Electronic Commerce has emerged as one of the most important aspects of the internet. It allows people to exchange goods and services immediately, with no barriers of time or distance. Any time of the day or night, you can go online and buy almost anything you want. Some benefits of e-commerce are:

• Lower transaction costs - when an e-commerce site is implemented well, the web can significantly lower both order-taking costs up front and customer service costs after the sale by automating processes.

• People can shop in different ways. Traditional mail order companies introduced the concept of shopping from home in your pajamas, and e-commerce offers this same luxury. New features that web sites offer include:

• The ability to build an order over several days
• The ability to configure products and see actual prices
• The ability to easily build complicated custom orders
• The ability to compare prices between multiple vendors easily
• The ability to search large catalogs easily



• Larger catalogs - A company can build a catalog on the web that would never fit in an ordinary mailbox.

• Improved customer interactions - With automated tools it is possible to interact with a customer in richer ways at virtually no cost. For example, the customer might get an email when the order is confirmed, when the order is shipped and after the order arrives. A happy customer is more likely to purchase something else from the company.

In e-commerce both the catalog distribution cost and the order taking cost fall toward zero. That means that it may be possible to offer products at a lower price, or to offer products that could not be offered before because of the change in cost dynamics.

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