Unit 4: Introduction to e-commerce
Workshop on IT Tools for Business and E-Commerce notes · PTU syllabus (BCOMSEC 301-18)
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Unit summary
E-commerce lets businesses sell, buy and serve customers online — India now has one of the world's largest digital buyer bases. This unit covers e-commerce vs traditional commerce, features and benefits of e-commerce, website components and design, corporate websites and portals, internet advertising, electronic payment systems and security issues.
After this unit you can
- Define e-commerce and compare it with traditional commerce
- Explain the features, benefits and models of e-commerce
- Describe website components, design principles, corporate websites and portals
- Explain internet advertising, electronic payment systems and e-commerce security
PTU syllabus topics
- E-commerce vs. traditional commerce
- features and benefits of e-commerce
- website components and design
- corporate websites and portals
- internet advertising
- electronic payment systems
- security issues in e-commerce
B2B
Business to business, e.g. IndiaMART
B2C
Business to consumer, e.g. online stores
C2C
Consumer to consumer, e.g. OLX
C2B
Consumer to business, e.g. freelancers
Topic 1
E-commerce vs traditional commerce
E-commerce is buying and selling goods and services, and transmitting funds or data, over an electronic network, primarily the internet.
Place
Physical store or market
Website or app
Time
Limited business hours
24 × 7
Reach
Local
National and global
Customer interaction
Face to face
Digital — chat, email, reviews
Cost of set-up
High (rent, staff)
Lower
Payment
Cash, cheque, card at counter
UPI, cards, net banking, wallets, COD
Inspection of goods
Possible before purchase
Only after delivery
E-commerce models
B2B
Business to business — IndiaMART, Udaan
B2C
Business to consumer — Amazon, Flipkart, Nykaa
C2C
Consumer to consumer — OLX, Quikr
C2B
Consumer to business — freelancers on Upwork
B2G / G2C
Government e-Marketplace (GeM), online tax filing
Others
M-commerce (mobile), social commerce (Instagram, Meesho), ONDC network
Topic 2
Features and benefits of e-commerce
- Features: ubiquity, global reach, universal standards, richness of information, interactivity, personalisation, social technology.
| Benefits to business | Benefits to customers | Benefits to society |
|---|---|---|
| Wider market at low cost | Convenience — shop anytime, anywhere | Rural access to products |
| Lower inventory and overheads | More choice and price comparison | Digital payments and transparency |
| Customer data for personalisation | Reviews and ratings | Employment in logistics and tech |
| Faster launch of products | Doorstep delivery, easy returns | Less travel and congestion |
- Limitations: security and privacy concerns, no physical inspection, delivery delays, return fraud, digital divide, dependence on internet and logistics.
Topic 3
Website components and design
Domain name and hosting
Address (www.sbs.ac.in) and server space
Home page and navigation
Menus, search bar, categories
Product catalogue
Images, descriptions, prices, reviews
Shopping cart and checkout
Add to cart, address, delivery options
Payment gateway
Secure online payment
Customer account
Login, order history, wish list
Content management system
Updating pages without coding
Policies and contact
Privacy, returns, terms, support
Principles of good website design
- Easy navigation and search; clear call-to-action buttons.
- Fast loading — optimised images, minimal scripts.
- Responsive (mobile-friendly) layout.
- Consistency in colours, fonts and layout; brand identity.
- Trust signals — HTTPS padlock, reviews, contact details, return policy.
- Accessibility for all users; SEO for visibility on search engines.
Topic 4
Corporate websites and portals
- Corporate website: the official site of a company providing information about products, investors, careers, CSR and contact — builds image and credibility (e.g., tata.com).
- Portal: a gateway website offering a wide range of content and services from one place.
Coverage
General content for all users
Specialised for one industry or interest
Examples
Yahoo, MSN
Naukri (jobs), MakeMyTrip (travel), PolicyBazaar (insurance)
Revenue
Advertising
Commissions, subscriptions, listings
- Enterprise (corporate) portal: an intranet giving employees access to company information, applications and collaboration tools.
