Ecommerce introduction

E-Commerce History:

E-Commerce, refers to the online purchasing and distribution of goods and services.

In several ways, ecommerce happen, such as purchasing products, purchasing a service,

purchasing an information source subscription, or even setting up an online bill-paying plan.

It is impossible to picture our life without ecommerce, it wouldn’t only be inconvenient, but so
much difficult as well. Even, as entrenched in our lives as ecommerce has been, it wasn't so long
ago when it didn't even function. We can date about 40 years back to the beginnings of
ecommerce, when "teleshopping" first emerged.

Of course, when shopping giant Amazon established one of the first ecommerce websites back in
the early 1990s, ecommerce, as we know it today, really got its start. Since then, there have been
numerous enterprises pursuing the lead.

Invention of online shopping:

Since as far back as the 1960s, companies have been using electronic networks to do business,
but the ecommerce variant would be almost unrecognizable to us today.

The world's first routers were commissioned in 1968 by the ARPA (Advanced Research Projects
Agency). A network named ARPANET was established within a year to ensure that in the case
of a nuclear strike, vital channels of communication will be maintained.

Three years later, a new system for dialing into ARPANET using only a computer terminal was
developed by researchers. The Terminal Interface Processor (TIP) inevitably contributed to a
common mix of Transmission Control Protocol and Internet Protocol (TCP / IP), also in modern
times.

This invention helped carry the Internet to corporate offices from military bases and academic
laboratories.

It was used by businesses to exchange business records with each other, focusing entirely on
Electronic Data Interchange (EDI), a technology for automated information transmission that
could substitute mail and fax for record sharing. Without the need for human interaction, this
invention made it easy to transfer knowledge from computer to computer effortlessly.

The American National Standards Institute (ANSI) ultimately stepped in and adopted a standard
for the exchange of company records only in 1979. It was named ASC X12 and provided a
secure standard for businesses to exchange documents through electronic networks.

For the Digital Era, 1979 even encountered another first: the root of ecommerce.

History of E-Commerce:

In 1979, through the linking between television and telephone lines, English inventor Michael
Aldrich initiated and invented what would soon become known as ecommerce.

He developed a device that marketed broadcast products and services, allowing audiences the
opportunity to phone in and position orders at a processing center. Aldrich dubbed
"teleshopping," his method.

It was the beginning of e-comerce

The Internet began to grow across the 80s and into the early 90s when emerging technology such
as SSL made it something more and more people felt comfortable with.

The Minitel site, a successor to the World Wide Web, was introduced by French innovators in
1982. For telephone customers, this service was free and used a Videotex terminal and phone
lines to connect millions of people. The Minitel grew, and by 1999, about 25 million people were
connected to more than 9 million terminals.

The World Wide Web quickly caught up, though. Debuting to the public in 1991, the Minitel
was soon eclipsed by its exponential growth. France Telecom finally ended the Minitel operation
in 2012.

The First Store of ecommerce:

Boston Computer Exchange, which started all the way back in 1982, was officially the first
ecommerce company. It was mainly an internet platform that represented individuals who
needed their obsolete machines to be traded.

Another, more familiar sort of shop launched with the advent of the Internet. Book Stacks
Unlimited, which opened its virtual doors in 1992, was an online retailer that initially predated
an entity that would soon become synonymous with the word for two consecutive years:
Amazon. Eventually, Barnes & Noble acquired Book Shelves Unlimited.

User-Friendly: The World Wide Web

In 1990, a proposal to create a hypertext browser called "World Wide Web" was published by
Tim Berners-Lee and Robert Cailliau.

The first Web server was also designed by Berners-Lee during the same year.

On August 6, 1991, when he unveiled the first website, Berners-Lee made history again,
ushering in the World Wide Web as a service open to the public.

A short time later, the National Science Foundation eased rules regulating the commercial usage
of the Internet, preparing the way for online shopping.

The National Science Foundation began charging usage fees in 1995 for domain name
registration. Licensed domain names soared from 120,000 to more than 2 million within just
three years.

