, which could cause legal problems. - **Consumer Rights:** It's really important to be honest and fair with customers to avoid legal problems under consumer protection laws. This means being clear about how you do business and treating customers fairly to prevent arguments about their rights when they buy things online. - **Contractual Agreements:** Confusing terms or breaking the rules in contracts, such as sales or service agreements, can lead to legal problems. This happens when agreements aren't clear or when one side doesn't do what they promised, which may require legal steps to fix problems in online transactions. - **Cybersecurity:** It's very important to prevent data breaches and cyberattacks. If you don't, it can cause legal issues and lawsuits. This means keeping sensitive information safe from unauthorized access or theft, following data protection laws, and reducing the chance of legal problems from breaches. - **Dispute Resolution:** Misunderstandings or disagreements between people can cause legal problems that need solving. These issues happen when people understand contracts or agreements in different ways. Legal help may be needed to fix these problems and make sure everything is clear in online transactions. **ACTS AND PROVISIONS RELATED TO LEGAL ISSUES** **1. Consumer Act of the Philippines (Republic Act No. 7394) :** This law protects consumers from unfair trade practices, including deceptive advertising and the sale of unsafe products. E-commerce platforms must ensure accurate product information, fair pricing, and proper warranties for goods sold online. **2. E-Commerce Act of 2000 (Republic Act No. 8792):** The primary legislation for e-commerce transactions in the Philippines. It grants legal recognition to electronic contracts and signatures, making them enforceable. It also includes provisions against cybercrimes, such as hacking and online fraud. **3. Data Privacy Act of 2012 (Republic Act No. 10173):** This law mandates businesses, including e-commerce platforms, to protect the personal data of users. It establishes guidelines on the collection, storage, and processing of personal information, and requires businesses to adopt adequate security measures to prevent data breaches. The National Privacy Commission enforces this law. **4. Cybercrime Prevention Act of 2012 (Republic Act No. 10175):** Defines and penalizes various forms of cybercrimes, such as hacking, identity theft, and online fraud, which are critical issues faced by e-commerce platforms. The law offers legal remedies for online crimes affecting both businesses and consumers. **5. National Internal Revenue Code (Tax Code) and BIR Regulations:** E-commerce businesses must comply with tax obligations under the National Internal Revenue Code, which includes registering with the Bureau of Internal Revenue (BIR), paying income tax, and collecting Value Added Tax (VAT) on goods and services sold online. The BIR\'s Revenue Memorandum Circular No. 55-2013 specifically addresses tax compliance for online businesses. **6. Intellectual Property Code of the Philippines (Republic Act No. 8293):** This law protects intellectual property, including copyrights, trademarks, and patents. E-commerce platforms must ensure that products sold do not infringe on intellectual property rights, and businesses can take legal action against infringers. **7. Electronic Commerce Guidelines (DTI Department Administrative Order No. 10, Series of 2010):** Issued by the Department of Trade and Industry (DTI), these guidelines provide rules for e-commerce businesses, including the requirement to provide accurate information about goods and services, terms of service, and clear pricing. They also ensure that e-commerce platforms have an effective dispute resolution process for consumer complaints. **8. Consumer Protection in Electronic Commerce (DTI Administrative Order No. 20-07, Series of 2020):** Provides additional protections to consumers in online transactions, requiring e-commerce platforms to provide accurate and complete product descriptions, secure payment mechanisms, and consumer support for addressing grievances. It also outlines penalties for non-compliance. **9. Anti-Cybercrime Laws (Special Provisions under RA 10175 and RA 10173):** These provisions address online fraud, phishing, unauthorized access, and other cybercrimes that e-commerce businesses may face. The Cybercrime Prevention Act complements the Data Privacy Act to ensure that personal and financial data are secure in online transactions. **10. Product Standards Law (Republic Act No. 4109):** This law enforces standards for products sold online, especially in categories such as food, electronics, and cosmetics. E-commerce businesses must ensure that their products meet safety standards before offering them for sale online. **LEGAL ISSUES FACED BY E-COMMERCE BUSINESSES** **1. Terms of Service/Policies**: If the terms of Service or Policies are not clear, then the business might face legal hurdles. Having a clear, lawful policy regarding the use of the site, purchases, returns/refunds, privacy practices, etc., helps in avoiding any future legal issues. Having well-drafted terms of services and policies acts as a contract with users and helps in preventing any future dispute. A **Terms and Conditions** agreement is a contract which spells out exactly what the legal relationship is between the store and the consumer. **2. Intellectual Property Infringement**: If someone uses the intellectual property of another company without the consent of that company, then the other company can claim damages in huge amounts for infringement. Hence, intellectual properties should be handled with care and protection such as Trademarks, Copyrights, Patents etc., to protect the brand assets and avoid infringing on others. **Intellectual property infringement** is a violation or breach that erodes, weakens, or damages intellectual property rights. As a result, a wide range of IP protections, such as trademarks, patents, copyright, and trade secrets, have been