Bach viet college faculty of foreign languages internship report e-commerce necessity and development trend
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- Navigate this page:
- Consumer to Consumer E-Commerce (C2C)
- Consumer to Business E-Commerce (C2B) and Business to Consumer E-Commerce (B2C)
- Business to Business E-Commerce (B2B)
- Intra business E-Commerce
- Characteristic of E-Commerce
- Advertising in E-Commerce
- Website and E-Commerce website
- General differences between E-Commerce and Traditional Commerce
- Benefit and limitation of E-Commerce The benefit
- Things to be noted when joining in E-Commerce Security
- Infrastructure situation of E-Commerce Information technology
- Economy, society and policies
- Development of E-Commerce in recent years
Parties involved in E-Commerce
Chart 2.1: Parties involved in E-Commerce E-Commerce transactions are constituted of three parties: consumer, business and government. These transactions include the following models: Consumer to Consumer E-Commerce (C2C): This model is done through the purchase and sale forms directly between the customers via the personal website, phone, and e-mail. In other words, C2C involves the electronically transactions between the consumers through some third party. A common example is the online auction, in which a consumer posts an item for sale and other consumers bid to purchase it; the third party generally charges a flat fee or commission. The sites are only intermediaries.[Trầ10] Consumer to Business E-Commerce (C2B) and Business to Consumer E-Commerce (B2C): C2B is a business model, in which consumers (individuals) create value, and firms consume this value. For example, when a consumer writes reviews, or when a consumer gives a useful idea for new product development, that mean this individual is creating value to the firm, if the firm adopts the input, the firms can pay this individual a sum. B2C is a business model that the companies sell their products or provide their services to end-consumers over the internet.[Trầ10] Business to Business E-Commerce (B2B): B2B describes commerce transactions between businesses, such as between a manufacturer and a wholesaler, or between a wholesaler and a retailer. The volume of B2B transactions is much higher than the volume of B2C transactions. The primary reason for this is that in a typical supply chain there will be many B2B transactions involving sub components or raw materials, and only one B2C transaction, specifically sale of the finished product to the end customer. For example, an automobile manufacturer makes several B2B transactions such as buying tires, glass for windscreens, and rubber hoses for its vehicles. The final transaction, a finished vehicle sold to the consumer, is a single B2C transaction.[Trầ10] Nonbusiness E-Commerce: There are a lot of non-business organizations engaged in E-Commerce such as academic institutions, scientific agencies, non-profit organizations, religious institutions, social organizations, government agencies… Non-business E-commerce includes Business to Government E-Commerce (B2G), Government to Business E-Commerce (G2B), Government to Government E-Commerce (G2G), Consumer to Government E-Commerce (C2G) and Government to Consumer E-Commerce (G2C). Those none-business organizations use E-Commerce to reduce their expenses, to improve their general operation and customer services.[Trầ10] Intra business E-Commerce: This model includes all internal organizational activities that involve the exchange of goods, services or information among various units and individual in that organization. It is usually performed using intranets within the organization (business).[Trầ10] Characteristic of E-Commerce E-Commerce transactions are paperless transaction. All of the text files or documents must be put down in digital data. E-Commerce is dependent on technology and IT level of users. It is also depended on degree of digitization of the economy. E-Commerce has fast speed. The steps of the transaction process are conducted via computer networks. Software services are increasingly perfect. They make transaction time shorter. [Wik111]
Advertising in E-Commerce Online advertising is a form of trade promotion that uses the Internet and World Wide Web to deliver marketing messages to attract customers. Online advertising include contextual ads on search engine results pages, banner ads, blogs, rich media ads, social network advertising, interstitial ads, online classified advertising, advertising networks and e-mail marketing, including e-mail spam.[Wik09] One major benefit of online advertising is the immediate publishing of information and content that is not limited by geography or time. Online advertising allows for the customization of advertisements, including content and posted websites. Website and E-Commerce website A website, also written as web site, or simply site, is a set of related web pages containing content such as text, images, video, audio, etc. A website is hosted on at least one web server, accessible via a network such as the Internet or a private local area network through an Internet address known as a Uniform Resource Locator (URL). All publicly accessible websites collectively constitute the World Wide Web.[Wik10] A webpage is a document, typically written in plain text interspersed with formatting instructions of Hypertext Markup Language (HTML, XHTML). A webpage may incorporate elements from other websites with suitable markup anchors.