E-Commerce What is it and how Does it Work

E-Commerce What is it and how Does it Work

July 8, 2022 Reading time: 11 min


E-Commerce is Electronic commerce and involves buying or selling products online or over the internet. It does this by drawing on varying technologies. E-Commerce has grown enormously during Covid lockdown with many people living their commercial and working lives online. It is the way of the future, and retail sales of e-commerce show that they will reach $6.5 trillion by 2023, there is no going back with the three main areas being: Online retailing electronic markets, online auctions, and electronic business. E-commerce uses the web for a part of a transaction’s life cycle, often combined with e-mail.

An example of E-commerce is the sale of E-books on Amazon. it is interesting to note that the term E-commerce was first coined by Dr. Robert Jacobson in a Commerce Committee in 1984. Since that time E-Commerce has gradually evolved, speeding up in the last ten years.

Electronic Commerce and Type of E-Commerce

In some places, government regulation has been slow to catch up with electronic progress, and the privacy of individuals must be protected online. The California Privacy Act (2020) was enacted, and it includes the use of emails, online privacy, and consumer privacy. Over the last few years, Internet Commerce has continued to grow involving some of the following applications.

  • Digital Wallet
  • Document automation
  • Electronic tickets
  • Content management for writers
  • instant messaging
  • internet security
  • online banking
  • online auctions
  • shopping cart software
  • virtual assistant
  • domestic payment systems
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Every country has its own version of consumer protection and offers advice to the consumer when something goes wrong. One of the things that can go wrong is data security, and sometimes data can remain unprotected or unsecured. If data is hacked it can leave the consumer at risk.

In China E-commerce continues to grow and expand as Chinese consumers seem to feel comfortable with online shopping.

Having a mobile device like an i phone has made a big difference to people accessing online shopping. In 2022 nearly everyone has an i phone and can use their ‘down time’ while on a bus ride to work or school, to browse and shop without physically having to go to the store.

This has proved an unexpected bonus for older people with limited mobility, who would have once ordered out of catalogs. They now only need to become adept at their phone technology to order anything from clothing to Uber Eats, giving them a new level of independence. Deliveries to the home are big business and appear to be getting faster and faster.

The Growth of E-Commerce https://www.shopify.com/encyclopedia/what-is-ecommerce

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In 2017 E-commerce sales were at 2.3 trillion US across the world. Shops in the Mall are beginning to struggle because online shopping is accessible, cheaper, and fast in reaching the purchaser. Many small retailers have had to reinvent themselves and go online to avoid fading into oblivion. E-commerce also has the ability to fill the gap in the supply chain, due to new supply chain technologies. fewer people are now required to supply more products, meaning a lot of jobs will cease to exist. Many lower-paid workers will need to retrain to avoid redundancy.

Sadly human interaction is often lacking in e-commerce and for those who would rather deal face-to-face, it makes life hard, while many see it as a way to expedite the transaction and save time. The hard part comes when you have to return a product, so it is a good idea to be sure of your purchase before you order.

Environmental Impact

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Lots of packaging and cardboard are used in sending out products, and Amazon has put a strategy in place to cut back on the use of packaging and boxes and is researching ways of reducing it further. With new local initiatives in recycling plastics and using them again, the waste piles are diminishing and it looks as though environmental waste will be much lower in the future.

Types of E-Commerce


Electronic commerce has several different models, and some of them are.

  • Business to Business refers to sales of products between different businesses
  • Business to consumer or direct to the consumer is the most common e-commerce model that most people are familiar with. This is good for the consumer as it allows them to shop around for the best deal, and when they find the right business it enables them to form a relationship with the business. It creates an unlimited market for the customer allowing them to shop when it is convenient for them, and not abide by old-fashioned shopping times. It also makes running a business easier, in keeping an inventory, tracking transactions, and providing real-time updates.
  • Consumer to Consumer, creates a market, allowing one customer to purchase goods from another customer. The third-party platform earns money by charging a listing fee. The consumer has the advantage of finding goods that are hard to find elsewhere, and an example of this type of site is eBay where the site takes special planning and setting up, and getting the online platforms right.
  • Business to administration, another digital commerce example for all examples between companies and government. Usually, government contracts are complicated and involve a lot of paperwork and regulation. However, government contracts involve large amounts of money, meaning that most businesses look forward to the stability and regular payments that a government contract brings.
  • Consumer to Administration is a type of e-commerce between individuals and public administration creating an easy way to establish communication between customers and government. Everything is listed on the website, and the consumer is easily able to look up information scheduling health appointments and other things. Example, https://www.australia.gov.au ( official COVID Government website)

Digital Commerce Advantages

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Working online from home can save time and money. Not having to set up an expensive rented office and pay for the equipment is a big saving.

You just log on and hire a virtual assistant, who will complete your typing in a prearranged time at a market rate.

