Slight changes in the way a Web page integrates marketing, product information, and visuals can create an enormous difference in the perceptions of customers. Most Web surfers spend a very short time inspecting online stores before moving on, and the right words or the right information, displayed correctly, can make a great difference. As David Needle says in his article for Smallbusinesscomputing. The first type of signpost is navigation-oriented. This involves the way the online store is constructed — where the links to products are and where they go, how far down the Web site pages scroll, and links to related sites.
The second type of signpost is microcontent-related. This refers to Web site headings, URLs, and titles that organize online information. All information in the company's online store should be clear and easy to read and understand. The third type of signpost is metadata, which is data concerning the information of the Web site itself, such as how many users have accessed it and the keywords.
Despite the growing number of e-commerce success stories, plenty of e-commerce Web sites do not live up to their potential. There were two primary causes of e-commerce failures during the early s. First, most Web sites offer a truncated e-commerce model, meaning that they do not give Web users the capability to complete an entire sales cycle from initial inquiry to purchase. As analyzed by Forrester Research, the consumer sales cycle has four stages. First, consumers ask questions about what they want to buy.
Second, they collect and compare answers. Third, the user makes a decision about the purchase. If the purchase is made, the fourth phase is order payment and fulfillment delivery of the goods or services. The problem is that many Web sites do not provide enough information or options for all four phases. For example, a site may provide answers about a product, but not answers to the questions that the consumer has in mind.
In other cases, the consumer gets to the point where he or she wants to make a purchase, but is not given an adequate variety of payment options to place the actual order. The second problem occurs when e-commerce efforts are not integrated properly into the corporate organization. While sales and marketing staff generally assist in the development of e-commerce Web sites, final profit and loss responsibility rests with the IS staff.
This is a major source of breakdowns in e-commerce strategy because the units that actually make products and services do not have direct responsibility for selling them on the Web. One promising trend is that more companies are beginning to decentralize the authority to create e-commerce sites to individual business units, in the same way that each unit is responsible for its part of a corporate intranet. After studying many aspects of electronic commerce, several consulting and analytic firms created guidelines on how to implement and leverage it successfully.
In particular, two organizations have developed lists of critical success factors that seem to capture the state of thinking on this topic. First is the Patricia Seybold Group, which publishes trade newsletters and provides consulting services related to using information technology in corporations. This firm identified five critical e-commerce success factors:. A quick review of two successful e-commerce sites, the Amazon.
The site is highly personalized; each visitor to the site, once registered, is greeted by name. The site content also is customized. Using software based on pattern recognition, Amazon. The company has a very integrated customer service support system, so that any customer service representative can access all data on the transactions, purchasing information, and security measures of each customer. The system also supports communications using e-mail, fax, and telephone. Finally, Amazon.
Under this program, a Web site can host a hyperlink directly to the Amazon.
Sergey A. Yablonsky
Any time that a visitor to that site buys books through Amazon. This is a very inexpensive way for Amazon. Dell Computer also uses personalization and customization tools. For every major corporate customer, Dell creates a special Premier Page, which shows all products covered under purchasing contracts with that firm, as well as the special pricing under those contracts. This ensures. Dell also has integrated its e-commerce Web site with all back-office systems, so that when a customer orders a custom-configured PC, that information is automatically transferred to the production system to ensure that the unit is built according to specifications.
This also improves customer service; Dell will proactively notify any customer if a production problem or inventory shortage will delay delivery. Electronic commerce, as used by U. Early experiences helped to stabilize e-commerce technology and set the development path for more sophisticated and useful technologies. Later experiences provided guidelines on strategic approaches and operational models that will help to improve e-commerce success.
As technology continues to develop and mature, the ability to assess the impact of electronic commerce will become more cogent. Moreover, the significance of privacy, security, and intellectual property rights protection as prerequisites for the successful worldwide diffusion, adoption, and commercial success of Internet-related technologies — especially in places with less democratic political institutions and highly regulated economies — is continually increasing. The differentiation between the Internet the global network of public computer networks and intranets corporate-based computer networks that involve well-defined communities and potentially more promising technology platforms for fostering Internet-related commerce became significant in the late s and early s.
Intranet development has surpassed the Internet in terms of revenue — by more than half of the world's Web sites were commercial in nature. Ned Kock, in his book Encyclopedia of E-collaboration , gives several possible negative effects of e-commerce, if the trend continues at the same rate it is currently growing. Global companies with highly developed online stores may already possess the extra edge to attract potential customers.
This may leave beginning companies, eager to enter the online market, without much chance to make an impact. International competition may become skewed and lead to an unhealthy type of oligopoly in the e-commerce world. Some also fear that e-commerce will allow companies to evade certain tax laws, especially when it comes to international trade. New regulations might need to be set for customs concerning online exchanges.
Others wonder how e-commerce will change the job market. While online business offers jobs to those with newer IT skills, it can also displace many traditional jobs. Barnatt, Christopher. Crum, Rachelle. June Domaracki, Gregory S. Oxford University Press, Hof, Robert D. Lumpkin, G. Mullaney, Timothy J. Hof, and Linda Himelstein.
Needle, David. Scanlon, Jessie. Soen, Ori. Department of Commerce: Economics and Statistics Administration. Vulkan, Nir. Yamarone, Richard. Bloomberg Press, Cite this article Pick a style below, and copy the text for your bibliography. September 24, Retrieved September 24, from Encyclopedia. Then, copy and paste the text into your bibliography or works cited list. Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.
Although use of the term "electronic commerce" or "e-commerce" dates back only to the s, broadly interpreted it includes all commercial transactions that use any electronic communications facilities. Used this way, its origins extend back to the commercial use of the telegraph in However, the term was widely adopted in the s to describe business transactions involving the Internet.