[Wik10] Webpages are accessed and transported with the Hypertext Transfer Protocol (HTTP), which may optionally employ encryption (HTTP Secure, HTTPS) to provide security and privacy for the user of the webpage content. The user's application, often a web browser, renders the page content according to its HTML markup instructions onto a display terminal.[Wik10] E-Commerce website is a dynamic website with advanced features that allows online transactions such as shopping cart, ordering, online payment, customer management, order management ... etc. Customer Service Customer service is the provision of service to customers before, during and after a purchase. According to Turban, E. (2002), "Customer service is a series of activities designed to enhance the level of customer satisfaction – that is, the feeling that a product or service has met the customer expectation." Customer service plays an important role in an organization's ability to generate income and revenue. From that perspective, customer service should be included as part of an overall approach to systematic improvement. A customer service experience can change the entire perception a customer has of the organization. General differences between E-Commerce and Traditional Commerce
Table 2.1: Differences between E-Commerce and Traditional Commerce Benefit and limitation of E-Commerce The benefit To organizations E-Commerce expanded the scope of transactions worldwide. With a minimum capital, the firms can approach a lot of customers easily and quickly, select the best suppliers and determine the suitable business partners. E-Commerce makes reducing the cost to gather, process, store, and use information; reducing the course of time of the purchase and sale process. E-Commerce contributes to lessen the inventory and requirements in material facilities by applying “pull”-type supply chain management method. It also contributes to improve the image of the business, to enhance the customer service quality. The firms will provide the after-sales services better and more convenient. To consumers E-Commerce allows consumers to purchase in anytime, anywhere. It provides customers with much option. E-Commerce makes customers reducing the cost of products or services that they received. Customers can compare to choose the fastest supplier and best price. E-Commerce creates conditions for customer to influence mutually in e-business community. Consumers will enjoy the after-sales services better. The limitation In technique There are no international standards for quality, safety and reliability. Internet connection speed has not met the requirements of users, especially in E-Commerce. The software tools are still in development stage. It is difficult to incorporate E-Commerce software with other software applications and traditional database. There should be the servers of E-Commerce especially in terms of capacity and safety. And it requires additional investment costs. Internet access costs remain high. In non-technical Security and privacy are two psychological barriers to participants in E-Commerce. Customers are lack of trust in E-Commerce and sellers by not having direct. Many matters of law, policies, and taxes are unclear. Conversion of consumer habits need much time. The number of fraud is increasing due to the characteristics of E-Commerce. The number of participants in E-Commerce isn't large enough to achieve advantages in scale. Things to be noted when joining in E-Commerce Security Joining in E-Commerce means that the system is connected to the global network and thus the system can be attacked at any time if there is not a strong security mechanism. In addition, information is transmitted over the internet through a lot of stage. It is difficult to control and vulnerable. Therefore, information needs to be encrypted by the sender and the receiver must know how to decode it. Electronic Payment In E-Commerce, the payment process is paramount. Method of payment must be suitable, efficient, and reliable. At the same time, payment information of customers must be maximum security. Payment method also depends on the payment object: Payment method of the individual will be different to the business. REAL SITUATION OF E-COMMERCE IN VIETNAM Infrastructure situation of E-Commerce Information technology Many years ago, IT was a completely new concept to people in Vietnam, and its applications were not widely. However, in recent years, IT has boomed in our country. It has created a solid infrastructure for E-Commerce development. Currently, most agencies and organizations have put IT into their operating procedures. The data structure has been managed by many different database management systems. Sales of IT equipment increased. Many companies have invested in the fields of IT to business. It was through the intranet and the internet that the management of some branches has been computerized. After 15 years from the date that Vietnam has connected to global internet, the number of internet users in the country increased significantly. According to GSO, until November 2010, the total number of internet users in Vietnam was 27.3 million, making up 31.7% of the population. Report on the situation of IT application in 2011 of the United Nations, Vietnam ranked 83/190 countries, up 7 ranks from the results two years ago, and the internet connection speed is 1.7Mb/s. However, the Vietnamese software industry has not developed yet. Status of software piracy is widespread. This discourages creativity of programmers. Despite the high in speed of internet connection, its quality is not ensured stability. The safety and security system is not good. I hope that our country will overcome the shortcomings to promote IT development in the next stage.
