MIT- SOM PGRC KJIMRP National Research Conference (Special Issue) - 2016 ISSN : 0976-8262
E-Commerce New Trends, Strategies, Issues, Challenges
and Best Practices
Ms. Shilpa D. Kolhe*
Abstract :
The use of electronic commerce by business in developed countries has grown considerably
in the past few years. This paper examines how e-commerce applications, issues, challenges,
new trends, strategies. The findings from this paper demonstrate both the challenges face in
using e-commerce in developing countries and the opportunities emerging from this new
Internet platform for development.
E-commerce stands for electronic commerce. E-commerce is improving standard among the
business community in worlds, about the opportunities offered by E-commerce. E-commerce
as part of the information technology revolution became widely used in the world trade in
general and Indian economy in particular. With advancements in technology, there have been
many changes has been occupied. Indian banks have been playing an essential role with the
e-commerce. Present scenario Banks are facing many issues and challenges by the e-
commerce.
In the backdrop of all these developments the present paper makes an attempt to, highlight
the challenges of e-commerce in Indian banks, and to understand the issues of e-commerce in
Indian banks. It raises key challenges that are being faced by consumers relating to e-
commerce Ethical issues. Finally many companies, organizations, and communities in India
are beginning to take advantage of the potential of e-commerce; critical challenges remain to
be overcome before e-commerce would become an asset for common people.
Key Words: Electronic commerce New Trends, Challenges, Issues and Banks.
* Ms. Shilpa D. Kolhe,
Department Of Computer Application
MIT Arts, Commerce and Science College, Alandi
Email ID: sdkolhe@[Link]
Contact No. : 9922402303
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2016
Objectives : their financial capacities. These options
can be divided into,
• To highlight the challenges of e-
1. Technical hardware.
commerce. .
2. Site design and maintenance.
• To understand the issues of e-commerce.
The organization will have to decide
The E-commerce strategy: whether it wants to invest in setting
up its own in-house server,
depending on the organization's size
and computing requirements, or find
a third party that is willing to host the
site on its server
3. Staffing/Training: Along with the
capital costs comes the assessment of
whether the organization has trained staff
that can maintain an e-commerce site,
including both the technical staff
mentioned above, and the administrative
staff that can process and fulfill the
orders. Is the current staff able and
It may be useful for development willing to take on these activities? Will
organizations to consider the many issues capacities be taken away from other
involved before embarking on an e- projects and activities? Will the
commerce initiative, in relation to the organization have to employ new staff to
organization's mandate, development goals, concentrate on e-commerce? Would it be
and organizational structure. The primary it cheaper/more effective to hire an outside
involved, company to do this? Can the
1. Resource Expansion: The organization organization afford these costs? Will the
may have to approach e-commerce as a staff have to receive training? All of the
resource expansion activity that uses above questions are important, not only
business strategies and a full marketing for the success of the e-commerce
approach. initiative, but also to ensure that
2. Capital Costs: A development capacities are not taken away from other
organization undertaking e-commerce development activities. Once the above-
activities should consider whether it mentioned issues are addressed, it is
wants to incur higher costs, with the possible to move on to the operational
possibility of cost recovery from an strategy. The operational strategy
expected higher level of sales. addresses the issues highlighted in the
Development organizations pursuing e- examples above. These issues are
commerce activities may have to decide important to address because of their
between varieties of options for their impact on the overall expected sales
online selling activities, depending on patterns of development organizations.
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MIT- SOM PGRC KJIMRP National Research Conference (Special Issue) - 2016 ISSN : 0976-8262
4. Marketing: As good marketing strategy used e-commerce or are unlikely to do
forms the basis of the operational so. In these cases, "traditional" means of
strategy, in order to attract customers to marketing can be employed to attract the
the e-commerce site and ensure a steady potential customer to the e-commerce
pattern of sales. Development site. This includes advertisements in
organizations often need not employ publications, newsletters, announcements
capital-intensive marketing programs in at conferences and events, mailings to
order to have a successful marketing members, and supporters. Other
campaign. The marketing strategy can be innovative means of marketing can be
divided into two main categories: 1) employed, such as advertising
online markets and 2) offline markets. promotional offers (e.g., "buy one, get
5. Online markets: It includes those one free," or announcements of
customers that have already used, or are discounted items) on the home page of
able to use, e-commerce for purchasing the development organization's website.