There is, nonetheless, historical continuity between earlier technologies and the Internet since Internet-based commerce is rooted in prior technologies, policies, and business practices. During the first half of the twentieth century, the use of the telephone and the introduction of office machines such as the typewriter, adding machine, cash register, mimeograph, and Teletype transformed previous ways of doing business, creating a new paradigm based on mechanical automation.
Then, following its development during World War II , the computer became commercially available in Early computers were large, sensitive, expensive devices for storing and manipulating data. These "mainframe" computers were subsequently connected in closed nonpublic proprietary networks by large corporations, research universities, and governmental departments.
These networks often used leased telecommunications facilities to transport their data. By the late s, such networks, called Value-Added Networks VANs , served a variety of purposes, such as timesharing of mainframe computing, electronic messaging, and data transfer.
Companies could acquire electronic data services by leasing the networking services of telephone companies, and by acquiring leased computer time offered by the large in-house shops of companies such as General Electric GE and International Business Machines IBM. Independent companies began to offer packages of combined communications and data processing services, forcing the Federal Communications Commission FCC in to decide whether such providers were telephone "common carriers," and thus subject to extensive regulation.
The FCC, in a decision with subsequent critical effect on the development of the Internet, decided they were not. In the s and s, businesses extended their networks to include suppliers and customers, electronically sending and receiving purchase orders, invoices, and shipping notifications. In the s, vendors such as McDonnell Douglas and General Motors introduced computer-aided design, engineering, and manufacturing over these communications networks.
During the same period, banks developed a closed system for the management of electronic funds transfers EFTs. The first consumer-directed network of automatic teller machines ATMs was introduced in Thus, a significant volume of commercial transactions was being conducted over private, digital networks well in advance of the widespread availability of the Internet. A related development was the improved capability and availability of U. The Advanced Research Projects Agency Network ARPANET , which was eventually transformed into the Internet, was originally created in to provide military and university research centers with a digital communications system that was able to self-repair by quickly rerouting packets of data in the event of damage to part of the system.
The first description of this network of networks as "the Internet" apparently appeared in This network evolved through the s primarily under the direction and supervision of the U. Notwithstanding this, there were early pioneers of commercial-type services before the Internet, such as The Source, which started in However, the technology of the time was cumbersome and daunting to nonexpert users.
This trend—experimentation with technology and services—continued through the s. It has been estimated that there were some two thousand commercial online offerings attempted in the United States during the s. The idea of commerce over a network with a wide consumer base was also initiated in France, with the "Minitel" service, first introduced in The necessary infrastructure for expansion—high-speed digital transmission facilities and large dedicated computers for storing and forwarding packets of data—all were put into place.
The FCC, following the logic of its decision, ruled that the Internet, and Internet service providers ISPs , were not subject to common carrier regulation. However, it took some additional developments to make large-scale Internet e-commerce feasible. By the early s, several factors began to make the idea of commerce over the Internet both feasible and attractive. Networked microcomputers were replacing mainframes and were generally accessible to businesses. Uniform packaged software platforms operating systems were widely adopted. The Internet began to establish itself as a global network, and in , the set of instructions underlying the World Wide Web WWW were written.
This allowed both the display of graphics as well as text on Internet web-pages and the introduction of "hyperlinks," allowing easy movement from one web-page or site to another. This was further enhanced in by the development of Mosaic, the first "browser" and predecessor to Netscape Navigator. With these changes, the Internet became more "consumer friendly. Subsequently, use of the Internet by businesses as both a substitute for, and complement to, closed EDI networks and public telecommunications facilities rapidly evolved. Websites became more sophisticated, new business models evolved, and an array of new business intermediary services appeared.
It also became apparent that the new information technologies would drive a major restructuring of corporate enterprises. By , the phenomenon of Internet-based electronic commerce was thoroughly launched, with wide-ranging implications for businesses, consumers, and society. Before addressing the changes that the Internet-as-business-tool has brought about, a few words about the concept of "electronic commerce" and its measurement may be useful in putting industry statistics into context.
There is no single, universally accepted definition of "electronic commerce. In its most common usage, e-commerce refers to a transaction some part of which has been conducted over the Internet although this does not usually reflect transactions in which the Internet was used to collect information used to consummate a transaction elsewhere.
This lack of a universal definition is one, but not the only, challenge in interpreting studies purporting to measure "electronic commerce. However, such large numbers can be misleading. The Internet is most often used as a substitute for another form of communication e. Thus, in many cases, there may be little or no net new business occurring, just the same old business being conducted through a new medium.
The real benefits to companies of doing business online are more difficult to measure: increased efficiency, fewer errors, lower cost, smaller inventory, elimination of paper, and better relationships with customers. Furthermore, electronic commerce is typically divided into two kinds: business-to-business and business-to-consumer some also add consumer-to-consumer and consumer-to-business.
These "virtual" divisions mirror physical reality in that business-to-business transactions represent eight to ten times the dollar volume of business-to-consumer transactions. In overall statistics, these numbers are often combined. Moreover, these figures say nothing about profitability. As of , the businesses primarily receiving profits from use of the Internet were companies facilitating electronic commerce, rather than the online businesses themselves. It is clear nonetheless that there is an extraordinary expansion of e-commerce around the world.
This global growth of electronic commerce has raised significant regulatory and legal issues at the national and global levels. The resolution of these issues may either facilitate or hinder the growth of e-commerce. The period following World War II saw a steady growth in the volume and importance of international trade. In the mids, large parts of the world experienced a "sea change" in their view of the relationship of government and business. Many governments moved from a highly regulatory and national protectionist posture to one of deregulation, privatization, and the opening of domestic markets.