Marketplaces, Web ecommerce, and Payment:

Advancements continued to take root during the formative years of the Internet, which expanded
its commercial use.

As we have discussed, Amazon was first launched as an online bookstore in 1995. During that
time, it was only possible to expect big brick-and - mortar bookstores to hold around 200,000
books at most.

As an online retailer, though, Amazon has no such restrictions. From best sellers to obscure
documents, it could hold countless names.
After its inception, Amazon has evolved to the extent where nearly any kind of product possible,
including eBooks and movies, is now available. The exchange of customer feedback was also
pioneered by Amazon, a concept that was initially considered suicide by ecommerce.

The exact reverse existed, of course. Amazon is one of the world's most influential corporations
seemingly overnight by making consumers share their reviews.

Meanwhile, eBay appeared, debuting in 1995, as a popular online auction platform.

Etsy was founded in 2005 as a worldwide marketplace where individuals may build stores to sell
their exclusive and mostly handmade goods.

Amazon launched Amazon Prime during the same year, a program that provided free two-day
delivery throughout the eastern United States to members. In ecommerce, this initiative
developed a pattern, requiring other retailers to reduce delivery time and costs.

PayPal was launched in 1998 as a multinational ecommerce corporation that supported online
retailers and other commercial customers with payment processing. In several different
currencies, PayPal clients can keep, send, and receive funds.

In 2004, to ensure that organizations comply with security requirements, the Payment Card
Industry Security Standards Council was created. This company is designing and adopting
account data privacy security policies.

Amazon launched the first smartphone website in 2001 as mobile computing continued to evolve
and expand, launching the mobile ecommerce race. The drive to make mobile purchases possible
was high as more consumers used their mobile devices to navigate ecommerce websites. Today,
users use mobile devices not only for sales, but also for product testing, deal searching, and
social media interaction.

Timeline for ecommerce:

This is a concise list of the most notable achievements in the history of ecommerce:

1969: Establishment of CompuServe. It will go on to become what many deem the first real
ecommerce business to be.

1979: Fed up with daily market visits, Michael Aldrich brings mobile shopping to the world.
1982: One of the first ecommerce sites becomes the Boston Computer Exchange

1992: From Charles M. Stack is launching one of the first online marketplaces, Book Stacks
Unlimited

1994: Netscape publishes Netscape Navigator, the most successful of the early web browsers.

1994: Amazon is unveiled by Jeff Bezos

1995: Launches Auction Web. Eventually, the name will be changed to eBay.

1998: PayPal revolutionizes ecommerce with a safe way to receive payments from websites.

1999: Jack Ma opens Alibaba.com, a first-of-its-kind ecommerce company for B2C, B2B, and
C2C.

2005: Amazon is forever transforming ecommerce by offering flat-fee, two-day delivery through
Prime

2011: With funded articles, Facebook drops its hat in the ecommerce ring

2011: Stripe joins the online payments environment

2014: With Apple Pay, Apple follows suit

2015: Google reacts by enforcing Android Pay

2015: Revenue on Cyber Monday hit a new record high of over $3 billion

2016: Alibaba sets a record in just one day with revenue of $17 billion

2017: Instagram enters the game of ecommerce with purchasable articles

2019: Revenues in ecommerce hit $3.5 trillion

2020: Voice commerce (shopping using voice search such as, Alex and Amazon Echo)

If you can see from this timeline, at a fast pace, ecommerce is evolving. The next 10 years could
be much more vivid than the last 40.

What does the future of ecommerce look like?

As technology grows and evolves, e-commerce and customer trends will begin to grow. The
Census Bureau reported that U.S. e-commerce retail revenues were $158.0 billion for the fourth
quarter of 2019, a rise of 2.6 percent from the third quarter.

For years to come, expect the development to persist.

Advances in diverse screen styles are one example of innovations significantly affecting the
future of ecommerce. Consumers will soon be engaging via wearable, kiosks, and enhanced
voice experiences with ecommerce touch points.