products. The Internet can be used as a 7. Types of products offered for sale
tool in itself in order to capture online online: As previously noted, the
markets. Techniques include identifying products that are produced by
other sites that would be willing to link development organizations primarily
to the organization's e-commerce site, or serve the purpose of disseminating
cross selling on these sites. These sites information on a specific development
include organization partners and sites topic or issue. These are products that are
that offer links to development not often produced for mass markets, but
information and online resources. for particular groups with an interest in
Another technique includes identifying the development sector. Should
target markets that would be interested in development organizations wish to
purchasing the specific development- broaden their market sector, they can
focused products that the organization is develop products that have a wider
selling online. Once the target markets appeal, while still maintaining a focus on
are identified, potential customers can be the dissemination of information on
identified and a personalized e-mail sent, development issues. These products
providing a description of the products could include general information and
being offered and why they might be of educational publications on a particular
interest to the potential customer. As development theme (e.g., a survey of
well, individuals and organizations that regional environmental issues). Such
have already been in contact with the products could draw in new markets,
organization can be contacted by e-mail such as schools and libraries.
with a similar message. In this way, the
Human skills required for E-Commerce:
development organization is targeting
It's not just about E-commerce. It's about
markets that it knows will be interested redefining business models, reinventing
in the products it offers. business processes, changing corporate
6. Offline markets: include those cultures, and raising relationships with
individuals and organizations that have customers and suppliers to unprecedented
access to the Internet, but have never levels of intimacy.
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Internet-enabled Electronic Commerce: a. Privacy consists of not being interfered
1. Web site development with, having the power to exclude;
2. Web Server technologies individual
3. Security b. Privacy is a moral right.
4. Integration with existing applications and Privacy is "a desirable condition with respect
processes Developing Electronic to possession of information by other
Commerce solutions successfully across persons about him/herself on the
the Organization means building reliable, observation/perceiving of him/herself by
scalable systems for, other persons".
• Security 2. Security concerns
• E- commerce payments In addition to privacy concerns, other ethical
• Supply- chain management issues are involved with electronic
• Sales force, data warehousing, customer commerce. The Internet offers
relations unprecedented ease of access to a vast array
• Integrating all of this existing back-end of goods and services. The rapidly
operation. expanding arena of "click and mortar" and
Issues: the largely unregulated cyberspace medium
This massive increase in the uptake of have however prompted concerns about both
ecommerce has led to a new generation of privacy and data security.
associated security threats, but any
ecommerce system must meet four integral 3. Other ethical issues
requirements: Manufacturers Competing with
a. Privacy – information exchanged must Intermediaries Online.
be kept from unauthorized parties. "Disintermediation," a means eliminating the
b. Integrity – the exchanged information intermediary such as retailers, wholesalers,
must not be altered or tampered. outside sales reps by setting up a Website to
c. Authentication – both sender and sell directly to customers.
recipient must prove their identities to Disintermediation include music being
each other. downloaded directly from producers 2)
d. Non-repudiation – proof is required that authors
the exchanged information was indeed distributing their work from their own Web
received. sites or through writer co-operatives.
Ethical issues: Challenges of E-commerce:
The following ethical issues related to e- Persistent connection with customers
commerce. New value for customers
1. Privacy : Access to new customers
Privacy has been and continues to be a Scalability
significant issue of concern for both current Challenges
and prospective electronic commerce Channel conflict
customers. With regard to web interactions Customer confusion
and e- commerce the following dimensions Investor confusion
are most salient.
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MIT- SOM PGRC KJIMRP National Research Conference (Special Issue) - 2016 ISSN : 0976-8262
Technical Challenges: offering COD as one of mode of
• There is a lack of standards for quality, payment for the buyers. 30%-50% of
security, and reliability. buyers are also taking advantage of this
• The telecommunications bandwidth is mode of payment while making purchase
insufficient. of any product and service over internet.
• Software development tools are still COD has been introduced to counter the
evolving. payment security issues of online
• There are difficulties in integrating the transaction, but this mode has been
Internet and software with some existing proving to be loss and expensive to the
(especially legacy) applications and companies. It is seen that majority of the
databases. customers denied to make the payment at
Special Web servers in addition to the the time of delivery of the product.
network servers are needed. Internet Hence, companies tend to lose the sale
accessibility is still expensive and/or along with product transit fees. In order
inconvenient. to curb the problem of COD, online
1) Poor Knowledge and Awareness: companies should take some judicial
When it comes to ratio of internet steps; otherwise basic logic behind the
consumers, scenario is not so admirable ecommerce business will be at risk.