The result was the globalization of markets, corporations, finance, banking, and consumerism. The collapse of the bipolar political world with the breakup of the Soviet Union emphasized the dominant role of the United States. The United States was the leader in Internet development, is the home of the largest number of commercial websites, and stands to be the largest gainer from increased global electronic commerce, at least in the short term.
Consequently, the United States has adopted a very aggressive policy position in international forums insisting that the global Internet be free from regulation, tariffs, and new taxes. The majority of the developed nations generally support this view. A number of lesser-developed nations do not support this view, because they see "globalization" as a euphemism for "Americanization" and as a threat to their sovereignty and interests. Through a series of market-opening agreements, it has been able to reduce or eliminate many tariff barriers to trade, particularly in telecommunications and electronic equipment.
This, along with the liberalization of banking and investment rules, helped lay the foundation for a system of electronic global trade. At the same time, since the Internet is inherently global, cross-border electronic trade raises many policy issues that can only be addressed by international bodies. These include issues of consumer protection, privacy and encryption, advertising, intellectual property, the protection of children, and harmful content.
Several international organizations have taken up these themes. Some issues have proven quite contentious, such as the differing views on an individual's right of privacy that are held in Europe and in the United States. Like many previous technological innovations, ICTs tend to be productivity biased, skill biased, and voice biased.
Those who are already successful, talented, or better connected tend to benefit most. The problem then is not just access but also capability. In countries like Niger and Afghanistan, 70 percent of adults are illiterate. Even low-income people who can afford a mobile phone among some groups of African phone owners, the median expenditure on phone service is 13 percent of their income will benefit far less than those already better off. A larger portion than today will be deprived and although they may be better off, materially, than today, they will be further behind when compared with the advanced portions of the world.
Add to this the likely implications of widespread automation. The traditional path to development has been through labor-intensive manufacturing—arguably the greatest contributor to poverty reduction in China and elsewhere. Reduced employment opportunities in these sectors will put large pressure on wages in remaining low-skill occupations.
And if future jobs are knowledge intensive, major shortcomings in early childhood development in many developing countries, in education but also in nutrition, become even more damaging. What are the implications for development policy? Clearly the goal of universal affordable Internet access is still important. Even just the private benefits of easier communication with friends and family and access to useful information justify public policies that ease ICT infrastructure investments.
Distortions in the telecom markets rather than a lack of capital more often hold back such investments or keep prices high, including in remote and sparsely populated areas that are often also the poorest. But policymakers also need to realize that the Internet is not a shortcut to high-income status, even if it can be an enabler and perhaps an accelerator of development.
Technology by itself can become a placebo, making us feel better in the short term, while delaying the deeper changes required to solve the real underlying problems. These are the foundations of economic development—the business climate, human capital, and governance—and though the Internet and mobile phones can help improve these foundations in many ways, new technologies are not a substitute. See World Bank b for a discussion of these and the subsequent examples and specific references. Asimov, Isaac. New York Times , August 16, Collier, Paul.
Poushter, Jacob. Car, Bike or Motorcycle? Depends on Where You Live. Fact Tank , Pew Research Center. World Bank. Poverty and Shared Prosperity Taking on Inequality. Washington, DC: World Bank. World Development Report Digital Dividends. Barely nine years ago, Africa was struggling with broadband access and affordability. At the time, there was only one undersea fiber optic cable connecting the western part of Africa to South Africa and Asia. Virtually all countries used satellite for connectivity, which was expensive.
A regional initiative by twenty-two East African countries to link an undersea fiber optic cable to the rest of the world was taking too long to realize because of bickering and competing priorities. It thus appeared as though the region would have to wait much longer to witness the transformative power of modern information and communication technologies ICTs.
I was the permanent secretary of ICT in Kenya at that time. Mutahi Kagwe, the minister for ICT, and I convinced President Mwai Kibaki that Kenya needed to go it alone and land its own undersea cable to fast track the benefits of these new technologies to the region. The president accepted. It was a risky proposition. We were committing meager national resources to a venture whose returns could only be guessed. In hindsight, however, the decision changed the fortunes of the region. A few East African countries have connected to the Kenyan cable, while others are barely managing to stay abreast of the latest developments.
Those that have connected have extracted huge advantages, and everyone agrees that the challenge now lies in improving the access and affordability of broadband. In Kenya, we devised deliberate policy measures that hugely paid off. These included subsidizing fiber optic connectivity to universities and access to devices; removing taxes on both broadband and devices; enabling open data to fuel innovative applications; softening the regulatory framework to allow greater risk taking leading up to transformative mobile money; and liberalizing the industry to allow for greater competition.
The difference between transformational change and a lack of such change is the level of connectivity. At a minimum, the world today needs universal 3G connectivity while improving terrestrial fiber optic networks. The time has come for each country to work toward greater access and affordability of the key driver of ICTs—broadband Internet—and enable it to be a tool for rapid economic growth, poverty reduction, and better monitoring of progress toward the Sustainable Development Goals SDGs.
It is no longer a question of whether ICTs will transform public services in Africa—because they are doing so every day. In East Africa, for example, the advent of money applications for mobile phones has demonstrated the ability of ICTs to increase the financial inclusivity of millions. But a group of young mappers alongside Kibra residents have begun to turn things around using ICT tools. Using an open mapping platform, cheap tools, connectivity, and the Global Positioning System GPS , they created a digital map, giving every asset in the slum an address.
