Accounting Information Systems: The Processes and Controls, 2nd Edition

E-COMMERCE AND ITS BENEFITS (STUDY OBJECTIVE 4)

There has never been complete agreement on an exact definition of e-commerce. However, most would agree that e-commerce is a transaction between a business and customer, in which the transaction information is exchanged electronically. Under such a broad definition, there are many forms of exchange that could be called e-commerce. The use of a credit card at a department store, ATM transactions with a bank, EDI transactions between vendor and buyer, and Web-based transactions all fit into this definition of e-commerce. With the explosive growth of “Web-based” commerce in the last decade, e-commerce has widely come to be thought of as Web-based. That is, the average person thinks that e-commerce is Web-based commerce. Since Web-based commerce is the most common form of e-commerce, this section will focus on the Web-based form of e-commerce.

Hereafter, the references to e-commerce will be to Web-based e-commerce. Also, e-commerce will refer to business-to-consumer sales. The common term for business-to-consumer e-commerce is B2C. Conversely, the term e-business will include business-to-business electronic transactions. The common term for business-to-business electronic sales is B2B.

B2C sales are transactions between a business and a consumer, which usually involve a retail or service company whose customers are end-user consumers. While there are literally thousands of different types of B2C transactions, some examples are as follows: ...