2.2.16
E-commerce & M-commerce
E-Commerce and M-Commerce
E-Commerce and M-Commerce
E-commerce and m-commerce are changing the way people shop and this is also changing how businesses distribute their products and services. They are prime examples of how technological advances can impact businesses.


E-commerce
E-commerce
- E-commerce describes the purchases that take place electronically on the internet.


M-commerce
M-commerce
- M-commerce is buying goods online using a mobile phone.
Benefits of E-Commerce and M-Commerce
Benefits of E-Commerce and M-Commerce
There are many benefits of e-commerce and m-commerce:


Reach more customers
Reach more customers
- Businesses can now easily sell their products to customers all over the world without setting up a physical store there.
- A business’ products can reach international markets without setting up stores or overseas subsidiaries.
- Small businesses in particular rarely have the finance (money) needed to set up shops internationally. Before e-commerce, expanding was harder for small businesses.


Cheaper to set up a business
Cheaper to set up a business
- It is cheaper to set up a business that uses e-commerce.
- Firms don’t have to invest lots of money in opening stores and hiring people to work in store.
- Amazon was started by Jeff Bezos. He initially sold books from his garage and the only investment that he had to make was in a website and some books, rather than leasing (renting) a store. Amazon is now worth over $700bn.


Sell direct to consumer (B2C)
Sell direct to consumer (B2C)
- Because businesses are selling directly to the consumer, no middle men take a cut, and so the business can offer a lower price to the customer.
- The business has lower average costs and usually lower prices.
- This should help a business to remain competitive.
Drawbacks of E-Commerce and M-Commerce
Drawbacks of E-Commerce and M-Commerce
There are also drawbacks of e-commerce and m-commerce for businesses:


Increased competition
Increased competition
- Because e-commerce allows business to easily reach wider markets, UK businesses face more competition. Foreign businesses can compete in the UK more easily.
- For example, AussieBum sells men’s underwear and sportswear directly to customers in the UK from its production plant in Sydney, Australia. Prices are cheaper for UK customers than buying from approved retailers like House of Fraser and this allows AussieBum to compete against brands like Ted Baker in the UK.
- Increased competition can have a negative effect on profits.


Investment needed
Investment needed
- Firms must invest in specialists who can build websites.
- Large businesses who sell a large volume of products may have to invest in warehouses and fulfilment centres.