Prior to this initiative, nearly everybody thought that more than 1 million people lived in the slum. Now, with accurate population measures, policymakers are able to make more informed decisions and design much more effective policies for the residents of Kibra. For example, a policy that allowed only public primary school students into elite public high schools was reversed when the mapping clearly showed that most schools in Kibra were privately run by church groups or other donor agencies.
Soon some of the satellite pictures will be used to estimate country poverty levels—something that has been impossible until now. A small startup in Nairobi, Gro Intelligence, aggregates both structured and unstructured data to help farmers better understand what factors affect their productivity. Never before in any country in Africa has specific economic information been analyzed in this manner and disseminated to rural farmers to help them increase their yields. If governments were to cooperate and support the expansion of such ICTs in agricultural practices, the perennial challenge of food insecurity on the continent could be significantly reduced.
In virtually all other sectors, ICTs are transforming communities. In Kenya, for example, ICTs have eliminated intermediaries in the agricultural sector, thus enabling farmers to realize value for their produce; enabled the poor to access healthcare in remote places; brought education closer to the very poor, who could not afford to buy textbooks; and enabled pastoralist communities to sell their livestock through the mobile phone application WhatsApp, reducing how often they need to travel long distances to marketplaces.
More importantly, the adoption of ICTs continuously proves wrong the critics who argue that access and affordability are not sufficient if capacity building is not present. In most transformative applications that solve critical problems, adoption rates have been higher without any training.
What is puzzling is how this substantial part of the population came to learn this fairly complex use of a mobile platform. Although encouraging, further studies are needed to establish the evolution of this trend. Findings from such studies would help other countries reap the economic benefits of ICTs.
As Africa celebrates the transformative nature of ICTs, all parties should continuously revisit the question of its inclusiveness. This flawed approach could lead to new forms of discrimination. Yet, if universal connectivity were to become a reality, this discrimination could be avoided. This is the message from development institutions and other nongovernmental organizations NGOs currently grappling with the question of how to measure progress and ensure success. To transform communities and achieve the SDGs globally, the world must strive toward universal connectivity that enables access to ICTs.
These technologies now help us measure what we could not measure previously. With better measurement, we can better implement development. Kibra is the correct spelling of what used to be and is commonly called Kibera. Connectivity creates opportunities for businesses and individuals to participate directly in globalization Friedman and is associated with job creation, productivity gains, and GDP growth Deloitte Connectivity is not just a byproduct of progress—it is a crucial enabler.
Connectivity must be improved for the Internet to be globally inclusive and beneficial. For individuals, the Internet provides a pathway out of poverty. It enables people to share information, access education, transfer funds, and identify savings in a globally competitive marketplace. According to one study focused on the poorest population in East Africa, people with ICT access gained approximately twenty-one dollars more per month than those without access and narrowed their income gap with others in higher income brackets May, Dutton, and Manyakazi A similar study based in Peru found that individuals who gained Internet access between and obtained household incomes 19 percent higher than those who failed to gain access Pepper and Garrity The economic benefits of the Internet do not exist just at the individual level but apply to businesses as well.
Twenty years ago, only large multinationals and some governments could buy and sell products at an international scale. The Internet has democratized globalization Manyika and Lund Never has it cost less to connect with and sell to customers around the world, so small businesses can scale. Advances in advertising technologies enable small businesses and entrepreneurs to reach out to niche as well as mass audiences who will find their products useful and relevant.
As a consequence, entrepreneurs and small businesses that may have struggled to grow at a local level can now participate meaningfully in a truly global economy. Moreover, groups that have traditionally been excluded can engage with broader markets. Take the example of Kalpana Rajesh, who started a business in India selling wedding headdresses poola jada after the birth of her son. She created a Facebook page and started sharing photos and boosting posts to reach people around the world.
Soon, her business, Pelli Poola Jada, grew to include forty-five branches and employees—all women, who, because of their work and earnings, gained greater respect from their families and communities. Yet, particularly in underconnected markets, small businesses may have a hard time filling job openings because qualified candidates have no way to learn about openings or to match their skills to positions.
In Kenya, for instance, small and medium enterprises SMEs report difficulty finding qualified candidates despite a population of ten million underemployed youth. A significant challenge is connecting labor supply with business demand—a problem that could be solved through technology. Duma Works, a startup based in Nairobi, uses an algorithm to match job seekers to employers particularly under-resourced SMEs online or offline using SMS.
The company has already helped nearly three thousand Kenyans find jobs at over companies. At a more macro level, the Internet enables economies of scale, creating more efficient markets for consumers and producers. Traditionally, most Colombian food vendors were required to wake up at 3 a. Agruppa allows these vendors to place their orders via SMS or app, aggregating them into one large order to buy wholesale, reducing prices by up to 30 percent. Agruppa receives the goods and distributes them to the vendors. As a result, consumers enjoy healthy, fresh food at affordable prices, while small vendors enjoy bigger profits and better working hours.
These are just a few of the ways in which connectivity is being used to solve some economic challenges in developing markets. There are countless more examples just like them. When we consider them in the aggregate, a picture forms of how connectivity can transform the world and move us closer to achieving sustained economic growth in the least developed countries.
Research that unpacks the relationship between connectivity and development is needed to inform policy decisions and to guide the allocation of resources. The chapters in this volume provide a tremendous contribution to our understanding of the complex and endogenous relationship between connectivity and development. They add to the growing body of evidence demonstrating that connectivity is a catalyst of economic growth, not the coincident.
But, perhaps ironically, the people and communities that can benefit most from connectivity are currently least connected. Today, 4. The largely market-driven growth of connectivity has brought us to this point. If we continue on this trajectory, connectivity may never reach those whose lives it can transform the most.
