E-Commerce is an Evolution                                   DonHoo Lee

Todayí»s economists indicate that we are moving from the traditional economy that emphasized on physical manufacturing of goods, to the new economy where companies concentrate more on knowledge and information.  The key to the new digital world is e-commerce, electronic commerce, an electronic transmission medium to engage in the exchange, including buying and selling, of products and services requiring transportation.  Supply and demand still remains the same as the forces that control prices and quantities, but e-commerce changes how these forces appear themselves.  E-commerce brings forth a tougher business competition, creation of new marketplaces, faster speed of transactions, and rapid growth in technologies, and also determines the nature of the leadership; it has put itself to become one of the must-haves for companies today.

            Movement from the Industrial age to the Information Age and later on shifting to the New Digital World, our economy has developed rapidly.  Invention of EDI (Electronic Data Interchange: sends purchase invoices electronically) in the late 1970s accelerated the growth of e-commerce.  However, real economic growth period was in the 1990s when Tim Berners-Lee introduced the í░World Wide Webí▒ to the economy.  Soon after, e-commerce was introduced in a well organized way on the web.  It served the web with secure connections with electronic data transferring, internet marketing, and electronic payment services.  Today, e-commerce is being implemented to e-business.  Electronic businessí» not only exchanges information between buying and selling of goods but also distributes information and provides support and services to consumers. 

More consumer demands appear in the internet than any other transmission mediums today.  According to Morgan Stanley U.S. Investment Research, the internet only takes four years to reach fifty million people while television take more than ten years and radio about 38 years.  It demonstrates that the internet has a huge potential to grab many customers in a short amount of time, which in turn can become a target market for growing firms.

Why do we then prefer internet more?  Because our old systems of economic are being replaced by the new technology.  Our time value has gone up and our activities were more convenient, accurate, and faster.  It does not require us to go to the store to buy any given product.  One or two clicks do just enough to get the product shipped right to the door step.  Traditional distribution of products had to go through many steps until consumer receives.  E-commerce allowed skipping of many of these steps, getting you the profits that could have been lost in those steps.   Consumers gained the power over the producers; we became more interested in the share of spending of a consumer rather than just being targeted as a market.

Web-based company such as Amazon.com is challenging many traditional companies to rethink about how they should change.  Traditional companies such as Boeing and US Airways have successfully implemented to the new modern e-commerce.  E-commerce is use in categories such as travel, financial services, pc hardware & software, books & music, apparel & footwear, e-learning, and etc.  Downloading music or software are now common methods of todayí»s digital delivery, and it has expanded to its systems to have electronic book available online so that poorer areas can have the opportunity to read books. 

One of the most essential systems e-commerce makes available to consumers is e-learning.  Online education is increasing very rapidly along e-commerce.  In 2005, more than 3.2 million students participated in on-line learning in the United States.  Well trained teachers were hired to provide a high quality lesson.  E-learning had an advantage of being a relatively cheap method of teaching the students as they were able to teach unlimited number of people in one class. 

CEOs realized that they needed to enlarge their domestic market to overseas.  In order to achieve that, they needed to be prepared with global practices, techniques, and languages.  As the market became more global, the internet enabled customers to place an order to the company from a country far away and have the product shipped to an exact location.   It has led to a tremendous amount of trading over the web.  Due to the new competitive market, companies had to develop new marketing strategies.  Because the target was at many different countries, it had to suit with many different traditional cultures, otherwise it will most likely lead to failure.  Many companies have tried to standardize world practice by pushing domestic products without a change, which led them to fail.

            To take all these advantages of e-commerce, firms had to face a lot of challenges.  Firms had to invest more money to provide new approaches that were linked to the use of the internet to remain competitive in the future.  Managers needed to spend more time to get used to the IT systems than ever before.

            E-commerce is beneficial for both companies and customers.  Internet based e-commerce is more affordable than traditional EDI for the companies.  It can reach broader areas to get customers from all around the world with less cycle times.  Small companies are able to advertise themselves to a huge population with a small cost.  Customers are now able to have more choices and information of vendors and products, and it has become more convenient to shop at home.  They can compare products easier and the delivery of services has become much better.   E-commerce also increased the labour force.

