| eCommerce is the popular name for
conducting business by electronic transactions and has to do
with selling and buying goods and services using computer
telecommunications networks, of which the internet is one such
network system and today the most popular one.
eCommerce includes business-to-consumer (B2C) and
business-to-business (B2B) activities, but also includes
virtual private networking (VPN) over the internet between
offices of one company or business.
The history of eCommerce
eCommerce started after World War 2, around 1948-1949, at a
time when Berlin was closed off from the rest of the Western
world.
Because of the blockade the city was under it was
impractical, and not often impossible, to conduct business in
the normal manner - by using paper documents.
The U.S. Army, who was in charge of a large section of the
city, started using telephone, telex and radio-type instead.
Credit goes to Edward Guilbert, a logistics officer who
devised this first electronic commerce system.
Over the years since then other businesses and
organizations started using and devising electronic transfer
systems and by 1975 the first general standard was excepted
known as the Electronic Data Interchange standard (EDI). the
EDI standard was universal and flexible enough to handle most
electronic transactions.
eCommerce and the internet
As the internet slowly grew in the early 1990's, companies
such as CompuServe started using graphical browsers, of which
Mosaic was the first. Much of Microsoft's Internet Explorer is
based on Mosaic, for example.
As access to the internet got easier and more people and
businesses started to hook up, so did commerce move to the net
en masse. And with this explosive development the need
to secure data transactions became necessary.
Where early hackers made off with millions by tapping into
data streams, current hackers have a much more difficult
time since the use of encryption, firewalls and secure log
in became accepted practices.
Electronic Funds Transfers (EFT) and other sensitive
information now widely uses encryption as a means to ensure
secure ecommerce.
Current ecommerce business practices
The internet and ecommerce made the world smaller. The idea
of a global village and market place suddenly became a reality
rather than a dream and many budding businesses and
entrepreneurs took to the net in search of success and fast
cash.
It is now possible to buy almost anything through the
internet and many companies conduct all their business this
way. Naturally, where others sell products, some sell
information and services, as does Links999.
Shopping centers, on line auctions, ticket reservations and
purchase for holidays, concerts and travel are now
commonplace. Ordering books and music, furniture and
everything imaginable is now available on the internet.
Directories and guides, telephone directories and
discussion platforms are all service (by)products of the internet and
ecommerce revolution.
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The ecommerce or dotcom crache of 2000
By 2000 doing business on the internet was a much hyped event
and everyone got on the bandwagon. Internet companies like
Yahoo! and Amazon sprang up, quickly reaching outrageous share prices, for
example.
Billions were spent on these and many other internet-based
companies. Unrealistically so, and the Make-Money-Quick hype
that took off in 1998 reached its melt-down only two years later
in early 2000.
The world had not gone up in smoke and flame and soon
enough financial reality reared its ugly head. Starting in March of that year,
inflated internet stocks started their downward slide and by
December of 2000 it was estimated that these stocks lost a total
of about US$800 billion.
Capital investors and venture capitalists
Since the crache of 2000 investors have been cautious of
internet IPO's (Initial Public Offerings) and the investment
made in startup internet companies by organizations, banks and
venture capitalists has declined drastically since then.
Perhaps rightly so, but we beg to differ.
When you start
off with someone else's capital it may seem smooth sailing until
they want their money back and demand to see a profit. That's
nothing new in business and the fault of the crache lies
mostly with the investors rather than with the entrepreneurs.
Investors who, despite knowing better, should not have
expected or demanded such outrageous short term profits. It
was their own greed that made them lose money. Anyone serious
about starting a business knows that it takes several years to
turn a profit, not months!
As such, entrepreneurs were forced to present business
plans which were unrealistically profitable in the short term
in order to obtain any outside funding.
The result was that most did not make it where, had they
been properly advised and invested in by the VC's, banks and
other financial institutions (which, after all, employed
financial experts and professionals!), they would have
survived the initial set up years and would have turned a
profit within standard average time of one to three years.
eCommerce today and tomorrow
So the internet was not the "Get rich quick" arena that
everyone thought it was. Perhaps only for a lucky few, but it
was, and still is, a real time business venture, just as the
high street shop, with all that entails - proper planning,
hard work, perseverance, and a little bit of good luck.
But the good news of the dotcom crache is that where big
companies have failed, smaller companies are doing extremely
well on the internet using ecommerce.
No longer are we limited to the local shopping street -
with often extortionate rents and utility costs - to sell
goods and services. We can now offer them over the internet at
a much lower startup price or monthly overhead.
The time of quick money by getting someone else to put up
the cash is over and if you want to make it on the net you
have to think long term and provide quality of content or
product.
But the net is here to stay and a good thing too. For many
smaller businesses it's the only way to avoid marketing costs and
still reach their desired target consumers. As with all business
you need to persevere and not be afraid of competition.
So, and you think you can still make it on the net?
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