Ensuring the equal flow of connectivity throughout the world is therefore extremely important, lest we run the risk of exacerbating existing inequalities Pepper and Garity But united, the private sector, governments, communities, and civil society have an opportunity to close the inclusion gap and break down global inequalities in a way that is historically unprecedented.
First, we must ensure access to the unconnected. This will require solving difficult technical challenges to bring infrastructure to low-density and remote corners of the world—for example, building last-mile links where nonexistent, and providing high-capacity backhaul and middle-mile infrastructure through new technologies and satellites. Second, we need to improve connections for the underconnected. This means expanding and extending the next generation of Wi-Fi so that people can upgrade from 2G to 3G and 4G networks.
Third, increasing relevant content in local languages requires incentives for local content production and translation of existing content. Finally, we must make it a priority to close the connectivity gender gap. Many reasons explain why women are not online—including affordability, relevance, and readiness. To be sure, narrowing the gender gap will require long-term, multi-pronged, and context-specific approaches, but we can start by improving educational opportunities available to women, creating greater awareness of the Internet and the benefits it can bring, and making it more affordable and acceptable for women to obtain connected devices.
We share a responsibility and global imperative to ensure that the benefits of connecting to and using the Internet do not flow exclusively to those who have historically benefited from technological advances. We need to come together as a global community to bring greater access to the unconnected and, just as important, better access for the underconnected. London: Deloitte. Friedman, Thomas. The World Is Flat. Manyika, J. Globalization for the Little Guy. January May, J. Dutton, and L. Pepper, Robert, and John Garrity.
World Economic Forum. The expansion of mobile services in Africa is heralded in popular narratives as an example of how the continent can leapfrog technologically—participating in the global economy through local dynamic and innovative enterprises. The disruption of landlines by mobile phones is at times described by researchers as technological leapfrogging, but without the associated industrial transformation Aker and Mbiti In this short reflection, I argue that this focus limits the discussion on digital inclusion to the use of services.
The challenge instead should be to expand economic inclusion through local industrial development. Some of the most transformative applications are in agriculture Juma The promise, however, is misplaced because the mobile revolution has hardly been a stimulus for economic inclusion via industrial expansion.
Africa still lags behind other regions of the world in manufacturing, and it has not made major steps to move to the production of mobile-related technologies. Doing so would help to broaden the base for economic inclusion beyond the core provision of telecommunications services. As the M-Pesa example shows, the wide adoption of mobile phones in Africa has created remarkable enthusiasm for technology on the continent. It symbolizes the great potential that lies in technological catch-up, that is, by leapfrogging along the path blazed by South Korea to break out of the middle-income trap Lee While inspirational, however, the mobile revolution appears to have had little effect on the industrial policies of African countries, partly because of misinterpretation of what the revolution actually entailed.
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Popular narratives of the mobile revolution focus on access devices and the services that the sector provides. The mobile handset, especially in the hands of ordinary Africans, has become the symbol of the revolution. There is a good basis for this imagery. The business model that made it possible for Africa to rapidly adopt mobile telephony involved the availability of low-cost handsets.
What often goes unstated, however, is that the mobile revolution was fundamentally about telecommunications infrastructure Batuo The spread of mobile phone towers across Africa is the outer manifestation of a complex engineering system that enables mobile communication.
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Creating such a system involved reforming laws across Africa to create the entrepreneurial space for the new infrastructure Ndemo The policy champions of this disruptive technology confronted many issues, including opposition from the existing landline industry Juma But the public and private entrepreneurs introduced new business models—included prepayments and low-cost handsets—that enabled the poor to be included in the revolution. The infrastructure revolution has also undergone dramatic changes.
Early mobile phone systems were connected to the rest of the world via satellite links. Until , only a small number of West African cities had access to undersea fiber optic cables. Today all of continental Africa and the Indian Ocean states have access to marine fiber optic cables with significantly higher bandwidth. Terrestrial connectivity is the latest investment frontier. The challenge for many countries is how to leverage broadband infrastructure for economic transformation. In some countries, telecoms operators have yet to migrate from a reliance on satellite links to using fiber optics cables.
As a result, the promise of low communication costs has yet to be realized. Even where the migration to fiber has occurred, access charges remain prohibitive. As a result, the infrastructure is not being fully utilized to foster innovation and development. This is not just a telecoms issue but indicates the lack of a complementary evolution in innovation policy.
There is great optimism over the emergence of information technology IT hubs in major urban areas across Africa Adesina, Karuri-Sebina, and Resende-Santos These hubs have become a symbol of youth entrepreneurship in Africa. But their appearance away from centers of research and learning also signals the need to foster more integrated innovation ecosystems that bring business, academia, and government together.
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The hubs have also exposed the need to improve the overall funding and policy environment for technology-based ventures. The definition of mobile inclusion in Africa needs to broaden to cover industrial development. This includes the potential to manufacture devices, equipment, and infrastructure components. It also entails strengthening human capacity in the related engineering fields. This industrial expansion can be supported by linking industrial development directly to current efforts to grow African markets through regional integration Mangeni and Juma, forthcoming.
Take the case of Taiwan. In the early s, the country was a world leader in mushroom exports, a high-volume, low-value perishable commodity. Taiwan then took advantage of the emerging semiconductor industry to redefine itself as an industrial player. The case of Taiwan illustrates how a country can move from the initial use of existing technologies to generating increasingly diverse products through industrial policy.
Many African countries have greater research capacity than Taiwan did when it entered the semiconductor field. The difference is that Taiwan viewed it as an opportunity for industrial growth, not just the provision of services. An effective industrial policy will entail continuous interactions among government, industry, and academia. Many of the critical elements needed for this process to work are emerging. For example, several African countries have created higher education institutions to train new professionals for the digital sector, including new telecoms universities in Egypt, Kenya, and Ghana.