The personalization of ecommerce will continue to advance the sector, too. We are now at the
stage where websites can "know" clients and change their perceptions in ecommerce
accordingly. This not only increases purchases and consumer loyalty. It also generates game-
changing knowledge that marketers can use to create much more interactions for visitors to their
website.

How to succeed and prosper in the new marketplace:

There's no reason your business can't survive and even succeed against this shopping giant, as
popular as Amazon is.

In ways that a behemoth like Amazon can't compensate, even smaller, local retailers can also
interact with customers. This organizations will also strive to create a brand image that is
unforgettable, helping to gain customer loyalty.

Although the Amazon Effect for retailers is mostly seen as a drawback, many have responded by
implementing what strategies they can and providing the aforementioned brand opportunities
that Amazon does not.

The Evolution of E-commerce:

Damien Bennett, NMPi's Head of Marketing, spoke to the audience at Emerging Digital about
what marketers face in today's digital landscape, and where the ecommerce industry is heading
through defining two major trends: Artificial Learning and Payment Choices.
The rate of progress in digital marketing has been remarkable and customer preferences and the
way marketers view conversion are dramatically changing. There are some tools, for example,
that have changed the way users view their daily lives. In such a brief amount of time, Uber has
revolutionized how we fly. By tapping into customer aversion to holding cash for a taxi trip, they
have streamlined the travel process. This awareness has helped them to conquer the taxi scene in
London and around the world simply by simplifying the process.

Another technology that has transformed our lives by fundamentally altering the way we listen to
music is Spotify, the music giant. By analyzing what they are actually listening to, and using
artificial intelligence to make relevant choices, listeners are given the opportunity to find
musicians they are likely to be interested in. For any music lover, it has been a formidable
platform for exploration.

Machine Learning:

Machine learning is not just a technology used as advertisers and buyers to make our lives
smoother, it has really made a change about how people act about terms of items such as viewing
television, looking up instructions, and enjoying holidays. Companies such as Netflix or Love
Film, by recommending films or TV programs to a viewer based on what they've been viewing,
have helped us to explore new content, much in the same vein as Spotify. To push personalized
interactions, it uses info.

Another strong example of machine learning is Google Maps; it links to live traffic data to send
you the best journey possible. It's a brilliant example of the use of personalized data to make our
lives simpler.

We are catching on with vRetailers. By introducing a software dubbed Makeup Brilliant,

cosmetic firms such as L'Oréal push a much more customized interface where the customer plugs
in personal data about what they are looking for along with knowledge regarding their
appearance. It then proposes items based on the data they have produced.
Google Now offers users the opportunity to arrange holidays; it is now easy to store your passes,
bookings and travel information on the Google Now website. Based on minute data, such as the
temperature of the location they are going to, Google will then deliver personalized advertising
according to what they have saved on this website.

Tools for Payment

With the boom of payment options launched over the last three years, shopping for goods and
services has become simpler. Paypal, eWallets, and smartwatches can enable payment and, as a
result, boost smartphone conversion. The launch of "Order Now" buttons via Facebook, Pinterest
and Twitter in the US market is a development in payment methods. In the US, Google has
launched an "Order Now" icon exclusively on cell phones. These buttons allow you to purchase
goods without ever leaving their portal directly on the websites. This could become a very strong
device if advertisements, such as products used by sports stars, were paired with an "Order Now"
press.

What does this mean for ecommerce's future?

The path of the client would become exponentially shorter. When marketers serve an ad with a
"Buy Now" button on Twitter, instead of doing analysis or comparison shopping, the user can
order the advertisement automatically. Immediacy is essential.

There will be purchases across a larger spectrum of networks. The key point that individuals’
trade will no longer be your website. People can buy directly by quest, social media, or have
purchases in a variety of different locations and platforms with "Order Now" buttons. Payment
options, especially around new client purchases, would see a definite shift in consumer behavior.

Is this going to get tougher or easier? It's impossible to claim why. On the one side, as consumers
are spoon fed, there are few options for panic buying. There is still little discretion over
innovative campaigns as corporations crack down on what they want to see in their commercials.
Brands are growing better at cross-selling and upselling consumers utilizing distinct networks.

