A Guide to Ecommerce in the UK

Ecommerce stands for 'Electronic Commerce' and can be abbreviated into a few spelling variations,

- ecommerce
- e-commerce
- eCommerce

Whilst the term can apply to the buying and selling of services and items over any electronic system, it's commonly thought of in connection to trade on the Internet and the World Wide Web. As the usage of the Web has grown exponentially, so has the amount of trade conducted on it. The World Wide Web was launched in 1990, but trade was barred from it until 1991, when most of the restrictions enforced on the Web were lifted.

The amount of websites on the Web was tiny in comparison to present day standards, and it took until 1995-97 for well known ecommerce sites such as Amazon and eBay to be launched. Virtually every ecommerce enterprise now uses the World Wide Web as it's front end, but there are a few other IT's that are used (electronic email).

While most ecommerce businesses now utilizes the World Wide Web, it's development began long before the Web was invented. Ecommerce, as has already been discussed, refers to electronic commerce, and the usage of electronic systems to facilitate trade began in the 1970's, with technology such as credit cards, electronic fund transfers, and ATM machines.

Online shopping can be categorised into two types,

• B2B, business-to-business
• B2C, business-to-consumer

The first recorded B2B transaction was completed by a UK company, Thomson Holidays in 1982. Likewise the first B2C transaction was completed in the UK in 1984, this time to buy groceries from Tesco.

The two main types of B2C transactions are,

- Services, paid access to restricted online content.
- Physical products, transactions involving the transportation of items.

Search engines and word of mouth are the most popular ways to find ecommerce sites on the Web. When it comes to the sale of physical products, the following type of products make up the bulk of most sale,

Media ( dvds, cds, books), Small electronics (mobiles, cameras, media/ipods)

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Larger electronics (dvd players, hifi's, televisions) , Appliances (irons, microwaves, grills)

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Computer (accessories, hardware, systems)

The formula that tends to work and sums up trade on the Web is as follows. The most successful products for a profitbale income are those with a high value but a low weight ratio. Therefore, items such as digital cameras, portable media players and mobile phones are ideal. They each have a high value, but the cost of sending them through the post is minimal. Whereas products with a low value and high weight, such as groceries, have tended to be more problematic to profit at. It's not to say there are not successful online grocery businesses, there are, but it still does not lend itself as readily as smaller more valuable items.

The advantages of ecommerce on the Web are what led to it's increase in popularity. The most commonly stated advantages are it's convenience, people with mobility problems are able to browse thousands of products at the click of a mouse button. The additional amount of information and user/expert reviews provides a more informed choice, and utilities to compare prices from hundreds of merchants in one click saves money. The major concerns are security, fraud and privacy.

The demographic of online shoppers appears to indicate that women and person's from a middle class background are the most regular users. The one disadvantage that online shopping has for people from less well off backgrounds is that you need a computer, Internet access and a credit/debit card. While there are alternative systems for online payment, such as electronic money, cash on delivery and cheque. None are very convenient and compromise the whole advantage of ecommerce.