Electronic commerce is a set of technologies, applications, and business processes that link business, consumers, and communities for buying, selling, and delivering products and services and for integrating and optimizing processes within and between participant entities.

1. ASSIGNMENT
ON
E-commerce helps us to perform in a global platform
SUBMITTED TO:
BANGLADESH UNIVERSITY IN SCHOOL OF BUSINESS
SUBMITTED BY:
MD. RAKIBUL HASAN
MBA 28th BATCH
I D- 201213228004
SUBMITTED COURSE:
Electronic Commerce
COM-526
SEMESTER: SPRING
SUBMITTED DATE: 10/05/2012

2. In the name of Allah, the Beneficent, the Merciful.
May 10, 2012
To,
Course instructor
Master of Business Administration
Bangladesh University
Sub: Submission of the Assignment.
Dear Sir,
It is my pleasure to submit the Assignment on subject Electronic commerce. This has
arranged to one as the partial fulfillment of my e-business program. The application and
electronic program was valuable experience for me. I found my assignment work challenging
and interesting.
I have tried my level best to follow the guidelines of you. The whole experience of this
assignment enabled me to get an insight into the real life solution in different way. I will be
happy to provide further clarification regarding this assignment whenever necessary.
Sincerely yours,
Md. Rakibul Hasan
MBA 28th Batch
ID: 201213228004

3. ACKNOWLEDGEMENTS
First of all I would like to express my humble gratitude to the Almighty Allah who
has helped me to complete the Assignment successfully. I am also grateful to the
people who helped me to complete the Assignment. I must acknowledge my debt to
my course instructor, Department of Business Administration, University of
Bangladesh for his valuable time, consideration and expert touch on the report. He
has continuously helped, cooperated and advised me how to prevail over the
problem; I have faced in preparing the assignment. I am also thankful to him for his
valuable suggestions regarding the assignment.
I am grateful to the department of M. B. A. University of Bangladesh to give me
such opportunity of the practical situation of e-business reporting.
Thanks to all
Md. Rakibul Hasan
(From Group)

4. EXECUTIVE SUMMARY
Electronic commerce is a set of technologies, applications, and business processes that link
business, consumers, and communities for buying, selling, and delivering products and
services and for integrating and optimizing processes within and between participant entities.
Electronic commerce, commonly known as e-commerce, ecommerce, eCommerce or e-
comm, refers to the buying and selling of products or services over electronic systems such as
the Internet (The Internet is a global system of interconnected computer networks that use the
standard Internet protocol suite (IP) to serve billions of users worldwide.) and other computer
networks(A computer network, often simply referred to as a network, is a collection of
hardware components and computers interconnected by communication channels that allow
sharing of resources and information). However, the term may refer to more than just buying
and selling products online. It also includes the entire online process of developing,
marketing, selling, delivering, servicing and paying for products and services.
E-Commerce helps us from all the way to perform globally in the present competition era. To
perform overall by using facilities of e-commerce to e-business we need to know whole
configuration of electronic commerce. E-commerce is like any other business, except-
Developing a business over the Internet requires many of the same major activities as starting
any other business. We should do some basic business planning. After all, we need a product.
We may need funding to get our business going. We need customers. We need to market
products to our customers. We need strong customer service. We need to manage purchases
by customers, finances, staff and other resources.
But there are some features unique to e-commerce. Not all products are real compatible to be
sold over the Internet. For example, they may require a lot of face-to-face selling. They may
cost a lot to ship (a primary practice in e-commerce is that customers buy products, and we
ship the products to them). We need to make sure that, because our product may be
advertised to the world, that we remain in control of our ideas, or "intellectual property".
Basically, we need an "online store" to be an "e-tailer". (Don't fret. we may be able to
outsource, or hire, a current store to work with us.) Our store will need a "merchant" account,
or the ability to process our customers' credit card transactions over the Internet. This
includes needing a "secure server", or that our online store is on a computer system that
ensures that customers' credit card numbers cannot readily be read by people who are not
supposed to read these numbers. We'll probably need some kind of online order form that
customers can complete, in order to purchase our products. We may even want our the
processing of customers' order to include processing the customers' credit card numbers right
away while they're still online and connected to our Website.
Furthermore, we need to design and promote a Website. We'll need access to expertise that
can regularly design and maintain this Website for us -- and it will require ongoing attention.
Fortunately, there is a great deal of free information available to help us with this design and
promotion.

