Most of us if not all of us have a clear definition of what commerce is. But for the benefit of doubt we can define Commerce as a branch of business that is concerned with the exchange of goods and services. It includes all those activities, which directly or indirectly facilitate the exchange of goods and services. Now we have understand what commerce is. What then is Electronic commerce or e-commerce? E-commerce is an acronym for Electronic commerce.
We can define e-commerce is a term for any type of business, or commercial transaction, that involves the transfer of information, goods, services or fund across the Internet. It covers a wide range of different types of businesses, from consumer to consumer based retail sites like HITHOOD, auction or music sites like iTUNE and Sound cloud, business exchanges trading goods and services between corporations like ALIBABA. Of recent time; lets say between 2002 to 2016, e-commerce has experienced steady and rapid growth. The steady development in e-commerce sector is as a result of increase in the number of internet users over time and also advances in web technology. For instance, in 2010 about 2,016,000 of the world population uses the Internet but in 2016 about 4,000,000 of the world population are using the Internet. So e-commerce was born out of the tremendous increase in population of Internet users with time. It is predicted by experts that the e-commerce activities will continue to increase and develop with time. This is because man continue to search for easy way of solving problem. It has so many advantage and disadvantage compare to the typical commerce.
Advantages of e-commerce
- It is faster in procedures and it is easy to find and locate products.
- It is readily available, customers can buy and sell at anytime. This is because the website is located in a web server and a web server is a computer that is alive 24/7.
- It is easy to reach more customers. Therefore there is no theoretical geographic limitations unless restricted consciously by the by the web developer or the managers.
- There is no need of physical company set-ups, so it eliminates the stress of finance and setting up of location.
- It is easy to start and manage a business. You just need a website!
- Customers can easily select products from different providers without moving around physically.
Disadvantages of e-commerce
- Any one, good or bad, can easily start a business. And there are many companies with bad reputation that fraud customers’ money. In other words regulation of e-commerce is difficult.
- There is no guarantee of product quality because you cant see or feel the product unless after purchasing and transaction.
- Mechanical failures can cause unpredictable effects on the total processes, for instance, slow internet network and low server response
- As there is minimum chance of direct customer to company interactions, customer loyalty is always on a check.
- E-commerce site, service, payment gateways, all are always prone to attack to hackers and crackers. Security is of paramount important in e-commerce.