However, there are some negatives about e-commerce.  Despite security protocols (like HTTPS); businesses with the internet were more likely to be the victims of security loss.  Information loss, computer virus, theft/hacking, and manipulating their internal systems, are big issues of todayí»s e-commerce.  They try to secure all transactions with SSL (Secure Sockets Layer for private transactions through internet) security standards.   Hosting your store in a secure hosting environment or displaying a disclaimer during the checkout process helps to ensure that the visitor is in a safe environment.  However, intellectual property protection still seems to be an issue of today. 

E-Commerce is an evolution that helped our traditional economy adapt to the new digital world, using electronic technology through the internet, resulting in more competitions, more marketplaces, faster transactions, and more advanced technologies to make activities between customers and producers more active.  Internet has changed economy so much that most of the business activities today are made in the web.  Therefore, we as customers and internet users are responsible to keep our e-commerce healthy and safe so that e-business can be more reliable in the future.  That way, every single person in the world will be able to take advantage of e-commerce. 







Cortada, James. 21ST Century Business. New Jersey: Prentice-Hall, Inc., 2001.


Ecommerce Issues. GoECart.com. 3 Nov 2007. <http://www.goecart.com/ecommerce-issues.asp>.


Electronic Commerce. 8 Nov 2007. Wikipedia. 10 Nov 2007. <http://en.wikipedia.org/wiki/Electronic_commerce>.


Electronic Data Interchange. 8 Nov 2007. Wikipedia. 10 Nov 2007. <http://en.wikipedia.org/wiki/Electronic_Data_Interchange>.


Greenstein, Marilyn and Todd M. Feinman. Electronic Commerce: Security, Risk Management and Control. USA: McGraw-Hill Companies, Inc., 2000.


Hagel III, John and Arthur G. Armstrong.  Net Gain. Massachusetts: McKinsey & Company, Inc., 1997.


Herbig, Paul A. Handbook of Cross-Cultural Marketing.  New York: The Haworth Press, 1998.


Kalakota, Ravi and Marcia Robinson. E-Business 2.0 Roadmap for Success. New Jersey: Addison-Wesley, 2001.


Levitt, Theodore. Marketing. Massachusetts: Harvard School Publishing Corporation, 2006. 


Luther, William M. The Marketing Plan. New York: AMACOM, 2001.


Mann, Catherine L., Sue E. Eckert, and Sarah Cleeland Knight. Global Electronic Commerce. Washington: Institute for International Economics, 2000.


Mixer28. Business Tips - 6 Key Web Pages for ECommerce Websites. YouTube. 3 Nov 2007. <http://www.youtube.com/watch?v=9xrzIwkYxPU>.


Modern Economic Eras. 23 Feb. 2003. Internet Macroeconomics. 12 Nov 2007. <http://www.brazosport.cc.tx.us/~econ/arch/Eras.html>.


Molenaar, C.N.A. The Future of Marketing. Great Britain: Cor Molenaar. Prentice-Hall, Inc., 2002.


Reid, David A and Richard E. Plank. Fundamentals of Business Marketing Research. New York: The Haworth Press, Inc., 2004. 


Richardson, Paul. Internet Marketing. New York: McGraw-Hill Companies, Inc., 2001.


Sandeepchagger. E-Commerce – Evolution. YouTube. 3 Nov 2007. <http://www.youtube.com/watch?v=LW4X3b_j0eE>.


Schwartz, Evan I. WEBONOMICS. New York: Bantam Doubleday Dell Publishing Group, Inc., 1997.


Statistical Challenges in Ecommerce Research. SCECR 2007. 2 Nov 2007. <http://www.citi.uconn.edu/scecr07/>.


Van Slyke, Craig and France Belanger. E-Business Technologies. New York: John Wiley & Sons, Inc., 2003.