Ecommerceproject

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A PROJECT REPORT ON E-COMMERCEMARKETING

SUBMITTED IN PARTIAL FULFILLMENT OF THEREQUIREMENT FOR THE AWARD OF THE DEGREE OF

MASTER OF BUSINESS ADMINISTRATION

SUBMITTED BY:

MOHAMMED YOUNUS

HALL TICKET NO: 141709672012

SHADAN INSTITUTE OF MANAGEMENT STUDIES

(Affiliated to Osmania University, HYDERABAD)KHAIRTABAD

(2009-2010)



ACKNOWLEDGEMENT

Success of every project depends largely on the encouragement and guidance of many others. I

take this opportunity to express my gratitude to the people who have been instrumental in the

successful completion of this project.

I would like to thank Mr. Omer bin Husain (marketing manager), for his valuable guidance during

the project work. I would also like to thank him for his encouragement, advice and overall

supervision. I am highly obliged and grateful to Mr. Ikram ullah aman (faculty member &internalguide) for providing me with new ideas and valuable advice and endless supply of new ideas

and support for this project.

My special thanks to Mr. Shahid Ansari(principal of Shadan Institute of Management studies) for

his complete guidance and it goes without his support this project would not have been

possible.

This acknowledgement would be incomplete if I failed to thank my classmate, for all the

assistance received. I thank them for their meaningful hints and suggestions.

A lot of effort has gone into this project, and many people have contributed wholeheartedly and

vastly to its competition, I thank everyone who aided me in my endeavors.

MOHAMMED YOUNUS

MBA II YEAR



CONTENTS

1. INTRODUCTION

1.1 E-COMMERCE DEFINITION

1.2 E-COMMERCE HISTORY

1.3 TYPES OF E-COMMERCE

1.4 BUSINESS APPLICATIONS

1.5 BENEFITS AND LIMITATIONS

1.6 ABOUT COMPANY

1.7 PURPOSE

1.8 PROBLEM DISCUSSION

2. E-MARKETING

2.1 E-MARKETING DEFINITIONS

2.2 OVERVIEW OF ELECTRONIC MARKETING STRUCTURE

2.3 BUSINESS MODELS OF ELECTRONIC MARKETING

2.4 ELECTRONIC DEPARTMENTAL STORES

2.5 CONSUMER PERSPECTIVE MODEL

3. ELECTRONIC PAYMENT SYSTEMS

3.1 TYPES OF ELECTRONIC PAYMENT SYSTEMS

3.2 DIGITAL TOKEN-BASED ELECTRONIC PAYMENT SYSTEMS

3.3 SMART CARDS AND ELECTRONIC PAYMENT SYSTEMS

3.4 CREDIT CARD-BASED ELECTRONIC PAYMENT SYSTEMS

3.5 DESIGNING ELECTRONIC PAYMENT SYSTEMS

3.6 RISK AND ELECTRONIC PAYMENT SYSTEMS

4. ADVERTISING AND MARKETING ON THE INTERNET

4.1 THE NEW AGE OF INFORMATION-BASED MARKETING

4.2 ADVERTISING ON THE INTERNET



4.3 CHARTING THE ON-LINE MARKETING PROCESS

4.4 MARKETING RESEARCH

5. CUSTOMER RELATIONSHIP MANAGEMENT

5.1 FUNDAMENTALS OF CRM

5.2 CENTRALIZED CUSTOMER SUPPORT

5.3 E-CRM

5.4 CONSUMER BEHAVIOR

6. METHODOLOGY

6.1 GATHERING DATA

6.2 QUALITATIVE VS. QUANTITATIVE RESEARCH METHOD

6.3 THE DELPHI STUDY METHOD

6.4 PRIMARY & SECONDARY SOURCES

6.5 INTERVIEWS

6.5.1 FACE TO FACE INTERVIEW

6.5.2 E-MAIL INTERVIEW

6.6 INTERPRETATION

6.6.1 ANALYZING THE DATA

6.6.2 RELIABILITY

6.7 SHORT SUMMARY OF THE METHODOLOGY

7. CONCLUSIONS

8. REFERENCES



online shopping started, it took about five years to introduce security protocols and DSL allowing

continual connection to the Internet. By the end of 2000, many European and American

business companies offered their services through the World Wide Web. Since then people

began to associate a word "ecommerce" with the ability of purchasing various goods through

the Internet using secure protocols and electronic payment services.

