The E-commerce Framework, Trends, Content.

E-commerce Framework

E-commerce Framework: According to the U.S. Census Bureau (2016), e-commerce sales in 2015 accounted for over 50% of total sales of all manufacturing activities in the United States, over 25% of merchant wholesalers, 7.5% of all retailing (vs. 4.7% in 2011), and 2% of all sales in selected service industries. The grand total of EC in 2015 has been $4000 billion as seen in Figure 1.1. Notice the sharp increase in manufacturing compared to other sectors. In addition, note that EC is growing much faster than the total of all commerce by about 16–17% annually. For a more detailed breakdown, see the U.S. Census Bureau (2013) report as well as Plunkett et al. (2015). There is a clear trend that online retail sales are taking business from traditional retailers. For example, Wilfred (2014) reported that during the 2013 holiday shopping season online shopping grew 10% a year versus 2.7% of traditional retailers. Today, even more people buy online. According to E-commerce Europe, September 5, 2012, European online retail sales will double to €323 billion by 2018.

The Content and Framework of E-Commerce

Classifying e-commerce aids understanding of this diversified field. In general, selling and buying electronically can be either business-to-consumer (B2C) or business-to-business (B2B). Online transactions are made between businesses and individual consumers in B2C, such as when a person purchases a coffee from coffee store or a computer from pc Store . In B2B, business transactions are made online between businesses, such as when the PC store electronically buys parts from its suppliers. Pc storealso collaborates electronically with its partners and provides customer service online e-CRM (see Online Tutorial T1). Several other types of EC will be described later in this chapter.

According to the U.S. Census Bureau (2013), the total EC shipments grew 16.5% in a year; ComScore reported that U.S. retail commerce online increased 17% in QI 2012 as compared to a year earlier. EC is growing in all areas. For example, Leggatt (2012) reported that in the UK Domino’s Pizza online sales grew about 1000% between 2000 and 2012. Similar results can be found in many industries, companies, and countries (e.g., see periodic reports at ComScore and BizReport) and Ahmad (2014, an Infographic). E-commerce is exploding globally. According to a press release of ecommerce-europe.eu/press of May 23, 2013, European e-commerce grew by 19% in 2012 reaching €312 billion. According to Stanley and Ritacca (2014), e-commerce in China is exploding, reaching $600 billion by the end of 2013. Finally, in several developing countries EC is becoming a major economic asset (e.g., see Maitra 2013 for information on India).

An E-Commerce Framework

The EC field is diverse, involving many activities, organizational units, and technologies. Therefore, a framework that describes its contents can be useful. As shown down below, there are many EC applications (top of figure), which will be illustrated throughout the book. To perform these applications, companies need the right information, infrastructure, and support services. that EC applications are supported by infrastructure and by the following five support areas (shown as pillars in the figure):

1. People. Sellers, buyers, intermediaries, information systems and technology specialists, other employees, and any other participants.

2. Public policy. Legal and other policy and regulatory issues, such as privacy protection and taxation, which are determined by governments. Included are technical standards and compliance.

3. Marketing and advertising. Like any other business, EC usually requires the support of marketing and advertising. This is especially important in B2C online transactions, in which the buyers and sellers usually do not know each other.

4. Support services. Many services are needed to support EC. These range from content creation to payments to order delivery.

5. Business partnerships. Joint ventures, exchanges, and business partnerships of various types are common in EC. These occur frequently throughout the supply chain (i.e., the interactions between a company and its suppliers, customers, and other partners).
This means that companies need to plan, organize, motivate, devise strategy, and restructure processes, as needed, to optimize the business use of EC models and strategies.