Effects of E-Commerce to Globalization and Vice-Versa

1. The Effects of E-Commerce to
Globalization and Vice-Versa
Fidel G. Patricio Jr.
DIT Student
Saint Paul University Philippines
June 2018

2. What is E-Commerce
• E-Commerce is define as the process of
buying and selling, transferring or
exchanging products, services and
information via electronic networks.
• Simply put, ecommerce refers to
commercial transactions conducted
online. This means that whenever you buy
and sell something using the Internet,
you’re involved in ecommerce.

3. Typical Ecommerce Process

4. Advantages
• Advantages of E-commerce
• Much faster transactions available 24/7.
• Products and services are easy to find.
• Easier time managing a business.
• Doesn’t require much (if at all) physical space.
• No geographical limitations translates as a
bigger customer reach.
• Higher quality of services and lower operational
costs.

5. Disadvantages
• No guarantee of product quality.
• Customer loyalty becomes a bigger issue as there is a
minimal direct customer-company interaction.
• Inability to experience products beforehand leads to
more checkout dropouts.
• Anyone can start an online business, which sometimes
leads to scam and phishing sites.
• Hackers target web shops more often than you think.
• Mechanical failures can get quite more punishing.

6. History of E-commerce
• 1969: CompuServe, the first major eCommerce
company is established by Dr. John R. Goltz and
Jeffrey Wilkins by utilizing a dial-up connection.
This is the first time eCommerce was introduced.
• 1979: Electronic shopping was invented by
Michael Aldrich (he is also considered as founder
or inventor of eCommerce). This was done by
connecting a transaction-processing computer
with a modified TV through a telephone
connection. This was done for the purpose of
transmission of secure data.

7. History of E-commerce
• 1994: Web browser tool introduced by Netscape
Navigator by Marc Andreessen and Jim Clark. It
was used on the Windows platform.
• 1995: The year marked the iconic development
in the history of eCommerce as Amazon and
eBay were launched. Amazon was launched by
Jeff Bezos, while Pierre Omidyar launched
eBay.
• 1998: The first eCommerce payment system
was launched by PayPal as a tool to make
money transfers.

8. History of E-Commerce
• 1999: Alibaba launched its online
shopping platform in 1999 with more than
$25 million as capital. Gradually it turned
out to be an eCommerce giant.
• 2000: The first online advertising tool
named Google AdWords was launched by
Google as a way to help retailers to utilize
the pay-per-click (PPC) context.

9. Types of E-commerce
• Business to consumer (B2C) – Transactions
happen between businesses and consumers. In
B2C ecommerce, businesses are the ones
selling products or services to end-users (i.e.
consumers).
• Business to business (B2B) – As its name
states, B2B ecommerce pertains to transactions
conducted between two businesses. Any
company whose customers are other
businesses operate on a B2B model.

10. Types of E-commerce
• Consumer to business (C2B) – Consumer to
business ecommerce happens when a consumer
sells or contributes monetary value to a business.
Many crowdsourcing campaigns fall under C2B
ecommerce.
• Consumer to consumer (C2C) – As you might have
guessed, C2C ecommerce happens when
something is bought and sold between two
consumers. C2C commonly takes place on online
marketplaces such as eBay, in which one individual
sells a product or service to another.

11. Types of E-commerce
• Government to business (G2B) – G2C transactions
take place when a company pays for government
goods, services, or fees online. Examples could be
a business paying for taxes using the Internet.
• Business to government (B2G) – When a
government entity uses the Internet to purchases
goods or services from a business, the transaction
may fall under B2G ecommerce. Let’s say a city or
town hires a web design firm to update its website.
This type of deal may be considered a form of B2G.

12. Types of E-commerce
• Consumer to government (G2C) –
Consumers can also engage in B2C
ecommerce. People paying for traffic
tickets or paying for their car registration
renewals online may fall under this
category.

13. What is Globalization
• Globalization is a process of interaction and
integration among the people, companies,
and governments of different nations, a
process driven by international trade and
investment and aided by information
technology. This process has effects on the
environment, on culture, on political systems,
on economic development and prosperity,
and on human physical well-being in
societies around the world.

14. Advantages of Globalization
• Increase in employment opportunities: As
globalization increases, more and more
companies are setting up businesses in
other countries.
• Education: With the increase in
globalization, it has become easier for
people to move across borders to different
parts of the world to acquire better
education.

15. Advantages of Globalization
• Increase in free trade: An increase in free
trade has opened doors for investors in
developed countries to invest their money
in developing countries.
• Faster flow of Information: Information
flows from one part of the world to the
other immediately, resulting in the world
being tied together.

16. Advantages of Globalization
• Increase in quality of goods and services: As
a result of globalization, people have access
to the best quality of goods and services
throughout the world.
• Decrease in prices of goods and services: As
the competition in the market has increased
due to rapid globalization, producers have to
price their products competitively in order to
remain in the market.