Selling online can create problems
Selling online can create problems
- Some goods are hard to judge from a computer or mobile phone. Consumers may want to see a product in person before buying it.
- For example, people may want to sit on a sofa or mattress before buying it. However, companies like Casper are now successfully selling mattresses online. They offer a money back guarantee if people do not like their mattresses.
1Investigating Small Business
1.1Enterprise & Entrepreneurship
1.2Spotting a Business Opportunity
1.2.1Customer Needs
1.2.2Market Research
1.2.3Market Segmentation
1.2.4The Competitive Environment
1.2.5Primary & Secondary Market Research
1.2.6End of Topic Test - Business Opportunities
1.2.7Application Questions - Business Opportunities
1.2.8Exam-Style Questions - Market Segmentation
1.2.9Diagnostic Misconceptions - Competition
1.3Putting a Business Idea into Practice
1.3.1Business Aims
1.3.2Business Objectives
1.3.3Business Revenues & Costs
1.3.4Costs - Calculations
1.3.5Revenue - Calculations
1.3.6Business Profits & Break-Even Analysis
1.3.7Profits & Losses - Calculations
1.3.8Interest - Calculations
1.3.9Cash & Cash Flow
1.3.10Cash & Cash Flow 2
1.3.11Cash Flow - Calculations
1.3.12Sources of Business Finance
1.3.13End of Topic Test - Business in Practice
1.3.14Grade 9 - Business in Practice
1.3.15Exam-Style Questions - Business in Practice
1.3.16Diagnostic Misconceptions - Profit
1.3.17Diagnostic Misconceptions - Company vs Business
1.3.18Diagnostic Misconceptions - Economies of Scale
1.3.19Diagnostic Misconceptions - Cash Flow
1.3.20Diagnostic Misconceptions - Break-even
1.3.21Diagnostic Misconceptions - Fixed Costs
1.4Making the Business Effective
1.5Business Stakeholders
2Building a Business
2.1Growing the Business
2.2Making Marketing Decisions
2.2.1Product
2.2.2Product Life Cycle
2.2.3Price
2.2.4Pricing Methods
2.2.5End of Topic Test - Product & Price
2.2.6Grade 9 - Product & Price
2.2.7Promotion & Advertising
2.2.8PR & Sales Promotions
2.2.9Sponsorship & Product Placement
2.2.10Promotional Mix
2.2.11End of Topic Test - Promotion
2.2.12Application Questions - Promotion
2.2.13Exam-Style Questions - Promotional Mix
2.2.14Place & Wholesalers
2.2.15Direct to Consumer
2.2.16E-commerce & M-commerce
2.2.17Diagnostic Misconceptions - Decreasing Price
2.2.18Diagnostic Misconceptions - Advertise vs Promote
2.2.19Diagnostic Misconceptions - Social Media
2.3Making Operational Decisions
2.3.1Job Production
2.3.2Batch & Flow Production
2.3.3Working with Suppliers
2.3.4Effective Supply Chains
2.3.5Just In Time & Just In Case
2.3.6Managing Quality
2.3.7Total Quality Management
2.3.8The Sales Process
2.3.9End of Topic Test - Operational Decisions
2.3.10Grade 9 - Operational Decisions
2.3.11Exam-Style Questions - Managing Stock
2.3.12Diagnostic Misconceptions - JIT vs JIC
2.4Making Financial Decisions
2.5Making Human Resource Decisions
2.5.1Organisational Structures
2.5.2Organisational Structures 2
2.5.3Recruitment
2.5.4Effective Recruitment
2.5.5Training a Workforce
2.5.6Motivating a Workforce
2.5.7End of Topic Tests - Human Resources
2.5.8Application Questions - Human Resources
2.5.9Exam-Style Questions - Human Resources
2.5.10Diagnostic Misconceptions - Owners vs Shareholders
2.5.11Diagnostic Misconceptions - Internal Recruitment
2.5.12Diagnostic Misconceptions - Employee Motivation
Jump to other topics
1Investigating Small Business
1.1Enterprise & Entrepreneurship
1.2Spotting a Business Opportunity
1.2.1Customer Needs
1.2.2Market Research
1.2.3Market Segmentation
1.2.4The Competitive Environment
1.2.5Primary & Secondary Market Research
1.2.6End of Topic Test - Business Opportunities
1.2.7Application Questions - Business Opportunities
1.2.8Exam-Style Questions - Market Segmentation
1.2.9Diagnostic Misconceptions - Competition
1.3Putting a Business Idea into Practice
1.3.1Business Aims
1.3.2Business Objectives
1.3.3Business Revenues & Costs
1.3.4Costs - Calculations
1.3.5Revenue - Calculations
1.3.6Business Profits & Break-Even Analysis
1.3.7Profits & Losses - Calculations
1.3.8Interest - Calculations
1.3.9Cash & Cash Flow
1.3.10Cash & Cash Flow 2
1.3.11Cash Flow - Calculations
1.3.12Sources of Business Finance
1.3.13End of Topic Test - Business in Practice
1.3.14Grade 9 - Business in Practice
1.3.15Exam-Style Questions - Business in Practice
1.3.16Diagnostic Misconceptions - Profit
1.3.17Diagnostic Misconceptions - Company vs Business
1.3.18Diagnostic Misconceptions - Economies of Scale
1.3.19Diagnostic Misconceptions - Cash Flow
1.3.20Diagnostic Misconceptions - Break-even
1.3.21Diagnostic Misconceptions - Fixed Costs
1.4Making the Business Effective
1.5Business Stakeholders
2Building a Business
2.1Growing the Business
2.2Making Marketing Decisions
2.2.1Product
2.2.2Product Life Cycle
2.2.3Price
2.2.4Pricing Methods
2.2.5End of Topic Test - Product & Price
2.2.6Grade 9 - Product & Price
2.2.7Promotion & Advertising
2.2.8PR & Sales Promotions
2.2.9Sponsorship & Product Placement
2.2.10Promotional Mix
2.2.11End of Topic Test - Promotion
2.2.12Application Questions - Promotion
2.2.13Exam-Style Questions - Promotional Mix
2.2.14Place & Wholesalers
2.2.15Direct to Consumer
2.2.16E-commerce & M-commerce
2.2.17Diagnostic Misconceptions - Decreasing Price
2.2.18Diagnostic Misconceptions - Advertise vs Promote
2.2.19Diagnostic Misconceptions - Social Media
2.3Making Operational Decisions
2.3.1Job Production
2.3.2Batch & Flow Production
2.3.3Working with Suppliers
2.3.4Effective Supply Chains
2.3.5Just In Time & Just In Case
2.3.6Managing Quality
2.3.7Total Quality Management
2.3.8The Sales Process
2.3.9End of Topic Test - Operational Decisions
2.3.10Grade 9 - Operational Decisions
2.3.11Exam-Style Questions - Managing Stock
2.3.12Diagnostic Misconceptions - JIT vs JIC
2.4Making Financial Decisions
2.5Making Human Resource Decisions
2.5.1Organisational Structures
2.5.2Organisational Structures 2
2.5.3Recruitment
2.5.4Effective Recruitment
2.5.5Training a Workforce
2.5.6Motivating a Workforce
2.5.7End of Topic Tests - Human Resources
2.5.8Application Questions - Human Resources
2.5.9Exam-Style Questions - Human Resources
2.5.10Diagnostic Misconceptions - Owners vs Shareholders
2.5.11Diagnostic Misconceptions - Internal Recruitment
2.5.12Diagnostic Misconceptions - Employee Motivation
Unlock your full potential with Seneca Premium
Unlimited access to 10,000+ open-ended exam questions
Mini-mock exams based on your study history
Unlock 800+ premium courses & e-books