Effects of E-commerce to Globalization and Vice-Versa

1. The Effect of
E-commerce to
Globalization and
vice versa
Michael Bryan P. Lumaban
DIT Student
Saint Paul University Philippines – Tuguegarao City

2. What is E-Commerce?
• Electronic commerce or ecommerce is a term for any
type of business, or commercial transaction, that involves
the transfer of information across the Internet.
• Ecommerce allows consumers to electronically exchange
goods and services with no barriers of time or distance.
• Example
– business-to-consumer e-commerce would be
an online store such as Amazon.com. Anyone
with Internet access and a credit card can
access the website, browse products and
services, make a selection, and purchase a
product by credit card payment with the
assurance of delivery in the mail.

3. Advantages of E-Commerce
• Overcome Geographical Limitations
• Gain New Customers With Search Engine Visibility
• Lower Costs
• Locate the Product Quicker
• Eliminate Travel Time and Cost
• Provide Comparison Shopping
• Enable Deals, Bargains, Coupons, and Group
Buying
• Provide Abundant Information
• Create Targeted Communication
• Remain Open All the Time
• Create Markets for Niche Products

4. E-commerce according
to parties involved
• Business to consumer (B2C) – Transactions happen between businesses
and consumers. In B2C ecommerce, businesses are the ones selling
products or services to end-users
– Online retail typically works on a B2C model. Retailers with online
stores such as Walmart, Macy’s, and IKEA are all examples of
businesses that engage in B2C ecommerce.
• Business to business (B2B) – As its name states, B2B ecommerce pertains
to transactions conducted between two businesses. Any company whose
customers are other businesses operate on a B2B model.
– Examples include Xero, an online accounting software for small
businesses, ADP, a payroll processing company, and Square, a
payments solution for SMBs.

5. E-commerce according
to parties involved (Cont.)
• Consumer to business (C2B) – Consumer to business ecommerce
happens when a consumer sells or contributes monetary value to a
business. Many crowdsourcing campaigns fall under C2B ecommerce.
– Soma, a business that sells eco-friendly water filters is one example of
a company that engaged in B2C ecommerce. Back in 2012, Soma
launched a Kickstarter campaign to fund the manufacturing of their
product. The project was successful, and Soma went on to raise
$147,444.
• Consumer to consumer (C2C) – As you might have guessed, C2C
ecommerce happens when something is bought and sold between two
consumers. C2C commonly takes place on online marketplaces such
as eBay, in which one individual sells a product or service to another.

6. E-commerce according
to parties involved (Cont.)
• Government to business (G2B) – G2C transactions take place when
a company pays for government goods, services, or fees online.
Examples could be a business paying for taxes using the Internet.
• Business to government (B2G) – When a government entity uses
the Internet to purchases goods or services from a business, the
transaction may fall under B2G ecommerce. Let’s say a city or town
hires a web design firm to update its website. This type of deal may
be considered a form of B2G.
• Consumer to government (G2C) – Consumers can also engage in
B2C ecommerce. People paying for traffic tickets or paying for their
car registration renewals online may fall under this category.

7. What is Globalization?
• In economic terms it is the
international integration of markets
for goods, services, and capital;
• is not just a phenomenon or a
passing trend but is the integration of
capital, technology, and information
across national borders, in a way that
is creating a single global market and
a global village.

8. Positive and Negative
effect of Globalization
Positive
• It creates greater opportunities for forms in
less industrialized countries to tap into more
and larger markets around the world.
• This can lead to more access to capital flows,
technology, human capital, cheaper imports
and large larger export markets.
• It allows businesses in less industrialized
countries to become part of international
production networks and supply chains that
are the main conduits of trade.
Negative
• The growth of international trade is
exacerbating income inequalities, both
between and within industrialized and less
nations.
• Global commerce is increasingly dominated
by transnational corporations which seek to
maximize profits without regard for the
development needs of individual countries or
the local populations.
• Competitions among developing countries to
attract foreign investment leads to a “race to
the bottom” in which countries dangerously
lower environmental standards.

9. Effect of E-commerce to
Globalization
– Multinational corporations operate
on a global scale, with satellite
offices and branches in numerous
locations.
– Outsourcing can ass to the economic
development of a struggling country,
bringing much needed jobs.
– Some automobiles use parts from
other countries, as in a car being
assembled in the US with the parts
coming from Japan, Korea, or
Germany.

10. Effect of E-commerce to
Globalization
– The Internet is a major
contributor to globalization,
not only technologically but in
other areas as well, like
cultural exchanges of the arts.
– Cell phones connect people all
over the world like never
before. Around 60% of all
people in the world use cell
phones.

14. Insights
• Information technology has greater impact with globalization. The birth of high
speed transmission line, innovative development of technology in both hardware
and software is one of the key factors interplay with information technology and
globalization.
• Information and Communication Technology (ICT) reformed the nature of business
operation and enhance competitive business environment. This resulted in
evolution and innovations of the many products, services and business process.
• In terms of products, e-commerce provides a new way of advertising products
through the use of internet advertisements.
• placing “E” in the front of any process is a magic prescription for never ending
story of success and rapid return for enterprises. Therefore, businesses that have
adopted with the changing business environments made it up to the top but those
businesses who were left behind with the competition did not survive.

15. References
• The Balance Small Business. (2018). Why E-commerce Is Taking the Retail World by
Storm. [online] Available at: https://www.thebalancesmb.com/advantages-of-
ecommerce-1141610 [Accessed 30 May 2018].
• Ecommerce Guide. (2018). What is ecommerce? Ecommerce explained with
examples.. [online] Available at: https://ecommerceguide.com/guides/what-is-
ecommerce/ [Accessed 30 May 2018].
• The Balance Small Business. (2018). Why E-commerce Is Taking the Retail World by
Storm. [online] Available at: https://www.thebalancesmb.com/advantages-of-
ecommerce-1141610 [Accessed 30 May 2018].
• Rodrik, Dani, Has Globalization Gone Too Far?, Institute For International
Economics, Washington DC, 1997.
• Friedman, Thomas., The Lexus and the Olive Tree, Farrar Strua Giroux, 1999