E-commerce (electronic commerce) is the buying and selling of goods and services, or the transmitting of funds or data, over an electronic network, primarily the internet. These business transactions occur either as business-to-business, business-to-consumer, consumer-to-consumer or consumer-to-business. The terms e-commerce and e-business are often used interchangeably. The term e-tail is also sometimes used in reference to transactional processes for online shopping.

E-commerce applications

E-commerce is conducted using a variety of applications, such as email, online catalogues and shopping carts, EDI, File Transfer Protocol, and web services. This includes business-to-business activities and outreach such as using email for unsolicited ads (usually viewed as spam) to consumers and other business prospects, as well as to send out e-newsletters to subscribers. More companies now try to entice consumers directly online, using tools such as digital coupons, social media marketing and targeted advertisements.

The benefits of e-commerce include its around-the-clock availability, the speed of access, the wide availability of goods and services for the consumer, easy accessibility, and international reach. It’s perceived downsides include sometimes-limited customer service, consumers not being able to see or touch a product prior to purchase, and the necessitated wait time for product shipping.

The e-commerce market continues to grow: Online sales accounted for more than a third of total U.S. retail sales growth in 2015, according to data from the U.S. Commerce Department. Web sales totalled $341.7 billion in 2015, a 14.6% increase over 2014. E-commerce conducted using mobile devices and social media is on the rise as well: Internet Retailer reported that mobile accounted for 30% of all U.S. e-commerce activities in 2015. And according to Invesp, 5% of all online spending was via social commerce in 2015, with Facebook, Pinterest and Twitter providing the most referrals.

The rise of e-commerce forces IT personnel to move beyond infrastructure design and maintenance and consider numerous customer-facing aspects such as consumer data privacy and security. When developing IT systems and applications to accommodate e-commerce activities, data governance related regulatory compliance mandates, personally identifiable information privacy rules and information protection protocols must be considered.