TYPES OF E-COMMERCE

E-commerce is the use of Internet and the web to transact business but when we focus ondigitally enabled commercial transactions between and among organizations and individualsinvolving information systems under the control of the firm it takes the form of e-business.Nowadays, 'e' is gaining momentum and most of the things if not everything is getting digitallyenabled. Thus, it becomes very important to clearly draw the line between different types of commerce or business integrated with the 'e' factor.

There are mainly five types of e-commerce models:

1. Business to Consumer (B2C) - As the name suggests, it is the model involving businessesand consumers. This is the most common e-commerce segment. In this model, onlinebusinesses sell to individual consumers. When B2C started, it had a small share in the marketbut after 1995 its growth was exponential. The basic concept behind this type is that the onlineretailers and marketers can sell their products to the online consumer by using crystal clear datawhich is made available via various online marketing tools. E.g. an online pharmacy giving freemedical consultation and selling medicines to patients is following B2C model.

2. Business to Business (B2B) - It is the largest form of e-commerce involving business of

trillions of dollars. In this form, the buyers and sellers are both business entities and do notinvolve an individual consumer. It is like the manufacturer supplying goods to the retailer or wholesaler. E.g. Dell sells computers and other related accessories online but it is does notmanufacture all those products. So, in order to sell those products, it first purchases them fromdifferent businesses i.e. the manufacturers of those products.

3. Consumer to Consumer (C2C) - It facilitates the online transaction of goods or servicesbetween two people. Though there is no visible intermediary involved but the parties cannotcarry out the transactions without the platform which is provided by the online market maker such as eBay.

4. Peer to Peer (P2P) - Though it is an e-commerce model but it is more than that. It is a

technology in itself which helps people to directly share computer files and computer resourceswithout having to go through a central web server. To use this, both sides need to install therequired software so that they can communicate on the common platform. This type of e-commerce has quite low revenue generation as from the beginning it has been inclined to thefree usage due to which it sometimes got entangled in cyber laws.

5. m-Commerce - It refers to the use of mobile devices for conducting the transactions. Themobile device holders can contact each other and can conduct the business. Even the web



design and development companies optimize the websites to be viewed correctly on mobiledevices.

BENEFITS AND LIMITATIONS OF E-COMMERCE

The global nature of the technology, low cost, opportunity to reach hundreds of millions of people, interactive nature, variety of possibilities, and resourcefulness and rapid growth of thesupporting infrastructures result in many potential benefits to organizations, individuals, andsociety. These benefits are just starting to materialize, but they will increase significantly as ECexpands. It is not surprising that some maintain that the EC revolution is just ³as profound as thechange that came with the industrial revolution´.

BENEFITS TO ORGANIZATIONS

The following are the benefits of EC to organizations:

1. Electronic commerce expands the marketplace to national and international markets.2. Electronic commerce decreases the cost of creating, processing, distributing, storing and

retrieving paper-based information.3. Ability for creating highly specialized businesses.4. Electronic commerce allows reduced inventories and overhead by facilitating ³pull-type

supply chain management. In a pull-type system the process starts from customer orders and uses just-in-time manufacturing.

5. The pull-type processing enables expensive customization of products and serviceswhich provides competitive advantage to its implementers.

6. Electronic commerce reduces the time between the outlay of capital and the receipt of products and services.

7. Electronic commerce initiates business processes reengineering projects. By changingprocesses, productivity of salespeople, knowledge workers, and administrators canincrease by 100 percent or more.

