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The Role of E-commerce in Business Expansion

1.Define the role of using Electronic Commerce on the Business expansion

2.Recognize the typesof Business Models

3.Recognize the related revenue model in the selected website

4.Recognize the Implemented Business strategies in the selected website.

5.Describe the Development of Secure Electronic Transactions on the Internet

6.Explain Privacy Policies, Online Auctions and any potential legal or Ethical Issues

7.Describe the ways that the website manages the Customer relationship. 

The business report has been created for understanding the role of electronic commerce in the current world. Choice of the Australian e-commerce website has been made to understand and carry out the in-depth study. This website is for eBay Australia. Australia is a kind of Asia-Pacific's largest they've left e-commerce market which provides with a huge market size and technology savvy client base which prefers to shop online. As per A.T. Kearney's  Global retail e-commerce index published in 2015, Australia was holding 10th position all over the world with respect to e-commerce market's  capacity to attract buyers (, 2015)

 There have been rising number of Australians who purchased online due to the is and huge variety to select from, being offered by e-commerce. In the year  2014, the eBay was one of the top five e-commerce websites, followed by company and Amazon. This survey had been undertaken by Experian Hitwise Australia (Rajput, 2016). 

E-commerce has had individuals who get to buy at any time of the day, in a convenient way even when they are sitting at home (Karakaya and Shea, 2008). Even the clients save huge time and money because they get so many options to buy from. The sellers also have got added advantages in terms of expansion of business.  Looking at the structure of eBay, it can make use of e-commerce for keeping a constant check on the buying habits of people and see what interests the people. As per these requirements, eBay can provide with huge amount of goods and services which suit the needs of clients. EBay has been using this strategy of constantly improving its current relationships with the buyers and getting into long-lasting relations. The business can expand easily by use of e-commerce because the set up cost is very low in comparison to any physical outlets been started. E-commerce required very less number of submissions and licences because it did not start with any physical store rather just an online store. There has been a growth because business has been saving lots of funds by hiring of lesser number of staff members to carry out the operations such as management of inventory;dealing with clients and others which would have been much more in case there had been a physical store (Huang and Benyoucef, 2013).

Types of Business Models

One more highly significant benefit that e-commerce offers is that the store is open for 24 x 7 x 3 65 because the e-commerce webpage are running throughout. This way the sales get increased and people can alter anything irrespective of time (Boateng, 2014). The e-commerce has helped a lot in expansion of business because now there is no need to invest the funds to words physical storage, insurances and  big infrastructures because  all that is needed is a great design, are unique items so that the clients by the courts. This way the e-commerce websites save on their cost and the same benefit is transferred to the buyers in terms of economical and reasonable pricing of goods (Barnes, 2016).  Just like e-commerce was nice can be useful for the B2B businesses to attain new clients similarly it is useful for posting the brand awareness regarding the company. The development of webpage which can be indexed through the search engine crawlers is a kind of approach that can be used by different e-commerce retailers to boost their sales and target audiences. 

 It also helps in expansion off market for niche products because in the physical world it seems the farther purchasers and sellers to locate each other however when there is an E-store then the buyer can simply find what he is looking for (Datta, 2010). This way the buyers can buy anything without any hassle and from any part of the world. By use of effective e-commerce solutions for, eBay has been able to expand simply to fulfil the market demands and it has been call to reach to the different parts of the world.

The types of business models used by eBay (Editors, 2017) are:

  • Yard sales: people buy you need rare items at yard sales of free markets and then option it on eBay. 
  • Consignment: the eBay has a consignment business model which fetches the goods to people instead of people looking out for those goods. As per this model, people give advertisement locally for the quality items that people wish to sell out.  The item is found and then the individual decides if this item would be sold when officially on eBay or not and then a consignment agreement is created. This way the consignment agreement documents that the person will shell out the percentage of auction prize in case the item is sold.  The individual clicks pictures, makes an auction list and takes care of the payment and deliverance therefore the selling price has to pay higher to cover all those costs(, 2017). 
  • EBay stores: why this the seller can start with an online store where the goods are sold at plea decided prices rather than any kind of waiting on auction. This business model is light by a lot of people as they can easily know the amount of profit that they would be earning by sales. 
  • Option selling: the sellers put their product for sale through auction on eBay auction store where the potential buyers can wait for the Product. 
  • Wholesale: this model focuses on sales of birds in bulk rather than individual  selling and this is generally are  B2B model 
  • Drop shipping model of eBay: it is generally utilise my eBay stores to give the goats for direct selling. In this the seller doesn't has to stop any goats rather a drop shipping partner has to be found who fetched the items to be sold through  eBay.

EBay does not hold any stocks like It just offers the technology platforms and equipment for carrying out the e-commerce. EBay has a lot of revenue models:

  • It generated the transaction paymentby owning PayPal, but after the separation from the PayPal it has been facing hard time attracting more visitors
  • eBay also attains byselling of the service of list customer’s goods to be sold to other buyersi.e. seller pay the percentage of their sale to eBay for using the website as a platform to sell
  • It earns a little of advertisement fee (Miglani, 2017).
  • EBayis able to yearlygenerate revenueof approximately $6 billion from its three keytrades: auctions, imbursements (PayPal, but this has split now) and communication (through Skype).