The impetus for creating these institutions came from telecoms rather than education ministries. Countries such as Ethiopia have started local assembly of mobile handsets. This could help widen the base for industrial development. The rise of IT hubs in African cities such as Nairobi and Lagos is another node in a potential industrial ecosystem based on mobile technology. One of the key policy challenges is that shifting from mobile services to industrial development entails higher-level coordination.
This involves facilitating interactions between ministries, higher research and technical institutions, and civil society actors in a wide range of sectors, including finance, telecommunications, industry, services, education, and marketing. This coordination will need to be pursued with the support of systematic science and innovation advice, which is often missing in African countries. At the very least, heads of state and government offices will need to be guided by the best available technical advice to incrementally forge industrial policy that is suited to the task.
On the whole, the key lessons from the mobile revolution are yet to be fully learned and implemented as a basis for inclusive industrial transformation. Until they are learned, the popular call for technological leapfrogging and the associated industrial development will remain a mirage.
This situation is due to a failure to appreciate the scale and scope of the reforms needed to shift Africa from its current focus on users of services to a focus on contributors to the transformation of local industry. Adesina, O. Innovation Africa: Emerging Hubs of Excellence. Bingley, UK: Emerald. Aker, J. Mobile Phones and Economic Development in Africa. Journal of Economic Perspectives 24 3 : — Batuo, M. Journal of Developing Areas 49 1 : — Juma, C.
Lee, K. Mangeni, F. Ndemo, B. Ndemo and T. Weiss, — London: Palgrave Macmillan. Shih, C. The globe has become bathed in mobile signals and handsets are a nearly ubiquitous necessity, no longer just a convenience for the prosperous. The resulting benefits of widespread connectivity are many, and the associated enthusiasm about it is deserved. But these gains, and these narratives, also risk obscuring a shift in the political economic action. As we have written elsewhere Donner , the power of digital technologies to structure social and economic lives increasingly resides not in the handsets, nor even in the towers that connect them, but with the platform companies at the heart of the Internet.
The rise of platforms and the pervasiveness of mobile are inextricably linked. As the shift to mobile operating systems, networks, and apps has occurred—surpassing an Internet of PCs, unmetered connections, and open browsers—platform companies have developed and leveraged new points of control. Google runs Android as the window into the Google services within it. A more mobile Internet may touch more people.
But it seems to do so in a way that depends on or at least affords centralization, scale, and standardization Caribou Digital The ways in which these platforms alter the Internet could fill volumes. Our goals in these remarks are twofold. First is simply to signal that dynamics are at play between this age of a platform-driven, more mobile Internet and the prospects for digital inclusion at a global scale. The World Development Report was a clarion call here, sensitizing a broad community to how these new digital dynamics altered and complicated what we thought we knew about social and economic development World Bank The same unnerving, problematic dynamics debated in the Global North are at play at the margins.
But this is just the beginning—we suspect that even in the Global South, relationships between individual, state, and market will change more in the next ten years than they have over the past fifty, thanks to a more ubiquitous, more mobile Internet. The changes will be rife with unanticipated and complex consequences. But this is playing out against the shocks of rapid demonetization and considerable concerns over the erosion of user privacies.
These tradeoffs and disruptions, in finance, media, supply chains, even culture, are part of an endless Schumpeterian march of innovation and disruption Scherer , but at this moment, the disruptions are particularly rapid, and particularly global, with especially challenging prospects for the trajectories of social and economic development.
Consider Facebook. Once it offered social networking to sell advertisements. It still does. It offers financial services by facilitating peer-to-peer money transfers via Messenger. It mediates identity on its own terms by promoting a single log-on and a single digital ID, as well as increasingly drawing on artificial intelligence to offer services via chatbots and voice interfaces. Our challenge to readers, and our enthusiasm for this volume, centers on how traditional ICT4D frames are largely unequipped to address the considerable breadth and depth of the involvement of Facebook, or Uber, or Mechanical Turk, or any other digital platform in the structure of the economic and social spheres of developing economies.
The platforms are not saviors, nor inherently evil; however, they are logics unto themselves. The algorithms birthed in Menlo Park and Mountain View, California, are experienced in Mombasa and Mumbai in ways that may not be optimal for individual users, for regional economies, or even for national sovereignties. Shifts to digital advertising may stifle local news media; shifts in digital opinion may strain domestic politics; shifts in digital identify may alter the relationships between states and citizens; and shifts in digital labor may remove jobs as quickly as it can make them.
There is an urgent need for new circuits of ethical engagement beyond and outside regulation, which is often too late to the party and does little other than retrospectively charge fines after the damage is done. We need to work harder to bring more perspectives of power and exclusion into the broader discourse on technology and development. Critical, engaged scholarship is part of the puzzle, and we see receptivity in industry, policy, and research, but that job is just beginning.
Without the kinds of critiques of the global digital platforms found within this volume, we risk standing aside as the digital extractive industries exert power in this century much as the physical extractive industries did in the last one. Digital, Caribou. Winners and Losers in the Global App Economy. Farnham, UK: Caribou Digital. Scherer, F. Innovation and Growth: Schumpeterian Perspectives. Many examples of successful projects seem to support such arguments for digital development at global margins, from the use of mobiles for financial transactions to healthcare interventions, the provision of timely information for farmers, and the use of tablets connected to the Internet in schools GSMA There is thus good evidence that some poor people do indeed benefit economically and socially from greater connectivity.