8. Electronic commerce lowers telecommunications cost-the internet is much cheaper thanVANs.

9. Some other benefits of EC include improved image, improved customer service, newfound business partners, simplified processes, compressed cycle and delivery time,increased productivity, eliminating paper, expediting access to information, reducedtransportation costs and increased flexibility.

BENEFITS TO CONSUMERS

The following are the benefits of EC to consumers:

1. Electronic commerce enables customer to shop or do other transactions 24 hours aday, all year round, from almost any location.

2. Electronic commerce provides customers with more choices; they can select frommany vendors and from more products.

3. Electronic commerce frequently provides customers with less expensive productsand services by allowing them to shop in many places and conduct quickcomparisons.



4. In some cases, especially with digitized products. EC allows quick delivery.5. Customers can receive relevant and detailed information in seconds, rather than

days or weeks.6. Electronic commerce makes it possible to participate in virtual auctions.

BENEFITS TO SOCIETY

THE following are the benefits of EC to society

1. Electronic commerce enables more individual to work at home and to do lesstravelling for shopping, resulting in less traffic on the roads and lower air pollution.

2. Electronic commerce allows some merchandise to be sold at lower prices, soless affluent people can buy more and increase their standard of living.

3. Electronic commerce enables people in Third world countries and rural areas toenjoy products and services that otherwise are not available to them. Thisincludes opportunities to learn professions and earn college degrees.

4. Electronic commerce facilitates delivery of public services, such as health care,education and distribution of government social services at a reduced cost and/or improved quality. Health-care services, for example, can reach patients in ruralareas.

Limitations of e-commerce

There is no doubt behind the fact that E-commerce has given many companies the right tocheer but there are a few limitations of E-commerce too.

1. The companies or the businesses who are selling the products are not able to communicatewith the customer face to face. Due to this they are not able to get the feedback about theproducts so that they may improvise on the products. Although online chat programs havesolved this issue to some extent but it needs to be implemented on a large scale.

2. Another limitation with E-commerce is that you are not able to touch and check the quality of a product before buying it.

3. Credit Card security is a serious issue. People who are carrying out a transaction over theInternet are worried about the credit card security.

4. The next one is a technological limitation that the cost involved with bandwidth and server is

too high.

5. Customers are still worried and fear about their online Credit Card orders.

6. Extensive database and technical knowledge and experience required.



Business applications

Some common applications related to electronic commerce are the following:

Email

Enterprise content management

Instant messaging

Newsgroups

Online shopping and order tracking

Online banking

Online office suites

Domestic and international payment systems Shopping cart software

Teleconferencing

Electronic tickets

Group Buying

E-MAIL

E-mail, or email, is short for "electronic mail" and is a method of composing, sending, andreceiving messages over electronic communication systems. Most e-mail systems today usethe Internet, and e-mail is one of the most popular uses of the Internet.

E-MAIL ADDRESS

E-mail address is relatively easy to understand. Every e-mail address has three necessaryelements:

UserID: Every person with an e-mail address has a user identification of some sort. It is usuallysomething simple, like johndoe, but can be more complex.

y UID: The user ID

y @: THE ³at´ sign connects the user ID with the third element.

y DOMAIN: every e-mail address has one domain.

The basic form of an e-mail address is

[email protected]

The text before the @ (pronounced ³at´) sign specifies the username of the individual, while thetext after the @sign indicates how the computer system can locate the individual¶s mailbox.



of service providers blocking access to Usenet (see main article), newsgroups continue to be

widely used.

Online shopping

Online shopping is the process whereby consumers directly buy goods or services from aseller in real-time, without an intermediary service, over the Internet. If an intermediary service ispresent the process is called electronic commerce. An online shop, eshop, e-store, internetshop, web shop, webstore, online store, or virtual store evokes the physical analogy of buying products or services at a bricks-and-mortar retailer or in a shopping mall. The process iscalled Business-to-Consumer (B2C) online shopping. When a business buys from another business it is called Business-to-Business (B2B) online shopping. Both B2C and B2B onlineshopping are forms of e-commerce.

