What is electronic commerce?

Electronic commerce, digital commerce, virtual marketplace, e-commerce: the many terms used to talk about the same reality are a clue to how important and multifaceted that reality is today.

It is a world made not of shop windows, counters, and shelves, but of virtual platforms, software applications, and remote communication.

In this article, we want to see how this world is made up.

Definition

The term “electronic commerce” refers to transactions made through the internet. It is a concept that seeks to capture the enormous impact that the use of the internet has had and continues to have on the business world and on the way business is carried out.

Online shopping is the form of electronic commerce that immediately comes to most people's minds. However, other examples are virtual auctions, subscriptions to online publications, or financial and banking operations.

Physical products can, after purchase, be picked up in store or sent in the form of conventional delivery or out-of-home. There are also digital or non-physical products, such as lessons, documents, or shares.

History

Although the term has become inextricably associated with the internet, the history of electronic commerce, in a technical sense, predates it. An important historical moment took place in 1948-49, during the Berlin blockade, when the western section of the city used the Telex system to order the delivery of goods. During the following decades, systems for remote sending of commercial documents, such as invoices and orders, were developed.

But it was in 1994 that the first transaction over the internet took place: the sale of a CD through a website called NetMarket. A modest beginning. But since then, the innovations and changes have been too many for us to enumerate, and they continue to happen.

Electronic commerce is currently supported by a vast and complex network of infrastructures and technologies, taking place through computers, mobile phones, and even watches. It includes practically all types of goods and markets, representing a huge share of the world's commercial activity. The names of the e-commerce giants are known to everyone.

Many companies now operate only online, while others do so as a complement to the physical store. This possibility represents, for many small and medium-sized enterprises, a way to grow and expand their reach. Meanwhile, it also represents, because of that same unlimited potential, a highly competitive environment in which competition can be intense.

Problems and strategies

Certainly, the current context is not without challenges.

One of the most important is sustainability. Logistics is one of the activities that contributes most to CO2 emissions, with disastrous results for the environment. This is one of the reasons for the growing popularity of out-of-home delivery, which represents a much more environmentally friendly approach.

Another necessary concern is security. Electronic commerce is not immune to malicious agents, just as other forms of commerce are not. If you usually shop online, be sure to read this article of ours about the precautions you should take.

Finally, we should mention that the complexity and volatility of this territory make navigating it a complicated task. To give an example of the kind of detail companies have to consider, there are several ways of accessing the online market at their disposal. E-commerce platforms allow a store to sell through its own website. Virtual marketplaces, on the other hand, are spaces on the web where various companies can put their products up for sale. There are also social networks that provide means for carrying out transactions within the network itself.

The future

The future is famous for holding surprises. Meanwhile, it is worth knowing some of the current trends.

One of the most important is that electronic commerce continues to grow, and there are forecasts that this will continue.

One factor that has gained great importance in the virtual world is the personalization of interactions. While technology tends to make everything impersonal, companies continue to look for ways to make each customer feel valued as an individual.

Artificial intelligence has been one of the most talked-about terms in recent times, and it is believed that ways of using it will continue to be found, for example, in data analysis.

In the area of parcel delivery, and although conventional delivery remains the most used, out-of-home delivery has more and more supporters. This approach to last-mile logistics is not only better for the environment, but also more efficient and convenient on several levels. Find out more on our website about the reasons why we believe this will be the model of the future.