E-commerce vs M-commerce - Essay Example

E-commerce Vs M-commerce: Even Before the World Catches up the full practice of E-commerce trade, the new buzz word M-Commerce started making its noise in the trading circles. While E-Commerce has gained the good market share in some of the sectors like online Movies, DVDs etc., M-Commerce also makes a status of its own business with particular type of selling. E-Commerce and M-commerce operates on different technologies and modes of contacting the customer, for a normal user, both the terms sounds similar in terms of general Utility. Still while maintaining the similarity of utility, E-commerce and M-commerce are diversified and can be stated a competitive applications of technology trends. If E-commerce and M-commerce matters for development, it is not because the are the fancier or more convenient ways of doing shopping: but they allows allow enterprises to operate efficiently with their trading partners including their production sites, vendors and point of sales. Thus the paper strives to examines the basic arguments between the two commercial applications with basing root cause analysis to elicit the factors that can support the growth of the industry. For an Internet user to become an e-commerce customer, a much higher frequency of access is necessary in order to acquire the familiarity with the e-business transactions and payment systems. This is more required for the B2B traders, where the order of magnitude of their exposure to Internet etiquette must be more than a normal user. Contradicting the above general assumption, a survey conducted by IDC in 2002 there is a gap found between the Internet users and e-commerce revenue in the developing and developed countries. This shows that the usage of Internet does not directly imply the e-business attitude. Where as, the M-Commerce does not necessarily require more adequacy of such involvement with the mobile devise or operating the m-commerce applications. The reason behind this could be attributed to the low involvement and less choice of options for the customer to choose between while buying something through mobile phone. In other terms, mobile commerce involves a quick decision for buying, by simply replying to the message alert for the sale offer or saying yes to the chosen option. The prevalence of E-commerce has led people to research and form the strategically options to push the sales through Internet in the recent years. Some researches stated that lower per capita incomes, low credit card usage, lack of relevant Products and service to buy in near places, and lack of logistics and fulfillments are the factors influencing the buying behaviors of the users on E-commerce. Though these should be the same factors influencing the buying behavior of the M-Commerce also, rather than clear evidence of that, one could perceive some thing else alarming that the above for the influence of M-Commerce buying patterns. E-commerce trading is more seen between B2B or Business to Government types of transactions than Business to Consumer. This adoption could be linked with their capacity to integrate themselves into regional and global supply chains. At the enterprise level, this requires being able to meet technological and organizational challenges. At the country level, the digital and the physical layers of the national economies have to be connected in congruence. Thus E-commerce opens more trading between different foreign countries. Where as M-commerce, due to the localized service operators, has the limitation of global restriction with the service options limited within the geographical regions. Beyond technological limitations, the logistics and Policy regulations are also the other factors for this shortage. May be the still future of M-commerce could resolve such type of hindrances in a very short future depending on the nature of service expansions. While looking at the scenario of operations, E-commerce offers a more popular way of shopping than the other, through PC, laptops and palm tops. The purchasers of the Internet shopping can be termed as "Intentional buyers", as they go to PC and browse for the information, they require and then buy accordingly. This whole process is sometimes requires a time and other options like comparison with other sites and products, that's why a lot of e-commerce strategies have evolved to make the consumer to buy at a certain level. The e-business strategies like, product reviews, discussion forums, price comparison charts, ratings, user reviews are almost and anywhere for a buyer to evaluate the product or service he is looking for. This makes 'Customer King' during the process, and the customer has the option to change his decision during the buying process at any point of time. While looking at the Mobile commerce, the customer has the limited choice even in selecting the product or service as mentioned above: This basic difference is due to the short and limited visibility of the screen in Mobile Device, whereas the e-commerce operates through flexible keyboard, mouse etc., Beyond such ergonomics, the feature presentation and customer education are also limited with mobile business applications. Thus only impulsiveness and necessity are visible as driving factors for M-Commerce buying behavior. But when looking at the reach, M-commerce has more advantage than E-commerce. The user need not go to a PC and search for a the relevant product or service, as it is the case in E-com, the product or service is almost in the hands of the user on the mobile device which is open all the time with quick information t decide upon. Even if he has a querry regarding anything, the mobile device utility does not make him feel costly to get the information on the product or service offered. Though E-commerce does also provides the user interfaces with customer service programs like chat and Toll free calls, not all the E-commerce traders use such features, as they are the add on features to the browser based product catalogues on e- shopping. The major sectors of operations on the two boards also differ depending on the sales presentation the sectors require. The E-Commerce attracts the customer with well designed WebPages, urls to remember according to the product range and geographical locations of access with extensions like .uk, .canada etc., This gives more prominence to the Sale offered with available region and