5. If we can ensure the every elements of e-commerce to do e-business then it will help us to
perform in global platform perfectly.
E-commerce: (electronic commerce or EC) is the buying and selling of goods and services
on the Internet, especially the World Wide Web. In practice, this term and a newer term, e-
business, are often used interchangeably. For online retail selling, the term e-tailing is
sometimes used.
E-commerce can be divided into:
• E-tailing or "virtual storefronts" on Web sites with online catalogs, sometimes
gathered into a "virtual mall"
• The gathering and use of demographic data through Web contacts
• Electronic Data Interchange (EDI), the business-to-business exchange of data
• E-mail and fax and their use as media for reaching prospects and established
customers (for example, with newsletters)
• 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 rapidly becoming a multibillion dollar source of revenue for the world's businesses. A
number of businesses already report considerable success. 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. Although many so-called dotcom
retailers disappeared in the economic shakeout of 2000, Web retailing at sites such as
Amazon.com, CDNow.com, and CompudataOnline.com 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. (Microsoft referred to its policy of data collection as "profiling" and a proposed
standard has been developed that allows Internet users to decide who can have what personal
information.)
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 is expected
to be replaced by one or more standard XML formats, such as ebXML.

6. E-Mail, Fax, and Internet Telephony
E-commerce is also conducted through the more limited electronic forms of communication
called e-mail, facsimile or fax, and the emerging use of telephone calls over the Internet.
Most of this is business-to-business, with some companies attempting to use e-mail and fax
for unsolicited ads (usually viewed as online junk mail or spam) to consumers and other
business prospects. An increasing number of business Web sites offer e-mail newsletters for
subscribers. A new trend is opt-in e-mail in which Web users voluntarily sign up to receive e-
mail, 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 both of the leading Web
browsers.
What is B2C?
Interactions relating to the purchase and sale of goods and services between a business and
consumer—retail transactions.
• “Novelty” is that retail transaction is done on the Internet, rather than a “brick and
mortar” store location.
• Technical evolution of B2C from “brick and mortar” model not new.
Revenue Models:
• Sell goods and services and take a cut (just like B&M retailers). (e.g.,
Amazon, E*Trade, Dell)
• Advertising
-Ads only (original Yahoo)
-Ads in combination with other sources
• Transaction fees
• Sell digital content through subscription. (e.g., WSJ online, Economist Intelligence Wire)
A Different Approach to Location Retailing:
• In 1886, a jeweler unhappy with a shipment of watches refuses to accept them
• A local telegraphy operator bought the unwanted shipment
• Used the telegraph to sell all the watches to fellow operators and railroad employees

7. • Becomes so successful that he quits his job and started his own enterprise, specializing in
catalog sales
• Name: Richards Sears of Sears Roebuck
E-Commerce Retail Sales:
Estimated Quarterly U.S. Retail E-Commerce Worldwide B2C E-commerce Revenues 2000-2004 (in
Sales 4th Quarter 1999 - 4th Quarter 2000 billions)
10
8.686 2004 $428.1
9
8 2003 $250.0
7 6.393
5.526 2002 $167.2
6 5.198 5.24
Billions of Dollars
5 2001 $101.1
4
3 2000 $59.7
2
1 $0.0 $50.0 $100.0 $150.0 $200.0 $250.0 $300.0 $350.0 $400.0 $450.0
0 Source: eMarketer
4th Q 1999 1st Q 2000 2nd Q 2000 3rd Q 2000 4th Q 2000
Estimated Quarterly U.S. Retail Sales: Total and E-commerce:
Data in millions of dollars. Not adjusted for seasonal, holiday, and trading-day differences.
E-commerce
as a Percent Quarter to Quarter Percent
Period Retail Sales of Total Sales Change
E-commerce
Total E-commerce Total Sales Sales
4Q 1999 821,351 5,198 0.63 8035 NA
1Q 2000 747,934 5,240 0.70 -8.9 0.8
2Q 2000 815,677 5,526 0.68 9.1 5.5
3Q 2000 812,158 6,393 0.79 -0.4 15.7
4Q 2000 856,234 8,686 1.01 5.4 35.9
Source: Commerce Dept.
The State of B2C E-commerce in the U.S.
• U.S. consumers remain #1 the wired world as they increase frequency and volume of their
online purchases
• But, the number of Internet purchases by U.S. consumers is second to the U.K.
• Among U.S. respondents using the Internet, 74% have purchased an item online in last 2
months, and 87% expect to make an online purchase in the next year.

8. US vs. the World
Global Annual Online Expenditures (Median = $460)
Global Annual Online Transactions (Median = 10
transactions)
41+
10%
$4,001+
1-5 26-40 9%
41+ 26-40
32% 12%
$2,001-$4,000 $4,001+
16-25 11-15 $1-200
10% $2,001-$4,000
32% $1,001-$2,000
16-25 6-10 1-5
$1,001-$2,000 $501-$1,000
15%
13% $201-$500
6-10 11-15 $1-200
$201-$500 $501-$1,000
19% 12%
20% 16%
• Online buyers in the U.S. spent, on average, $898 last year shopping online.
• Worldwide: Median online expenditure total was $460.
Top Ten U.S. Purchase Categories
60%
52%
49% 49%
50%
40% 37%
29% 28% 28% 27%
30% 25%
20% 18%
10%
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Open Issues in E-commerce
• Globalization
• Contractual and Financial Issues
• Ownership
• Privacy and Security

