One of the biggest benefits of the Internet is its ability to allow organizations to perform business with anyone, anytime, anywhere. E-commerce is the act of buying and selling goods and services over the Internet. E-business is derived from the term E-commerce. E-commerce refers only to online transactions. While e-business is the conducting of business on the Internet, not only selling and buying but also serving customers and collaborating with business partners.There are different types of e-business.The primary difference between e-business and E-commerce is that e-business also refers to online exchanges of information. For example, a financial institution allowing its customers to review their banking, credit card, and mortgage accounts or a manufacturer allowing its suppliers to monitor production schedules.
In the past years, e-business seems to have permeated every aspect of daily life. Both organizations and individuals have embraced Internet technologies to maximize convenience, enhance productivity and improve communications globally. From shopping to banking to entertainment, the Internet has become integral to daily life.
An e-business model is an approach to managing the electronic business on the Internet. E-business transactions take place between two major entities—consumers and businesses. All types of e-business activities happen within the framework of two types of business relationships:
- The exchange of products and services between businesses “Business-to-Business, or B2B”
- The exchange of products and services with consumers (Business-to-Consumer, or B2C).
The primary difference between B2B and B2C are the customers; B2B customers are other businesses while B2C markets to consumers. Overall, B2B relations are more complex and have higher security needs; plus B2B is the dominant e-business force, representing 80 percent of all online business.
Business-to-business “B2B” applies to businesses selling from and buying to each other over the Internet. Online access to data, including the expected delivery date, shipping status, and shipping date, provided either by the seller or a third-party provider is widely supported by B2B models.
Electronic marketplaces “E-marketplaces” is a types of e-business that represent a new wave in B2B e-business models. E-marketplaces are interactive business communities providing a central market where multiple buyers and sellers can engage in e-business activities. They present structures for conducting commercial exchange, consolidating supply chains, and creating new sales channels. Their primary goal is to increase market efficiency by tightening and automating the relationship between buyers and sellers. Existing e-marketplaces allow access to various mechanisms in which to buy and sell almost anything, from services to direct materials.
Business-to-consumer “B2C” applies to every business that sells its products or services to consumers over the Internet. Carfax has been in the vehicle history report business for 20 years with an original customer base of used-car dealers. “The Internet was just a new way for us to reach the consumer market”, Carfax President Dick Raines said. Carfax spent $20 million on print and TV ads to attract customers to its Web site. Customers can purchase a Carfax report for $14.95 or six days of reports for $19.95. Carfax has now launched a partnership program for small auto dealers’ Web sites and a cashback program offering customers 20 percent of revenues received for their referrals. “We continue to look for more and more ways to add value,” Raines said. Common types of B2C e-business models include e-shops and e-malls.
E-Shop An e-shop sometimes referred to as an e-store or e-tailer, is a version of a retail store where customers can shop at any hour of the day without leaving their home or office. These online stores support and sell a variety of products and services. The online types of e-businesses channeling their services and goods via the Internet only, such as Amazon.com, are called pure plays. Some other online businesses are an extension of traditional retail outlets that sell online as well as through a traditional physical store. They are generally known as “bricks and clicks” or “click and mortar” organizations, such as the Gap and Best Buy.
E-Mall An e-mall consists of a number of e-shops; it serves as a gateway through which a visitor can access other e-shops. An e-mall may be generalized or specialized depending on the products offered by the e-shops it hosts. Revenues for e-mall operators include membership fees from participating e-shops, advertising, and possibly a fee on each transaction if the e-mall operator also processes payments. E-shops in e-malls benefit from brand reinforcement and increased traffic as visiting one shop on the e-mall often leads to browsing “neighboring” shops.
Consumer-to-business “C2B” applies to every consumer that sells a product or service to a business over the Internet. One example of this e-business type is Priceline “priceline.com” where bidders (or customers) set their prices for items such as airline tickets or hotel rooms, and a seller decides whether to supply them. The demand for C2B e-business will increase over the next few years due to the customer’s desire for lower prices and greater convenience.
Consumer-to-consumer “C2C” applies to sites primarily offering services and goods to assist consumers interacting with each other over the Internet. eBay, the Internet’s most successful C2C online auction Web site, links like-minded buyers and sellers for a small commission.
C2C online communities, or virtual communities, interact via e-mail groups, Web-based discussion forums, or chat rooms. C2C business models are consumer-driven and opportunities are available to satisfy most consumers’ needs, ranging from finding a mortgage to job hunting. They are global swap stores based on customer-centered communication. One C2C community, KazaA, allows users to download MPS music files, enabling users to exchange files.
Businesses can operate 24/7 and 365 days a year.
Improved Information Content
In the past, customers had to travel to a physical facility or order catalogs before they could compare price and product attributes. Web pages and Electronic catalogs present customers with updated information in real-time about services, goods, and prices.
Increased Customer Loyalty
Additional channels respond to, to contact, and access customers helps contribute to customer loyalty.
E-business improves and automates many of the activities that make up a buying experience.
Increased Global Reach
Businesses, both large and small, can reach new markets.
Decreased Cost The cost of conducting business on the Internet is considerably smaller than traditional forms of business communication.