E-commerce

Electronic commerce is the practice of buying and selling of products and services over an electronic system connected via internet or any other network. On the contrary traditional commerce relies on the traditional ways of doing commerce that occur physically. Traditional commerce is expensive, time consuming and  may not have good market reach. E-commerce is relatively cheaper, less time consuming and gives businesses the opportunity to have a global market reach.

The two developments that contributed to the emergence of the internet as an electronic commerce infrastructure are collaboration and the exchange of information. Through collaboration people and organizations are able to interact, communicate and search for information easily. This exchange of information along with the processing, storing and transmission of information are the key factors that made internet as the best place to do electronic commerce.

Transaction costs are charges that take place whenever an economic exchange occur. On the internet the transaction costs are low because it is easier to tap larger markets in less time and gathering the information and getting the best price is much easier.

The internet enables transparent exchange of information more over anyone can directly contact anybody. It becomes more like a network than the traditional hierarchical economic structure, in which firms can only buy and sell within an organization, and small firms had limited reach.

Managers can increase the performance of their company by being innovative. The best practice is to first identify changes that can add value to the performance. The identification can be done by breaking down the current value-adding activities of the company that help generate revenue. Through this technique the manager will easily be able to find the best solutions for his company.

The process of buying a product through internet is relatively more convenient. One can buy anything while sitting at home. The details and features of a product can be better understood, and hence  good decisions can be made while choosing a product. Companies that do business online have developed a lot over the years, enough that end buyers can now search and buy product more easily. Websites are user-friendly and anyone with little knowledge about the good can still find his way with the help of active help given by most websites. Prospective buyer for example if intends to buy a printer can easily log on to multiple vendors websites, compare and contrast the features and make an informed decision.

The laws enforced by China and Germany will force companies to limit their operation in these countries unless these companies adhere to the regulations. Specifically with China, the company might have to work along with the Chinese government as it maintains significant oversight over foreign businesses, e.g. Google was asked to ban pages against the Chinese government if it wanted to operate in China.

For the online video business, the following three features of online book-stores can be adapted
Top-seller This feature is used by online book-stores to give customers instant information about the best selling books. For the online video business, this feature would inform the customer about the highest selling videos, making it easier for customers to make a choice.

Discounts For online book-stores, this feature tells the cost-conscious customer about the cheaper titles. This can easily be adapted by an online video business, with the feature informing customers about cheaper videos.

Express Shipment This feature is used by customers who want delivery of their books faster than the normal shipment time. With the online video business, this feature would be very useful for  customers who would want early delivery of their videos.