Human resources Developing E-Commerce needs qualified human resources respectively. For many past years, the State and the organizations developed the teams of experts in IT, regularly update the knowledge of IT and able to put into application in the specific environment and business conditions. According to ICTnews, Vietnam has 15% of the population using 3G. And according to Net Index 2011, percentage of internet users in Vietnam has surpassed radio and newspapers. In statistics of the MIC in 2010, the number of colleges and universities training in ICT is 277. According to statistics of Vinasa 2009, total IT manpower of our country is 250,000; 50,000 of them working in the field of software and digital content. However, according to the survey of Consumer Probe 2011, the Bachelor of IT and internet users in Vietnam are still limited foreign language skills, especially English. Meanwhile, internet users lack also the skills and knowledge of online safety.
Economy, society and policies After 15 years of innovation, Vietnam has gained remarkable achievements in the field of economic. Economy was basically stable, out of the crisis, achieved growth rates due to macro-economic reform. The exports of goods increased rapidly. These achievements of economy have improved and raised living standards. However, business methods are outdated, not formed standard systems. During innovation, the national economy is shifting to an open economy. But it is still not enough to meet the requirements of the digital economy. The legal system for E-Commerce is in the process of formation. Most people are used to transacting in writing, purchasing and paying directly. These habits make difficult for e-commerce.
Development of E-Commerce in recent years Period 2001 - 2010 are considered decades of E-Commerce in Vietnam. In the end of 2010, basic infrastructure for E-Commerce applications in Vietnam has been formed. 2011 was a pivotal year for Vietnam E-commerce, marking the end of 5 years of applying the overall plan to develop e-commerce from 2006 to 2010 and the start of a new period. In the last 5 years, legal framework for E-Commerce Vietnam has basically formed with a series of documents from the laws, decrees and circulars to adjust various aspects of applying IT and E-Commerce. Civil Law and Commercial Law, the two core documents regulate activity of trade, have acknowledged the validity of electronic transactions through the recognition of data messages and expression forms of electronic transactions. The legal framework for electronic transactions in general and E-Commerce in particular has been formed with the Electronic Transactions Law and Information Technology Law, eight decrees, and a series of detail circulars for the specific aspects of electronic transactions in each specific application. And after years of innovation, the scale of E-Commerce has been extended. Businesses have a fuller awareness of E-Commerce. According to Vietnam E-Commerce Report 2011: 100% of businesses are equipped with computers. 
Chart 2.2: The number of computers in business over the years As of December 31th 2010, 97.3% of businesses have connected to internet. This rate increased significantly (91.6% in 2008). Most businesses and consumers have known great benefits of E-Commerce, but they have not applied or applied at low rates due to fears of the risks involved in online transactions. 
Chart 2.3: The information safety measures are used in businesses Online business requires staff with appropriate qualifications. According to this report, 23% of businesses have E-Commerce staffs. This rate is equivalent to 2010. The trend of modern business in the world as well as in Vietnam requires that all businesses need a website. Percentage of businesses with a website is an important indicator to assess the level of applying E-Commerce. Excluding the error in the surveys over the years, we can see that the percentage in 2011 did not change significantly. The country generally has about 30% of businesses having websites. Deployment of E-Commerce is closely related with the using of software in the process of production and business activities, from the common office software to the complex software such as resource management, supply chain management or customer relationship management. Also according to Vietnam E-Commerce Report 2011, we have the following chart: 
Chart 2.4: Percentage of the applying IT and E-Commerce software in the businesses in 2011 In general, the structure of investment in IT in 2011 does not differ with 2010 and does not have any signs of a landmark change. But the businesses appreciated highly the powerful impact of e-commerce in expanding contact channels with customers and promoting business image. This can be seen as a promising future of E-Commerce in Vietnam.
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