9. • Interconnectivity and Interoperability
• Deployment
Barriers to E-commerce (U.S.): Old retail inconveniences and inefficiencies:
Barriers
1. Concern that credit card will be
stolen
3. Item is very large
5. High shipping costs
0% 10% 20% 30% 40% 50% 60%
source: Ernst & Young
First-Generation B2C
• Main Attraction: Lower Retail Prices
• “B2C Pure Plays” could eliminate intermediaries, storefront costs, some distribution
costs, etc.
• Archetype: www.amazon.com
Basic Problems Encountered Immediately
• “Customer-Acquisition Costs” are huge.
• Service is technically commoditizable, and there are no significant network effects.
• Customers’ switching costs are tiny.
(Lock-in to online book-buying is high. Lock-in to Amazon is low. Recall Netscape and
IE.)
• Competition is fierce in almost all segments. Few e-tailers are profitable.

10. • Investors have run out of money and patience.
Internet Customer Acquisition Costs
Customer acquisition cost = total spent on advertising and marketing divided by the total
number of new customers obtained
– Amazon.com ™ $29
– DLJ Direct ™ $185
– E*Trade ™ $257
– Various E-Commerce Sites ™ $34
E-tailing is Difficult in Low-Margin Businesses
• Toys (e-Toys.com)
– Typical online order contributes $11 to gross revenues.
– Warehouse, marketing, website, and other fixed overhead is high.
– A pure-play e-tailer needs to capture at least 5% of the toy market to reach profitability.
• Groceries (Webvan.com, Peapod.com)
– Typical online order contributes $9 to gross revenue (fulfillment costs are very high).
– Steady customer orders ~30 times/year.
– McKinsey/Salomon-Smith-Barney’s estimate of the value of one steady customer: ~$900
over 4 years.
Current Theories (after first shake-out)
• High order frequency and large order size are more important than large customer base.
• E-tailers should strive for average order sizes of >$50 and concentrate on high-margin
product categories (>35%). [Traditional grocery margins: 2-3%.]
• Concentrate on making transactions profitable, not on VC-supported market-share wars.
• Combine e-tailing with B&M stores.
Multi-Channel” Retail (B2C w/ B&M)
• Exploit multiple marketing and distribution channels simultaneously
– B&M (“bricks and mortar”) stores: Customers browse on the web before going to the
store.
– Catalog sales, telephone, tv advertising,…
• In 1999, multi-channel retailers (i.e., B&Ms or traditional catalog companies that also sell
online) made up 62% of B2C e-commerce. Mostly high-margin sales, e.g., computers,
tickets, and financial service.
• Projected to reach 85% in next 5 years. (Source: Boston Consulting Group)
Advantages of Multi-channel Retail
• Leverage existing brands.
• Biggest B&M retailers have huge clout. (Walmart’s annual sales are $138B, much more
than all e-tailers’ combined.)

11. • Profits from existing channels can subsidize e-tail start-up. No need to quit when VCs
lose interest.
• Use established distribution and fulfillment infrastructure (e.g., LL Bean, Land’s End,…).
• Cross-marketing and cross-datamining.
E-tailers are Adding “Offline” Channels
• Alloy.com sold clothes and accessories, but it became a hit only after its catalog was
launched.
• Drugstore.com once dismissed B&M retailing, but it agreed to sell a 25% stake to Rite-
Aid not long after rival Soma.com was bought by CVS.
• Gateway sells computers through WWW and catalog, but it also has 164 stores across
U.S. They carry little stock, but they allow customers to “get a feel for the product”
before ordering it.
Conclusion:
From the diffident analysis e-commerce helps us to develop in new business across the world.
Business models across the world also continue to change drastically with the advent of
eCommerce and this change is not just restricted to USA. Other countries are also
contributing to the growth of eCommerce. For example, the United Kingdom has the biggest
e-commerce market in the world when measured by the amount spent per capita, even higher
than the USA. The internet economy in UK is likely to grow by 10% between 2010 to 2015.
This has led to changing dynamics for the advertising industry.
Amongst emerging economies, China's eCommerce presence continues to expand. With 384
million internet users, China’s online shopping sales rose to $36.6 billion in 2009 and one of
the reasons behind the huge growth has been the improved trust level for shoppers. The
Chinese retailers have been able to help consumers feel more comfortable shopping online.
eCommerce is also expanding across the Middle East. Having recorded the world’s fastest
growth in internet usage between 2000 and 2009, the region is now home to more than 60
million internet users. Retail, travel and gaming are the region’s top eCommerce segments, in
spite of difficulties such as the lack of region-wide legal frameworks and logistical problems
in cross-border transportation. E-Commerce has become an important tool for businesses
worldwide not only to sell to customers but also to engage them.