Yet, all too often, such initiatives do not go to scale, or are unsustainable, and therefore larger numbers of poor people more generally do not benefit appropriately from such digital interventions. Information and communication technologies ICTs have transformed most aspects of human life over the last twenty-five years for those who have access to them, can afford such access, and know how to use them. Yet, the enormous potential that such technologies can enable also means that those who do not have access to them are left relatively more disadvantaged than they were previously.
Even those who only have 2G phone connectivity, for example, are now being left far behind by those with smartphones and 4G access. If poverty is defined in a relative sense, digital technologies can thus be seen as increasing relative poverty. They are a powerful accelerator of difference and inequality. This is not to suggest abandoning attempts to use ICTs to contribute to development but it is to argue that at least as much attention needs to be paid to issues of inequality SDG 10 as to the use of ICTs for economic growth.
Margins are not just geographic. Although connecting remote rural areas to the Internet is more difficult, and thus more costly, many people living in well-connected areas cannot afford such connectivity or are prevented from using the Internet for their empowerment. In patriarchal societies, women are often marginalized in their usage of, and benefit from, ICTs; children living on the streets of major cities fail to benefit from the digital revolution taking place in schools; those with disabilities are widely forgotten. These dimensions of social, political, economic, and cultural marginalization are at least as important as geographic marginalization, and they imply that digital solutions to poverty reduction must be much more subtle and sophisticated than just ensuring that everywhere has connectivity at a reasonably affordable price.
Without any connectivity, no one can benefit from the full potential that ICTs can offer, but more needs to be done to support the poorest and most marginalized in their use of ICTs once connectivity is in place. Recent research by the Organisation for Economic Co-operation and Development OECD has shown how those with higher socioeconomic status tend to use the Internet for activities that will enhance their status and careers, whereas those from disadvantaged backgrounds use it mainly for chatting or playing games, thereby perpetuating a digital divide based on socioeconomic status.
If the poor and marginalized, wherever they are found, are to benefit from connectivity, much more needs to be in place to support and empower them. This goes way beyond the standard arguments surrounding affordability of access, local content, digital literacy, and the provision of infrastructure World Economic Forum Above all, it requires all those involved in delivering such interventions to focus primarily on the needs and interests of the poorest and most marginalized, rather than on ensuring that everyone is connected.
There is little evidence of sufficient global will to enable this agenda to be realized, largely because the private sector, governments, and even civil society tend to be focused mainly on using the idea and practice of development primarily to serve their own ICT interests i. This was typified, for example, in the rush of applications by civil society organizations and others to develop Internet-based solutions for Ebola during the outbreak in Sierra Leone between and , when less than 5 percent of the country had Internet access.
Likewise, the interests of many private sector companies are primarily in generating profits from expanding Internet usage, rather than in enabling poor people to use the Internet effectively to enhance their lives and livelihoods. The poorest and most marginalized are also more likely to suffer disproportionally from some of the darker aspects of Internet connectivity.
As yet, scant research explores the effects of digital crime and abuse on different sections of society, but theft of small amounts of money in online financial transactions will clearly affect someone with little money more dramatically than someone who is richer. Likewise, poor children may be more likely to be targets of abuse through online pornography than are richer children. Women in patriarchal societies are subject to online sexual harassment more than men.
Marginalized ethnic groups are particularly vulnerable to ethnic cleansing by governments that increasingly have good digital records about their citizens. None of this is to suggest that efforts to connect the unconnected should not continue. Without such connectivity, people do not even have the chance to benefit from the potential of ICTs. An increasingly digitally marginalized and disenfranchised population is not only morally wrong, it is also a danger to the sustained economic growth that dominates global rhetoric on development.
This situation certainly requires appropriate policies by governments at all scales, particularly through their regulatory mechanisms, but above all, the private sector and civil society need to focus more on ICT4D than they do on D4ICT. Connected Society. Accessed October 29, Built on algorithmic mathematics, and revealing a sophistication that hides its brutality Sassen , the digital-financial nexus is emerging as the preferred modus operandi of information age capitalism. The global financial crisis of — was propelled by the logic of finance and had nothing to do with traditional banking and credit.
The sole aim of the information age capitalism that fueled the crisis was to extract a contract the mortgage agreement from low-income households a majority of whom could have qualified for regular mortgages; Newman to increase capital flows to investors, and not for the purpose of mortgage repayment itself.
Algorithms were able to slice, dice, and redistribute credit over a chain of balance sheets to a point where nobody really knew where regulated liabilities ended and unregulated liabilities began. An important feature of what can be called the digital-financial assemblage—constitutive of contemporary capitalism—is its systemic nature.
It is a self-propelling juggernaut exploiting and generating precarity and debt. It feeds off a division of labor in which specialists in law, statistics, and business intelligence at the higher end provide over-valorized expert labor, and invisible and alienated individuals at the lower end contribute the grist to keep the extraction mill going Chen For the digital-financial assemblage, venture capital is the chosen instrument for control over market share.
The value of digital behemoths is largely dependent on speculations of potential profits the company can make out of the huge pool of user data. Although the viability of their business model is yet to be proven, the promise of financial market capitalization propels these corporations on their path. Current metrics and meanings of the digital economy are far too narrow to adequately capture and delineate its material and symbolic moorings. In digital globality, the economy is not a fixed idea. It is fluid. In conventional terms, economic activity is organized into sectors or industries bound by institutional norms, rules, and practices concerning production and distribution of goods and services for that sector.
The emergence of data and digital intelligence as the means of production destabilizes the very logic of such organization. As Amazon redefines its territory from digital content to delivery drones, and now, to brick-and-mortar food retail, market share battles are becoming intensified in newer sectors. The material consequences of the digital-financial apparatus are without doubt likely to reverberate through the retail supply chain, suppressing payments of farm produce and annexing new sites of primitive accumulation Roberts Technology giants like Google, Apple, and Facebook are poised to enter the financial services business beyond mere experiments in mobile wallets McCormack , suggesting an economic future of hyperconsolidation.