other attributes. Thus the products or services pertaining to such trade sectors like B2B transactions, educational services and other commercial products can be traded upon, which requires an optimal product selection among a range of products with good illustration. Whereas the mobile devices does not support lengthy web pages and Product catalogues with urls to support the particular products. The most utility of the mobile device is to quick access of the information, but not the leisure surfing, which limits the products displays through graphical presentation. And hence most of the mobile sales campaigns are limited to text messages. Still, the short Message Service (SMS) campaigns are highly powerful in capturing the attention of the customer, as they come in regular frequent reminders with great and bumper offers. The most of the products and services that can trade through m-commerce include, B2C, where the customer's direct and instant buying decision is involved and can be influenced through such pop up messages in his hand with alarming ring tones. M-Commerce offers a personalized shopping experience. Different trading applications like sports ticketing, Vending machines sales, Mobile service billings and financial applications like banking, stocks can also be conducted through M-commerce. The Enterprise business Applications like Intrabusiness applications, inventory management, sales force automation, wireless voice, job dispatching, wireless office, etc are also in the state of creating M-commerce wave. This alarms a great need for Content development and promotional strategies for the growth of M-commerce on the mobile devices. The m-commerce vendors have to develop a context based content tools for different sale applications. The major hindrances in information sharing through mobile devices on commercial purpose include: Limited bandwidth restricting the data levels for transmission, with data speeds between 9.6-14.4 kbps, which is slow. Expensive wire less Internet services, smaller memory capacity on the palm devices, with less powerful processors. Even at the data transmission level, challenges like, Abbreviation of data to fit into the screens and specification of alerts on the receiving end of data to be developed in an innovative way like, what Personification has developed the latest 2 new technologies like Text summary and phone Summary. (3) "TextSummary uses state-of-the-art algorithms to analyze a document's structure, grammar and keywords generating a coherent summary of the original - without compromising its meaning. PhoneSummary takes the data generated by TextSummary and converts it to voice. Any web content can be summarized and delivered inaudio format through a telephone." Many of the people assume that any E-commerce web site can launch the M-commerce with simple adaptability. But this has some technology and non-technology considerations to look into: The technical platforms that both the commerce applications work on are as follows: E-commerce utilizes PC as device working on Windows, Unix, Linux Operating systems. The presentation standards are developed on HTML language supporting the Microsoft IE and Netscape navigator. The E-commerce uses the bearer networks TCP/IP & Fixed Wireline Internet. Whereas the M-commerce operates on the devices like Smartphones, Pagers, PDAs working on the Operating systems like, Symbian (EPOC), PalmOS, Pocket PC, and proprietary platforms. M-Commerce applications are developed on the HTML, WML, HDML, and i-Mode Presentation Standards. The browsers like Phone.com UP Browser, Nokia browser, MS Mobile Explorer and other microbrowsers, can support the M-comm applications. The Bearer Networks like GSM, GSM/GPRS, TDMA, CDMA, CDPD, paging networks are the options for M-commerce applications. The evolution of PC structures has not much impact on E-commerce, but the evolution in the Mobile Phone technology also has an immense impact on the M-commerce: -The first-generation or analogue phones are just good enough for voice calls, which are not of much use for M-commerce -Second-generation phones use digital technology and are typical of the average phone in use today -2.5G digital phones - support the transmission of data using general packet radio service (GPRS) -Third generation (3G) digital phones - support voice and data transmission at greatly increased speeds. (13) The 3G supports following features that are not possible with earlier technologies: -Video call transmission among 3G users -Video and other types of media can be downloaded to play on mobile phone -Location-based services can be accessed in order to see a map of where you are, or find out the nearest bank, shopping mall or a vending machine etc (13) Hence M-commerce developments are focused very strongly on the use of 3G phone technology. Where as, Wireless application protocol (WAP) technology and allows users to access information instantly. WAP enables mobile devices to browse the Internet because the web browsers built into these devices support HTML and XML. That's why People usually assume that M-commerce is an up gradation of E-commerce when using these content scripting languages. WAP-enabled devices can support micro browsers. These are applications that suit the small memory size of handheld devices and the low-bandwidth constraints of a wireless-handheld network. The most important m-commerce technology, which is widely in usage supported by maximum types of mobile devices, is short message service (SMS). This service allows short text messages to be sent from and to mobile devices at low cost. Payment Systems and Issues: E-commerce payments are handled through credit card authentication, which is most popular and prevalent with high security standards. Though as of now payment frauds are majorly not reported in M-commerce payments method, the payment system involves little non-personal identification, in the instances like mobile when placed in other's hand. The m-commerce payments can be carried through, Wireless Payment by handheld devices like palm-beam to a credit card terminal using infra red rays. Users are using the Mobile commerce payments to pay the Micro payments with small value transactions, where credit card processing charges can be avoided. In this situation, mobile wallet initiatives and Cashless Payment without using the cash card systems are more convenient ways and true to the meaning. Mobile