what is e-commerce?

DEFINITION

E-commerce (electronic commerce or EC) is the buying and selling of goods and services on the Internet. In practice, this term and e-business are often used interchangeably. For online retail selling, the term e-tailing is sometimes used.

Aspects of e-commerce include:

* E-tailing or "virtual storefronts" on websites with online catalogs.
* The gathering and use of demographic data through Web contacts.
* Electronic Data Interchange (EDI), the business-to-business exchange of data.
* email, instant messaging and social networking as media for reaching prospects and established customers.
* Business-to-business buying and selling.
* The security of business transactions.

E-tailing or The Virtual Storefront and the Virtual Mall

As a place for direct retail shopping, with its 24-hour availability, a global reach, the ability to interact and provide custom information and ordering, and multimedia prospects, the Web is a multi-billion dollar source of revenue for the world's businesses. As early as the middle of 1997, Dell Computers reported orders of a million dollars a day. By early 1999, projected e-commerce revenues for business were in the billions of dollars and the stocks of companies deemed most adept at e-commerce were skyrocketing. Web retailing continues to grow.
Market Research

In early 1999, it was widely recognized that because of the interactive nature of the Internet, companies could gather data about prospects and customers in unprecedented amounts -through site registration, questionnaires, and as part of taking orders. The issue of whether data was being collected with the knowledge and permission of market subjects had been raised.
Electronic Data Interchange (EDI)

EDI is the exchange of business data using an understood data format. It predates today's Internet. EDI involves data exchange among parties that know each other well and make arrangements for one-to-one (or point-to-point) connection, usually dial-up. EDI may be replaced by one or more standard XML formats, such as ebXML.
Email, social networking and instant messaging

E-commerce is also conducted through email, instant messaging and social networking sites such as Facebook. To avoid the perception of spam, Opt-In Email is an option in which Web users voluntarily sign up to receive email, usually sponsored or containing ads, about product categories or other subjects they are interested in.
Business-to-Business Buying and Selling

Thousands of companies that sell products to other companies have discovered that the Web provides not only a 24-hour-a-day showcase for their products but a quick way to reach the right people in a company for more information.
The Security of Business Transactions

Security includes authenticating business transactors, controlling access to resources such as Web pages for registered or selected users, encrypting communications, and, in general, ensuring the privacy and effectiveness of transactions. Among the most widely-used security technologies is the Secure Sockets Layer (SSL), which is built into Web browsers.


Getting started with e-commerce
To explore how e-commerce is used in the enterprise, here is an additional resource:
Sold on Web 2.0: Web 2.0 offers a host of e-commerce tools to engage customers, improve product lines and bring greater alignment between IT and the business. Four CIOs share how Web 2.0 tools have helped their e-commerce efforts. (Free registration may be required for this article.)