Thursday, 27 June 2019

what is e-commerce?

what is e-commerce

e-commerce


Our focus in this article is e-commerce—the use of the Internet, the World Wide Web (Web), and mobile apps and browsers running on mobile devices to transact business. Although the terms Internet and Web are often used interchangeably, they are actually two very different things. The Internet is a worldwide network of computer networks, and the Web is one of the Internet’s most popular services, providing access to billions of Web pages. An app (short-hand for application) is a software application. The term is typically used when referring to mobile applications, although it is also sometimes used to refer to desktop computer applications as well. A mobile browser is a version of Web browser software accessed via a mobile device. More formally, we focus on digitally enabled commercial transactions between and among organizations and individuals. Each of these components of our working definition of e-commerce is important. Digitally enabled transactions include all transactions mediated by digital technology. For the most part, this means transactions that occur over the Internet, the Web, and/or via mobile devices. Commercial transactions involve the exchange of value (e.g., money) across organizational or individual boundaries in return for products and services. Exchange of value is important for understanding the limits of e-commerce. Without an exchange of value, no commerce occurs. The professional literature sometimes refers to e-commerce as digital commerce. For our purposes, we consider e-commerce and digital commerce to be synonymous.


THE DIFFERENCE BETWEEN E-COMMERCE AND E-BUSINESS

There is a debate about the meaning and limitations of both e-commerce and e-business. Some argue that e-commerce encompasses the entire world of electronically based organizational activities that support a firm’s market exchanges—including a firm’s entire information system’s infrastructure (Rayport and Jaworski, 2003). Others argue, on the other hand, that e-business encompasses the entire world of internal and external electronically based activities, including e-commerce (Kalakota and Robinson, 2003). We think it is important to make a working distinction between e-commerce and e-business because we believe they refer to different phenomena. E-commerce is not “anything digital” that a firm does. For purposes of this text, we will use the term e‑business to refer primarily to the digital enabling of transactions and processes within a firm, involving information systems under the control of the firm. For the most part, in our view, e-business does not include commercial transactions involving an exchange of value across organizational boundaries. For example, a company’s online inventory control mechanisms are a component of e-business, but such internal processes do not directly generate revenue for the firm from outside businesses or consumers, as e-commerce, by definition, does. It is true, however, that a firm’s e-business infrastructure provides support for online e-commerce exchanges; the same infrastructure and skill sets are involved in both e-business and e-commerce. E-commerce and e-business systems blur together at the business firm boundary, at the point where internal business systems link up with suppliers or customers (see Figure 1.1).E-business applications turn into e-commerce precisely when an exchange of value occurs (see Mesenbourg, U.S. Department of Commerce, 2001, for a similar view).

e-commerce

E-commerce primarily involves transactions that cross-firm boundaries. E-business primarily involves the application of digital technologies to business processes within the firm.

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