ONLINE BANKING

Online banking (or Internet banking) allows customers to conduct financial transactions on asecure website operated by their retail or virtual bank, credit union or building society.

ONLINE OFFICE SUITE

An online office suite or online productivity suite is a type of office suite offered by websitesin the form of software as a service. They can be accessed online from any Internet-enableddevice running any operating system.[1] This allows people to work together worldwide and at

any time, thereby leading to international web-based collaboration and virtual teamwork.Usually, the basic versions are offered for free and for more advanced versions one is requiredto pay a nominal subscription fee.

DOMESTIC AND INTERNATIONAL PAYMENT SYSTEM

A payment system is a system for the transfer of money. What makes it a "system" is that itemploys cash-substitutes; traditional payment systems are negotiable instruments suchas drafts (e.g., checks), credit cards and other charge cards, documentary credit (such as L/C)and electronic funds transfers. Some payment systems include credit mechanisms, but that isessentially a different aspect of payment. Payment systems are used in lieu of tendering cash in

domestic and international transactions and consist of a major service provided by banks andother financial institutions. In the US, they are regulated by different state statutes (UCC) andfederal regulations.

SHOPPING CART SOFTWARE



Shopping cart software is software used in e-commerce to assist people making purchases

online, analogous to the English term 'shopping cart'. In British English it is generally known as

a shopping basket, almost exclusively shortened on websites to 'basket'.

The software allows online shopping customers to accumulate a list of items for purchase,

described metaphorically as "placing items in the shopping cart". Upon checkout, the software

typically calculates a total for the order, including shipping and handling (i.e. postage and

packing) charges and the associated taxes, as applicable.

TELECONFERENCING

A teleconference or teleseminar is the live exchange and mass articulation of

information among several persons and machines remote from one another but linked by

a telecommunications system. Terms such as audio conferencing, telephone conferencing andphone conferencing are also sometimes used to refer to teleconferencing.

The telecommunications system may support the teleconference by providing one or more of

the following: audio, video, and/or data services by one or more means, such

as telephone, computer, telegraph, teletype, radio, and television

Electronic ticket

An electronic ticket or e-ticket is used to represent the purchase of a seat on apassenger airline, usually through a website or by telephone, or sometimes through airline ticket

offices or travel agencies. This form of airline ticket rapidly replaced the older multi-layered

paper tickets (from close to zero to 100% in about 10 years) and became mandatory

for IATA members as from June 1, 2008. During the last few years, where paper tickets were

still available, airlines frequently charged extra for issuing them. E-tickets are also available for

some entertainment venues.

Once a reservation is made, an e-ticket exists only as a digital record in the airline computers.

Customers usually print out a copy of their receipt which contains the record locator or

reservation number and the e-ticket number.

According to critical acclaim, Joel R. Goheen is recognized as the Inventor of Electronic

Ticketing in the Airline Industry, an industry where global electronic ticket sales (the industry

standard) accounts for over US$400 billion a year (2007).

GROUP BUYING



Group buying, which refers to social buying or collective buying as well, is the buying an offer

which has been significantly reduced, due to the fact that it is only valid if enough buyers are

found. Recently, group buying has been taken online in numerous forms, although group buys

prior to 2009 usually referred to the grouping of industrial products for wholesale (especially in

China). As just mentioned, group buys are a variation of tango buying that also occurs in China,

in which an item must be bought in a minimum quantity or dollar amount; otherwise, the seller

will not allow the purchase. Since individuals typically do not need multiples of one item or do

not have the resources to buy in bulk, group buys allow people to invite others to purchase in

bulk jointly. These group buys often result in better prices for the individual buyers or ensure

that a scarce or obscure item is available for sale.

Group buys were and still are often organized by like-minded people through Internet forums.

There have also been recent attempts at creating more focused online forums such as

GroupBuyCenter.com.[1] And Tippr.com the vast majority of the users tend to focus onaftermarket auto parts and have now also started to leverage the group buying model for

purposes of buying other consumer durables.

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