As a part of its e-commerce strategy, eBay has brought about bring some changes which involve the improvement in site search capacity is so that the lookout for items would be further organised. Rather than listing of entire  set of available courts whenever anything is looked out for, now there has been differentcategorisationslike "best value ", "brand-new "and similar other categorisations. This has allowed the buyer to narrow down his search and the buyer will get improved choices which closely match to the requirements (Turnaround challenge, 2014). 

One more aspect of the e-commerce strategy is the way eBay is working on the ranking in the Google search results. It is trying to resolve the issue of websites search optimisation by improving the structure of information. The average time of shipping for any eBay order is three days and it plans to continue with the same delivery strategy.

Related Revenue Model in the Selected Website

Secure Electronic Transaction (SET) is the approach used by e-commerce businesses for ensuring the protection of monetary transactions on the websites. It has been supported by MasterCard, Visa, internet banking, Netscape, etc. By use of SET, a user is provided with an a digital certificate and any exchanges is performed and confirmedby a blend of digital certificates and digital signatures between the buyer, a merchant, and the buyer's bank in a manner that allowsconfidentiality and secrecy. The One time password (OTP) is sent to user’s mobile, which has to be entered for the transaction to be successful.  At the checkout page, the user enters credit card number in the checkout page and the details of buying her sent to claimant gateway to be processed (Jarupunphol and Buathong, 2013). This weather transition details are forwarded through the payment gateway to the Bank of the seller. This bank again forward the formation of the transaction to the bank from which credit card has been issued for the theorisation of the exchange. In case of the approval or denial the information is sent back to the bank of the seller. In case of approval of the card the bank deposits money into merchant account at a predefined time. The transaction information is sent from other payment gateway to the eBay and even informs the buyer that the transaction was successful or not.

There ethical issues:

  • Who should be given access to information?
  • Who is the owner of data?
  • Who has to maintain the accuracy and protection of data?
  • How the data captured has to be used and how this use has to be monitored?

Privacy issues:

  • Risky data with employees of e-commerce business
  • The mails, calls and communication needs to be tracked
  • Privacy of records (Choton Basu, 2005)

Legal issues:

  • Privacy
  • Customer and seller protection from the fraudulent activities
  • Censorship vs. freedom of speech regarding dissemination of information
  • Intellectual property rights
  • Spam
  • Internet stocking fraud
  • Bogus investments
  • Non-financial issues like poor quality, damaged goods, unnecessary delays in delivery

EBay makes use of the customer relationship management tool and it trains all of its workers on the usage of this tool.  All the activities are logged in to the CRM tools that are the client calls, all emails are passed through this tool (Nassar, 2015). There is complete information and daily reporting is carried out. This reporting allows the business to build its customised reports for tracking the efficiency of the representatives, looking out for the problematic areas and also for the problematic clients.

The clients must be assured that they are accessing the real web page and it’s not a fraud. The consumer protection must be assured (Lendle and Vézina, 2015). There has to be seller protection also in case the clients deny of placing order or the clients download any copyright software to sell to other people. For going to different countries, there must be an option of choosing different pages in which webpage get translated. This will make the communication easier and also the buyer will not lose interest in the page and also they will have trust in the website

References (2015). Global Retail E-Commerce Index™. [online] Available at: [Accessed 12 May 2017].

Barnes, S. (2016). E-commerce and v-business. 1st ed. [Place of publication not identified]: Routledge.

Boateng, R. (2014). Resources, Electronic-Commerce Capabilities and Electronic-Commerce Benefits: Conceptualizing the Links. Information Technology for Development, 22(2), pp.242-264.

Choton Basu, S. (2005). On Issues of Computer Crimes, Online Security and Legal Resources. Journal of Information Privacy and Security, 1(4), pp.1-2.

Datta, P. (2010). A preliminary study of ecommerce adoption in developing countries.Information Systems Journal, 21(1), pp.3-32.

Editors, A. (2017). The eBay Business Model | [online] Available at: [Accessed 17 May 2017].

Huang, Z. and Benyoucef, M. (2013). From e-commerce to social commerce: A close look at design features. Electronic Commerce Research and Applications, 12(4), pp.246-259.

Jarupunphol, P. and Buathong, W. (2013). Secure Electronic Transactions (SET): A Case of Secure System Project Failures. International Journal of Engineering and Technology, pp.278-282.

Karakaya, F. and Shea, T. (2008).Underlying Motivations for Establishing E-Commerce Business and Their Relationship to E-Commerce Success.Journal of Internet Commerce, 7(2), pp.153-179.

Lendle, A. and Vézina, P. (2015). Internet Technology and the Extensive Margin of Trade: Evidence from eBay in Emerging Economies. Review of Development Economics, 19(2), pp.375-386.

Maamar, Z. (2003). Commerce, e-commerce, and m-commerce.Communications of the ACM, 46(12), p.251.

Miglani, J. (2017). How eBay Makes Money? - Revenues & Profits. [online] Revenues & Profits. Available at: [Accessed 17 May 2017].

Nassar, B. (2015). The customer trust and customer commitment of e-customer relationship management: study at Jordan of mobile phone services. International Journal of Electronic Customer Relationship Management, 9(1), p.33.

Rajput, W. (2016).E-Commerce systems architecture and applications. 1st ed. Boston, Mass.: Artech House.

Turnaround challenge: business and the city of the future. (2014). Choice Reviews Online, 51(09), pp.51-5107-51-5107. (2017).What Is an eBay Business Model?. [online] Available at:
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