Bennet continued on an optimistic note, saying it will be much easier for advertisers and by
levelling the playing field it reduces some of the barriers to advertisement. There won't be a need
for excessively sophisticated sites to market goods and services. Although the inclusion of the
"Order Now" buttons is of some concern, Bennett suggested that early adopters would be
compensated, and urged companies to consider the improvements.

E-Commerce in Pakistan:

E-commerce was first launched in Pakistan in 2001. E-commerce company firms and retailers
had to focus on cash on arrival and bank transfer methods with the ban of PayPal services in
Pakistan. In Pakistan, there was no dedicated online payment service running, which was also
not favorable for Pakistan's online buyers. However, with the introduction of mobile payment
services in Pakistan, the need has been satisfied to a degree. Telenor launched "Easypaisa"
Mobile Account Service in October 2009 by which consumers can pay bills, pass cash
nationwide, globally and also save cash in their Simple Paisa Mobile Account.

Over the past few years, Pakistan's e-commerce sector has expanded steadily, but strong reliance
on cash has ensured that data collection and benchmarks are still a problem.

Insights on customer preferences and purchasing habits are important in order for the industry to
thrive. Data on national penetration extensively and payment methods are just as relevant.

The first Ecommerce Index of Pakistan-curated by Daraz using 2019 internal data-provides these
observations and helps chart the developments observed over a year in consumer shopping
habits.

Punjab has the highest exposure to e-commerce order shares at 55 percent for the largest
population, led by Sindh at 36 percent. Baluchistan, KPK and Azad Kashmir contribute the
remaining 9 percent, cumulatively.
The Index also gives a city-wide view of order market share, with Karachi contributing 24%,
Lahore 17%, and Islamabad and Rawalpindi 10%. Alongside Sialkot and Hyderabad, Multan is
known as a growing town for e-commerce.

According to the Index, during the last three months of the year, online purchases and orders
increased, with November and December remained relatively common for shopping; mostly
implying that Pakistani online shoppers appear to follow foreign market patterns such as 11.11
and Black Friday.

In the last three months, the total order size for Daraz has risen by 11.8 points.

What do consumers purchase?

The Ecommerce Ranking has found that 'Electronics and Equipment',' Phones and Tablets' and
'Fashion' are the top three e-commerce success groups.

The FMCG group has been found to be the most common in 2019, in terms of units sold. In
terms of sales, the group of mobiles and tablets was most praised on e-commerce sites.

Mobile top-ups at Daraz were the second most sold item on the website, suggesting that
simplicity is a crucial aspect that can help turn online shoppers to hybrid and offline shoppers.
Payments on Web

An increase in the use of digital payment methods was noted by the Ecommerce Index in 2019.
Last year, the use of e-wallets and mobile accounts increased by 8.2X, while bank card use
increased by 1.9x. In comparison, online banking use increased by 1.9x. In 2019, 32 percent of
overall customer spending on Daraz was contributed to digital payments.

Accessibility-the provision of flexible payment solutions-security and consumer education have

been key factors driving digital payment growth.

The effect of Covid-19 on ecommerce

The Index has found that demand for FMCG goods has soared since the coronavirus outbreak in
Pakistan. In Daraz, FMCG products' contribution to total revenue doubled in March and is
forecast to rise to 70%.

The study also shows that the market for hand washes and hand sanitizers has increased by 18x,
while DFresh, the Daraz fruit and vegetables site, has experienced a 9x order uplift.

The data insists that during these turbulent times, a significant segment of Pakistani shoppers
have recognized ecommerce sites as a workaround and have switched to online shopping also to
buy groceries, a sector on which conventional retail has maintained a stronger hold.

The Ecommerce Index is the first index in Pakistan that will help the industry set benchmarks.

Federal IT and Telecom Secretary Shoaib Ahmed Siddiqui, attending an online launch function,
noted the value of e-commerce and online buying of goods during the current situation.