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10.3 Electronic commerce

Before we move our discussion from direct marketing to online marketing we will spend some time examining the wider concept of electronic commerce as a means to introduce online marketing.

Electronic commerce, or as we find with terms associated with the Internet (which abbreviate the word 'electronic' to the letter 'e'), e-commerce , has come to represent the transaction of business over the Internet. In general terms, e-commerce is often seen as being another term for e-business. However, many writers now make a distinction between the two by suggesting that e-business is more encompassing because it uses wide area networks (that include the Internet and Intranets) with the objective to enhance relations with customers and staff and to reduce costs. Your text explains further on page 777 that e-commerce is a subset of e-business.

Miller and Layton (2000, p. 489) define e-commerce as:

.being about a global electronic marketplace that enables all members of a value chain to interact spontaneously for mutual benefits. It provides an environment where customers are empowered to control the buying process more effectively, receiving and accessing personalised information. It provides a platform for complete relationship management, not just a one time transaction.

Consider this

Examine the definitions from Kotler et al. (2004, pp. 777-778) and Miller and Layton (2000); what aspects are similar?

Miller and Layton's (2000) definition highlights that the focus of e-commerce will be on enhancing the relationships with customers rather than focusing on the transaction, with the customer instead of the marketer gaining more power in the relationship. For the purposes of this unit we will not enter into the debate of the coverage of e-business and e-commerce but instead will take the more common ground of simply referring to 'e-commerce' with the understanding that other terms may also be used. The key point is that e-commerce has already emerged as an alternative means of conducting business, with the added benefits of a greater market base, speed, interaction, efficiency, and all with the potential of significant cost reductions.

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