History and Evoluation of E-commerce

The origin of commerce by exchanging goods, now commerce is a basic activity of goods trading and buying in everyday life. Entering into the electronic era, the way individuals and organizations do business and undertake commercial transactions have been changed.The emergence of electronic commerce started in the early 1970s with the earliest is technology electronic interchange (EDI) was introduced.
During the 1990s, the Internet was opened for commercial use; it was also the period that users started to participate in World Wide Web (WWW), and the phenomenon of rapid personal computer (PCs) usage growth. Due to the rapid expansion of the WWW network; e-commerce software; and the peer business competitions, large number of dot-coms and Internet starts-ups appeared. Integrated with the commercialization of the Internet, Web invention, and PC networks these three important factors made electronic commerce possible and successful.
Today the largest electronic commerce is Business-to-Business (B2B). Businesses involved in B2B sell their goods to other businesses.Other varieties growing today include Consumer-to-Consumer (C2C) where consumers sell to each other, for example through auction sites. Peer-to-Peer (P2P) is another form of e-commerce that allows users to share resources and files directly.
History of ecommerce is a history of a new, virtual world which is evolving according to the customer advantage. All the tasks, letters, messages and data transferred within a flick of a second at any place no matter how far or how near. This all was impossible even for a thought or a dream, for things to be like that just a few years ago. It is a world which we are all building together brick by brick, laying a secure foundation for the future generations.

An example of an E-commerce failure and its causes

eToys.com started from 1997 to 2001. The company raised $166 million in a May 1999 IPO, but in the course of 16 months, its stock went from a high of $84 per share in October 1999 to a low of just 9 cents per share in February 2001.
There are several causes of failure in eToys. One of the failures is technology which has the ability to win other competitors in the same field. This is due to technology are improving tremendous quickly.
Another cause is inadequate reserve cash, where need to calculate before a business is start. It is important to identify the demand and need of consumers. Besides, also need to understand the market demand and needs of consumers. Hence, to get professional advice of business is advisable.
However, pricing also play an important role when the price is too high there will be low number of customers. Besides, the needs to know the price of products those customers are willing to pay for.
Furthermore, the failure are spending millions on advertising where have outweighed company’s income. Company should be aware of fine line between effective advertising and over advertising. There are many methods to produce great and minimum cost advertising such as brochures, catalogs, direct mail, and web site.

Revenue Model

Revenue model is description of how the company or an E-commerce project will earn revenue. It is include 5 models such as sales revenue model, transaction fees model, subscription fees, advertising model, and affiliate model.

Sales revenue model is companies generate revenue from selling merchandise on their web site of from providing a service.
Transaction fees is company receives a commission based on the volume of transaction made.
Subscription fees are customers pay a fixed amount, usually monthly, to get some type of service. Fee from subscribers is in exchange for access to content or service.
Advertising fees is companies charge others for allowing them to place a banner on their sites.
Affiliate fees are companies receive commissions for referring customers to other Web sites.

Now, let me compare each revenue model for Google, eBay, and Amazon.com.

Sales Revenue Model: The main representative is Amazon.com.
The major revenue of Amazon.com is selling book, CDs, DVDs, software and so on. Amazon.com reported over 1.3 million sellers sold products through Amazon's worldwide web sites in 2007. Not only Amazon.com, eBay also make revenue through sales revenue model as well. However, Google seldom involve in such model as it major business is search engines.

Transaction Fees Model: eBay is classical example for this model.
eBay is platform let people buy and sell their goods through their website. It become the intermediate in this trade and received transaction fee between them. Amazon.com and Google not many this kind of revenue compare with eBay.

Subscription Fees Model: These three companies all got this kind of model. The following link is can let u see how they can earn this revenue.
eBay
Amazon.com
Google

Advertising Fees Model: it is Google major revenue sources.
Almost 99% sources revenue of Google is advertising fees, such as Google AdWords and Google Adsense.

Clickriver Ads can place advertisement on the Amazon.com

Same as the Amazon.com, eBay also got some this kind of model.

Affiliate Fees Model: Pay-Per-Click is most popular that Google use it generates revenue. As compare with eBay and Amazon, Google also very famous in this. Nowadays, affiliate program is also become more popular compare with advertising as it also part of the advertising. eBay and Amazon trend to become most using it as well.

Example of an E-commerce success and its cause: Amazon.com.

Is there anyone has the experiences of online shopping or selling products through internet? Online shopping brings a lot of convenience to the consumers. In Malaysia, more and more people start to purchase something online such as clothes, electronic products or even pets. Therefore you should not be strange about this E-Commerce company: Amazon.com, Inc.

As we know, people called Amazon.com as Titans of E-Commence which together with eBay. Amazon.com, Inc was founded by Jeff Bezoz in 1994, and launched online in 1995.

Amazon.com started as an online bookstore, but it offers "Earth's Biggest Selection" of nearly everything today. it has 35 million customers and lists million of different items in categories such as electronic product, kitchen and housewares, music CDs, DVD, computer software, food ,toys, etc. Furthermore, it has established separate websites in United Kingdom, France, China and Japan.

In order to let consumers get more information of the products, Amazon.com provides a good feature which allows the users to submit reviews and comments to the
web pages of each product. The users can also rate the product on a rating scale from one to five stars.

Besides that, Amazon.com provides “Search inside the books” which allows consumers to search the book that fulfill their requirement from around 250,000 books in the program.

On the other hand, Amazon’s worldwide sites allow the internet user to sell their product online. Unlike eBay/ Paypal, Amazon sellers do not have to maintain separate payment accounts because all payments and payment security are handled by Amazon.com itself.

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