FUNDAMENTAL FEATURES OF E-COMMERCE TECHNOLOGY
E-commerce technology offers new opportunities in many areas such as marketing, sales, personalization, rich information content and target group. These technologies enable consumers to have more information about the producers and to make effective use of the information they obtained. Potentially, commercial companies use this new information with the purposes like rendering quality service and product development. They become more competitive on the prices. The fundamental features of e-commerce technology are indicated as being ubiquitous, global reach, universal standards, information richness, interactivity, information density, personalization and social technology in Laudon’s and Traver’s books about e-commerce.
In traditional trade, a marketplace is a physical space that you can visit. So, you have to go to that place in order to spend money. By contrast, e-commerce is about shopping always everywhere. It makes individuals independent of the physical location, making it possible to shop from anywhere from home, work and car by using mobile commerce. This marketplace is not subject to the geographical limitation. Such a marketplace reduces the transaction costs for the consumer, and saves time and money that the consumer will spend in a market. It allows you to make less effort by reducing the energy you need to go to a market.
E-commerce technology also enables business transactions to be carried out more cost-effectiveness than in traditional commerce among different cultures and borders. The higher potential client of e-commerce than traditional trade best explains this fact. Most of the traditional commerce is local or regional. Consumers can only be reached with strong national ties. However, Internet technology can easily reach the global customer.
A more unique nature of e-commerce is the technical standards of the Internet. These standards necessary for the management of e-commerce are universal standards and are used by all nations. In traditional trade, these standards differ, for example consumer is reached via a mobile phone, television or radio. The universal technical standards of e-commerce provide access to markets at a lower cost. Everyone using the same technology creates positive externality within individuals and firms. As the English language is a universal language, the technical standards of e-commerce have become universal and have enabled producers and consumers to speak the same language in trade all over the world.
Information richness means that the message is content and strong. In traditional markets, companies have this richness, because they provide strong links to face-to-face relationships with individuals. The richness traditional markets makes them commercial environment. Before the development of the web, there was a contradiction between information richness and reach. Few people could achieve intense knowledge. With the development of the Internet, more than the information offered by the traditional media such as written press, radio and TV reaches more people.
E-commerce technologies have made it possible for consumers and manufacturers to have a two-way interaction. With instant links through the website, consumers can get answers to their questions. Moreover, they can get information they want at the international level; not only at the local or national level. The interactivity has become global thanks to e-commerce technologies, enabling the consumer and the manufacturer to be able to meet anywhere at any time.
The Internet and the web have increased the intensity of information, and have been made available to market participants, consumers and producers. E-commerce technologies have reduced not only the collection of information but also the storage and processing and communication costs of information. At the same time, it has reduced the information’s dependency on time, and strengthened its accuracy. Information has been useful and important than it has never been before. More information is available at higher quality at a lower cost. It provides transparency at both price and cost.
Personalization is another important feature of e-commerce technologies. By registering the previous shopping behaviors of the individual, private transmissions can be made to specific individuals and institutions. Thus, the shopping behavior can be maintained by observing which products the individual prefers, when he/she uses the products, and whether he/she prefers low or high priced products.
Unlike previous technologies, the internet and e-commerce technologies have made users more social, sharing many contents such as written text, video and pictures. The use of these communication technologies creates new social networks and strengthens the relationship of individuals to the social environment. Standard media model is replaced by a more productive and more creative new media. A media that calls out to larger masses has begun to be formed.