one. Majority of Indian rural population 3) Online Security: In case of start up and
are unaware of internet and it uses. small business, Business owners are
Surprisingly, most of internet users ignoring the importance of authentic
suffering from poor knowledge on online software due to budget constraints. They
business and its functionalities. Very few are even failing to take the initial steps to
are aware of the online corruption and secure and protect their online business
fraud and thus darkness still exists. A through installation of authentic
reliable survey reveals that 50% of protection services like antivirus and
Indian online users are unaware of the firewall protection, which indeed a
solution of online security. Online crucial step for successful online
Transaction: Most of Indian customers business players. In India, maximum
do not possess plastic money, credit card, number of business entrepreneurs used
debit card and net banking system, which unauthorized software in their server,
is one of the prime reasons to curtail the which usually does not come with
growth of ecommerce. Nevertheless, in upgraded online security. Such pirated
recent years, some of the nationalized software leaves room for virus, malwares
banks have started to issue debit cards to and Trojan attacks and it is highly risky
all its account holders. This is task to make online transactions in the
undoubtedly a positive sign for Indian systems, which may disclose or leak
online entrepreneurs. sensitive details of credit cards and
2) Cash on Delivery: Cash on Delivery online banking of the users. These kinds
(COD) has evolved out of less of droopiness should be banned in Indian
penetration of credit card in India. Most ecommerce sectors. Affiliation to SSL
of Indian E-commerce companies are
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certificate should be imposed as a buying products physically. They tend to
mandatory action for every owner. choose the product by touching the
product directly. Thereby, Indian buyers
4) Logistics and Shipment Services: In
are more inclined to do ticketing and
India, logistics and courier services
booking online in Travel sectors, books
required lots of improvement. While,
and electronics. Companies dealing with
perfect and strong logistics service is one
products like apparel, handicrafts,
of the key reasons behind the success of
jewellery have to face challenges to sell
any online company, India is lagging far
their products as the buyers want to see
behind in this sector as most of the town
and touch before they buy these stuffs.
and small villages are still not covered
Best Practices:
under serviceable area of many of the
courier and logistic companies.
Ecommerce is hampered in a big way
owing to the limited services offered by
the courier service companies.
5) Tax Structure: Tax rate system of
Business objectives interact with web based
Indian market is another factor for lesser
applications. The Internet revolutionized
growth rate of e-commerce in India in
ways of doing business. Entrepreneurs found
comparison to other developed countries
ways to exploit market failures and earn
like USA and UK. In those countries, tax
economic rents. New businesses were
rate is uniform for all sectors whereas tax
created that were not feasible earlier. The
structure of India varies from sector to
new economy poses threats to old economy
sector. This factor creates accounting
firms that do not wish to adapt. The
problems for the Indian online business
transformation is still in process. The
companies.
evolution continues What is a web-based
6) Fear factor: Fear of making online business. Business that uses the WWW to
payment is a universal psychological fulfill its business process Four basic
factor of Indian customers. With the business processes:
• Information dissemination
spread of knowledge on online
• Data capture
transactions and its reliability, some
• Promotions and marketing
percentages of customers have
• Transacting with stakeholders
overlooked this fear and they are
fearlessly engaging themselves in online 1) Information dissemination
shopping. But still, majority of a. Can publish relevant information
customers are not aware of online b. Can be used in crisis mode
transactions and its security. They often c. Identifying worst case scenarios and
reluctant to disclose their credit card and providing details
bank details and preferred to stay away 2) Data capture
from online world of shopping. a. Collect information about customers.
7) ‘Touch and Feel’ factors: Indian Two methods:
customers are more comfortable in
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MIT- SOM PGRC KJIMRP National Research Conference (Special Issue) - 2016 ISSN : 0976-8262
1. manual input number of banks are planning to offer new
2. automated products designed specifically for
e-commerce. Now a day’s banks are playing
3) Promotions and Marketing vital role in the competition towards e-
Banner advertising commerce. In conclusion the e-commerce
a. Affiliate programs industry faces a challenging future in terms
b. Registration with directories of the security risks it must avert. With
c. Traditional marketing increasing technical knowledge, and its
4) Transacting with stakeholders widespread availability on the internet,
a. Can display products and services criminals are becoming more and more
b. Cross-selling can be implemented sophisticated in the deceptions and attacks
c. Can customize website they can perform. Novel attack strategies
d. Can react to competition and vulnerabilities only really become
e. Can improve relationship known once a perpetrator has uncovered and
exploited them. In saying this, there are
1. [Link] – India's premier recruitment multiple security strategies which any e-
site has captured around 50% of the commerce provider can instigate to reduce
recruitment market. the risk of attack and compromise
2. ICICI [Link] - Stock trading significantly. Awareness of the risks and the
simplified, [Link] is today the implementation detailed and open privacy
country's premier trading portal. policies and strong authentication and
3. [Link] -The country's premier encryption measures will go a long way to
shopping site started as an auction site assure the consumer and insure the risk of
and graduated to be the most popular compromise is kept minimal.
platform-shopping site.
4. [Link] - One of the best things about References:
this site is that a credit card is not an • “e-commerce in India:, Press
essential requirement for buying tickets Information Bureau, Government Of
here. Instead the site offers a direct debit India.
facility having tied with most of the • Daily- Times Of India, Indian Express
popular banks. And Economic Times.
• V.P. Gulati, K.R Ganapathy, Ashutosh
Conclusion:
Saxena And M.V.S Prasad, “Electronic
Banks are responding to opportunities
Commerce and Banks in India”,
created by the rise of on-line commerce.
IDRBT’s Working Paper no.3.
Many banks have already put in place a cost-
efficient electronic access channel for
traditional banking products. In addition, a
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