wallet was a failure for the E-commerce transactions. Because creating a wallet with a limited amount of money and registering on the net for each time for authentication became tie taking to complete the shopping process. Rather than this simply typing in the payment details for each buy became easier for the regular E-commerce buyer. But Mobile wallet became an alternate easy option for the mobile commerce user with little alteration in the payment system. Now the mobile commerce user can simply authenticate the mobile wallet by pressing yes, rather preferring to enter the payment details as like in e-commerce sites. Still there are some problems perceived with mobile wallet in connection to the device operations. Here also technology plays a key role. Simple replication of e-commerce wallet to mobile commerce will not work. This has to have different features, to let the Payment handle itself after the authentication. A background support is required to fill the registration details, and sending in the Password and PIN for a single time, so that customer interaction with payment details submission will be less for number of transactions. The mobile wallet helps in aggregation of transaction to bill as a one account, though used at different instances for frequent small payments. This is an advantage with Mobile wallet payment. The Major issues involved with Mobile payment applications are, Lack of standards for m-commerce between different financial institutions, End-to-end security issues, Retailer-processing center integration problems - too many variables in OSes., High transaction processing capacity at the backend application, Lack of payment infrastructure. These factors limiting the customer's trust on the mobile payment system and the business in turn. Above all, as stated by Yankee Group mobile analyst Adam Zawel, "There needs to be a reason to make a purchase using your wireless device. No one's going to bother with an inferior experience on wireless when they can do it on their home PC."(3) So rather than looking at the technology implications to facilitate the smooth transactions, the mobile vendors does need to look for new and innovative strategies to reach the customer if they ant to gain profits over e-commerce. Just like the E-commerce industry, M-commerce industry has also experienced lot of speculations and hype, which made the industry players to take some time to get into the facts and understand the game. Under the wrong calculations and misassumptions, the players could not concentrate on materializing the consumer choice in the industry. That's why though the bandwagon started early, the players could not get ready with the new equipment and other strategical formulations for the easy operations. But a careful identification and development of critical success factors like payment systems, data transmission, strategical and personalization of content presentation, targeting of customers will definitely help the m-commerce to beat the e-commerce segments. Adam Jawel also expresses that "the enterprise side of wireless holds more promise than the consumer end. Mobile offerings for field service, retail, manufacturing, distribution and delivery "continue to be hot areas," He said wireless offerings for field service , retail, manufacturing, distribution and delivery "continue to be hot areas, with sales force solutions coming next." ... system integrators and wireless local area network (WLAN) equipment makers are also positioned as big winners, as companies move to install wireless systems to handle horizontal and vertical applications." . Conclusion: Though E-commerce and M-commerce seems to be competitors markets for each other, in reality, each segment has its own market segmentation and infrastructure needs. The basic difference is one is most popular and the other is still nascent to catch up with the investor's sight. The perceived problems and the lack of proper infrastructure for technology and the payment methods are making the industry to still think about the M-commerce establishments. Along with the features like Immediacy, Connectivity, Localization and Personalization, a little adaptability like E -commerce applications with Content presentation on the micro browsers and strong policy and regulations for easy payment systems will eliminate the barriers to M-commerce. References: 1. Philip Gordon and Judith Gebauer, M-Commerce: Revolution + Inertia=Evolution, Working Paper01- 2001. Retrieved March 13, 2006, from http://www.haas.berkeley.edu/citm/publications/papers/wp-1038.pdf. 2. M-commerce payment system and issues. Retreived March 13, 2006, from http://www.mobileinfo.com/Mcommerce/payment_Systems.htm 3. Introduction to M-commerce. 2005. Retrieved March 14, 2006, from http://www.witiger.com/ecommerce/mcommerceintro.htm 4. Teri Robinson, What Will It Take To Save the Wireless Sector2002: Introduction to M-commerce. 2005. Retrieved March 14, 2006, from http://www.witiger.com/ecommerce/mcommerceintro.htm 5. Neil Andrews, Digital Rum, e-Commerce vs m-Commerce - Creating a winning proposition, 2001. Retrived from March15, 2006, from http://www.imrg.org/IMRG/Library.nsf/(httpLibrary)/8D745AA5BA42F0B980256AE300516B0F 6. Separating Mobile Commerce from Electronic Commerce. Retrieved March 13, 2006, from http://www.mobileinfo.com/Mcommerce/differences.htm. 7. Michael Mahoney, E-commerce Times, 2001, Whatever Happened to M-Commerce, Retrieved March 16, 2006, from http://www.ecommercetimes.com/story/15042.html 8. Paul A. Greenberg, Consumers Cool to Wireless E-Commerce, 2000. Retrieved March 17 2006 from http://www.ecommercetimes.com/story/2817.html 9. E-COMMERCE AND DEVELOPMENT REPORT 2002, United Nations Conference on Trade and Development, Retrieved March 14, 2006, from http://www.unctad.org/ecommerce/ 10. The Essentials of Mobile Commerce, Retrieved March 15, 2006, from http://www.businesslink.gov.uk/bdotg/action/detailr.l3=1075386889&r.l2=1073866263&r.t=RESOURCES&r.i=1075387101&r.l1=1073861197&r.s=sc&type=RESOURCES&itemId=1075386960 11. e-commerce vs m-commerce What is all the fuss about August 2000, Retrieved March 14, 2006, from http://www.bcsnet.co.za/press/ecommerce.html 12. M commerce technologies, retrieved March 15, 2006, from http://www.businesslink.gov.uk/bdotg/action/detailr.l3=1075386889&r.l2=1073866263&r.t=RESOURCES&r.i=1075387286&r.l1=1073861197&r.s=sc&type=RESOURCES&itemId=1075386960 Read More