17. Advantages of Globalization
• Reduction in cultural barriers: As people
move from one country to another,
barriers between various cultures tend to
decrease.This has resulted in tolerance
and openness towards other cultures.

18. Disadvantages of Globalization
• Environmental degradation: Developed
countries can take advantage of
underdeveloped countries’ weak regulatory
laws in terms of environmental protection.
• Unfair working conditions: Many
multinationals have been accused of social
injustice by exploiting labor in
underdeveloped countries in order to cut
costs.

19. Disadvantages of Globalization
• Fall in employment growth rate: Though
the promotion of the idea that the
advances in technology and increase in
productivity would create more jobs has
been a cornerstone of globalization, it has
been seen that in the past few years, such
advances have led to a decrease in the
employment growth rate in some
developing economies.

20. Disadvantages of Globalization
• Growing disparity among the rich and the poor: 86%
of the world’s resources are said to be consumed by
the richest 20% of the world population.
• Small scale industries face extinction: Small scale
industries which are indigenous to a particular place
face extinction as they do not have the resources or
the power that the multinational companies have.
• Rapid spread of deadly diseases: Deadly diseases
such as AIDS or other communicable diseases can
spread at very fast pace via travelers or due to other
means as a direct consequence of globalization.

21. Globalization and E-Commerce
• A research shows that the relationship
between globalization and e-commerce is
complex and varied. Among firms that use
the Internet to conduct business, global
firms use the technology more intensively,
engaging in a wider variety of e-commerce
activities than less global firms.

22. Globalization and E-Commerce
• When e-commerce is broken down in terms of the
type of business relationship involved, the research
found a very different picture for B2B and B2C e-
commerce, with global firms more likely to engage in
the former and local firms in the latter.
• The findings provide
• empirical support that upstream activities, which
involve B2B transactions, are more global in nature,
while downstream activities involving B2C
interactions are more local, or multidomestic.

23. Globalization and E-Commerce
• A research on ecommerce suggests that
global convergence is occurring in B2B
through the coordination and integration of
business processes and operations, but
that B2C remains more of a local
phenomenon due to divergence in
consumer preferences and habits.

24. Globalization and E-Commerce
• Although globalization has a negative effect on B2C,
firms derive most of their performance benefits from
B2B rather than B2C, so the net effect of
globalization seems to be a positive one on firm
performance.
• Global firms get more performance improvements
from e-commerce than local firms, as they tend to
adopt B2B, which has greater impacts across a
broader range (efficiency, coordination, and
commerce) than B2C, which is a driver only of
increased sales and efficiency.

25. Globalization and E-Commerce
• A research suggest that e-commerce is
reinforcing rather than transforming
existing commerce patterns. A major
finding is that B2B e-commerce sales and
services tend to be global, while B2C
tends to be local or multi-domestic
businesses, while local firms (especially
finance and distribution) are more likely to
provide sales and services to consumers.

26. Future of E-commerce
• When we look at how drastically
eCommerce has changed over the past
20, or even 10 years, it’s difficult not to be
excited about the future of retail
technology and how the experience for
both consumers and retailers will continue
to change.

27. Future of E-commerce
• What will ecommerce see next or in the
distant future? Personally I can see more
“mCommerce” businesses, services, and
platforms being founded and developed.
Just think about how many people you see
using their smartphone or tablet and how
many of those people buy through it?

28. Future of E-commerce
• Saying that however, I would be a
billionaire if I could correctly guess where
the market will be 20 years from now. Will
we see a dominant force such as
Amazon.com but in mCommerce? What I
do know and what has been proved in the
past is that those that do spot a gap in the
market will clearly be the leaders 20 years
from now.

29. References
What Is Ecommerce? Ecommerce Explained with Examples.
https://ecommerceguide.com/guides/what-is-ecommerce/
Blog
DotFront.com - https://www.dotfront.com/blog.asp?article=123
Advantages and Disadvantages Of E-commerce
https://gauss-development.com/advantages-and-disadvantages-of-e-commerce/
Ecommerce History and Its Evolution - The Timeline - Shiprocket
https://www.shiprocket.in/blog/ecommerce-history-evolution-timeline/
What Is Globalization?
http://www.globalization101.org/what-is-globalization/

30. References
What Are the Advantages and Disadvantages Of Globalization?
https://www.quora.com/What-are-the-advantages-and-disadvantages-of-Globalization
Impacts of Globalization on E-Commerce Use and Firm Performance: A Cross-Country
Investigation
https://www.researchgate.net/publication/220175484_Impacts_of_Globalization_on_E-
Commerce_Use_and_Firm_Performance_A_Cross-Country_Investigation
20 Years Of Ecommerce: The History in a Timeline
http://www.yoma.co.uk/blog/20-years-ecommerce-history-timeline/

31. Thank you and Good Day.
Fidel G. Patricio Jr