The development of E-Commerce - Research Paper Example

THE DEVELOPMENT OF E-COMMERCE Introduction Electronic commerce, popularly known as e-commerce, is a platform or industry where product and services are bought and sold over electronic systems and computer networks such as the internet. It is a vast technological field that includes electronic fund transfer (EFT), electronic data interchange (EDI), mobile commerce, online transaction processing, and inventory management systems. The e-commerce is mainly considered to be only the sales aspect of e-business which also includes the facilitating payments involved in business transactions.

The e-commerce may also further be divided into business-to-business (B2B) or business to customers (C2C). Pure or traditional brick and mortar e-tailing is also constituent of e-commerce. The industry has been growing very steadily over the last two decades but one of the issues that concerns modern day e-commerce is the issues related to the security of business transactions (Andam, 2003, pp.6-13). Development of E-CommerceThe history of e-commerce can be dated back to the days when computers, internets and modems were invented.

Before 1991, the internet (then popularly known as the Arpanet) was not open for public or commercial uses. Hence, it can be said that the true birth of e-commerce was possible only after the year 1991 when the internet was opened for commercial purposes. Initially the term e-commerce referred only to commercial transactions that took place with the help of electronic media and then latest technology such as EDI and EFT. The process of clearing payments related to business transactions simplified drastically.

The lead time also reduced significantly and users soon realized the hidden potential e-commerce and its application the corporate world. The e-commerce was readily accepted in the corporate sector because of cost efficiency, faster transactions, lower cost per transactions, and lower documentation requirements. With the advancement of internet, the popularity of online transactions in US grew very rapidly from the year 1991 (Humphrey, Mansell, & Pare, 1999, pp.31-32). (Source: e-commerce land, 2004)The biggest threat in the virtual world of e-commerce was from the transfer of critical business related information or transactions over the public networks such as the internet.

It almost took four years to develop the various security protocols including hypertext transfer protocol (http) that allows the users to get speedy and continuous access to internet (Panagariya, 1999, pp.10-11). In the year 2000, many Western European and American companies represented themselves in the World Wide Web (Obayi, 2011, pp.43-63). During the early 2000 people recognized e-commerce as the process of buying and selling goods and services over secured connections or the internet which involves electronic transactions.

The biggest success was experienced by traditional brick and mortar retailers who also started offer their products and services via the internet. Amazon.com and ebay.com revolutionized the dot com era when it became one of the most trusted and used e-commerce portals. By the end of year 2001, the B2B model of e-commerce constituted major share (around US$700 billion) of the total e-commerce share of transaction.ConclusionThe biggest advantage that the companies get through e-commerce is that they could reach their customers at place and time without any geographic boundaries.

The search engines offer the companies inexpensive advertising opportunity and also to earn revenue by third party advertisements. Even the small and medium scale business can now reach their customers globally with the help of e-commerce. The technology also enables the companies to track customer preferences and tailor products accordingly (Berkley, Lamie, & Markley, 2007, p.1). Thus, from the above discussion it can be said that the history of e-commerce gave the customers a new and virtual world from where they will be able to get access to their favorite products and services from any place and any time.

Reference Andam, Z. R. (2003). E-Commerce and E-Business. Retrieved from http://www.kau.edu.sa/Files/830/Files/61164_Ecommerce%20and%20E%20Business.pdf. Berkley, D. L., Lamie, R. D., & Markley, D. M. (2007). Case Studies of E-Commerce in Small and Medium-Sized Enterprises: A Review of the Literature. Retrieved from http://www.clemson.edu/uced/working_papers/uced_100701.pdf. Humphrey, J., Mansell, R., & Pare, D. J. (1999). E-Commerce for Developing Countries: Expectations and Reality. Retrieved from http://www.academia.edu/181499/E-commerce_for_Developing_Countries_Expectations_and_Reality.

Obayi, A. (2011). Introduction to E-Commerce. Retrieved from http://www.nou.edu.ng/noun/NOUN_OCL/pdf/edited_pdf3/CIT415%20INTRODUCTION%20TO%20E-COMMERCE.pdf. Panagariya, A. (1999). E-Commerce, WTO and Developing Countries. Retrieved from http://www.columbia.edu/~ap2231/Policy%20Papers/e-commerce-3.pdf.