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Electronic commerce (or simply e-commerce) is more than just buying and selling products or services online.
It encompasses the entire online process of developing, marketing, selling, delivering, servicing, and paying for products and services.
E-commerce systems rely on the resources of the Internet and other computer networks to support every step of the process.
Through an e-commerce system, customers can order and make payment for the products or services they purchase online and receive support at the company's websites through the Internet.
It also allows customers and suppliers to participate in product development via Internet newsgroups and E-mail exchanges.
There are three basic types of e-commerce applications: business-to-business (B2B), business-to-consumer (B2C), and consumer-to-consumer (C2C).
Business-to-business (B2B) e-commerce is the online automation of purchase and sale transactions from business to business.
Many companies use secure Internet or extranets for their business customers and suppliers to access to their websites while some may rely on electronic data interchange (EDI) systems.
Cisco Systems, a leading manufacturer of computer networking equipment, makes about 40 percent of its sales online.
These activities include order taking, credit check, production scheduling and technical support to their customers.
General Electric and the United Parcel Service (UPS) are a few of many other firms that offer B2B e-commerce sites.
Business-to-consumer (B2C) e-commerce creates electronic marketplaces where businesses promote and sell products and services directly to consumers.
In this form of electronic commerce, which has grown into a multibillion dollar market, businesses can bypass intermediaries such as distributors or retail outlets.
Companies like Amazon.com and Dell Corporation offer e-commerce websites that provide virtual storefronts and multimedia catalogs, interactive order processing, secure electronic payment systems, and online customer support.
Consumer-to-consumer (C2C) e-commerce is an important alternative for business-to-business or business-to-consumer e-commerce.
In this form of e-commerce, consumers can buy and sell products and services with each other in an auction process at an auction website.
Through an online auction site like e-Bay, one of the most successful C2C e-commerce models, consumers or businesses can participate in or sponsor consumer or business auctions.
Other forms of consumer-to-consumer e-commerce include personal advertising of products or services by consumers at electronic newspaper sites, consumer e-commerce portals, or personal websites.