Topic 5
Internet advertising
Search engine advertising
Paid listings on Google (pay-per-click)
Display advertising
Banners, pop-ups, video ads on websites
Social media advertising
Targeted ads on Instagram, Facebook, YouTube, LinkedIn
Email and affiliate marketing
Newsletters; partners earn commission per sale
- Other forms: influencer marketing, native ads, retargeting, in-app ads.
- Pricing models: CPM (cost per thousand impressions), CPC (cost per click), CPA (cost per action/acquisition).
- Advantages: precise targeting, measurable results (click-through rate, conversion rate), low cost, interactivity, real-time changes.
- Limitations: ad blindness and ad blockers, click fraud, privacy concerns, clutter.
Topic 6
Electronic payment systems
Cards
Credit, debit, prepaid cards; RuPay
Net banking
Direct transfer from bank account
UPI
Instant, mobile-based (NPCI); BHIM, Google Pay, PhonePe
Mobile wallets
Paytm, Amazon Pay
Fund transfer systems
NEFT, RTGS, IMPS
Others
Payment gateways (Razorpay), BNPL, e-RUPI vouchers, Central Bank Digital Currency (e₹)
- 1
Customer enters card details at checkout
- 2
Payment gateway encrypts and sends to acquiring bank
- 3
Card network (Visa, RuPay) routes to issuing bank
- 4
Issuing bank authorises (OTP / 2-factor)
- 5
Approval returns to merchant
- 6
Settlement to merchant's account
- Requirements of a good e-payment system: security, convenience, low cost, speed, acceptability, privacy, interoperability.
Topic 7
Security issues in e-commerce
- Threats: hacking and data breaches, phishing (fake sites/emails), malware and ransomware, identity theft, credit card fraud, denial-of-service attacks, man-in-the-middle attacks, fake sellers.
Encryption
SSL/TLS (HTTPS) protects data in transit
Authentication
Passwords, OTP, two-factor authentication, biometrics
Digital signatures and certificates
Verify identity and integrity (IT Act, 2000)
Firewalls and antivirus
Block unauthorised access and malware
Payment standards
PCI-DSS compliance, tokenisation of cards (RBI)
Policies and awareness
Privacy policy, user education
- Legal framework in India: Information Technology Act, 2000; Consumer Protection (E-Commerce) Rules, 2020; Digital Personal Data Protection Act, 2023.
Exam tip
The five security goals to quote: confidentiality, integrity, availability, authentication and non-repudiation.
Key terms
- E-commerce
- Buying and selling goods and services over electronic networks
- Portal
- A gateway website offering many services from one place
- Pay-per-click
- Advertising model where the advertiser pays for each click
- UPI
- Unified Payments Interface for instant mobile bank transfers
- SSL/TLS
- Encryption protocols that secure data between browser and server
Quick revision
- E-commerce vs traditional: 24 × 7, global, lower cost, digital payments.
- Models: B2B, B2C, C2C, C2B, B2G, m-commerce, social commerce.
- Website: domain, hosting, catalogue, cart, payment gateway, CMS.
- Internet ads: search, display, social, email, affiliate; CPM, CPC, CPA.
- Security: encryption, authentication, digital signatures, firewalls, PCI-DSS.
Important exam questions
Practice questions written to the PTU exam pattern for this unit's syllabus: short answers (Section A style) and long answers (Sections B and C style).
Short-answer questions
- Q1.Define e-commerce.
- Q2.Distinguish B2B and B2C e-commerce.
- Q3.What is a portal?
- Q4.What is pay-per-click advertising?
- Q5.Name four electronic payment systems used in India.
- Q6.What is phishing?
Long-answer questions
- Q1.Distinguish e-commerce from traditional commerce and explain its benefits.
- Q2.Explain the components and principles of good website design.
- Q3.Discuss internet advertising and its forms.
- Q4.Explain electronic payment systems and security issues in e-commerce.
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