The other thing it saves is time, if your office is in your home there is no commute, although in many cases conditions become cramped with everyone working from home, and for many of us, there are distinct advantages to leaving the house.

If you have spent some years working in e-commerce, you will have a following of customers who like what you do. However, competition is increasing, and more and more people are vying for a market share. So in the future, only the best will survive.

If you are a teacher you may be working from home coaching children in e-learning systems. It is really sad that some people still don’t have access to the internet, but if you go along to the library, the librarians will set you up on one of their computers so that you can use the internet to learn without cost or just the cost of wifi.

Internet Commerce

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The internet gives us opportunities to create new markets, and for the creative, this is a bonus for those who embrace the medium and no longer want to do things in the old way. For example, on the internet the shop is open all the time, so your site is still working for you even when you are sleeping someone somewhere is purchasing your product. You may have a product for sale on Amazon, and this will give you the ability to sell into many different countries, to a whole lot of new customers. Using e-commerce brings you many advantages and some others are.

  • Better targetting of clients, as the client chooses your site.
  • Reduced marketing costs
  • Reduced communication costs.
  • Improved after-sales service.
  • Constant information about what is new in your specialized marketplace

This is a great way of reaching your customers, without opening a new office.

The E-Commerce Shop


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You have decided to sell your perfumed candles online, they are beautifully made and make amazing gifts, so you want to establish your online store. Your first step is to have a Domain name and once you have that go through the following steps.

1. Planning Phase

  • Make a video of your candles, spend some time making the setting perfect
  • Price them competitively
  • Upload the video to the website

2. Send an Email to all your contacts to say the site is live

Ask your friends to like the range

3. Select Some Online Shopping Channels

To advertise your product (two are enough)

Set up Payment Facilities, credit cards, or online cash.

4. Monitor Traffic

To see who is buying

5. Sell Your E-Commerce Product

Make sure you have enough supply in the funnel as you can’t run out of candles.

6. Evaluate and Optimize

Consider adding compatible products to the range.

This is a very simple example of internet commerce at work, and once you identify the steps, you can make them work for you.

Types of E-Commerce the Author

Once it was nearly impossible to get a start as an author, but now we have content writing to hone our skills on while waiting for a break.

When you write content you add value to educational articles that will be read by those interested in the topic that you are writing about. The first thing the writer must do is to extensively research the subject he/she is writing about, as it is important to have a sound knowledge of the subject.

The requester will mostly give the writer a couple of keywords or Search Engine Optimization terms, that need to come up in the article, usually 2% or slightly less of the time. This way the reader knows what to google to gain more information on the product. This leads to the reader finally reaching the advertizer’s website, and often buying the product.

Benefits of Content Writing for Internet Commerce

E-commerce benefits widely from content writing, and the writer is often hired to write a business page for the website. This makes it look new and different. The Call To Action (CTA) increases the conversion rate. The content helps the product reach the electronic audience while repositioning your brand to a wider audience.

A blog gives visitors to the website a reason to return to your website, and if you get a content writer to write for you, clients often want to see what the next blog is about, and they will return every week to read the blog becoming internet commerce regulars, and bringing repeat business.

Researching Types of E-Commerce

Content writing research is everything, and it is important not to get it wrong by misinterpreting your subject. Remember you are getting everything right to drive traffic to a website and the SEO has normally been chosen by your employer, so it is really important that it is respectfully written. Practice makes perfect, and the more you write, mostly the better you get at the wording and content.

The Effective Digital Commerce Workplace

Enabling is important and prospective buyers must be able to find your site. If your work is specific Trade directories may be best for you, so the tradesman can easily locate you.

Have a new product section on your site, many buyers will go straight to this so spend time researching anything new.

Market to all your established clients using email and then they will know what is to come.

Activate an exchange mechanism, so that if people purchase the wrong hammer or drill they can swap it.

Give discounts to those that purchase more than a designated amount, say $1,000 a month as a loyalty scheme.

Everyday Internet Commerce

Try to start your electronic business simply. Employ a couple of school leavers with good electronic commerce marks, and explain to them what you want to do. It is frightening to think that most 12-year-olds can build a website. But having said that, it is better to employ a qualified website builder who will have a good idea of types of e-commerce and what is required for digital commerce now and in the future when your business will be thriving.

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Experienced SEO Specialist and Entrepreneur. Participated in startup projects in the markets of different countries. Participant and speaker at several digital marketing conferences. Leads several channels in different languages and also writes articles for various resources. Invented the style of imperial content matrices that increase the effectiveness of SEO and content marketing


Experienced SEO Specialist and Entrepreneur. Participated in startup projects in the markets of different countries. Participant and speaker at several digital marketing conferences. Leads several channels in different languages and also writes articles for various resources. Invented the style of imperial content matrices that increase the effectiveness of SEO and content marketing