enshrined to ensure IPs aren't stolen or violated through illegal malfeasance. **Types of Intellectual Property Infringement** ***Patent Infringement*** ***Copyright Infringemen*** ***Trademark Infringement*** ***Trade secrets*** **3. Data Security and Privacy**: Most e-commerce platforms contain sensitive information of customers which is mostly collected via contact forms, through customer registrations. If the regulations regarding data protection are not followed, then it may cause data privacy concerns. Following regulations regarding securing sensitive user data stored on the systems helps to prevent cyber attacks and leaks. **Data privacy** or Information privacy revolves around the proper handling, processing, storage, and usage of personal information. the rights of individuals concerning their personal information. **Data security** is focused on protecting personal data from unauthorized third-party access, malicious attacks, and exploitation. It is set up to protect personal data using different methods and techniques to ensure data privacy. ensures the integrity of the data, meaning data is accurate, reliable, and available to authorized parties. **4. Tax Compliances**: Not complying with the prescribed rules and regulations might lead to serious legal implications. Hence, in order to avoid any legal tax implications, tax laws should be followed mandatorily. **Tax Compliance** refers to adhering to tax laws and regulations by correctly reporting income, expenses, and other financial details to the relevant tax authorities. It involves timely filing of tax returns and paying the correct amount of taxes. **5. Advertising/Marketing Regulations**: Unauthorized sellers cannot resell the products legally that differ from the original product. Every business must ensure truth in advertising claims, proper disclosures, CAN-SPAM compliance for emails, etc. Issues like fraud could lead to consumer class action suits. Adhering to safety standards, labelling and warning requirements to avoid injury lawsuits if selling physical goods. Hence, all the marketing regulations and laws should be strictly followed in order to avoid any legal issues related to the marketing procedure or products. **6. Accessibility**: E-commerce websites must be accessible to the customers in the most smoothest way. There should not be any complexities or disabilities while using the site, and all the laws must be followed before initiating any site. Violations of the laws could lead to enforcing lawsuits in some industries as well, giving rise to future legal hurdles. **7. Contract Management**: A contract is the most essential form of any business and is treated as a safeguard against any complication that arises. If the clauses in a contract have any ambiguity, in such cases, it becomes complex to handle disputes arising in business. A well-drafted contract without any confusion protects the interests of the business in case of disputes. **E-COMMERCE LEGISLATION IN THE PHILIPPINES** WHAT IS E-COMMERCE LEGISLATION? The laws, rules, and regulations that control online commercial transactions and activities. Establish standards for online businesses, including rules on electronic contracts, digital signatures, taxation, and intellectual property. 1\. **E-Commerce Act of 2000 (Republic Act No. 8792)** AN ACT PROVIDING FOR THE RECOGNITION AND USE OF ELECTRONIC COMMERCIAL AND NON-COMMERCIAL TRANSACTIONS AND DOCUMENTS, PENALTIES FOR UNLAWFUL USE THEREOF, AND FOR OTHER PURPOSES A Philippine law known as the E-Commerce Act of 2000 (Republic Act No. 8792) establishes the legal framework for performing electronic transactions within the nation. This law was passed on June 14, 2000, and it allows electronic documents, electronic signatures, and other digital transactions the same legal standing as traditional paper-based contracts and documents. It also acknowledges their validity and enforceability. In the Philippines, it aims to protect online company operations and promote e-commerce. 2\. **Data Privacy Act of 2012 (Republic Act No. 10173)** A Philippine law that seeks to protect the privacy of individuals' personal information by regulating the collection, handling, storage, and disposal of personal data. Enacted on August 15, 2012, it establishes the rights of individuals with respect to their personal data, and outlines the obligations of organizations that collect and process this data. The law applies to both government and private entities. 3\. **Cybercrime Prevention Act of 2012 (Republic Act No. 10175)** This law addresses various forms of cybercrime, including hacking, identity theft, and online fraud. It provides a legal framework for the investigation, prosecution, and prevention of cybercrimes. **Examples of cybercrimes in E-commerce Covered by the Act:** - **Computer-Related Fraud:** This involves manipulating data or systems to gain an unfair advantage or financial gain. may appear as altered payment information, fabricated transaction records, or manipulated pricing schemes. - **Illegal Access/Hacking:** Payment and personal information of customers is stored on e-commerce platforms together with other sensitive client data. Hackers might try to enter these systems without authorization in order to take data for malicious or personal use. Any attempt to gain unauthorized access to a computer system is referred to as illegal access. - **Data Interference:** When someone intentionally modifies, removes, or tampers with data in a way that interferes with e-commerce operations, this happens. - **Identity Theft and Phishing:** Users of e-commerce platforms might have their personal information stolen by cybercriminals, who can use it to pretend to be them or perpetrate fraud. Phishing is a popular identity theft technique in which cybercriminals send fake emails or set up fake websites in an attempt to deceive people into providing private information like bank account data, credit card numbers, or passwords. 