There are no traditional industry silos here. In this new architecture of economic organization, intelligence is organized across economic territories for runaway finance. Discursive formations of the digital economy play a pivotal role in its material manifestations. Big platform players are emerging as transnational sovereigns who speak with independent voices in emerging global policies—from trade negotiations to proceedings conducted by Internet standard-setting bodies. They assign a specific hashtag to every piece of clothing on their website and encourage customers to use them.
When they do, the image is featured on the product page and possibly on their Instagram channel which has over a million followers. What's so brilliant about this is that it displays all different types of women that customers can relate to more than the usual models you see on clothing websites. If like Black Milk you're looking to use Shopify , there are tons of amazing Instagram integrations you can use to publish your feed to your website- such as InstaShow and Code Canyon.
They initially focussed on their blog content which they updated daily. Their blog was a mixture of insights into photography, interviews with models, as well as the odd book recommendation. When celebrating National Sunscreen Day yes, really they wrote an article about it and pushed it onto their channels using relevant hashtags. This ensured every time there was a random celebratory day related to their product, they were always on the ball and involved with the virality of it.
However, there are varying forms of ecommerce that may match your ideas betters.
There are six types of e commerce. Below we've listed them and briefly explained what they all mean. Quite self-explanatory, B2B ecommerce occurs when a transaction is made between two businesses. Successful B2B businesses include companies such as HubSpot who offer inbound marketing and sales software and Xero who provides accounting software for small to medium businesses.
The success stories above are all B2C ecommerce companies. This is when stores sell products to consumers, i. Online retail including dropshipping usually works on a business to consumer model. C2C e commerce occurs when consumer sells directly to consumers. This has seen a particular boom over the last ten years.
They're closely followed by Etsy who was founded ten years later in Consumer to business models is slightly less common in ecommerce. This materializes when a consumer sells or contributes money to a company. Companies using crowdsourcing or a Kickstarter campaign to fund their business would fall under the bracket of C2B. This type of ecommerce happens when transactions are carried out online between companies and public administration. This area tends to involve a variety of services such as social security, employment, and legal documentation.
This type of e commerce has seen an increase in recent years with the due to increasing investment in e-government. Lastly, this type of ecommerce involves all transactions between individual people and public administration. Well, put simply, they're all the rage these days for anyone wanting to launch their own online shop. However, there are a few questions and potential problems you need to consider before you select the right website builder for you.
First off, you don't want to choose an ecommerce website builder to realize one year later you're paying too much in transaction fees. Another common issue is that entrepreneurs can't handle the design tools because they're made for more experienced developers. Therefore, dividing your ecommerce website builder shopping experience into two areas: a what you want to accomplish, and b what your own needs are is usually a good idea:.
Here's a brief synopsis of four of the most significant tools on the market and which sorts of companies are best suited to them:. Shopify has always been at the forefront of making ecommerce accessible to everyone. Shopify has turned ecommerce on its head and has made the process of a setting up a website incredibly easy for even the biggest technophobe. If you're looking to start your ecommerce business from scratch today then Shopify is a great choice.
E-Commerce and V-Business 2nd Edition
Additionally, as your business grows, Shopify can grow to match where you're at by offering better shipping discounts as well as unlimited staff accounts and advanced reporting. Read a thorough review of Shopify here. Check out our in-depth guide to Shopify pricing plans. Hosted means you pay for the solution and web hosting comes as part of the package. Whereas with self-hosting, you'll need to find your own hosting and pay for it.
If you already have WordPress, simply attach the WooCommerce plugin for free, and you're ready to go. If you're looking to start your own store on a budget, and have a decent knowledge of hosting and web development, then WooCommerce is the option for you! Read a thorough review of WooCommerce here. Magento is used by some of the biggest companies in the world, and the scalability of it is seemingly endless. Whereas you could probably recognize a Shopify store just by looking at it, Magento has a massive range of themes to make your website look unique.
If you're starting up, you may consider the free open-source option. If your business takes off and you need more flexibility with your website, then Magento is ideal. Read a thorough review of Magento here. These always crop up early on! If you're ambitious and see your business taking off very quickly, then BigCommerce is a great tool to support that. Not to mention, it also offers you the chance to sell through Facebook. Read a full review of BigCommerce. If you're trying to find the right ecommerce solution for you, you need to consider all your options. Here are a few programs we recommend.
We love that Volusion offers users a day trial period. So, you don't have to hand over your hard earned cash until you've tried and tested the software for yourself. Read a full review of Volusion. Check out our in-depth guide to Volusion pricing plans. If you want to start selling homemade art online, then Big Cartel is probably the best ecommerce platform for you. Founded back in , they boast well over a decade of experience in this field.
Needless to say, they know a thing or two about helping small brands build an online presence. There are plenty of free themes you can use to customize the look and feel of your ecommerce shop. Alternatively, if you have any experience coding or web designing, you can craft a one-of-a-kind design that brings your vision to life. Read a full review of Big Cartel. With Teachable , you can create a course for your customers in a way that's incredibly user-friendly. With just a few clicks of a button, you can set up a fabulous virtual classroom, complete with learning management tools, fully functioning payment gateways, a customizable interface, responsive design, and last but certainly not least- handy marketing features.
Alternatively, if you have any experience coding, you can use Teachable's Power Editor to modify virtually any aspect of your digital course.
Related E-Commerce and V-Business: Digital Enterprise in the Twenty-First Century, 2nd Edition
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