4\. **Consumer Act of the Philippines (Republic Act No. 7394)** Enacted on April 13, 1992, is the primary legislation in the Philippines designed to protect the interests of consumers. It establishes the rights of consumers and the responsibilities of businesses in ensuring fair trade, product safety, and accurate information in the marketplace. The law aims to prevent exploitative and abusive practices by regulating product quality, advertising, warranties, and sales practices. It protect the rights of consumers, advancing their overall well-being, and establishing industry and commercial norms of behavior. Product safety, misleading advertising, price, warranties, and other significant areas pertaining to consumer transactions are just a few of the areas this legislation addresses when it comes to consumer rights and obligations. *Example of How the Consumer Act Protects E-commerce Consumers* **Warranties:** The product\'s warranty must be honored by the online seller. If the product is covered by an express warranty (such as a one-year warranty on defects), the seller is required to fix or replace it at no cost to the customer, or to offer a refund if the problem cannot be fixed. **Right to Redress:** In the event that a product is defective, the customer is entitled to file a complaint and pursue damages. The customer may submit a complaint with the DTI. **Product safety:** Selling things that are subpar or defective is against the Consumer Act. 5**. Electronic Payments and Financial Technology (EPFT) Law (Republic Act No. 11494)** part of the Bayanihan to Recover as One Act (also known as Bayanihan 2). Enacted in response to the COVID-19 pandemic, it focuses on promoting the use of electronic payments and financial technology to facilitate economic recovery and provide financial inclusion for more Filipinos. The law recognizes the critical role of digital finance and technology in the modern economy, especially during times of crisis. E-commerce platforms can now provide more payment choices, making it easier for customers to shop online, due to the law\'s support of electronic payments. Small and medium-sized businesses (SMEs) can reach a wider audience by using digital payments, particularly those who do not have access to traditional banking services. Businesses that use digital payment methods benefit from easier, more effective transactions. They can simplify accounting procedures, enhance cash flow management, and lower the danger of handling actual cash. REGULATORY BODIES: **National Privacy Commission (NPC)**: Responsible for enforcing data privacy laws and ensuring compliance among e-commerce businesses. **Department of Trade and Industry (DTI)**: Oversees consumer protection and fair trade practices in e-commerce. **National Bureau of Investigation (NBI) Cybercrime Division:** Handles investigations related to cybercrimes, including those affecting e-commerce. DIFFERENCE BETWEEN DATA PRIVACY AND DATA SECURITY Data privacy and data security are both critical concepts in managing and protecting information, but they focus on different aspects. Data privacy refers to the policies and practices governing how personal data is collected, used, and shared. It is centered on ensuring that individuals have control over their personal information and that it is handled in compliance with regulations like GDPR or HIPAA. Privacy is about who has access to data and how that access is managed. On the other hand, data security is concerned with protecting data from unauthorized access, breaches, or malicious attacks. It involves implementing technical measures such as encryption, firewalls, and secure authentication to safeguard the integrity and confidentiality of the data. Security ensures that the data is not compromised by external threats or internal misuse. DIFFERENCE BETWEEN IDENTITY THEFT AND PHISHING Identity theft and phishing are both forms of cybercrime, but they differ in their methods and goals: Identity theft occurs when someone unlawfully obtains and uses another person's personal information, such as Social Security numbers, credit card details, or bank account information, to commit fraud. The perpetrator typically uses this stolen information to make unauthorized purchases, open new accounts, or commit other financial crimes in the victim\'s name. The focus of identity theft is on exploiting personal information to impersonate the victim and gain financial or other benefits. Phishing, on the other hand, is a method used by cybercriminals to trick individuals into voluntarily providing sensitive information, such as passwords, credit card numbers, or login credentials. Phishing often occurs through fraudulent emails, websites, or text messages designed to look like they come from legitimate sources (e.g., banks or government agencies). The primary aim of phishing is to deceive victims into revealing their information, which can later be used for identity theft or other malicious activities. DIFFERENCE BETWEEN CONSUMER ACT AND E-COMMERCE ACT 1\. Consumer Act: This typically refers to general consumer protection laws that regulate traditional commerce, where consumers purchase goods or services in physical stores or through face-to-face interactions. These laws ensure that businesses provide safe products, honest advertising, fair contracts, and that consumers have rights to refunds, warranties, and redress in case of disputes. The Consumer Act applies to all forms of traditional business transactions and provides a legal framework for addressing consumer rights and business obligations. E-Consumer Act: This refers to specific regulations or extensions of consumer protection laws that focus on \*\*e-commerce\*\* or online transactions. The E-Consumer Act is designed to protect consumers in the digital marketplace, addressing issues such as data privacy, secure online payments, transparency in online advertising, and the rights of consumers when purchasing products or services over the internet. It also deals with the unique challenges of online fraud, misleading website practices, and dispute resolution in cross-border e-commerce.